Cleveland HeartLab has agreed to be acquired by Quest Diagnostics, a Fortune 500 medical testing company based in New Jersey.
The deal should help the Cleveland Clinic spinout company accelerate its growth, said Cleveland HeartLab CEO Jake Orville.
"We're still a fraction of a fraction of what the real opportunity is," Orville said, adding that he expects Cleveland HeartLab to keep its 200-plus employees, including roughly 120 who work at its Midtown Cleveland headquarters.
He highlighted the commitment that Quest Diagnostics has made to Cleveland.
For one, the company plans to use Cleveland HeartLab's headquarters as "a national center of excellence" focused on tests related to heart disease, according to a news release announcing the deal.
Quest Diagnostics also plans to form a partnership with the Cleveland Clinic, which owns a significant stake in Cleveland HeartLab. Quest and the Clinic plan to form a committee of experts that would evaluate medical biomarkers discovered by the Clinic. Quest then could use those discoveries to create new medical tests. They also plan to work together on trials to test out those biomarkers and others, the release stated.
Together, the organizations should be able to speed up the development of diagnostic technologies and get them to market faster, according a press release statement from Dr. Brian Donley, chief of staff at the Cleveland Clinic. Likewise, Quest CEO Steve Rusckowski stated that acquisition and the Clinic partnership "will provide new insights for empowering better health."
In addition to the Clinic, several local investors own shares in Cleveland HeartLab, including Mutual Capital Partners, Glengary LLC, Zapis Capital and Second Generation.
Though the companies aren't disclosing the terms of the deal, Orville said "it's a good day" for everyone involved.
So how will being part of Quest help Cleveland HeartLab grow?
For one, the deal will give more patients the ability to receive Cleveland HeartLab's tests, Orville said, noting that Quest runs roughly 2,000 patient service centers in the United States. Quest also has agreements with most insurance carriers, which should make it easier for patients to afford Cleveland HeartLab's tests, he added.
Cleveland HeartLab experienced explosive growth almost immediately after its founding in 2009, hiring about 120 people by the end of its fourth year in business. That growth then slowed significantly, pushing the company to develop new tests and double the size of its sales force.
Those efforts paid off, Orville said.
"They worked. They worked really well," he said, noting that the company has "been growing very nicely" in recent years.
The deal is expected to close in the fourth quarter, pending regulatory reviews.
"Cleveland HeartLab to be acquired by Quest Diagnostics" originally appeared in Crain's Cleveland Business.
