Slone Partners’ 2018 PMC Interview Series continues with an exclusive, in-depth interview with David P. King, the Chairman and CEO of LabCorp, a leading global life sciences company. Under Mr. King’s leadership, LabCorp’s 60,000 employees have helped LabCorp become the world’s largest healthcare diagnostics company, annually serving 115 million patients, processing 130 million patient specimens, and supporting clinical trial activity in 100 countries. This ongoing series of healthcare executive discussions is presented in partnership with Personalized Medicine Coalition.
See David P. King deliver the keynote address for The Lay of the Lab: Exploring the State of the Clinical Laboratory Testing Industry at the 14th Annual Personalized Medicine Conference on November 14th. For more information, visit www.personalizedmedicineconference.org
Slone Partners: LabCorp is one of the world’s largest clinical testing laboratory companies. Since becoming COO in 2005 and then CEO in 2007, you’ve presided over dizzying, exponential growth. In what ways has your job become easier or perhaps more difficult than it was 10 years ago? Any surprises?
Mr. King: The job has become easier over time because I have learned what a CEO should do. It took several years to understand the need to focus on what we call “the long game” and not get absorbed in the details of day-to-day operations. My team will tell you that I still spend more time on operational issues than they might like, but it is easier for me to stay focused on where we want LabCorp to be in the five-year time horizon than it was early on. The job is also easier because we have a terrific group of senior leaders; the more time I have served as CEO, the more I have come to realize that talent is critical, talent attracts talent, and great talent makes my job less demanding and more fun.
The job is harder because we are a global company now and we are in multiple businesses. We have nearly 24,000 colleagues who work in drug development, a very different business from the clinical laboratory, and many of them are located outside the US. They want to see and hear from the CEO, and they want the CEO to understand their part of the business. So there is always something new to learn and somewhere new to visit to do my part in maintaining our company’s identity and culture.
The job is also harder because of the pace of change in healthcare. The industry is rapidly evolving and we have to evolve with it. This is an exciting and challenging aspect of being CEO today, but making the case for change in a business that has been very successful for many years is not easy.
Slone Partners: Our interview series is in conjunction with the Personalized Medicine Coalition, whose mission includes personalized medicine education and advocacy, particularly in public policy. What interest and involvement does LabCorp have in pushing forward greater adoption of targeted treatment?
Mr. King: We start with the premise that the healthcare system should be organized around the patient. This is more aspirational than real today, but it is a core belief at LabCorp.
So how do we help organize the system to deliver optimal care to the patient? LabCorp is uniquely positioned at the intersection of research and patient care to enable more precise and individualized healthcare. We help discover lifesaving drugs and bring them to market; we help the doctor choose the right lab test; we help the doctor and the patient understand what the lab results mean; we help the patient and the doctor evaluate treatment options; and we continually work to increase our role in delivering targeted, tailored, high-value care.
We are especially proud of our work in companion diagnostics. LabCorp is the market leader for the development, validation, and commercialization of companion diagnostics, which are key drivers of personalized medicine. In fact, LabCorp has supported approximately 70 percent of companion diagnostics on the market today, and we offer one of the most comprehensive menus of therapeutic drug monitoring tests in the industry. So we are at the forefront of developing targeted treatments and bringing them to market so that patients may receive optimal care.
Slone Partners: Although LabCorp is the laboratory testing backbone partner for thousands of hospitals, health systems, physicians, CRO’s, pharmaceutical companies, and independent labs, your LabCorp.com website is surprisingly, almost entirely consumer-facing. Right on your home page, patients can create accounts, find labs, make lab appointments, retrieve test results, and even pay their lab fees. What can you share about this strategy, about this patient-centric approach?
Mr. King: If you spoke to my colleagues, from phlebotomists to couriers to lab techs to senior executives, you would hear over and over “we are here for the patients.” Our mission is to improve their health and their lives. Now, as patients pay more of the cost of healthcare and must make more of the decisions, we must help them by meeting them where they want to be met and providing them with the tools to be better consumers of healthcare.
