A Diagnostics & Imaging Week

BioReference Laboratories (BRLI; Elmwood Park, New Jersey) said it has received a letter from Horizon Blue Cross Blue Shield of New Jersey terminating their in-network provider relationship, effective March 31, 2007, and BRLI promised to contest that decision.

BRLI said it has been a provider for Horizon, and its predecessors, since BRLI became a clinical laboratory 20 years ago. BRLI said there was no prior notice from Horizon regarding the termination, no negotiation or any indication of any kind from Horizon that the change in the authorized panel was even being contemplated.

Marc Grodman, MD, CEO of BRLI, noted a “recent agreement by Horizon and LabCorp. [Laboratory Corporation of America],” with that agreement leaving “only one full-service clinical laboratory authorized to provide laboratory testing to Horizon subscribers. Unlike other recent managed care decisions in the area where competition was maintained to assure the best interests of subscribers, this situation was different.”

Grodman said that the contract with Horizon represented roughly 5% of the company’s FY06 revenues, but that the impact of the change is not clear due to uncertainties concerning “how the changes would be put into effect, the ramifications of using out-of-network providers that Horizon would place on its subscribers, along with the company’s own organic growth across all business lines.”

As a result, he saw no change in its guidance given in its recent 4Q06 earnings report. “We are far more concerned with the deleterious effect that this decision may have on healthcare in the state of New Jersey.”

He said the agreement between Horizion and LabCorp would “virtually eliminate competition among laboratory providers” and that Horizon subscribers “will no longer benefit from the best possible service, support, and technological innovation that they have paid for and which competition assures.”

“We have no intention of allowing this decision to be implemented without challenge. We have asked Horizon to rescind their decision; if they fail to do so, we will pursue all avenues of relief available to us.”

Sources indicated that BRLI was one of two New Jersey-based laboratories that were dropped from the panel which otherwise remained intact.

BRLI bills itself the largest independent regional clinical laboratory in the Northeast, claiming “major market positions” in physician offices, nursing homes and correctional institutions.

In other contract news:

• Strategic Diagnostics (Newark, Delaware) said that it has sold its RapidChek Listeria and RapidChek Select for Salmonella test platforms to three major food processors with an estimated, combined annual value in excess of $800,000 per year. Product has started to ship in the current calendar quarter. No additional customer specifics are being released.

“Major food processors continue to embrace our methodologies as the preferred testing process to ensure the ongoing safety of their products and maintain consumer confidence,” said Matt Knight, president/CEO of Strategic Diagnostics. “Within this mature market, we continue to capture accounts with high-volume testing needs, demonstrating our ability to take market share from well established competitive methods and validating our technology. Our success is due to our ability to clearly demonstrate both the technical performance of our methods, and ultimately their superior cost in use.”

Strategic Diagnostics makes biotechnology-based detection solutions to a diverse customer base, across multiple industrial and human health markets.

In grant news:

• Nanomix (Emeryville, California), a nanoelectronic detection company commercializing diagnostic and monitoring applications, reported the award of a $1 million project grant from the Department of Homeland Security (DHS). The Nanomix grant will cover a three-year period and will be developed in cooperation with the Naval Research Laboratories.

The company said that the scope of the project is not being disclosed “for security reasons.”

The Nanomix Sensation platform enables detection of an array of chemical and biomolecules. It has high specificity and reproducibility, operates at room temperature, consumes little power, and permits both wireless integration and simple deployment, the company said.