Quest Diagnostics Incorporated NYSE: DGX , the leading U.S. provider of diagnostic testing, information and services, announced today that it has acquired HemoCue, a Swedish company specializing in near patient testing, also known as point-of- care testing, from the private equity firm EQT II B.V. in a cash transaction valued at approximately $420 million. The acquisition will allow Quest Diagnostics to enter the growing near patient testing market and leverage HemoCue's international presence to reach new markets around the world. The transaction, which has been financed through a new credit facility, is not expected to have a material impact on Quest Diagnostics' 2007 financial results. Additional terms of the transaction were not disclosed.
HemoCue has annualized revenues of approximately $90 million and is the leading international provider in near patient testing for hemoglobin, with a growing share in professional glucose and microalbumin testing. The company's handheld systems are used in physicians' offices, blood banks, hospitals, diabetes clinics, and public health clinics. In developing countries these systems are used as the primary means to screen for anemia. The measurement of hemoglobin is important for patients being treated by transfusion, or undergoing dialysis or chemotherapy, where instant test results can lead to immediate treatment decisions.
HemoCue has a strong product pipeline, based on the pioneering use of its patented microfluidic systems, and is currently developing new tests including a near patient test to determine white blood cell counts. This test will help physicians quickly determine the presence of an infection and, consequently, the need for antibiotic treatment, potentially reducing the overuse of antibiotics, an ongoing public health concern. This acquisition also complements efforts underway at Quest Diagnostics in near patient testing for infectious disease and cancer, including new tests for colorectal cancer screening and herpes simplex virus type 2.
In addition, Quest Diagnostics intends to enhance the electronic connectivity of HemoCue's handheld systems by making them compatible with its Care360 portal, which enables doctors to store, access and share patient information. The Care360 portal provides physicians with 24/7 access to lab and medication records, patient medical history and remote ordering of lab testing or e-prescribing.
"Technology is enabling diagnostic testing to move closer to the patient, and the acquisition of HemoCue and its exciting product pipeline gives us a strong presence in this emerging market," said Surya N. Mohapatra, Ph.D., Chairman and Chief Executive Officer of Quest Diagnostics. "Linking near patient testing devices to our proprietary Care360 patient-centric physician portal can provide longitudinal test reporting on a patient regardless of how or where a test was performed. This will help doctors improve the way they diagnose, monitor and treat disease."
"We look forward to bringing together two organizations that share a passion for patient care, quality, service and innovation," said HemoCue Managing Director and Chief Executive Officer, Josef Selinger, who will continue to operate HemoCue as part of Quest Diagnostics.