Many Payer Contracts – Steady Revenue – Plenty of Growth Possible
Strong Reputation
This Mid-West Lab maintains a strong reputation and serves a diverse client base comprising dermatologists, plastic surgeons, gastroenterologists, podiatrists, and other medical specialists.
Partnership Benefits
The Laboratory has a partnership with a physician’s group (while operating as an independent lab), enabling it to remain in-network with several payers. An additional benefit of this partnership is it receives samples from physicians within that group. The acquirer has the option to continue with that partnership or not.
Comprehensive Services and Multiple Client Accounts
Broadly speaking, the Laboratory provides both Technical and Professional Services, catering to over 300 clients with a significant portion of sample volume coming from about a dozen clinics with a total of about 60-70 providers. The Laboratory also provides consulting services to some clients and also does some sample preparation work (Technical Component). The Lab has a steady volume of about 15,000 samples per year.
Dedicated Staff
The Laboratory boasts a team of dedicated and loyal staff who have been with the facility since its inception. This includes a Lab Supervisor/Practice Manager/Marketer, a technician, and two secretaries/accessioners, one of whom works full-time and the other part-time.
Steady Revenue / Opportunity for Growth
The lab has had fairly steady revenue over the past few years, between $1.0M and $1.2M. In 2023, its revenue was $1.1M, and Discretionary Earnings was $393K. A more ambitious buyer can certainly build onto this with marketing, expanding geographical reach and offering more services.
Asking Price and Reason for Sale
The asking price is $1.5M. Part of its value lies in its access to a large network of in-network payers. The Seller seeks to reduce his work hours and take longer vacations to spend time with his elderly parents residing abroad. He is willing to stay with the buyer for an extended period if the buyer desires.
Ideal Buyer
This opportunity is ideal for pathology labs, pathology groups, or individual pathologists aiming to expand their business by acquiring more clients and broadening their geographic reach. It’s advantageous for buyers with a sales force and the ability to utilize the Laboratory’s payer contracts. Advanced technologies like molecular tests, telepathology, and AI can significantly enhance the Laboratory’s services and geographic footprint.
It may not be ideal for a clinical lab without a physician owner, looking for payer contracts as there has to be a physician provider in the lab to join the current physician group.