One of the company’s three strategic objectives is to create a leading consumer engagement platform. We continue to enhance patient convenience and engagement, broaden our channel to market, and build brand loyalty. Our consumer-friendly initiatives include our mobile app, patient service center improvements, retail presence, opportunities to participate in drug research, and later this year a self-collection device allowing them to draw their blood at home and mail it in for processing. We will continue to enhance our offerings to increase the convenience of our services and the value of the information we provide consumers.
Slone Partners: There are varying viewpoints on establishing and nurturing corporate culture — the environments, behaviors and vibes that attract and retain top employees. Some believe culture starts at the top, some people believe culture starts in the middle ranks, while many believe culture is unwritten. What’s the culture like at LabCorp? How are you actively a part of it? And how do you keep tens of thousands of employees happy, most of whom (53,000 people) are not based (at or around HQ) in North Carolina?
Mr. King: We are fortunate that we have a powerful and uniting mission – we get up every morning and come to work to improve people’s health and lives. My colleagues often say “every tube is a life” and they live that statement every day. During Hurricane Florence one of our colleagues in Eastern North Carolina drove more than 60 hours to pick up specimens in the Myrtle Beach area and make sure they were processed, despite flood detours and adverse conditions. Our pilots flew multiple trips on their own time to communities that were inaccessible by road, delivering 1,500 hot meals and over 30,000 pounds of supplies to people in need. And the incredible thing is that our people do these kinds of heroic things for others day in and day out.
So I feel great about our culture. I try to model it for my colleagues, but, as in the examples mentioned above, most often they model it for each other — and for me.
Slone Partners: As the world becomes more wired, how are the blurred lines between technology and personalized medicine anticipated to affect LabCorp’s future? How might it operate differently, say, 10 or 15 years from now?
Mr. King: Technology is changing the delivery of healthcare and helping us deliver better outcomes through population health and precision medicine. At LabCorp, we are capitalizing on the power of data and technology, including building progressive new tools to help our patients find out the cost of tests before their blood is drawn, to require less blood for a sample, and to provide predictive analytics for the populations we serve. Technology is also vitally important to improve the efficiency of clinical trials. Nonetheless, although technology will change (and I hope improve) the delivery of healthcare, it will always be a fundamentally human service industry, where a direct connection with the patient will be critical to achieving the best outcome.
Slone Partners: We’re always curious about what industry CEO’s specifically look for in senior management, and what specific or particularly revealing questions they might ask in interviews. Jeff Bezos, who’s entering the healthcare fray with Berkshire Hathaway and JP Morgan, recently said he asks himself, “Will I admire this person?” and “Will this person raise the average level of effectiveness of the group they’re entering?” Care to share any hiring insights?
Mr. King: To use a sports analogy, I want to hire the best athletes we can find, but they have to be team players who can make us all better. So what I want to know is: what is it that brings you here – wanting to work for LabCorp? What is your passion? How do you think working here will make you better? How do you think it will make us better? We have an outstanding management team in the industry because we care just as much about fit, values, and culture as we care about producing results.
Slone Partners: The diagnostics industry is poised and predicted to explode with new retail approaches, home testing kits, and telemedicine. LabCorp, for example, recently announced plans to open at least 600 LabCorp patient service centers at Walgreens stores across the U.S. over the next four years, inclusive of the 17 locations already open. What does this portend for the diagnostics industry as a whole?
Mr. King: As consumers demand more information about their overall health, genetics, predisposition to disease, and other important measures of well-being from lab testing, LabCorp must meet them where they want to be met. The LabCorp at Walgreens partnership is a key pillar of our commitment to engage directly with consumers. The home is another place where consumers are going to demand that we provide high-quality care – and we will meet them there with low-cost, convenient testing, which we will unveil later this year.
The diagnostics industry will have to continually innovate, not only in testing and technology, but in meeting the desires of our customers. The opportunity for us to meaningfully participate in delivery of improved care and outcomes is great, but we will not get there by simply executing the old model more efficiently.
Slone Partners: What makes you happy personally?
Mr. King: Spending time with my wonderful family. Watching the flowers bloom that I planted in the garden. Walking the dogs early in the morning to start the day. Exercising so I can stay healthy. And learning new things.