20 Things You Didn’t Know About LabCorp
LabCorp is the abbreviation of the company that is officially titled Laboratory Corporation of America Holdings. They operate a network of clinical laboratories They’re an American company and if you haven’t heard about them but have an interest in laboratory testing, they’re an important corporation to know about because you may be familiar with some of their subsidiaries. To let everyone know about the interesting and important facts about them, here are 20 things you didn’t know about LabCorp.
1. They operate one of the biggest clinical laboratory networks on the planet
LabCorp has a network of 36 laboratories which serve as their primary locations. These are within the United States. There are many more outside of the borders of its home country. They also operate large network affiliates in Canada and in Puerto Rico.
2. LabCorp pioneered genomic testing
The company is an important and valuable resource for the United States as well as the entire world because of the significant contributions that its labs have made in the field of genomic testing. LabCorp was one of the first to pioneer genomic testing through the use of an innovative technology known as polymerase chain reaction or PCR. This was accomplished at its Triangle Park, North Carolina location called the Center for Molecular Biology and Pathology in Research.
3. Their research could lead to a cure for current health epidemics
LabCorp also performs other types of molecular diagnostics. They take common life-threatening diseases and perform genotyping and phenotyping to learn more about what makes these diseases thrive and how to arrest their growth. Two important forms of this testing that they do is oncology, which deals with cancer and human immunodeficiency virus, or HIV testing. Research in these areas and the development of knowledge about them that can lead to a cure may be vital for our survival as a species.
4. The company was founded under a different name
When this massive clinical laboratory network giant first formed it was under a different name. It was called National Health Laboratories Incorporated. They began as a national laboratory for testing of blood and pathology samples and they were originally owned by the Revlon Health Care Group, which served as the parent company.
5. Going public and turning a profit
National Health Laboratories went public as a company on the NASDAQ exchange in 1988. Revlon only retained 24% of the common shares of the company. The revenues for the company climbed to a high of $500 million by 1990 with earnings in the US of more than $70 million. It was at this time that the company started paying out cash dividends to its shareholders. The company was performing extremely well and even continued to profit during the recession of 1990-1991 with an increase in revenue to nearly $90 million in earnings.
6. Prior to 1995, They were known under a different name
The name of the company that has emerged into a giant in the industry was Roche BioMedical. This is an interesting fact about the history of LabCorp in the process of its evolution. Roche BioMedical merged with National Health Laboratory in 1995. We see a pattern of mergers of major laboratory companies and in many instances, the company that does the acquisition absorbs the company into its main structure but sometimes when the acquired company performs functions that are established under its own brand name, they are allowed to maintain the same name as a subsidiary company. The entire process gets complicated.
7. LabCorp owned a genetics lab
LabCorp also operates a genetics testing facility and laboratory. The name of the company is National Genetics Institute, Inc. The facility is located in Los Angeles, California. NGI develops PCR testing methods. It’s interesting to discover just how many different branches of testing and laboratory disciplines fall under the umbrella of the mega-giant in the industry. They also own a ViroMed facility which performs PCR microbial testing in real-time with lab-developed assays. This facility was originally located in Minnetonka, Minnesota, but in 2013, it was relocated to Burlington, North Carolina.
8. LabCorp has a fleet of aircraft
It really comes as no surprise that LabCorp uses a total of eight aircraft to make runs from one facility alone. These aircraft make nightly flights without fail. Tests and other products are flown from the facility in Burlington, North Carolina to the East Coast for use at labs and other facilities in these locations.
9. LabCorp was investigated for fraud in 1991
There was a huge crackdown on health care system fraud in a nationwide operation that was titled “Labscam.” The U.S. Attorney’s Office was in charge of the investigation. Changes were filed against LabCorp along with many other labs accusing them of submitting false claims for payment from government health care agencies including Medicaid and Medicare for tests which were never ordered by physicians. The company that was now LabCorp was prosecuted under its previous name National Health Laboratories and it was one of the first companies to be prosecuted for the crimes of fraud.
10. National Health Laboratories was fined millions
When the case against National Health Laboratories concluded in the Labcam investigation, it wasn’t a positive outcome for the company. They entered into a settlement agreement that required them to make a payment of $111 million in 1992, then make another payment the following year for a total of $173 million dollars in the settlement. This was most certainly a scandalous event and it came at the time when insurance rates were rising because of the high number of fraudulent claims that were being made not only on government insurance accounts but also through the entire sector of private insurance carriers. It is estimated that the total amount of funds which were obtained from insurance companies for unnecessary, unauthorized and fraudulent test claims amounted to billions of dollars. The costs were passed along to consumers were then charged higher premiums, higher deductibles and higher co-payments, often with a reduction in their benefits plans.
