Health Diagnostic Laboratory Inc. has proposed to spend a $30 million loan from private-equity giant Cerberus Capital Management LP to keep the Virginia lab operating while leaders figure out a survival plan, Dow Jones Daily Bankruptcy Review reported today. Health Diagnostic Laboratory officials said that the Richmond lab, which tests for cardiovascular diseases like diabetes, is low on cash after business slowed and a bank froze the company's account last month, making it tough for the firm to pay suppliers. Health Diagnostic Laboratory filed for bankruptcy on June 7, several months after agreeing to pay nearly $50 million to settle civil allegations filed by the U.S. Department of Justice that it paid doctors to send the company patient blood samples. Justice Department officials said the fees were illegal kickbacks; the lab has denied wrongdoing.
