Zoetis Inc. today announced the acquisition of ZNLabs, a full-service veterinary clinical reference laboratory company with a network of labs across the U.S. This follows Zoetis’ recent acquisition of Phoenix Lab as its entry into reference laboratory services and builds on a strategy to develop a more comprehensive diagnostics offering with enhanced value for veterinarians in the United States. Financial terms of the transaction are not being disclosed.

Founded by veterinarians seeking to revolutionize reference laboratory services for companion animals, ZNLabs is guided by its mission to be “Simple. Friendly. Fair.” The company has differentiated itself by offering a simple test menu and fast results with friendly service and no contracts. ZNLabs operates a “hub” laboratory in Louisville, adjacent to a major logistics provider for fast sample turnaround times, with its “spoke” laboratories in Boise, Chicago, Cincinnati, Dallas, New Orleans and Salt Lake City providing local service in key U.S. markets.

Acquisition Strengthens Zoetis’ Position in Reference Labs

“The addition of ZNLabs strengthens our portfolio, expands our diagnostics footprint and enhances our value proposition to veterinary customers. Together with ZNLabs – and the recently added team from Phoenix Lab with over 30 years of trusted reference lab experience – we will focus on integrated solutions across the continuum of animal care,” said Kristin Peck, Executive Vice President and Group President, U.S. Operations, Business Development and Strategy for Zoetis. “We plan to grow further in this space through a mixture of small, business development activities combined with organic expansions in key markets in the coming years.”

“We built ZNLabs with the dream of providing a national reference lab that truly partners with clients and makes testing more accessible for pet owners with our simple, fair pricing model,” said David W. Gardiner, DVM, DACVP, co-founder, co-Chief Medical Officer and Chief Pathology Officer, ZNLabs. “Now with Zoetis, we will be able to rapidly continue to build our innovative reference lab model and provide an expanded diagnostic testing solution to more clients than we ever could have done by ourselves. In my entire career, I’ve never been more excited about the future of veterinary diagnostics.”

“Thanks to the extraordinary efforts of our small team – our ‘Zennies’ – we have in a relatively short time provided the veterinary community with a friendly, high-quality and trusted alternative to existing commercial laboratory services,” said Andrew Loar, DVM, DACVIM (IM & Oncology), co-founder and co-Chief Medical Officer, ZNLabs. “For our next phase, we are pleased to join Zoetis as they fuel ZNLabs’ humble, ambitious beginnings into a formidable presence in the veterinary laboratory space.”

“For me as a clinician, and speaking for ZNLabs’ founders, clinical veterinary medicine will thrive so long as the tools we use – particularly laboratory testing – remain accessible to us and appealing to pet owners,” continued Dr. Loar. “As part of Zoetis, we can scale our ‘simple, friendly and fair’ model and grow a nationwide network of excellent laboratory facilities.”

Reference Labs Complement Point-of-Care Diagnostics

Reference laboratories and point-of-care diagnostic testing are highly synergistic, offering veterinarians a single source for a full spectrum of tests, as well as access to the expertise of Board-certified specialists and pathologists to support test results. In 2018, through the acquisition of Abaxis Inc., and its world-class portfolio of VetScan diagnostic instruments and rapid tests, Zoetis became a leader in the development, manufacture, and marketing of veterinary point-of-care diagnostic instruments and consumables.

The global veterinary diagnostics category, which includes reference laboratory and point-of-care diagnostics, is estimated to be $4 billion, with compound annual growth of approximately 10% over the past three years. Zoetis expects the diagnostics category to continue to grow faster than the animal health industry, with growth in the mid to high single digits; this growth is driven by international adoption of point-of-care diagnostic instruments due to pet owners’ increasing interest in pet wellness trends, rising medicalization rates, increasing standards of veterinary care and the convenience of in-clinic testing.