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Immunochemistry Instruments and Reagents

A Market Becoming Increasingly Skewed?

Five companies in India dominate this segment at a combined 72.5 percent share, with CLIA, at the expense of ELISA and rapid tests, steadily gaining share.

Immunochemistry analyzers are rapidly gaining popularity as improved assays are being added to the test menus incrementally. There is a rising focus on biomarker development across the globe as they help in detection of various diseases in their initial stage. Immunochemistry plays a crucial role in the development of biomarkers; thus with the growing demand of biomarkers, the market for immunochemistry instruments and reagents will also flourish. Furthermore, government support in terms of funds and grants has also provided much-needed impetus to this market.

Indian Market Dynamics
In 2016, the Indian immunochemistry market is estimated at 1914 crore. The ELISA kits market in 2016 is estimated at 306 crore and rapid tests at 225 crore, both seeing a decline every year. Immunochemistry instruments and reagents market is estimated at 1383 crore. Reagents continue to account for 90 percent of the market.

Chemiluminescence immunoassay (CLIA) systems have been steadily gaining momentum, especially in Tier-I cities where the installation base and

replacement market is increasing, resulting in a decline in enzyme-linked immunosorbent assay (ELISA) tests. Rapid tests are also seeing a decline, particularly with blood banks, which are now being monitored more closely by the FDA (Food and Drug Administration). Facing stringent checks, they are gradually shifting to chemiluminescence.

The segment is receiving impetus with increasing awareness of tests as AMH (Anti-Mllerian hormone) and Vitamin D. The need for automation is now also being felt by laboratories in Tier-III and IV cities, perhaps being pushed by the opening of competitive labs by corporate chains.

Global Market Dynamics
The global immunochemistry instruments and reagents market is expected to reach USD 24.5 billion by 2019 from USD 19.8 billion in 2016, growing at a CAGR of 7.2 percent. North America dominates the market, with government funding being a major factor. Presence of advanced immunochemistry instruments is another major factor for the high share of the US market. The Asian market is poised to grow at the highest CAGR owing to increasing government investments in the life sciences sector and improving healthcare facilities in the region. The rising focus of prominent players on the Asian immunochemistry market is another factor driving its growth. Increasing number of baby boomers that require frequent health checkups is also a main driver for this market.

Competitive Factors
Automation and integration are driving the analyzers market. Offering a broad assay menu, including infectious diseases, is a central competitive factor for increasing installed base of analyzers. Consequently, market participants of this highly competitive market are expected to continue infectious disease immunoassay product development and menu expansion.

Reagent sales typically comprise approximately 85 percent of fiscal revenues from any single system. Instrument placement is necessary for reagent sales. Many competitive factors in the immunoassay testing market lie with the instrumentation platform. The installed base of an instrument allows for an increase in test sales. When deciding on a particular testing platform, central laboratories value integrated and automated solutions. The number of tests offered by an instrument promote the installed base and future reagent sales. A majority of testing platforms are closed systems in which the instrument does not facilitate tests of another provider. The competitive advantage in this market lies with companies that offer a broad testing menu on an integrated and automated system. Servicing the instruments installed in the laboratory is another significant part of the value proposition market participants should offer. Test performance is yet another competitive factor. However, it is becoming difficult for market participants to stand out on the basis of higher sensitivity or other testing characteristics.

Competitor Strategies
As the market becomes highly competitive, it becomes essential for manufacturers to retain their installed base. This provides recurring reagent business, and hence, several market participants adopt various strategies with their customers.

Offering large discounts on the list price of the analyzer. As the market for immunoassay and clinical assay systems is enormously shrinking and eroding, companies are now adding immunoassay components or clinical chemistry systems to existing analyzers in order to make it an integrated analyzer. As a result, customers receive large discounts. This works in their favor when laboratories have stringent budgets.

Bundle reagent rental contracts. The tendency toward opting for reagent rentals varies from region to region. For example, laboratories in emerging markets opt for multiple reagent vendors, while established markets in the US and Europe prefer to select the instrument and the reagent from the same vendor, ensuring compliance and accreditation standards.

Offering upgrades and add-on analyzers and components. In order to retain their installed base, many vendors offer upgrades to existing analyzers at a very low cost to increase capabilities of existing outdated analyzers.

Abbott to Acquire Alere – An Update
Alere and Abbott are both US-based companies active in in vitro diagnostics (IVD) systems. Their activities are largely complementary; Abbott has a broader portfolio of laboratory systems and Alere focuses on point of care. However, overlaps exist, in particular for point-of-care analyzers used in the testing of blood gases and cardiac markers.

