Labcorp Completes Acquisition of Select Assets of BioReference Health's Innovative Oncology and Related Clinical Testing Services Businesses

Rhea-AI Summary

Labcorp (NYSE: LH) has completed the acquisition of select oncology and clinical testing assets from BioReference Health, a subsidiary of OPKO Health (Nasdaq: OPK). The transaction is valued at up to $225 million, comprising $192.5 million paid at closing and a potential $32.5 million performance-based earnout.

The acquisition strengthens Labcorp's oncology testing portfolio and expands its diagnostic capabilities. BioReference Health will retain its core clinical testing operations in NY/NJ and its 4Kscore® Test franchise, which generated approximately $300 million in revenue for 2024. OPKO plans to use part of the proceeds to fund its expanded share repurchase program.

Positive

• Strategic acquisition strengthens Labcorp's oncology testing portfolio and market leadership
• Deal structure includes significant upfront payment ($192.5M) with performance incentives
• BioReference's retained operations generated substantial revenue ($300M in 2024)
• OPKO to use proceeds for share repurchase program, benefiting shareholders

Negative

• Significant capital outlay of up to $225M for Labcorp
• Earnout portion ($32.5M) dependent on uncertain future performance metrics

Insights

M&A Financial Analyst

Labcorp's $225M acquisition of BioReference's oncology assets strengthens its diagnostic portfolio while providing OPKO with strategic capital for share repurchases.

Labcorp has completed its acquisition of select oncology and clinical testing assets from BioReference Health, a subsidiary of OPKO Health, for up to $225 million. The deal structure includes $192.5 million paid at closing with a potential $32.5 million performance-based earnout.

This transaction represents a strategic expansion of Labcorp's oncology testing capabilities. For Labcorp, which generated over $12 billion in revenue in 2024, this acquisition bolsters its oncology diagnostics portfolio, enhancing its competitive position in the specialized testing market where margins tend to be higher than routine laboratory services.

For OPKO Health, this divestiture allows the company to streamline operations while retaining BioReference's core clinical testing operations in NY/NJ and its 4Kscore Test franchise, which reportedly generated approximately $300 million in revenue for 2024. The deal provides OPKO with significant liquidity, with management indicating their intention to direct a portion of proceeds toward their expanded share repurchase program - a signal of management's belief that their stock may be undervalued.

The transaction appears to have strategic benefits for both parties: Labcorp expands its specialized diagnostic footprint in oncology, while OPKO gains capital to potentially enhance shareholder value through buybacks while focusing on its remaining diagnostic operations. The use of an earnout structure suggests some performance uncertainty in the transferred assets, with Labcorp protecting itself by making 14.4% of the total consideration contingent on future results.

BURLINGTON, N.C. and MIAMI, Sept. 15, 2025 /PRNewswire/ -- Labcorp (NYSE: LH), a global leader of innovative and comprehensive laboratory services, and OPKO Health, Inc. (Nasdaq: OPK), a multinational biopharmaceutical and diagnostics company, announced today the completion of Labcorp's acquisition of select assets of BioReference Health, a wholly owned subsidiary of OPKO Health.

This acquisition includes BioReference Health's laboratory testing businesses focused on oncology and oncology-related clinical testing services across the United States. This transaction includes certain customer accounts and other operating assets. The purchase price for the transaction is up to $225 million, including $192.5 million that was paid at closing and up to $32.5 million in an earnout based on performance.

"With this acquisition, we are providing patients, physicians and customers with expanded access to Labcorp's high-quality laboratory services, scientific expertise and comprehensive testing capabilities," said Mark Schroeder, President, Labcorp Diagnostics and Chief Operations Officer. "Bringing BioReference Health's oncology and clinical testing into our portfolio deepens our commitment to advancing cancer care and extends our leadership in oncology."

"The closing of this transaction marks a significant milestone for BioReference Health," stated Phillip Frost, M.D., Chairman and Chief Executive Officer of OPKO. "By focusing on our core clinical testing operations and the continued growth of our 4Kscore® Test franchise, we are better positioned to optimize our test menu and achieve sustainable profitability for this subsidiary.  We intend to utilize a portion of the proceeds to fund our recently expanded share repurchase authorization."

BioReference Health's continuing operations include its core clinical testing operations in the New York and New Jersey region and its 4Kscore® Test franchise, which represented approximately $300 million in revenue for 2024.

Lazard served as Labcorp's financial advisor, and Hogan Lovells and Kilpatrick Townsend served as legal counsel.

Piper Sandler & Co. served as OPKO Health's financial advisor and Greenberg Traurig served as legal counsel. 

About Labcorp
Labcorp (NYSE: LH) is a global leader of innovative and comprehensive laboratory services that helps doctors, hospitals, pharmaceutical companies, researchers and patients make clear and confident decisions. We provide insights and advance science to improve health and improve lives through our unparalleled diagnostics and drug development laboratory capabilities. The company's nearly 70,000 employees serve clients in approximately 100 countries, provided support for more than 75% of the new drugs and therapeutic products approved in 2024 by the FDA, and perform more than 700 million tests annually for patients around the world. Learn more about us at www.labcorp.com

About OPKO
OPKO Health, Inc. (Nasdaq: OPK) is a multinational biopharmaceutical and diagnostics company that seeks to establish industry-leading positions in large, rapidly growing markets by leveraging its discovery, development, and commercialization expertise and novel and proprietary technologies. For more information, visit www.opko.com.

Cautionary Statement Regarding Forward-Looking Statements
This press release contains forward-looking statements, including, but not limited to, statements with respect to the anticipated impact and benefits of the transaction; and the potential earnout payment.

Each of the forward-looking statements is subject to change based on various important factors, many of which are beyond the control of Labcorp and OPKO. These factors, in some cases, have affected and in the future (together with other factors) could affect each company's ability to implement its respective business strategy, and actual results could differ materially from those suggested by these forward-looking statements. As a result, readers are cautioned not to place undue reliance on any of the forward-looking statements.

Neither Labcorp nor OPKO has any obligation to provide any updates to these forward-looking statements even if its expectations change. All forward-looking statements are expressly qualified in their entirety by this cautionary statement. Further information on potential factors, risks and uncertainties that could affect operating and financial results is included in the most recent Annual Report on Form 10-K and subsequent Forms 10-Q, including in each case under the heading RISK FACTORS, and in other filings with the SEC by each of Labcorp and OPKO. The information in this press release should be read in conjunction with a review of Labcorp's and OPKO's filings with the SEC including the information in each of their respective most recent Annual Reports on Form 10-K, and subsequent quarterly reports on Forms 10-Q, under the heading "MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS".

 

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SOURCE Labcorp Holdings Inc

FAQ

What is the total value of Labcorp's acquisition of BioReference Health assets?

The total acquisition value is up to $225 million, including $192.5 million paid at closing and up to $32.5 million in performance-based earnout.

What assets did Labcorp (LH) acquire from BioReference Health?

Labcorp acquired BioReference Health's laboratory testing businesses focused on oncology and oncology-related clinical testing services across the United States, including certain customer accounts and operating assets.

How much revenue did BioReference Health's retained operations generate in 2024?

BioReference Health's continuing operations, including core clinical testing in NY/NJ and the 4Kscore® Test franchise, generated approximately $300 million in revenue for 2024.

How will OPKO Health use the proceeds from the BioReference Health asset sale?

OPKO Health plans to utilize a portion of the proceeds to fund their recently expanded share repurchase authorization.

What operations will BioReference Health retain after the Labcorp acquisition?

BioReference Health will retain its core clinical testing operations in the New York and New Jersey region and its 4Kscore® Test franchise.