The German company Synlab is a provider of pathology services to the NHS in partnership with NHS trusts. The company operates in the UK as both Integrated Pathology Partnerships (iPP) and Synlab. The company has four partnerships with NHS trusts, including the large 15 year partnership worth £2.25 billion for pathology services to most of south east and central London.
Last updated: July 2024
Strategy
Synlab, a German company, operates in 36 countries across four continents, employing more than 20,000 members of staff and conducting over 500 million tests per annum.
Synlab as it is today was created by the private equity company Cinven in August 2015, when it combined Labco with synlab. Cinven launched Synlab on the Frankfurt stock exchange in May 2021. In March 2023, Cinven, which owns 43% of Synlab, made an offer for the remaining shares, which would take the company private. Agreements were reached by September 2023. Synlab is experiencing a drop in testing business following the slowing down of the Covid pandemic. In August 2023, Synlab sold its veterinary diagnostics business to Mars Inc.
Under the leadership of Dr. Bartl Wimmer, founder of Synlab, and since 2018 of CEO Mathieu Floreani, Synlab acquired more than 100 companies/services and expanded its presence to an additional eight countries, including in Latin America and Africa. Today, the Group is active over 37 countries globally and the only player with a presence in the five largest European markets (France, Germany, Italy, Switzerland, UK). Its most recent acquisition was of the Institute for Pathology and Molecular Pathology Pforzheim in Germany.
Synlab is the leading private provider of pathology services within the NHS. Originally Synlab set up Integrated Pathology Partnerships (iPP) in 2010 to work in partnership with the NHS to deliver pathology testing services in the UK, and iPP now conducts more than 24 million tests per annum and employs over 600 staff across seven sites in the UK.
As iPP the company offers a full range of diagnostic tests and services ranging from phlebotomy, routine and urgent tests. Since 2010, iPP has formed joint venture (JV) partnerships with five NHS Foundation Trusts in Taunton, Yeovil, Southend, Basildon and the Christie in Manchester. In addition, the company works with CCGs in community testing, point of care testing and phlebotomy.
More recently Synlab has entered partnerships with the NHS under its global name, Synlab.
Financials
In May 2021, Cinven launched Synlab on the Frankfurt stock exchange, which raised €400 million. Cinven maintained 43% share ownership of Synlab but in September 2023 Cinven launched a public acquisition offer to all shareholders at a price of €10.00 per Synlab share in cash.
Synlab grew its revenues to €3.25 billion in fiscal year 2022. EBITDA increased to €753 million in the same period. COVID-19 testing revenue was €790 million. The company made 23 acquisitions in FY 2022, including entering the market in Chile.
Contracts
Synnovis: Synlab, Guy’s & St Thomas’ NHS Foundation Trust and King's College
Synnovis, the joint venture between Synlab, a German company, Guy's and St Thomas FT, and King's College Hospital FT began 1 April 2021. The joint venture took over from Viapath, a joint venture between Serco and Guy's and St Thomas' Hospital Trust and King's College Hospital, that was for several years the largest pathology service provider in the UK, processing more than 22 million tests a year in London and Bedford.
In January 2020, Synlab was named as the preferred provider to take over the £2.25 billion, 15 year contract to provide pathology services to most of south east and central London. Then in November 2020, the organisations involved signed an agreement to act as a joint venture in respect of the South East London Pathology Procurement.
The contract covers the provision of pathology services to South London and Maudsley FT, Oxleas FT, the Royal Brompton and Harefield FT, and to Guy’s and King’s FTs, the two trusts who jointly owned Viapath.
In early June 2024, Synnovia was subject to a ransomware attack by an organisation known as Qilin that affected the pathology systems of Guy’s and St Thomas’ and King’s College Hospital foundation trusts (GSTT), and of primary care across six boroughs in south east London.
The GSTT chief executive said that the trust was unable to connect to the servers of Synnovis. Senior sources told HSJ that resolving the issue and gaining access to pathology results could take “weeks, not days”. This led to the suspension of blood transfusions along with large numbers of blood tests in primary care, and some other planned procedures; and major trauma cases diverted from King’s to elsewhere in London.
It was one of the largest NHS cyber attacks in terms of impact. Synlab’s facilities in Italy were also targeted by hackers in April. By the end of June 2024, it was thought that more than 100,000 people’s test results could now be on the dark web.
The hackers asked for payment to allow Synnovis back on to its systems, and to stop it releasing the patient information it stole.
Other pathology services in London, including HSL and South West London Pathology, are providing help, but the number of tests available is way down on the normal number.
South West Pathology Services (SPS)
Southwest Pathology Services is a joint venture between Taunton and Somerset NHS Foundation Trust, Yeovil District Hospital NHS Foundation Trust and private sector partner – Integrated Pathology Partnerships (iPP), a subsidiary of Synlab. The joint venture was established in June 2012, serving a population of 500,000 and over 100 GP practices.
Pathology First
A collaboration between Basildon and Thurrock University Hospitals FT and Southend University Hospital FT and the private laboratory Integrated Pathology Partnerships (iPP), a subsidiary of Synlab, which provides pathology services across south Essex. It was launched in October 2014. Major problems were found with this service during a quality assurance visit in 2017. This led to smear test samples from 2,500 women having to be re-examined.
Christie Pathology Partnership
In 2014, the Christie Pathology Partnership (CPP) was set up as a joint venture between Synlab and The Christie NHS Foundation Trust. Synlab operates from within on-site pathology laboratories and serves a population of more than 3.2 million. The laboratories also provide testing, screening and assay development to support The Christie’s early phase clinical trials, with around 200 trials underway at any one time. Over 1 million tests are reported to be carried out per year, including: breast tumour receptor testing; blood sciences (biochemistry, haematology, blood Transfusion, stem cell processing); haematological malignancy diagnostic services; histopathology; oncology cytogenetics; and specialist oncology biochemistry.
The Christie Foundation Trust extended its contract with Synlab for another year in May 2024, three days before the ransomware attack on Synnovis in south London. Synlab’s partnership with the Christie was due to expire on 31 May. The Christie had been expected to award a new contract to last until 2040, but opted for just a year with a new procurement process at the end of the year.
Concerns
In December 2023 it was revealed that Pathology First had filed papers in the High Court claiming that Hertfordshire and West Essex ICB had broken procurement rules over a £500m pathology contract.
The rollout of a new integrated pathology service across Hertfordshire and West Essex ICB has been delayed as a result of this legal action.
A contract notice was first issued in 2019 for a 10-year outsourced pathology service to cover the acute trusts in Hertfordshire and West Essex. In October 2022, the ICB selected Health Services Laboratories, a joint venture between The Doctors Laboratory, Royal Free London and University College London Hospitals, and the contract was expected to be formally awarded in August 2023.
The legal papers claim the ICB had previously issued a “best and final offer document” to the different bidders, with a requirement that suppliers accepted the draft agreement without any amendment. Pathology First then withdrew from the process in February 2022, as it felt it could not agree to the terms without amendment, but says it then found out that the terms and conditions of the awarded contract differed from those in the draft agreement.
In 2012 Synlab was excluded from the procurement process to provide pathology services to Royal Free London FT and UCLH as the company lied - the company said it was in the process of developing a laboratory close to the trusts’ sites which would meet the requirements of the tender but this was not true.