On January 25, 2017, the European Commission approved the acquisition of Alere by Abbott Laboratories, subject to certain conditions. It also observed that the proposed merger might affect the ability of Danaher, another supplier of IVD systems, to compete for laboratory systems running B-type natriuretic peptide (BNP) tests.

In order to address the competition concerns identified by the Commission, Abbott offered the following commitments:

  • To fully divest Alere’s global Epoc business, including its manufacturing site in Ottawa, Canada;
  • To fully divest Alere’s global Triage business, including its manufacturing site in San Diego, USA; and
  • To fully divest the Alere BNP reagents business that markets a BNP test with Danaher.

Following its assessment of Abbott’s proposed commitments, the European Commission concluded that the acquisition could be implemented in light of the merger control regulation. This decision shows the complexity of merger control rules in the sector due to the very narrow markets and few active players in each individual market.

Competitors are certain to be closely following the sale of Alere’s activities.

Drivers and Challenges
Under the strong rules and regulations, laboratories find it difficult to have good revenues. Thus it is very important to find ways to sustain in such a cost-crunched environment. Due to cost cutting in clinical lab fees, profitability per test is decreasing, which makes it necessary for the laboratories to focus on the volume rather than the value. There is also heavy pressure for quality, error-free results to ensure patient satisfaction. This forces labs to lean toward more automated systems with effective workflow solutions.

Globally, laboratories are encouraged for automation due to the heavy influx of patients with insurance coverage. But with limited workforce in the clinical lab, it is difficult to manage the huge inflow of patients. On the other hand, patients need prompt and error-free results. Thus this scenario demands laboratories to seek the help of systems that have a high accuracy, with managing high growing volumes and also offer remote data acquisition capabilities. Implementing informatics is critical, and the automated analyzers built today offer a full suite for barcode readers, rack detection systems, and sample/plate identification modules to avoid plate or sample switch.

Way Forward
The key challenge when building on installed base is the high cost associated with transition. Even when dissatisfied, most lab managers endure outdated instruments to avoid resource-intensive issues, such as the purchase process, staff retraining, protocol standardization, and data management system reevaluation. As labs consolidate, the immunochemistry analyzer market relies on instrument replacements to generate the needed revenue. Nearly all manufacturers rely on key strategies, such as offering replacements for old clinical chemistry and immunochemistry systems or acquiring clients from other vendors. Competition is stiffening as most vendors face difficulties increasing their customer base.

However, increasing focus on drug monitoring and growing incidences of various diseases will drive the growth of the market. In addition to this, technological advancement due to which automated and more accurate instruments are present in the market is another major factor that will propel the growth of the market in the future. Factors such as stringent regulations for the development and launch of immunochemistry products and low adoption rate of automated immunochemistry products in developing economies due to high cost can hinder the growth of the market in coming years.

Industry Speak

Market Trends

Jatin Mahajan,
Managing Director
J. Mitra & Co. Pvt. Ltd.

The immunochemistry instruments and reagents industry is experiencing rapid technological developments. The need for highly accurate tests, ease of testing, wider test menu, flexibility of workload in individual parameters, demand for near patient testing, and difficulties faced in safe transportation of samples from distant places has led to ingress of companies offering solutions to this arena of diagnostic industry.

Many companies are manufacturing and marketing miniature instruments with highly accurate results. The quality results are being claimed owing to their cutting-edge luminescence-based technologies like fluorescence and chemiluminescence in miniaturized platforms. Some of these companies are offering specialized parameters like cardiac markers, others specializing in renal markers, while a few others are offering more demanded parameters like Hb1Ac, Vitamin D, Thyroid profile, and the like on a single platform machine. One such product has also been designed by Healthcare Technology Innovation Center, IIT Chennai, called i-Quant, keeping in view the demand of Indian healthcare industry. Some of these manufactures have even automated their manufacturing facilities to have consistency in their reagent quality.

Various test parameters, which were earlier required to be performed on different machines based on different technologies, are now converging to such single platforms through these miniaturized machines. This is not only helping labs and hospitals having moderate workloads to save on huge investments in capital equipment but also recurrent maintenance cost of the multiple machines.

As majority of immunoassay workload is carried out by high-end national laboratories and second-tier regional laboratories, these labs often get stuck with the companies which have installed the equipment on lease basis. With the advent of these miniaturized, state-of-the-art technology instruments and their availability at a fraction of the cost, not only the large laboratories but even smaller labs and nursing homes will have the option to install these instruments and switch to most competitive reagent manufacturers and suppliers.

