There is no denying that despite the odds, the IVD industry in India continues to offer unprecedented opportunities to investors and stakeholders, now more than ever before.
The IVD industry is well placed to build on and expand innovative developments and create new opportunities to deliver solutions that diagnose needs and inform care decisions, improve care delivery, and enable more comprehensive care management.
In recent years, the business of operating the diagnostic laboratory has changed dramatically. The lab is a connected production environment and a primary generator of data, which requires the delivery of increased efficiency driven through lean workflows. And as the modern clinical laboratory becomes more connected, it becomes increasingly difficult to efficiently exchange and manage data. This is especially true with regard to interoperability, where data is exchanged among several clinical systems. Laboratories have long stressed efficiency, safety, and quality in the management of diagnostic data; however, the focus has primarily been on the analytical phase. But the trends toward lab automation and increasing testing require that laboratories constantly adapt to ever-changing data management requirements in all phases of the testing process. To meet expectations, laboratories have implemented laboratory information systems (LIS) as well as demanded analytical instruments with more powerful and sophisticated data management solutions. Integrated instruments can help coordinate various processes, from managing test orders to monitoring samples, to validating final test results.
Development of sophisticated and specialized tests for early disease detection and disease management and increasing demand for lab automation will likely drive the growth of in-vitro diagnostics (IVD) market. The rapidly rising use of PoC diagnostic products has introduced a decentralization trend in the healthcare industry. Patients and healthcare facilities in an attempt to encourage early diagnosis, to cater to medical facilities remotely, and curb costs are now decentralizing their facilities. A wide array of clinical tests facilitates healthcare specialists with the ability to detect disease progression, which also includes blood and urine test ranging from simple to complex, molecular expression genetic analysis, and various medical chemistry panels.
Moreover, the growing rate of chronic diseases such as diabetes, heart failure, and colon cancer; increasing demand for personalized medicine; expanding geriatric population base; and growing patient awareness toward disease diagnosis will also lead the IVD market growth.
The Indian IVD market is forecast to grow at a CAGR of 7-8 percent from 2019 to 2023. IVD has witnessed several changes and additions to its gamut of offerings in the recent past. There has been a paradigm shift from traditional diagnostics to a new generation diagnostic that works on the gene level. This change was possible only due to the inclusion of advanced technology, such as genetic testing, molecular diagnostics, polymerase chain reaction (PCR), and next-generation sequencing (NGS). Fast turnaround, reliability, user-friendliness, and predictability of predisposed diseases are a few significant qualities that are making these technologies attain their share in major offerings of diagnosis providers around the world.
The lack of a proper reimbursement system is the major concern for the IVD market. The process of securing reimbursement and funding for a diagnostic test in India is extremely challenging. Stakeholders need to recognize the knowledge required. This fact asks for the extensive research and interpretation of a very large amount of data.
The major factors that are driving the growth of the Indian IVD market are the high prevalence of chronic diseases, increasing use of point-of-care (POC) diagnostics, and rising awareness and acceptance of personalized medicine and companion diagnostics. In addition, new and upcoming technologies, such as precision, resourcefulness, portability, and efficiency, are expected to fuel growth further. Based on the usability of IVD instruments, the disposable segment led the Indian IVD market with approximately 70 percent of the share in 2018. This share is expected to further increase over the years, due to the emergence of PoC testing and the growing demand for portable diagnostic instruments.
For diagnostic laboratories the main drivers will be the focus on preventive healthcare, shorter turnaround time through automation, next-generation logistics network, value-added services like the application of AI for qualifying lab reports, a home collection of samples, and establishing connect with customers through handheld devices. Even as health awareness spreads, as with any other healthcare services, the focus for laboratories will shift from a physician-centric approach to a customer-centric one. Although this shift is already palpable, it will gather momentum in 2019 onwards as laboratories move away from a simple pathology test provider’s role to an integrated healthcare solution provider’s one.
India has now drafted the first National Essential Diagnostics List (NEDL), which is a country-specific set of tests for detecting common morbid conditions and priority diseases in the country. The draft list, formulated by Indian Council of Medical Research (ICMR), is expected to improve the availability of quality diagnostics at all healthcare facility levels and drive down the cost of disease detection and treatment. The government has come out with this diagnostic list to build upon the initiatives of the Health Ministry to provide an expanded basket of tests at different levels of the public health system in the country. ICMR has drafted the list on the lines of the World Health Organization’s first-ever Essential Diagnostics List published in May 2018. The WHO’s list concentrates on in vitro tests, i.e. tests of human specimens like blood and urine. It contains 113 products. Among them, 58 tests are listed for the detection and diagnosis of a wide range of common conditions, providing an essential package that can form the basis for screening and management of patients. The remaining 55 tests are designed for the detection, diagnosis, and monitoring of priority diseases such as HIV, tuberculosis, malaria, hepatitis B and C, human papillomavirus, and syphilis. Some of the tests are particularly suitable for primary healthcare facilities, where laboratory services are often poorly resourced and sometimes non-existent. On the same lines, the ICMR has developed the NEDL for different tiers of the healthcare system to address the needs of villages, primary, secondary, and tertiary care centers. Consequently, diagnostic tests are chosen on the basis of the country’s disease burden. So, tests for malaria, dengue, chikungunya, leptospirosis, brucellosis, tuberculosis, hepatitis B and C, HIV, and syphilis are given priority on the draft list.
