Diagnostic laboratory technology has changed dramatically in the past few years, due to the publication of the human genome project and advances in functional genomics, bioinformatics, miniaturization, and microelectronics. Not three years ago, it would have been almost inconceivable to see research technologies such as genome sequencing and mass spectroscopy playing a pivotal role in improving lab medicine. Their influence is felt in personalized medicine, inherited diseases, pathogen detection, antibiotic resistance testing, blood banking, and much more to come.

Indian Market

Indian in vitro diagnostic (IVD) testing market stood at Rs.5005 crore in 2015. Constantly improving patient awareness levels pertaining to infectious diseases and their subsequent diagnosis, the introduction of advanced molecular and tissue diagnostic tests for cancer such as companion diagnostics and the growing global base of geriatric population are some of the primary drivers for this market. Moreover, rising global healthcare expenditures and increasing demand for rapid, minimally invasive and non-invasive diagnostic procedures are also expected to have a positive impact on market growth. The emergence of epigenomics-based diagnostics and the ability of molecular diagnostics to detect disease at an early stage of development are expected to create opportunity for industry participants to capitalize on over the next six years. In the foreseeable future, India will continue to offer one of the fastest-growing markets for IVD products. All leading IVD companies have established themselves in India and are seeking long-term market growth in the country.

Hospital laboratories will continue to be the largest and most diverse market for IVD products based on extensive inpatient, emergency, and post-surgical testing activities. The home healthcare segment will expand at the fastest pace, with the vast majority of demand remaining concentrated in diabetes-monitoring products. Through upgrading and broadening testing capabilities, independent clinical laboratories will continue to form the second-largest overall and second-fastest growing market served by the IVD industry.

Product opportunities for international IVD companies in the Indian market include rugged, easy-to-use rapid tests with built-in high specificity and sensitivity for applications in rural healthcare. Opportunities also exist for instrumentation in advanced diagnostics, including sequencers and molecular test analyzers, as well as microarrays and other multi-analyte molecular assays and multi-tool analyzers capable of running hematology and immunodiagnostic assays.

Key trends

  • Mergers and acquisitions by large corporates of regional or niche players
  • International players acquiring or entering into JVs with Indian players to tap rapidly growing Indian diagnostic sector
  • A hospital chain acquiring diagnostic player to enter into diagnostics business
  • Diagnostics player acquiring niche players catering to genetics and molecular diagnostics
  • Large players entering Tier-II/III cities, where the educated middle-class population is sophisticated and prefers preventive healthcare check-ups.

Worldwide Market

The global in vitro diagnostics market stood at USD 58 billion in 2015 and is expected to grow 4 percent annually to USD 64.3 billion by 2018. This includes all laboratory and hospital-based products, and OTC product sales. Clinical lab medicine plays an integral role in healthcare and disease management. This phenomenon has seen major vendors of these technologies enter the IVD market.

North America is expected to dominate the overall market over the next 6 years, majorly on account of the presence of sophisticated healthcare infrastructure, high patient awareness levels, and improving reimbursement frameworks, with revenue estimated to reach 
USD 28.79 billion by 2020.

Asia-Pacific is expected to be the fastest-growing regional market for IVD, at a CAGR of 7.4 percent from 2015 to 2020, estimates Grand View Research. The presence of high unmet medical needs for cancer and infectious diseases and a constantly improving healthcare infrastructure in emerging markets such as China and India are some of the drivers of this market.

US demand for in vitro diagnostic products is forecast to rise 6.1 percent annually to USD 24.7 billion in 2016. A growing volume of patient care activity, spurred by aging demographic patterns, a heightened incidence of diseases and disorders, and the extension of health insurance coverage by the Affordable Care Act of 2010, will underline gains. Advances in technology, along with the introduction of new and improved reagents and instruments, will drive up demand in most IVD product segments.

The global molecular diagnostics market is expected to follow the tissue diagnostics segment in terms of growth over the next 5 years, owing to the growing demand for advanced genetic and HPV diagnostic tests. The market is expected to grow at a CAGR of 8.7 percent from 2015 to 2020.

Demand for molecular diagnostic products will grow the fastest among all IVD products due to their throughput, accuracy, and speed advantages in the detection of infectious diseases, tumors, and genetic disorders. The US market for these products will benefit from the introduction of new, high value-added polymerase chain reaction (PCR), and related tests to post double-digit gains through 2016. Over the next 5 years, demand for blood testing reagents and instruments will rise 3.4 percent per year to USD 2.6 billion. Competition from new immunoassay and molecular tests will moderate growth in demand.

Uses in patient health screening and diabetes self-monitoring, coupled with the widening availability of integrated and point-of-care systems offering greater productivity and operating ease, will boost demand for clinical chemistry products. The expansion of test menus for therapeutic drug monitoring, infectious disease detection, and cardiovascular and cancer testing, along with advances in chemiluminescent and other advanced systems, will promote gains for immunoassay products. Companion diagnostics, used to determine the safety and effectiveness of drug therapies, will provide especially strong growth for these products.