Industry Speak

Meeting the Need for Safe Blood

Ratan Shetty
Sr. Business Development Manager-Immunology,
Transasia Bio-Medicals Ltd.

The immunochemistry market in India is growing at a CAGR of 15–16 percent annually and the trend is expected to continue till 2018. The Indian market has metamorphosed over the past couple of decades. Many of the testing formats like radio-immunoassays and the latex agglutination tests have made way for newer formats that better address the needs of clinicians and patients. Test menus now offer better sensitivity, specificity, accuracy, and precision.

Over the years, there is a sea-change in the testing menu across various formats. In the current scenario, there is an increasing trend for testing of hormone levels and other non-infectious bio-markers like assays for autoimmune diseases, oncology and cardiac markers, and tests for vitamins. This is in addition to the focus on diagnosis of infectious diseases like hepatitis, HIV, dengue, and malaria

Immunochemistry testing is widely used by lab chains, government, corporate and private hospitals, nursing homes, labs attached to clinics as well as blood banks to screen transfusion-transmitted infections.

The product segment mainly comprises immunoassay analyzers and reagents for chemiluminescence, fluorescence immunoassays, immuno-chromatography tests, and the latest generations of ELISA tests.

Some of the important decision criteria in choosing an immunochemistry testing system are: reliability of results; cost effectiveness; time to results; test menu; regulatory approvals; ease of performance; quality control and quality assurance; and service and application support.

In the near future, chemiluminescence assays seem to be headed for an even better growth trajectory, primarily owing to the broad menu offered with excellent sensitivity and specificity. Newer testing formats include point-of-care testing as well as microarrays in appropriate settings.

Manufacturers are focusing on meeting the laboratory needs for innovative test formats and systems that can adapt to the workflow of their setup, ensure reliable results consistently, and are affordable. Immunoassays for transfusion-transmitted infections need to be designed on parameters such as early detection, reduction in infection rates, affordability, etc.

Transasia Bio-Medicals Ltd. has been identifying and catering to the growing needs of blood banks by providing solutions for reliable screening of transfusion-transmitted infections, thereby ensuring safe blood.

Industry Speak

A Robust Market

Sanjaymon KR
Agappe Diagnostics

Immunochemistry reagents and instruments have the highest share in the Indian IVD industry. It is estimated at 1800 crore in the year 2017. Reagents account for 90 percent of the market. The major tests in this segment include the blood screening tests, hormones, specific protein testing, TDM, infectious disease testing, and tumor markers.

With technological advances in this field, the hormone analysis, once considered as the rare and specialty tests, has become routine and affordable to the common laboratories. With the new-generation bench-top analyzers with small foot print and cartridge-based testing, this segment witnessed an exponential growth in the installation base. It is estimated that more than 700 units are installed annually in this segment and majority of the instruments installed are on rentals. In the routine hormone testing, thyroid panel has a share of 50 percent, followed by infectious panel at 28 percent. Vitamin-D testing has shown an increase in the last few years and is with a share of 10 percent. The other testing panels include Fertility panel followed by Anemia. With multinationals entering into this segment directly with highly attractive prices, the cost of performing the tests has dropped down drastically.

With the introduction of affordable and easy-to-use rapid tests, the blood screening segment has shown an increase of 25 percent on the annual tests vis-a-vis last year.

A decade ago, approximately 35 percent of specific proteins were done by latex testing, which were either qualitative or semi-quantitative tests in nature. This was one of the limiting factors where there was always uncertainty of results in the borderline areas of reference ranges. These tests were affordable to the rural population because of the low cost per test but due to the low specificity and sensitivity, the purpose of testing was eluded in many cases. Approximately 45 percent of the tests were performed in turbidimetry assays either in fully automated or semi-automated systems with a higher cost. Nephelometry, the gold standard for protein testing, was unreachable to the common laboratories because of the very high cost of the automated instruments and high cost of reagents and consumables.

Semi-automated nephelometry systems were introduced in India in the last decade and became the game changer in the specific protein testing. It is estimated that approximately 2500 nephelometric analyzer units are installed in India annually accounting to 25 crore. With increase in the number of parameters, these systems are gaining wide acceptance among the customers. The latest entrant in nephelometry segment is cartridge-based fully automated system with wide testing menu.

With the current CAGR of 16 percent, the immunochemistry market in India is expected to reach 2650 crore by the year 2020.



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