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Laboratory Corporation of America Holdings LH, popularly known as LabCorp, recently announced the addition of bioanalytical services laboratory in Singapore. Construction and reconfiguration of this bioanalytical laboratory has already started and the opening is expected in late 2021.
Post the opening, this addition is going to expand the company’s Covance Drug development offerings in Asia Pacific (APAC) region.
As per LabCorp’s press release, Bioanalytics is a quantitative measure of drugs and metabolites in biological samples such as blood, serum, tissue and plasma. This new bioanalytical laboratory while providing a wide scale of regulated and non-regulated bioanalytical services will help the development of both small and large molecular entities.
The offerings include Good Laboratory Practice and Good Clinical Practice-compliant bioanalysis; liquid chromatography-mass spectometry and immunochemistry platforms; and discovery and clinical biomarker analytical services.
Singapore plays a vital role in strengthening Labcorp’s widespread global foothold. This region already offers both regional and international clients of LabCorp with a complementary site to support their bioanalytical studies. Accordingly, LabCorp is confident about expanding bioanalytical services in this area, which according to the company will broaden the options available to its client. The new laboratory will enable faster data turnaround for early phase trials in Asia-Pacific markets.
Going by a MARKETSANDMARKETS report, the bioanalytical testing services market is projected to reach $3.7 billion by 2025 from $2.1 billion in 2020 at a CAGR of 11.8%. The growth parameters include growing importance of analytical testing of biologics and biosimilars, increasing preference for outsourcing analytical testing, growing R&D expenditure in the pharmaceutical and biopharmaceutical industries and rising adoption of the Quality by Design approach.
Looking at this trend, we believe the company’s latest effort is well timed and strategic.
Covance's Progress in Bioanalytical andBiologics Space
Within Covance Drug Development, the company’s ongoing strategic investments in precision medicine, therapeutic expertise, FSP solutions and biologic drug development capabilities continue to increase its win rate with existing partners and new customers. The acquisition of Chiltern has significantly strengthened LabCorp’s strategic position in clinical development and accelerated revenue and profit growth within Covance. This apart, the company’s recent strategic technology contract with QIAGEN is expected to produce positive outcome down the line.
Share Price Performance
Shares of the company have gained 55% in a year’s time compared with the industry’s growth of 31%.
Zacks Rank and Key Picks
Currently, the company carries a Zacks Rank #3 (Hold).
A few better-ranked stocks from the broader medical space are National Vision Holdings, Inc. EYE, Owens & Minor, Inc. OMI and Envista Holdings Corporation NVST, each carrying a Zacks Rank #2 (Buy). You can see the complete list of Zacks #1 Rank (Strong Buy) stocks here.
National Vision has a projected long-term earnings growth rate of 15%.
Owens & Minor has a projected long-term earnings growth rate of 12%.
Envista Holdings has an estimated long-term earnings growth rate of 26%.
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