Quest Diagnostics 2006 Annual Report Download - page 5

Download and view the complete annual report

Please find page 5 of the 2006 Quest Diagnostics annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 131

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131

As฀advances฀ are฀made฀in฀diagnostic฀testing฀ and฀
services,฀ our฀ industry฀ is฀ undergoing฀ dramatic฀
change฀ brought฀ on฀ by฀ broad฀ shifts฀ in฀ the฀
healthcare฀sector.฀Health฀plans฀have฀consolidated,฀
creating฀integrated฀enterprises฀with฀greater฀pur-
chasing฀power.฀Our฀industry฀is฀fragmented,฀and฀฀
competition฀is฀fierce.฀As฀a฀result,฀pricing฀pressure฀
is฀heightened฀and฀will฀continue,฀at฀least฀through฀
the฀end฀of฀2007.
Courage,฀Compassion,฀Commitment
In฀the฀face฀of฀these฀challenges,฀we฀have฀the฀cour-
age฀to฀lead฀by฀holding฀fast฀to฀the฀values฀that฀have฀
made฀ us฀ the฀ leader.฀ Our฀ compassion฀ for฀ the฀฀
patient฀ is฀ at฀ the฀ core฀ of฀ what฀ we฀ do.฀ It฀ compels฀฀
us฀ to฀ constantly฀ enhance฀ quality฀ and฀ innovate.฀
And฀ we฀ have฀ a฀ commitment฀ to฀ growth฀ that฀฀
creates฀benefits฀for฀customers,฀opportunities฀for฀
employees฀and฀increased฀value฀for฀shareholders.฀
In฀the฀pages฀that฀follow,฀we฀show฀the฀ways฀that฀our฀
company฀and฀our฀people฀embody฀these฀behaviors.
In฀late฀2006฀we฀announced฀that฀we฀were฀unable฀
to฀come฀to฀terms฀with฀UnitedHealthcare,฀which฀
represented฀approximately฀7%฀of฀our฀revenues.฀
We฀had฀historically฀enjoyed฀a฀strong฀relationship฀
with฀ United฀ as฀ its฀ largest฀ laboratory฀ provider,฀
serving฀12฀million฀patients.฀When฀United฀issued฀a฀
request฀for฀bids,฀we฀met฀their฀requirement฀to฀help฀
them฀reduce฀overall฀lab฀costs.฀And฀we฀continued฀to฀
expand฀access฀and฀service฀for฀patients฀and฀doctors.฀
However,฀they฀insisted฀on฀unreasonable฀and฀uni-
lateral฀terms฀that฀would฀have฀been฀irresponsible฀
of฀us฀to฀accept.฀In฀the฀long฀term,฀this฀was฀the฀right฀
thing฀to฀do฀for฀our฀shareholders฀and฀our฀industry.
Ever฀since฀we฀announced฀the฀United฀contract฀loss฀
in฀October฀2006,฀we฀have฀been฀working฀to฀retain฀
United฀physicians฀and฀patients.฀United฀has฀threat-
ened฀financial฀penalties฀for฀doctors฀who฀choose฀
Quest฀Diagnostics.฀This฀is฀unprecedented฀and฀is฀
influencing฀physician฀behavior.
It฀is฀clear฀ that฀ 2007฀ will฀ be฀ a฀ year฀of฀ transition;฀
however,฀ we฀ expect฀ to฀ return฀ to฀ both฀ top-฀ and฀
bottom-line฀growth฀in฀2008.
A฀Successful฀Strategy
Our฀ strategy฀ is฀ based฀ on฀ three฀ simple฀ but฀ pro-
found฀ words—Patients,฀ Growth฀ and฀ People.฀ We฀
remain฀deeply฀committed฀to฀improving฀the฀overall฀
patient฀experience,฀driving฀growth฀and฀facilitating฀
the฀success฀of฀our฀colleagues.฀The฀opportunities฀
we฀see฀are฀limitless.
We฀ are฀ making฀ it฀ easier฀ and฀ more฀ convenient฀฀
for฀ patients฀ to฀ be฀ tested.฀ For฀ example,฀ in฀ many฀
locations,฀ we฀ have฀ enabled฀ patients฀ to฀ make฀฀
appointments฀for฀testing฀online.฀Based฀on฀the฀ini-
tial฀success,฀we฀are฀expanding฀this฀initiative฀com-
pany฀wide.฀ Our฀emphasis฀ on฀establishing฀ “Gold฀
Standards”฀for฀customer฀service฀and฀training฀our฀
frontline฀ employees฀ who฀ interact฀ with฀ patients฀
and฀ physicians฀has฀resulted฀in฀improved฀patient฀
satisfaction฀scores.
We฀continue฀to฀lead฀the฀way฀with฀important฀new฀
tests฀ for฀ cancers,฀ infectious฀ disease฀ and฀ cardio-
vascular฀ disease.฀ We฀ introduced฀ an฀ important฀
new฀ cancer฀ test฀ to฀ identify฀ cancers฀ of฀ unknown฀
primary฀origin.฀We฀expanded฀our฀Leumeta™฀family฀
of฀cancer฀tests,฀which฀use฀blood฀plasma฀instead฀of฀
painful฀bone฀marrow฀biopsies฀to฀assess฀leukemia฀
and฀lymphoma.
During฀ 2006,฀ we฀ acquired฀ both฀ Enterix,฀ which฀
makes฀ the฀ InSure™฀ colorectal฀ cancer฀ screening฀
test,฀ and฀ Focus฀ Diagnostics,฀ a฀ recognized฀ world฀
leader฀in฀infectious฀disease฀testing.฀
We฀are฀excited฀to฀acquire฀the฀worldwide฀rights฀to฀
the฀ InSure฀ test฀ for฀ colorectal฀ cancer฀ screening.฀
Colorectal฀cancer฀is฀the฀third฀most฀common฀form฀
of฀cancer฀in฀the฀U.S.฀ and฀ is฀often฀curable฀when฀
detected฀early.฀We฀have฀seen฀how฀a฀simple,฀non-
invasive฀ annual฀ test฀ such฀ as฀ InSure฀ can฀ have฀ a฀
profound฀ impact฀ on฀ early฀ detection.฀ We฀ see฀ an฀
opportunity฀ to฀ help฀ patients฀ around฀ the฀ world฀
screen฀for฀colorectal฀cancer฀at฀an฀early฀stage฀when฀
the฀disease฀is฀most฀treatable.
150฀Million
PATIENT฀EN COUNTERS฀
in฀200 6
Quest฀Diagnostics฀2006฀Annual฀Report฀—฀page฀3