HMi meets… Jos Lamers

Jos Lamers, executive chairman, Unilabs

The executive chairman of Unilabs talks about signs of a V-shaped recovery and consolidation opportunities in the diagnostics market


It is a treat to talk to Jos Lamers. As well as talking through his outlook for the diagnostics sector and how European diagnostics group Unilabs has coped with the Covid-19 pandemic, the executive chairman digresses on to subjects such as recent books that have caught his eye. Rutger Bregman’s Humankind: A Hopeful History is a current favourite.

A turnaround expert, Lamers joined Unilabs in October 2013 as chief executive officer after a successful stint at Nucletron, a global leader in radiotherapy. There he oversaw its sale to Sweden’s Elekta in 2011.

At Unilabs, he performed his magic again and in early 2017 oversaw the company’s buyout by Apax Partners.

In October last year and after overseeing 50 acquisitions over the past three years, he scaled back his day-to-day management of the company to focus on Unilabs’ long-term strategy.

Here he talks about why the diagnostics sector is well on the route to recovery, what Covid 19 will mean for valuations and consolidation in the sector.

The following transcript of HMi’s interview with Jos Lamers has been edited for brevity and clarity. 

HMi When do you expect the market to recover?

JS For our sector and our company specifically, I do expect a V-shaped recovery. We saw quite an impact on our March results. April for many companies was not a great month, but we saw a strong recovery in May.

People have been very careful about going to their doctor or to the hospital, but the underlying disorders have not gone away.

We are in a relatively good place where we are able to support the healthcare systems with quite elaborate Covid-19 testing across all our regions and countries effectively.

HMi Generic testing is the base of the diagnostics market and esoteric testing is where you make the real money. To what extent has Covid-19 ruined that model?

JS We’ve definitely seen [a decline] in markets with very strong lockdown measures. There has been a significant volume impact. In other countries, more towards the north of Europe, the impact has not been that severe.

We saw a strong bounce-back starting in May, which is encouraging and positive even though volumes are clearly not yet where they used to be.

We are lucky that we can support local governments with Covid-19 testing, but also with antibody testing to see whether people have had it in the past.

HMi You have ramped up Covid-19 testing in recent months. Is that enough to wipe out the difficulties that you had earlier in the year?

JS Additional Covid-19 testing helps us to get closer to the total value that we would typically see in a month.

Volumes are still impacted, but we are seeing a supportive bounce back. It again points towards a V-shaped recovery for us as a business.


HMi There are some signs of consolidation in the sector. Does this create
opportunities for you?

JS If you include private volumes and public volumes, the European market for diagnostics is sizable, around €200bn (US$225.4bn).

Consolidation is in its infancy. The top five [diagnostics companies] in Europe, don’t even have 10% of that [market value]. It goes to show that there is plenty of opportunity for consolidation.

The crisis has shown many smaller companies, whether they’re local public hospitals or smaller privately owned companies, that being relatively small and insular is perhaps not the best place to be. It has shown that being part of a bigger group gives you the ability to talk at a top level with, for example, suppliers. We are able to talk chief executive to chief executive to all of our main suppliers because we have that size.

It’s much more difficult to get that interest when you’re a small public lab or a small private lab.

HMi Unilabs has always been quite nimble with acquisitions. Is the pandemic an opportunity for you?

JS I think so. Many smaller owners and public hospitals realise that they’re exposed in a crisis.

We do see more interest coming from smaller places which ask: ‘Shouldn’t we become part of a group that has less exposure to one country or to one specific business area?’

I do expect the dynamics to change a bit in pricing as well. For example, in M&A people will generally ask for more of an earn-out structure simply because the Covid-19 crisis has really impacted them.

HMi Had we been having this conversation last year, I would have asked about the sustainability of high valuations. Do you think that Covid-19 has made it more of a buyers’ market than we’ve seen in years?

JS It depends on the size of the target. We have seen very high multiples paid for very small players, but I’m not sure that is likely to continue.

Big companies have shown pretty strong performance in this crisis so far.

Diversification across geographies and across businesses is a real asset for potential buyers. Whereas in the past our sector has been a bit generic in terms of media attention, we have seen an enormous interest in our industry in this crisis as well.

HMi What you call Region North – the UK, Denmark, Finland, Norway and Sweden – performed particularly well in the first quarter. Looking forward, are you seeing a different pickup in different parts of Europe?

JS There is a difference in pickup and it’s very much related to how strong the lockdown measures were in specific countries.

In the UK, there’s now a relatively strong process, where there had been a lot of uncertainty and the number of cases is still relatively high. While in a number of Southern European countries there was a very strong lockdown process straightaway, in Spain, France and Portugal, for example. But the Swedes have been relatively relaxed. Schools, restaurants and shops have stayed open. How strong the implementation [of measures] was checked locally differed from country to country.

In Spain, there was plenty of police on the streets and you really had to show that you were on the streets for a legitimate reason.

If you didn’t have a reason and you would get a strong fine.

HMi Imaging is more capex intensive than other parts of your business. Does that cause tensions?

JS There is a strong quality dimension to why we run an imaging business as well.

When we acquired Telemedicine Clinic [in November 2017], we acquired a virtual network of radiologists across Europe. We now employ around 500 radiologists which has had a positive effect because it allows us to specialise. That makes them better in quality and in productivity.

To give you some numbers: out of those 500 radiologists, we have some radiologists that only specialise in the prostate, or breast or only in the head and neck cases. Via our software system, we randomly check 10% of our MRIs for a second read. This is not to name and shame anyone, it is a quality standard that we have implemented.


If there’s a disconnect between the first and second reading, it’s a learning opportunity for that specific radiologist. We have been able to reduce discrepancies by a factor of four.

The imaging business also provides us with an opportunity to help individual hospitals. For many hospitals the decision to buy an MRI is one that they have to take once every couple of years. We buy 15 MRIs every year.

So clearly, our negotiation power with suppliers is different and we can help smaller entities provide a better quality service.

HMi Over the past year there has been much talk about a trade sale for Unilabs. Is everything on hold at the moment?

JS When the sector and the world go through a crisis, M&A activity is more limited. But we have an opportunity to become stronger. We are seeing encouraging results from this crisis, not only organically but also on the M&A side.

But it’s sensible to pause and the bigger companies are unlikely to change ownership anytime soon.

HMi You’re well-known for your turnaround strategy at companies. What else do you want to achieve at Unilabs?

JS I have moved to a slightly different role which is that of executive chairman. I wanted to have a slightly different worklife balance.

I have been chief executive of Unilabs for almost seven years. It’s a fantastic job and it’s a very intense job. In the last three years, we’ve done 50 acquisitions. Imagine buying a company almost every three weeks.

I’m 56 now and I wanted to see my family, my wife, my kids, my friends, a bit more. But there’s still an enormous amount to go for.

First of all, consolidation is only starting in this industry. And we’re going to see the next wave of digitalisation in our industry too.

The Covid-19 crisis has shown us that a lot more can be done, not face-to-face or via paper but through digitalisation. And we are doing a lot of work on the cultural side.

At the end of the day, we are a service company. In a service company, you have to have happy employees to provide happy customers, and if you have happy employees and happy customers you most likely will have very good results.