SmithKline Beecham Clinical Laboratories (SBCL) was an American-based

medical laboratory A medical laboratory or clinical laboratory is a laboratory where tests are conducted out on clinical specimens to obtain information about the health of a patient to aid in diagnosis, treatment, and prevention of disease. Clinical medical labor ...

company that was acquired by

Quest Diagnostics Quest Diagnostics Incorporated is an American clinical laboratory. A Fortune 500, ''Fortune'' 500 company, Quest operates in the United States, Puerto Rico, Mexico, and Brazil. Quest also maintains collaborative agreements with various hospitals ...

in 1999 for $1.3 billion.

Controversies

In 1989, SBCL had to pay a $1.5 million fine for illegal laboratory referral kickbacks. In 1997,

Operation LabScam Operation LabScam was a United States government investigation in the 1990s by a seven-member taskforce into laboratory billing fraud resulting in $800 million in fines.45 U.S. Att'ys Bull. 31 (1997) Successful LabCorp Settlement a Result of Operat ...

forced SBCL to agree to pay a $325 million settlement for billing Medicare and

Medicaid Medicaid is a government program in the United States that provides health insurance for adults and children with limited income and resources. The program is partially funded and primarily managed by U.S. state, state governments, which also h ...

for tests that physicians were misled into believing were free, violating the 1863 False Claims Act. In 1998, a

phlebotomist Phlebotomy is the process of making a puncture in a vein, usually in the arm, with a cannula for the purpose of drawing blood. The procedure itself is known as a venipuncture, which is also used for intravenous therapy. A person who performs a ...

at an SBCL facility in

Palo Alto, California Palo Alto ( ; Spanish language, Spanish for ) is a charter city in northwestern Santa Clara County, California, United States, in the San Francisco Bay Area, named after a Sequoia sempervirens, coastal redwood tree known as El Palo Alto. Th ...

was exposed as reusing needles to save money. As a result, over 3,600 patients had to receive testing and counseling for

HIV The human immunodeficiency viruses (HIV) are two species of '' Lentivirus'' (a subgroup of retrovirus) that infect humans. Over time, they cause acquired immunodeficiency syndrome (AIDS), a condition in which progressive failure of the im ...

and

hepatitis Hepatitis is inflammation of the liver parenchyma, liver tissue. Some people or animals with hepatitis have no symptoms, whereas others develop yellow discoloration of the skin and whites of the eyes (jaundice), Anorexia (symptom), poor appetite ...

. The incident led to phlebotomy licensure in

California California () is a U.S. state, state in the Western United States that lies on the West Coast of the United States, Pacific Coast. It borders Oregon to the north, Nevada and Arizona to the east, and shares Mexico–United States border, an ...

References

Life sciences industry {{US-company-stub