Quest Diagnostics 2010 Annual Report Download - page 6

timely and effective decisions, with the opportunity to improve patient care and reduce medical costs. We
have 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.
•Expand our geographic reach. In addition to growth opportunities in the United States, we see
opportunities to expand our presence in India, Ireland, 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.
To support our strategy, we expect to continue to selectively evaluate acquisitions in the United States and
in select international markets. We anticipate that acquisitions will enable us to expand our capabilities, further
leverage our assets and differentiate our Company from our competition, diversify our revenues and accelerate
our growth.
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 better healthcare decisions. 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 esoteric testing, anatomic pathology services and testing for drugs-of-abuse, and the leading
provider of risk assessment services for the life insurance industry. We also are 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. Most of our services are provided in the United States; for each of
the years ended December 31, 2008, 2009 and 2010, we derived approximately 3% of our revenues from foreign
operations and held approximately 7% of our long-lived assets outside the United States. The following chart
shows the percentage of our 2010 net revenues generated by the activities identified.
Activity
Approximate Percentage
of 2010 Net Revenues
Clinical testing................................................................ 91%
Routine clinical testing . . . ................................................ 52%
Anatomic pathology testing ............................................... 14%
Gene-based and esoteric testing ........................................... 22%
Drugs of abuse testing (employer services). . . .............................. 3%
Healthcare information technology, clinical trials testing, life insurer services and
diagnostic products ......................................................... 9%
Clinical Testing. We are the world’s largest commercial clinical testing company. 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. We offer customers the
broadest access to the most extensive test menu of clinical laboratory and anatomic pathology tests in the United
States. Clinical laboratory testing generally is performed on whole blood, serum, plasma and other body fluids,
such as urine, and specimens such as microbiology samples. 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. Anatomic pathology services
are performed on tissues, such as biopsies, and other samples, such as human cells. 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 integration of new tests into clinical practice, and help physicians best utilize these tests
to improve patient outcomes and enhance patient satisfaction. To this end, our in-house experts, including
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