• German-owned firm set to win large pathology contract in London
  • Synlab has been named preferred provider for south London contract over incumbent Viapath and north London challenger HSL
  • Bid will now progress to full business case stage for approval

An incumbent pathology provider looks set to lose its bid to retain a contract worth £2.25bn over 15 years.

German firm Synlab has been selected as the preferred strategic partner for the contract which covers a large swathe of south and central London.

Synlab beat incumbent provider Viapath and north London challenger HSL in the process, the result of which has been announced to staff this week.

Viapath — which is jointly owned by Guy’s and St Thomas’ Foundation Trust, King’s College Hospital FT and private firm Serco — has provided the service to the two trusts since 2009.

The 15-year contract would be for the provision of pathology services to Guy’s and King’s FTs, as well as South London and Maudsley FT, Oxleas FT and the Royal Brompton and Harefield FT.

Synlab UK’s chief executive Arnaud Gueny said he was “pleased to confirm that following an evaluation process” the company was the ”preferred strategic partner.”

The NHS will now submit a full business case, which must be approved by both the boards at Guy’s and King’s, which are leading on the procurement, by April.

Viapath chief executive Dougie Dryburgh said in a statement to HSJ: “We are currently assessing the situation. In the meantime, we continue with business as usual ensuring maintenance of our high-quality service and we remain fully committed to ensuring service continuity for patients, pathology service staff, customers and suppliers.”

The decision is a significant blow to Viapath, which appointed former Monitor chief executive David Bennett in 2016. If it were to lose the contract, it would no longer hold any major NHS contracts.

Mr Bennett said in the company’s most recent annual report: “Winning this tender is, of course, central to Viapath’s future although we will also continue to pursue other initiatives including the continued growth of our third-party referrals business and continuing to develop new and improved tests to broaden our offering.”

HSL is the pathology firm jointly owned by Royal Free London FT, University College London Hospitals FT and Australian firm TDL.

Earlier in the procurement process, a paper to south east London’s integrated care system board said the team running the exercise had “sought QC advice on any legal risks to a potential down-selection decision”.

A 2018 review by PwC into what had gone wrong with the finances of King’s mentioned an opportunity for savings by switching from Viapath.

The analysis said: “The Viapath contract is coming to an end, which represents an opportunity for the trust to retender at more competitive prices. Internal benchmarking versus an inhouse provision and NHS Improvement Carter analysis have shown a significant opportunity to reduce costs by £4-5m.”