OR WAIT null SECS
LabCorp announced it will purchase contract research company Covance Inc. for approximately $6.1 billion in cash and stock.
Diagnostics company LabCorp announced on Nov. 3, 2014 that it will purchase contract research organization Covance to create “the world’s leading healthcare diagnostics company,” according to a Covance press release. Together, the combined company will provide medical testing services and offer drug development commercialization services.
The focus of the combined company is enhanced data delivery, both to physicians and drug sponsors. These data for clinical trials will be collected more efficiently through the partnership and will help facilitate personalized medicine, drug development, and drug commercialization. According to Covance, this will improve R&D productivity, as both ends of the drug development process will be addressed.
“This transaction provides LabCorp with immediate scale and a comprehensive market-leading platform in the $141 billion biopharmaceutical R&D market, while at the same time achieving the new sources of revenue, broader payer mix, and greater international presence we have long pursued," said LabCorp Chairman and CEO David P. King in the press release. "As a combined company, we will be well positioned to respond to and benefit from the fundamental forces of change in our business, including payment for outcomes, pharmaceutical outsourcing, global trial support, trends in pharmaceutical R&D spending, personalized medicine, and big data and informatics."
Indeed, the partnership will create more genomic drug evidence in a market that increasingly demands more evidence-based medicine. The partnership may also help further LabCorp’s goal to optimize patient drug regimens, especially for expensive personalized medicines. Covance has spent much of 2014 expanding on its biologics capabilities and adding to its “molecule management teams,” which are made up of scientific experts in the field of drug development.
The acquisition, which is subject to Covance shareholder approval, is expected to close in the first quarter of 2015.