Quest Diagnostics 2009 Annual Report Download - page 13

years. We believe that we are well positioned to enable physicians to take advantage of the government
stimulus program, and we are committed to our Care 360 products becoming designated as certified
technology for purposes of the federal laws.
•Expand our geographic reach. In addition to growth opportunities in the United States, we see
opportunities to expand our presence in Ireland, India, Mexico, Puerto Rico and the U.K. and to bring our
experience and expertise in diagnostic testing to other international markets, particularly to developing
countries where the testing markets are highly fragmented and less mature.
•Expand our diagnostic scope. Technology advances are enabling testing to move closer to the patient and
point-of-care, or near patient, tests are becoming increasingly available and reliable. This enables more
timely and effective decisions, with the opportunity to improve patient care and reduce medical costs.
Since July 2006, we have acquired three businesses that offer point-of-care testing: HemoCue, Focus
Diagnostics and Enterix. We intend to expand our product menus, develop novel technology platforms and
systems to meet the needs of our clients and pursue potential additional acquisitions to supplement our
offering. Test results from our point-of-care products can be entered into our Care360 system, enabling the
integration of tests performed in a near patient setting with those performed in our laboratories. We are
well positioned to offer choice and integrated solutions to physicians, hospitals, clinics and retail
customers for the testing methods that are most appropriate for each patient and practice.
In support of our strategy, in recent years we have undertaken several acquisitions to support our strategy.
These acquisitions enable us to expand our capabilities, further leverage our assets and differentiate our Company
from our competition, diversify our revenues and accelerate our growth. We expect to continue to selectively
evaluate acquisitions in the United States and in select international markets.
BUSINESS OPERATIONS
Quest Diagnostics is the world’s leading provider of diagnostic testing, information and services, providing
insights that enable patients, physicians and others to make decisions to improve health. We offer U.S. patients
and physicians the broadest access to diagnostic testing services through our nationwide network of laboratories
and Company-owned patient service centers. We provide interpretive consultation through the largest medical and
scientific staff in the industry, with approximately 900 M.D.s and Ph.D.s, primarily located in the United States,
many of whom are recognized leaders in their field. We are the leading provider of clinical testing, including
gene-based and other esoteric testing, anatomic pathology services, including dermatopathology and testing for
drugs-of-abuse, and the leading provider of risk assessment services for the life insurance industry. We are also a
leading provider of testing for clinical trials. Our diagnostics products business manufactures and markets FDA
cleared or approved diagnostic test kits and specialized point-of-care testing. We empower healthcare
organizations and clinicians with robust information technology solutions. Our activities are described below.
Patients are at the center of everything that we do. We are leveraging our diagnostic testing capabilities and
our assets to serve multiple customer bases. In 2009, our clinical testing business accounted for greater than 90%
of our net revenues, with the balance derived from insurer services, clinical trials testing, diagnostic products and
healthcare information technology. Most of our services are provided in the United States. Clinical testing
includes routine testing, anatomic pathology, gene-based and esoteric testing, and drugs-of-abuse testing, which
generated approximately 54%, 16%, 20% and 2%, respectively, of our 2009 net revenues. Risk assessment
services for the life insurance industry, clinical trials testing, diagnostic products and healthcare information
technology combined generated approximately 8% of our 2009 net revenues. In 2009, we derived approximately
3% of our net revenues from foreign operations and held approximately 7% of our long-lived assets outside the
United States.
Clinical Testing. We are the world’s largest commercial clinical testing company. We offer customers the
broadest access to the most extensive test menu of clinical and anatomic pathology tests in the United States.
Clinical testing is an essential element in the delivery of healthcare services. Physicians use clinical tests to assist
in the detection, diagnosis, evaluation, monitoring and treatment of diseases and other medical conditions. Clinical
testing is generally categorized as clinical laboratory testing and anatomic pathology services. Clinical laboratory
testing generally is performed on whole blood, serum, plasma and other body fluids, such as urine, and
specimens such as microbiology samples. Anatomic pathology services are performed on tissues, such as biopsies,
and other samples, such as human cells. Clinical laboratory tests which can be performed by most clinical
laboratories are considered routine. Esoteric tests are clinical laboratory tests that are not routine, require highly
skilled personnel and generally require more sophisticated equipment. Esoteric tests, including gene-based tests,
generally are performed in several of our laboratories. As tests increasingly become more complex, we believe
that providing sound medical and scientific consultation regarding our tests and test results will help spur the
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