Moving forward, in 2019, besides influencing the government’s future price control policies on diagnostic procedures in the country, the NEDL will also help streamline procurement of essential diagnostics required at primary healthcare centers and encourage local companies to manufacture these products to ensure adequate and uninterrupted supply. In a country where a large number of people are unable to get tested for diseases because they cannot access diagnostic services, the NEDL will be helpful, as it will push for making diagnostics available at affordable prices for the common people. But all said and done, there is the grey area of availability of quality diagnostic laboratories in the country. Before finalizing the NEDL, the government should look at the larger picture of the quality and availability of diagnostic laboratories in the country. Without an integrated, well-connected, tiered laboratory system with adequate human resources, training, laboratory infrastructure, and quality assurance systems, the NEDL itself cannot have the desired impact and will not serve the intended purpose.
The global in vitro diagnostics market was valued at USD 67,574 million in 2018, and is estimated to reach at USD 93,614 million by 2025, registering a CAGR of 4.8 percent from 2019 to 2025, predicts Allied Market Research. Increase in incidence of chronic and infectious diseases and growth in geriatric population drive the global IVD market. In addition, growth in the number of public and private diagnostic centers and point of care testing centers is expected to fuel the market growth in the coming years. Furthermore, the rise in investment for the advancement of healthcare sector by the government is anticipated to boost the market growth. However, stringent government regulations for the manufacturing of IVD products and inadequate reimbursement policies are expected to hamper the growth of the IVD market. Ongoing R&D activities related to IVD are anticipated to provide new opportunities for market growth.
Based on product type, the instrument segment is expected to grow at a CAGR of 6.1 percent from 2019 to 2025. The growth of the instrument segment is attributed to the recent advancements in IVD instruments. Further, there is a growth in demand for fully automated instruments in the market, as they simplify the task and provide more accurate and reliable results.
In 2018, reagents and kits commanded the largest share in the global IVD market. They are also expected to witness a rapid growth during 2019-2025 mainly due to incessant product launches, the number of on-going research activities, and growing prevalence of various acute as well as chronic infectious diseases.
On the basis of technique, immunoassays commanded the largest share with to their greater adoption attributed to advantages such as inherent specificity, high throughput, high sensitivity, low cost, and rising demand for immunoassay-based tests. Moreover, molecular diagnostics is expected to witness the fastest growth over the next six years. Automation is an emerging trend observed in clinical testing. Availability of easy-to-use portable devices enables self-testing, which is expected to fuel the market growth in the near future.
Based on application, infectious disease segment commanded the largest share with a large volume of IVD tests performed for infectious diseases, high incidence of various infectious diseases, and incessant technological advancements in the tests used for the detection of such diseases. Oncology is expected to witness the fastest CAGR of 8.93 percent by 2025. Increasing demand for self-care devices and PoC diagnostics for the treatment of chronic diseases can boost the growth in the forthcoming years.
On the basis of the end user, hospital laboratories commanded the largest share primarily due to the high volume of diagnostic tests being performed in the hospitals and the high incidence of hospital-acquired infections. Homecare segment, on the other hand, is expected to register the fastest CAGR of 8.48 percent by 2025.
Geographically, Asia-Pacific will be the fastest growing regional market due to improving healthcare infrastructure; growing accessibility to healthcare services; increasing incidence of infectious and non-communicable diseases with an aging population; growing income levels and insurance penetration; and the rising number of hospitals and clinics. However, North America commanded the largest share of the global IVD market, followed by Europe, Asia-Pacific, Latin America, and the Middle East & Africa.
Major players operating in the global IVD market are Roche Diagnostics, Danaher Corporation, Abbott Laboratories, Siemens Healthcare, Thermo Fisher Scientific Inc., Sysmex Corporation, bioMérieux S.A., Becton, Dickinson and Company, Bio-Rad Laboratories, Inc., DiaSorin S.p.A., Qiagen N.V., and Agilent Technologies, Inc.
Key players focus on strategies such as mergers and acquisitions, collaborations, and new product developments. In addition, they are aiming at expanding their businesses across developing regions to boost their market share. For instance, in August 2018, Sysmex Corporation and Jvckenwood Corporation jointly established a new company, Creative Nanosystems Corporation to develop and manufacture biodevices.
