Bio-Reference Laboratories tests positive as the lab of choice for many in the Northeast. Primarily serving the greater New York Metropolitan Area, the company offers routine clinical tests, including Pap smears, pregnancy tests, cholesterol checks, and blood cell counts. Through its GenPath business unit, it also performs more sophisticated esoteric testing such as cancer pathology and molecular diagnostics. It gets most of its orders (close to 5 million per year) from doctors' offices, collecting specimens at draw stations scattered throughout its primary service area in the New York area. Bio-Reference Laboratories also provides services in Connecticut, Delaware, Maryland, New Jersey, and Pennsylvania.
The company's laboratory service in the New York Metro area is its core business, but it is growing steadily and now offers some of its testing services nationwide.
The company offers focused expertise in specialty areas through its various subsidiaries. It operates as a national oncology laboratory through its GenPath subsidiary. GenPath also houses Bio-Reference's women's health testing unit. GeneDX, another wholly owned subsidiary, performs testing of rare and ultra-rare genetic diseases nationally. Bio-Reference intends to build a marketing team to cross-sell its genetic testing and women's health testing capabilities to doctors who specialize in prenatal care.
Bio-Reference's specialty testing operations (both esoteric and for emerging markets) have been growing at a faster clip than its core routine testing business, and now routine lab tests account for less than half of the company's sales.
Another Bio-Reference unit, PSIMedica, makes health informatics software that combines information from health care claims, lab results, and other sources and markets it to managed care organizations. The CareEvolve subsidiary markets the company's online connectivity software to other laboratories. Revenues from PSIMedica and CareEvolve contribute a negligible percentage of the company's overall sales.
Sales and Marketing
Bio-Reference's primary client base is composed of doctors, employers, clinics, and governmental units.
Bio-Reference grows its services by tapping into emerging laboratory markets. The company is focused on developing its cardiology, histology, and women's health diagnostic testing capabilities to complement its existing hemostasis (process by which blood changes from fluid to a solid state), hematopathology (tests for congenital disorders), and correctional health care initiatives.
Still, demand for the both its routine and esoteric lab testing is expected to increase, thanks to a growing US trend of shorter inpatient stays at hospitals. With patients being discharged earlier, some of the business that would typically go straight to the hospital-based lab is instead being sent to labs like Bio-Reference by the patients' after-care physicians.
The company has enjoyed an upward trend in revenue the past five fiscal years. Net revenues were $.4 million in fiscal 2010, $.5 million in fiscal 2011, and $.66 million in fiscal 2012. Bio-Reference's increase in revenue per patient was due to increases in esoteric testing.
Part of Bio-Reference's strategy for expanding its testing areas is to partner with medical providers whose expertise can help expedite the development process. In 2010 Bio-Reference entered into one such agreement with Massachusetts General Hospital to develop a line of clinical diagnostic tests designed to identify and help treat solid tumors. The test will make use of the emerging field of personalized medicine, in which a patient's unique genetic make-up is used to help tailor testing and treatment to best address that patient's individual needs.
Doctors can place orders for lab tests and get test results using the company's proprietary CareEvolve online portal. Outside of its customer relationships with doctors' offices, Bio-Reference serves government agencies, large employers (for substance abuse testing, for instance) and prison systems in the northeastern US.
Mergers and Acquisitions
The company occasionally purchases other testing businesses to expand its reach. It acquired clinical laboratory business, The Genetics Center, in 2011. In 2010 Bio-Reference acquired clinical testing laboratory Lenetix Medical Screening Laboratory.
Founder, chairman, and CEO Marc Grodman owns 10% of the company. – less