Quest Diagnostics ($DGX) and LabCorp ($LH), the two largest lab diagnostic providers, scaled back their 2012 revenue projections after posting tepid second quarters.
While the firms' Q2 profits fell in line with analysts' projections thanks to cost-cutting, both companies are facing low-volume growth for the year, Reuters reports. Quest lowered its 2012 revenue projection from between 2% and 2.5% to between 1% and 2%, and LabCorp scaled back its expectations to between 2% and 3%, down from 2% to 3.5% earlier in the year, the news service reports.
Both firms blame sluggish market conditions for the decline, although they were affected in different ways. Quest reported a .7% increase in clinical testing volume for the quarter, but that was mitigated by pricing pressures. LabCorp, on the other hand, saw a decrease in demand for its services, and its testing volume remained largely unchanged from Q2 of 2011.
LabCorp's recent $241 million buy of Medtox is slowly clearing the necessary regulatory hurdles, and the company expects the acquisition to boost its presence in the toxicology field. Quest, on the other hand, has continued to pursue companion diagnostics partnerships, teaming with Biogen Idec ($BIIB) earlier this year and working Israeli firm RedHill Biopharma on a test related to Chron's disease.
- read Quest's statement
- check out LabCorp's release
- here's the Reuters report