Quest Diagnostics will take over the kidney-focused lab testing portfolio of the dialysis giant Fresenius Medical Care—including services that Quest will then provide back to Fresenius as well as its joint ventures, such as Interwell Health.
The financial terms of the deal, set to close in the latter half of this year, were not disclosed.
The selected assets from Fresenius’ Spectra Laboratories subsidiary include water purification testing for use in dialysis machines, as a new area for Quest. The clinical diagnostic giant will also add to its current offerings of lab testing services related to end-stage kidney disease and transplantation.
The two companies said they expect the tie-up to ultimately shorten turnaround times for lab results, with Quest’s nationwide testing centers being located near Fresenius’ network of dialysis centers.
Fresenius said the move is part of its three-year strategic plan, dubbed FME25, as it looks to sharpen its focus on core businesses.
This week the German company also shared its annual earnings report, posting a decrease of 1% in revenue to 19.34 billion euros, or about $20.30 billion U.S.
Fresenius’ net income, however, grew 8% year-over-year to 538 million euros. The company said that when accounting for projections from previous divestitures, portfolio optimizations and other legal costs—including its 2023 settlement with Tricare for 181 million euros—that percentage could increase to 42%.
“We successfully executed against our strategic turnaround and transformation plan, advancing our legacy portfolio optimization and realizing significant FME25 savings ahead of plan,” CEO Helen Giza said in a statement. “The momentum we have created enables us to further raise our FME25 savings target from EUR 650 million to EUR 750 million.”