Quintiles and Quest Diagnostics, a Madison, N.J.-based provider of diagnostic information services, have agreed to form a global clinical trials laboratory services business. The new entity will provide customers with a depth of capabilities and end-to-end clinical trial lab services.

The companies said the new entity will solidify its position as the second-largest central laboratory services company in the world. Quintiles will own 60% and Quest Diagnostics will own 40% of the new joint venture.

The venture joins Quintiles’ scale and trial and therapeutic experience with Quest Diagnostics’ supply chain network and informatics. Clinical, scientific and statistical excellence is becoming increasingly important for successful lab work as part of the regulatory approval process. To meet these needs, the entity will draw upon the scientific, medical and data experience of Quintiles and Quest Diagnostics, which together have a team of 3,500 medical doctors, Ph.D.s and biostatisticians, as well as capabilities in genomics and precision medicine.

The new entity also will leverage a number of additional resources from the broader Quintiles and Quest Diagnostics organizations, including the Quintiles Infosario technology platform and Quest Diagnostics’ data analytics capabilities. Quest Diagnostics draws from 20 billion test results, and Quintiles’ assets include electronic health records representing more than 60 million patient lives and a network of 250,000 clinical investigators.

The joint venture will be led by an experienced global management team appointed from Quintiles and Quest Diagnostics. The new entity will provide customers with a variety of advanced testing capabilities and services. These will enable end-to-end companion diagnostic development with regulatory, reimbursement and commercial strategies, to help customers’ precision medicine efforts. It also will help enhance quality and efficiency by leveraging Quest Diagnostics’ supply chain that serves approximately half of the physicians and hospitals in the U.S. and includes 2,200 service centers, 3,000 couriers and connectivity solutions used by 250,000 healthcare providers.

Steve Rusckowski, CEO, Quest Diagnostics, said, “For Quest Diagnostics, the joint venture model will enable us to generate growth and value from our clinical trials assets while simultaneously strengthening our focus on our core diagnostic information services business.”

Quintiles and Quest Diagnostics also expect to benefit from opportunities to collaborate in other areas, including new ways to enhance patient recruitment and retention for clinical trials; faster validation, development and commercialization of companion diagnostics; enhanced support of real-world late phase studies; and development of new population-health analytics and tools.

The transaction is anticipated to close in the third quarter.