11. The Labscam fines were more than their profits
The year that National Health Laboratories was required to make their first payment on the Labscam settlement was in 1992. Their profits for the year in actual earnings were just $40 million even though the reported revenues were $720 million.
12. A candy distributor owned part interest in National Health Laboratories
The company had gone through a major reorganization in 1994 and officially changed their name to National Health Laboratories Holdings, Inc. Twenty-four percent ownership of the company was held by the Revlon Holding’s Group. It’s a fun fact that this company distributed licorice extract and chocolate.
13. LabCorp has an interesting history of acquisitions
They started out as National Health Laboratories Incorporated in 1978. The acquired Allied Clinical Laboratories, Inc in 1994. In 1995, the company merged with Roche Biomedical Laboratories, Inc, then acquired Litholink Corporation in 2006. In 2007, they acquired Tandem Labs, followed by Monogram Biosciences in 2009, Genzyme Genetics in 2011, MedTOX in 2012, Covance Inc in 2015, Sequenom in 2016, and Clear Path Diagnostics in 2016 along with Chiltern.
14. They hit more financial problems in 1994
Granted, this is a massive corporation and as such, a bad year now and then doesn’t necessarily signal the end of its existence, but it’s not good for the shareholders. The company that did well through the financial crisis that hit the country from 1990-91 was now struggling with a drop of more than two thirds in revenue with a total of just $30 million. The stock trade stayed below its peak from the previous year by a little over half.
15. LabCorp of America Holdings took a marginal loss
When the company officially became known as LabCorp in 1995, it took a big hit and actually lost funds in the amount of a few million dollars. It had reached a frightening level of difficulty. The price of its stock took a drop of nearly half over the year and this would be within 10% of its all-time low since it went public six years earlier.
16. It failed in an agreement with Universal Standard Healthcare
In the summer of 1998, LabCorp made the acquisition of Universal Standard Healthare with an equity position and it became their clinical laboratory testing provider for the long-term. The agreement was terminated just one year later. When we attempted to identify the reason for the dissolution of the agreement, there were no records available to explain why it didn’t work out but it could have been for a number of reasons. They still retained control of the company but no longer performed their long-term testing assignments.
17. By 2000 LabCorp was in the pink with substantial growth
In the year 2000, LabCorp had made several prosperous acquisitions and they were operating throughout a variety of disciplines within the laboratory/testing industry. Their revenue for the year reached the amount of $1.9 billion and they employed more than 18,000 workers. Over the next few years, they would continue to make one large acquisition after another adding to their clinical diagnostic testing disciplines in virology, molecular biology, microbiology, mycology, serology, mycobacteriology and testing for tissue and eye banks. In late 2001, LabCorp also became a genomics and proteomics predictive cancer test product marketer exclusively with products made by Myraid Genetics, Inc.
18. LabCorp made 4.1 billion in revenues in 2007
From May of 2002 through 2007, the company continued to add to its long list of subsidiary companies by making yet more acquisitions and moving into the medical laboratory territory of companies established in three Canadian provinces. This was a massive expansion of the LabCorp company. They were growing and on the move.
19. LabCorp really got into HIV and DNA testing services
DNA testing is a very lucrative business with all of the advances in research that pose yet more questions, testing hit a boom. There were so many different types of DNA testing in demand that it made sense to acquire companies with a heavy focus on this industry. Interest in ancestry, as well as research that is looking for treatments and cures of a variety of genetic conditions and predispositions, spurred the need for an increase in this type of testing facility with newer and improved DNA testing that could yield more data than ever before. LabCorp companies also specialized in paternity testing as a part of their DNA diagnostics center. One of their most interesting acquisitions in this area came in December of 2014 when LabCorp completes its agreement to acquire the Bode Technology Group which specializes in forensic DNA analysis and DNA collection products. The scope of their DNA testing facilities covered nearly every aspect of the science which had been established at this point in time. Work on HIV testing also continued to be a large focus with multiple subsidiaries specializing in this field of research.
20. LabCorp also dabbles in the Food Industry
When it comes to Laboratory testing, one important industry that cannot be overlooked is the food manufacturers. LabCorp expanded its interests into this arena in October of 2015. They made the official announcement at this time that they would acquire Safe Foods International Holdings, LLC. Along with the newly purchased company was included two subsidiaries which were International Food Network and The National Food Laboratory. The amount of the deal was never disclosed publicly. Although this wasn’t new territory for LabCorp, it was their most significant entrance into this part of the industry. This expanded the capabilities of the larger parent company in expanding their testing into the food and beverage product development as well as for generating products and services that ensured product integrity. Through all of their ups and downs, LabCorp has done a little bit of everything that you can imagine when it comes to laboratory testing and more. They’re represented by companies that you never would have imagined are under their massive umbrella of subsidiaries.