Cellular analysis reagents and instruments will continue to generate sizable demand from uses in ovarian and breast cancer screening and HIV monitoring. By contrast, demand for anatomical pathology reagents and instruments will expand well above the overall average growth pace of IVD products as clinical and forensic laboratories upgrade testing capabilities. The market for microbiology products will rise at a comparatively slow pace as molecular diagnostic and immunoassay technologies penetrate cancer and infectious diseases testing procedures.

Market Trends

The revolution in bioinformatics is allowing clinical and traditional medical engineering to blend with components derived from the telecommunications, information, and computer sciences industries. This opens new niche markets for point-of-care (POC) test devices, which will have a positive impact on diagnostic testing.

IVD vendors in collaboration with research organizations and IT companies are working to make medicine really personalized. They are using Big Data analytics engines, which integrate the molecular information (genomic, proteomic, metabolomics, and others) from thousands of patients that they insure with their demographic and disease information to identify biomarkers linked to disease-driving mechanisms. The long-term goal is to develop markers that will make personalized medicine very precise.

Lab-quality molecular tests and immunoassays at the POC are on their way, but many of these tests require some interpretation and consultation for appropriate disease management. To meet this demand, smartphone apps have been launched just as fast as possible. The trend began with data analysis of blood glucose monitoring to help people with diabetes improve management of their diabetes. Now apps are available to help lab professionals consult with databases and experts worldwide. The widespread availability of communication devices such as ipad and iphone and other android phones and personal digital assistants is the most significant enabler of this phenomenon that will bring quality diagnostics to patients in remote areas of developing and developed countries.

The reformulation of reimbursement for the newest and most valuable tests and the reorganization of the regulatory process for these tests have created an environment of insecurity. The acute economic crisis in European countries has cut growth in the IVD industry to 1 percent at best. Payers are cutting reimbursement schedules to the bare minimum to keep from going broke. Japan has initiated its first pricing revision in 10 years with an anticipated increase in payments.

On the supply side, labs are challenged to add new tests with little increase in financial and human resources. For most labs, it may even mean doing more with less.

There is also a dearth of trained lab technologists, so there is a decreasing availability of human resources needed to run the complex new set of molecular and histological tests and immunoassays. Therefore, there has been a proliferation of test and lab automation tools launched that remove precious human resources from mundane pre-analytical and sample-tracking tasks to make time for more sophisticated ones. This phenomenon was once thought to be the purview of core lab biochemistry and immunoassays but automation is becoming a common feature in hematology, blood banking, microbiology, and histology.

This emphasis on automation has created further consolidation of laboratory testing to large core labs. More and more assays in coagulation, infectious diseases, proteins, diabetes, and even HPV are developed for automated clinical analyzers used in the core lab. Systems for urinalysis, coagulation, and microbiology are ready to take their place alongside the hematology, chemistry, and immunoassay instruments - all located in a single core lab. In larger labs, they may be linked to a common track line.

Getting information to caregivers and patients is now not an added plus, it is a prerequisite for all lab operations. Thus the next 3-5 years will see an intensification of the healthcare industry's emphasis on informatics, wireless communications, data networking, and cost-effective healthcare delivery. The reorganization of decentralized healthcare delivery worldwide and patient-focused medicine are having an enormous impact on the role of medical devices and diagnostic services in healthcare. Technological advancements, specifically those in device growth rate by IVD sector miniaturization, data digitization, wireless communications, and the Internet, form a technical synergy that will permit IVD tests and devices to maintain a central role in disease management.

In the area of test economics, outcome-based disease management establishes guidelines and directives for patient care. This is having a significant effect on the use of new tests, which have to prove their added value to patient care. It also affects how many and which tests are recommended and thus reimbursed for a specific disease group. Health insurance companies along with pharmacy organizations are mining their extensive databases to look for correlations between testing patterns and patient outcomes. It is expected that these would then be translated into test usage guidelines.

Challenges - Policy Implications

India is still lacking in the use of appropriate policy instruments in order to build the national system of innovation for resource-constrained settings. Development of appropriate technologies in diagnostic sector requires the government to take some key initiatives:

  • A generic model for health technology assessment for diagnostic should be established to determine whether a new diagnostic technology addresses the country's public health needs and to make technologies cost effective and affordable to the majority of populations.
  • A strong and transparent regulatory framework is needed with harmonized regional and national regulatory standard to check the quality of tests.
  • Public-private-partnership should be encouraged to foster R&D through government schemes and funds especially to incentivize young start-ups that seem to play a significant role in innovation making.
  • The issue of development of appropriate licensing mechanism and public funding of clinical trials in the case of diagnostics for resource-constrained settings needs to be addressed in order to speed up the formation of public and private markets.
  • The government needs to analyze patent information and take steps to eliminate restrictions being put by the system of intellectual property rights to speed up the development of a robust innovation system for the benefit of innovation making for resource constrained settings in India.

 

randox

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