Sonora Quest Laboratories Enters Into Draw Center Deal With Safeway

Sonora Quest is now offering laboratory services to patients as they shop for groceries. The Arizona-based Sonora Quest, a joint venture between hospital operator Banner Health and Quest Diagnostics, has entered into an agreement with retail giant Safeway to place patient service centers in its stores. The first two patient service centers opened at Safeway stores in Scottsdale and Phoenix last month.

"The endeavor between Sonora Quest Laboratories and Safeway is an investment in innovative capabilities in this new era of health care consumerism," said Christina Noble, Sonora Quest's vice president of business development. "We are proud to work closely with Safeway to continue our mission of empowering consumers to manage their health by offering laboratory testing in a unique and convenient way through one of the largest food and drug retailers in the United States."

Financial terms of the agreement between Sonora Quest and Safeway were not immediately available.

Although Sonora Quest is by far the largest lab in Arizona, with more than 2,500 employees and facilities in five states, it has been facing some pretty keen consumer-oriented competition from upstart Theranos. That California-based lab, which claims to be able to perform hundreds of laboratory tests with just a few drops of blood, has opened up more than 40 locations at Walgreens pharmacies throughout much of the Phoenix area. The company also lobbied hard to get a change in state law to allow direct marketing of tests to patients. Theranos prices its assays at half of Medicare rates, with some tests available for less than $2. However, Theranos has been under intense media scrutiny of late and could slow down its plans for rapid growth. It was reported by the Wall Street Journal last month that Safeway was trying to extricate itself from a deal with Theranos to build testing centers in its stores. A Sonora Quest spokesperson declined to say if the lab was taking over any of the planned Theranos sites.

Although Sonora Quest Chief Executive Officer Dave Dexter told Laboratory Industry Report earlier this year that it is not competing with Theranos, it now offers about 100 tests directly to consumers, and has posted its prices at its draw centers.

Takeaway: Rising consumerism in health care delivery drives Sonora Quest to enter into a pact with a grocery giant.