IVD trends to watch in 2019
Tests will still need to prove to play in 2019. Yes, new 2019 diagnostic test product will be effective, logical, and popular with providers and patients, but abstract cost-reduction is not enough. Even the most logically useful tests, such as tests that avoid high-cost treatments on patients, will still need to address scientific proof to survive in 2019. While it would seem that companion and precision would be money well spent, in reality, there is a major breakdown of the system in too many cases. The decision for payor approval for diagnostic testing comes from strong, even overwhelming, scientific evidence that the testing will have a direct impact on outcomes and in many cases, this is difficult to show meaningful benefits. The question asked will be: if the test is performed prior to initiating treatment, is there a significant improvement in clinical response and outcomes over those that do not have pre-treatment diagnostics?
The sales representatives will still be key to instrument sales. Sales representatives are perceived by some customers to be obsolete with the online availability of product information, but that perception is not the whole story, according to a report by BioInformatics, Inc. When queried deeper, customers still need their resourcefulness and their product knowledge. as they push through purchases in their own organizations. A majority rated resourcefulness their #1 or #2 category in a sales rep. The report found that what customers expect is that sales reps will be experts in the one thing they are not your company’s products.
If one wants to sell to a laboratorian in 2019, they will have to network. Laboratorians generally have a closer, an in-person social network that they rely on for recommendations, advice or information about products and services, elucidates IMVI Research’s 2019 Trends in Marketing to Clinical Diagnostic Labs. The report cites credibility factors and buying habits among laboratorians, what influences them, what sites they use and how best to approach laboratorians.
Revenue decreases at labs, lab consolidation, and pushback on vendors. The impact of PAMA and resulting in Medicare Part B cuts on testing is being felt. 2019 will bring more pressure on spending and consolidation for lab customers. And that means a downstream impact on IVD vendors. A survey from IMV Research indicated that most labs have seen decreases. 55 percent of a panel of 110 labs indicated they had revenue decreases, from single digits to double-digits as a result of Medicare Part B cuts, and that over 60 percent will review agreements with vendors for instruments and reagents.
2019 sales of drug discovery instruments, reagents, and other technologies will be brisk. The total demand for technologies used in drug discovery reached approximately USD 5.2 billion in 2018. The market is estimated to grow at a healthy annual rate of 6.4 percent over the next five years, driven by increasing demand for novel drugs as the global population ages.
The cannabis testing equipment market grows. As the cannabis industry emerges from the black market to the grey market to the open market, it faces forces of standardization and regulation. Among other effects, this has stimulated the development of analytical testing methods for cannabis, and these new applications and methods are available not only in areas where the market is open but also in geographies where the industry remains clandestine. A variety of instruments and techniques, such as gas chromatography, HPLC, supercritical fluid chromatography, thin-layer liquid chromatography, GC/MS, LC/MS, ICP-OES, ICP-MS, X-ray diffraction spectroscopy, and qPCR, are all employed for a variety of testing uses, including potency testing, heavy metal testing, and safety testing. And although many cannabis suppliers prepare samples before sending them to be tested, there also exists a small but quickly growing market for sample preparation.
Direct to consumer testing. gates are open, flood to follow? Patients can now access diagnostic testing without their doctor. Quest Laboratories has launched QuestDirect, an enhanced consumer-initiated testing service that empowers patients to manage and take control of their healthcare by ordering health and wellness lab testing from the convenience of their home. Walgreens and LabCorp announced a large-scale expansion of their LabCorp at Walgreens collaboration. The two companies have agreed to open at least 600 LabCorp patient service centers at Walgreens stores across the US over the next four years, inclusive of the 17 locations that have opened since they first announced their consumer-focused initiative in June 2017. LabCorp at Walgreens locations are currently open in Florida, Colorado, North Carolina, and Deerfield, Illinois, serving as an important part of LabCorp’s network of nearly 2000 patient service centers across the US. This is in addition to 23andMe.com’s offering of DNA testing for select BRCA variants without a doctor’s order. 2019 is the first full year the gate is open for the customer to test themselves, will demand follow? Industry experts think they will, but some prodding, advertising, apps, social media will be needed.
AI will be seen as a team player, not a job replacer. Artificial Intelligence (AI) was novel in the past few years, in 2019, the abstract concept fades and real products/software will be the focus. Talk of replacing doctors (or other workers) should be by at least the end of 2019 be less of the discussion surrounding AI. Instead, more attention will be on the positive supporting role that AI can play as the systems think about myriad data points that a human cannot always process. AI is emerging as a supporting tool, a team player. The demand is there, The Institute of Medicine at the National Academies of Science, Engineering, and Medicine reports that diagnostic errors contribute to approximately 10 percent of patient deaths, and also account for 6 to 17 percent of hospital complications.
IVD industry is well placed to build on and expand innovative developments and create new opportunities to deliver solutions that diagnose needs and inform care decisions, improve care delivery, and enable more comprehensive care management. There is no denying that despite the odds, the IVD industry in India continues to offer unprecedented opportunities to present and potential investors and stakeholders, now more than ever before.