Pathology services targeted by Sodexo in new JV

29 July 2010

Sodexo has added pathology to its services with the formation of a JV with Labco called Integrated Pathology Partnerships (iPP) to deliver cost effective pathology services to the healthcare sector.

This is the first time that a FM company and an independent professional pathology provider have joined forces in the UK to enable pathology services to be outsourced.
Labco is a a major European clinical diagnostics company owned and run by an international network of pathologists, that operate over 300 laboratories in six European countries, performing analyses for more than 10,000,000 patients a year from a range of over 2,500 clinical tests. Labco employs around 4,500 staff including 500 pathologists, and performs over 250,000 tests each day working with community and academic hospitals (both public and private), inpatient, outpatient, general practitioners, health clinics etc.(www.labco.eu). Sodexo has a major presence in the UK healthcare market with over 9,000 employees directly involved in the sector, of which 6,000 are working in NHS organisations across the UK having transferred from the NHS to Sodexo. It currently delivers a wide range of services in almost 100 hospitals and is also involved in a number of large and complex PFI schemes, both as a service provider and an equity partner.
iPP joint venture company aims to partner with UK healthcare organisations to deliver pathology services that are responsive to users, cost effective and support NHS national clinical programmes. To date, pathology services have been predominantly carried out by Trusts in-house given limited opportunity to outsource to independent experts.
In 2008, the Carter Review of Pathology made 20 recommendations covering eight broad topics. Carter estimated that the pathology market was worth £2.5bn a year to the health service alone. To date, the NHS has dominated the pathology market with the majority of clinical tests being performed either by the health service or on its behalf. The NHS has set itself a target of £500m in savings for pathology services in England.
Geoff Searle, MD for the new joint venture, said: “We believe this new joint venture addresses many of the issues raised in the Carter Review* concerning improvements to quality and patient safety and increased efficiency, and that iPP will help the NHS achieve its ambitious £500m savings target for pathology services in England. The combination of resources and clinical disciplines which iPP draws from its two parent companies, equips us to be a strategic partner to NHS and independent hospitals. We can assist healthcare providers and commissioners in meeting the challenges of quality, cost and rising demand in UK pathology services. Labco has excellent past performance in pathology in several major European healthcare markets and Sodexo has earned a key position in the NHS as a valued outsourcing partner.”
Simon Scrivens, MD for Sodexo, said: “This is an exciting development for Sodexo. We have been successfully delivering a wide range of services to the healthcare market for many years and we are delighted to be working with Labco which has expertise in this field, to move into this new area of service provision.
Eric Souêtre, Labco CEO, said “Labco has unrivalled experience in Europe of managing pathology services through outsourcing models and has an excellent track-record of successfully transferring its technical and medical knowledge to new healthcare markets: we are looking forward to helping our future UK clients improve their pathology services.”
Stuart Quin, Investment Manager at 3i, a leading international investor and backer of Labco added: "Today's announcement underlines 3i's strategy to partner with fast growing international healthcare businesses. The iPP joint venture will bring an innovative model of delivering pathology services across Europe to improve quality and drive efficiencies in the UK market."
Operating models will vary and IPP will offer a range of service and partnership options depending on each healthcare organisation’s needs.