A public-private pathology partnership has paid £25m in profit to its majority share owner, and another £25m to two NHS trusts, accounts reveal.
Health Services Laboratories is a company 51 per cent-owned by The Doctor’s Laboratory and 49 per cent-owned by two London hospital trusts.
HSL’s annual accounts for the year to 30 June 2024, published this month, show £25m profit was paid to TDL’s owner, Australian firm Sonic Healthcare, and £12.5m each to the Royal Free London Foundation Trust and University College London Hospitals Foundation Trust.
The business was created nine years ago and is chaired by Lord Patrick Carter, who recommended networking services over a larger footprint in a 2016 government report.
A spokesman for HSL said it was the first time profits had been distributed to members since it was founded.
About half of its total profit in the year — £98.1m — was paid out to partners. It said the profit was “primarily due to the receipt of historical earnings from its trading subsidiaries (HSL Analytics - £50m, HSL Facilities Management - £20m and HSL Pathology - £30m)”. The three companies had a combined turnover of £208.4m in their most recent financial results.
The accounts said: “The NHS continues to view the pathology sector as a possible source of efficiencies in the coming years. We are well placed to take advantage of opportunities created by this initiative because of our long experience in supporting and transforming public sector laboratory services.”
Documents filed by Sonic Healthcare said: “In the UK, acquisitions are unlikely, as the market is dominated by the National Health Service (NHS) and Sonic is the largest private participant. However, substantial growth opportunities exist from potential NHS and private hospital laboratory outsourcing contracts.”
HSL provides pathology services for the Royal Free and UCLH, which together deliver the large majority of hospital care in north central London.
In April, the nearby Whittington Healthcare Trust agreed it would also use HSL as its pathology provider, a move Sonic Healthcare estimates will increase annual revenue by AU$20m.
HSL is also due to take over the running of pathology services in Hertfordshire and West Essex after a legal battle with another provider. Sonic Healthcare’s accounts attributed an AU$10m loss to the Hertfordshire and West Essex contract so far, but said the 15-year contract will be “profitable from 2026 onwards”.
The company’s turnover grew 9 per cent in the UK overall, to £669m. It is the £8.9bn-turnover multi-national’s fifth biggest market, after the US, Australia, Germany and Switzerland.
Source: HSJ
Date: 6 January