17 Apr 2020
Posted in Medical Devices
Quest Diagnostics expected to experience decrease in revenue despite being commercial leader in COVID-19 testing
Following the announcement of Quest, leader in commercial COVID-19 testing in the US, making pay cuts and laying off workers;
Dara Lo, Medical Device Analyst at GlobalData, a leading data and analytics company, offers her view:
“Although Quest has performed nearly 800,000 COVID-19 tests, approximately 40% of all COVID-19 testing performed by commercial labs, 40% of its revenue comes from advanced diagnostic testing such as oncology tests, which have significantly decreased during the pandemic.
“Medicare has released its prices of COVID-19 tests, but this system has not yet been finalized. Until that happens, Quest is left holding the bill. A COVID-19 test costs $51.33 and, with 800,000 COVID-19 tests performed, this amounts to over $41m. The company’s drop in revenue, due to halted advanced diagnostic testing and the delay in reimbursement from Medicare, is likely putting a strain on Quest’s revenues resulting in pay cuts and layoffs.
“Who fronts the cost of COVID-19 testing is a growing concern in the US. In March, an emergency bill was passed that calls for free COVID-19 testing – upon a doctor’s recommendation – and patients would not be responsible for any deductibles or co-payments. However, in addition to the expense of lab testing, patients must access the tests through a doctor’s office or hospital visit, which adds to patient expenses.”