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Quest Diagnostics (DGX), eMed Deal to Boost BinaxNOW Sales

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Quest Diagnostics Incorporated (DGX - Free Report) recently entered into an agreement with telehealth company eMed in the field of COVID-19 testing. The deal with eMed, which has a digital-point-of-care solutions platform, will help Quest Diagnostics to offer clinician-guided rapid antigen testing for COVID-19 to employers who aim to minimize the risk of COVID-19 exposure at their workplaces.

However, financial terms of the deal have been kept under wraps.

More Insight into the Deal

Under the collaboration, eMed’s Certified Guide will supervise Quest Diagnostics’ BinaxNOW home testing process virtually, checking employee identity, ensuring proper sample collection and authenticating results during a telehealth visit. BinaxNOW COVID-19 Ag Card Home Test is a self-administered, nasal swab antigen test,which delivers results in 15 minutes.

Quest Diagnostics is currently a major provider of employer population health and workplace drug testing services, catering to thousands of employers across the United States. Its Employer Population Health helps improve outcomes and costs for employers. This employer population health provides health screenings and related population health solutions and utilizes screening data to help identify chronic disease risks. The company's services range from lab and biometric screening to behavioral and mental health interventions to telehealth, virtual care and flu clinics.

With the eMed deal, employers will be able to deliver rapid test kits directly to employees’ homes. Employees will receive their validated results via a digital health pass on their smart device, and employers will have access to a portal with consolidated employee test results. If the result is a positive, the employee will have the option to undergo additional molecular testing through Quest Diagnostics to confirm their positive result.

With the Employer Population Health having a huge network of organizations, this latest development will help Quest Diagnostics to lift its Binaxnow and other test kit sales significantly.

COVID-19 Testing Business Update

In the second quarter of 2021, demand for Quest Diagnostics’ COVID-19 testing sloweddownas expected, reflecting an industry-wide trend. However, in the last few weeks of June, demand stabilized and started to increase modestly, which the company believes wasto some extent due to the emergence of the Delta variant. Since the middle of July, the company has seen stabilization and modest increase in PCR volumes. Positivity rates have increased in all geographies served by the company’s performing lab.

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The company is also hopeful about the fact that COVID-19 testing remains critical as employees return to the workplace and students return to the classroom in a few weeks. The newest collaboration with eMed should gain from this trend.

Share Price Performance

Over the past three months, Quest Diagnostics has outperformed its industry. The stock has gained 8.1% against 24.1% decline of the industry.

Zacks Rank and Key Picks

Quest Diagnostics currently carries a Zacks Rank #3 (Hold).

A few better-ranked stocks from the Medical Products industry include VAREX IMAGING (VREX - Free Report) , Envista Holdings Corporation (NVST - Free Report) and BellRing Brands, Inc. (BRBR - Free Report) .

VAREX IMAGING, sporting a Zacks Rank #1 (Strong Buy), has a long-term earnings growth rate of 5%. You can see the complete list of today’s Zacks #1 Rank stocks here.

Envista Holdings, which carries a Zacks Rank #2 (Buy), has a long-term earnings growth rate of 27.4%.

BellRing Brands, which carries a Zacks Rank #2, has a long-term earnings growth rate of 29.1%.

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