Sylvan Learning Systems Inc. said yesterday that it has signed an agreement to administer the national physician licensing examination, a deal that will generate $12 million in annual revenue.
Baltimore-based Sylvan plans to deliver the nationally required test through its its global network of computer-based testing centers.
"This is exactly what the market expects them to do in the testing area," said Scott L. Soffen, an analyst for Legg Mason Wood Walker. "Sylvan is executing the strategy that they've told Wall Street they are pursuing."
The United States Medical Licensing Examination is required for most physicians licensed in this country. More than 125,000 exams are given globally each year in a paper-and-pencil format.
The USMLE program includes three tests, each of which will be converted to a computer-based format next year. The exams will be offered at more than 500 Sylvan Technology Centers throughout the world.
Sylvan expects the agreement to generate $12 million in annual revenue starting in 2000. The company had $246 million in sales last year.
The test program is owned jointly by the National Board of Medical Examiners and the Federation of State Medical Boards of the United States Inc.
"Having delivered the NBME exams through the Sylvan testing center network since 1995, we are well aware of the benefits of computer-based delivery and very confident in Sylvan as our test delivery partner,` said Dr. Donald Melnick, senior vice president of the NBME.
Steve Hoffman, president of Sylvan Prometric, the company's testing division, said the NBME "is taking a leadership role in the transition to computer-based testing, and we believe it will serve as a bellwether of this trend for large professional organizations.`
Soffen said that with a growing emphasis on accountability, computerized testing is on the rise. "They have what I would consider a sliver" of the market, he said of Sylvan. "It's a big sliver, but they plenty of room to grow."
Pub Date: 7/14/98