ROCKVILLE, Md., Dec. 16, 2016 /PRNewswire/ -- Hospital consolidation, the increased role of China in product launch decisions, service test markets, new small clinic targets, mergers & acquisitions are among the trends affecting companies selling in vitro diagnostic products, according to Kalorama Information. The healthcare market researcher with a biotechnology and IVD specialty has identified the top 5 trends in the in vitro diagnostics market of 2016. Kalorama's report, The Worldwide Market for In Vitro Diagnostic Tests, 10th Edition, covers the market for IVD products. The report is available at http://www.kaloramainformation.com/Worldwide-Vitro-Diagnostic-10206771/.
1. Consolidation Brings Renewed Focus to Core Lab
Healthcare organizations are consolidating, and IVD is adjusting to this trend. Healthcare consolidation requires a renewed approach to core lab markets and automation systems targeting the big accounts There is increasing demand among integrated health networks for greater centralization of diagnostic testing to streamline workflows and steer better healthcare information to professionals, Major IVD companies launched products this year to enhance workstations. Siemens Healthineers used the AACC Annual Meeting this year to unveil its Atellica Solution for automated core lab testing. Abbott Diagnostics unveiled its Alinity line of "harmonized systems" across the core lab (clinical chemistry and immunoassays), hematology, point-of-care (POC) diagnostics, blood screening, and molecular diagnostics.
2. CFDA Approval Rises in Prestige
In the past five years, China has solidified its place as an IVD market just behind the United States, European Union, and Japan. Outside of U.S. Food and Drug Administration (FDA) approval or European CE marking, China FDA (CFDA) approval has been the next most heralded product development for many IVD companies. Roche issued a 2016 press release for the CFDA approval of its CINtec PLUS Cytology test or immunocytochemistry assay for the detection of human papillomavirus (HPV). Roche also markets a molecular HPV assay that may find greater usage in emerging markets in the coming years after being approved by the U.S. FDA as a first-line HPV screening tool. Qiagen has also targeted the Chinese HPV test market with its CFDA-approved careHPV platform for low-resource settings.
Most surprising in the Chinese market's ascent has been the prominence of its cancer diagnostics space. Advanced cancer testing is not associated with middle-income countries, but China's research prowess in sequencing and globally significant patient populations in urban markets have created considerable opportunities for overseas IVD companies. Cancer diagnostic specialist Epigenomics of Germany has relied upon China as a principal market for its liquid biopsy colorectal cancer (CRC) test, Epi ProColon. In May 2016, the test was included in Chinese government-administered guidelines for the screening of early CRC. Epigenomics is expected to commence Chinese clinical trials during 2016 to support CFDA approval of its liquid biopsy assay for lung cancer using the methylated SHOX2 gene biomarker. Epi ProColon and other advanced molecular assays for cancer have been designated as innovative products by the CFDA, which can expedite approval processes. Next-generation sequencing (NGS) is the highest area of activity in the Chinese cancer diagnostics market. Driven foremost by demand for non-invasive prenatal testing (NIPT), the clinical sequencer base in China now includes over 40 hospitals in China and other testing institutions that serve at least 70 other hospitals and clinical clients. Cancer testing is the second-largest clinical application of NGS in China.
3. Strong Performance of Esoteric LDT Companies
An emerging dynamic is major cancer-focused U.S. LDT companies' penetration of the EU market. Myriad Genetics, Genomic Health and Foundation Medicine have pursued different strategies to introduce their LDTs to the EU market. Foundation Medicine has a strategic partnership with Roche for the international sales and marketing of the FoundationOne and other comprehensive genomic profiling (CGP) tests. The company will also begin operations at a centralized lab for its European market LDTs in Penzburg, Germany. Myriad Genetics complemented their reference lab in Munich, Germany with the acquisition of a German clinic known as an MVZ or multi-disciplined ambulatory care center. Operating an MVZ, Myriad Genetics will be able to open direct reimbursement negotiations with insurance providers and contract with physician network and hospital clients. Genomic Health has an appreciable LDT business in Europe (international markets were 14% of the company's 2015 revenue), but performs all testing at its Redwood City, CA facility from its CE-marked sample collection kit. The rising profile of LDTs in the EU market may limit growth opportunities for the EU molecular cancer diagnostics market. Wider availability of CE-marked molecular cancer kits has not translated to robust growth in the IVD market segment in recent years. The outlook for the regional market segment is improved, however, by returned political stability to the region, more favorable economic conditions, and rising demand for advanced LDT services (in turn driving sales of related reagents and instrumentation). Globally a high-growth market segment, molecular cancer diagnostics in the EU is expected to grow at approximately only 4% due to market maturity (relative to ROW markets) and reimbursement limitations (relative to the U.S. market with its more diversified payer system).
4. Aiming at Urgent Care and Retail Clinics
The proliferation of urgent care centers (10,000+) in the US, as well as retail clinics (1,200+) have made systems that can deal with the workflows associated with these clinics a priority. Alere is present in this marketplace. Roche's cobas Liat, a PCR point of care platform, which recently received CLIA –waived status for Flu A/B and RSV, is designed with these clinics in mind. Urgent Care Centers provide walk-in, extended hour access for acute illness and injury care that is either beyond the scope or availability of the typical primary care practice. UCC's differ from traditional physicians' offices with procedure rooms for lacerations and fractures, radiology department for x-ray services, and in some cases a laboratory. High visibility and adequate parking is part of their business model, thus centers are usually located in freestanding buildings, though they can be located in strip malls and in some cases they may be within a hospital complex but with a separate entrance, Convenient hours are a key strength of urgent care centers. Retail clinics differ from urgent care centers in that they are smaller, are encased within a retail setting, provide a limited menu of services and usually are staffed by one practitioner or two.
5. Pace of M&A Continues
Merger activity continued to brisk in 2016. The industry has shown to be extremely dynamic, and IVD M&A deals that were brisk in 2015 continued into 2016. Some allow larger companies to acquire new technologies, but as shown in bold, there is a distinct move for globalization of IVD knowledge. LabCorp purchased Sequenom. Abbott announced its intention to buy Alere, Sunnyvale, CA-based Cepheid was purchased by Danaher corporation. Bio-Techne acquired ACD for $250 million, marking Bio-Techne's entry into the genomics field and market. ACD's technology, RNA-ISH is a technology facilitating and improving the monitoring of gene expression patterns at the single cell level––while retaining the morphological context of the tissue being analyzed. Oxford Immunotec Global PLC, a global, high-growth diagnostics company focused on developing and commercializing proprietary tests for the management of immune-regulated conditions, acquired substantially all of the assets of Imugen, Inc., a Massachusetts-based clinical laboratory focused on developing and performing specialized testing for tick-borne diseases. Luminex acquired Nanosphere and their Verigene platform and seeks to benefit from their broad menu, and strong presence in the molecular microbiology market. According to the companies. Nanosphere's Verigene technology leads in the high-growth bloodstream infection segment and complements Luminex's current infectious disease portfolio.
Kalorama Information's The Worldwide Market for In Vitro Diagnostic Tests, 10th Edition details specific products, trends and mergers in the IVD industry and profiles hundreds of companies. The report is used by top companies in the IVD industry.
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