On The Cusp Of Metamorphosis

On The Cusp Of Metamorphosis

The Indian IVD industry has the opportunity to shape the future. The transformation that will follow should create an industry, which is technologically advanced, patient-friendly, and affordable.

The Indian in vitro diagnostics (IVD) industry has been witnessing immense progress. Major technological advancements and higher efficiency systems have taken the sector to new heights. Advanced cutting-edge technologies are being used to understand disease prognosis, thereby strengthening the sophistication level of the participants in the sector. Emergence of new concepts like point-of-care testing, near patient testing, increased automation, hospital laboratory management, and customer relationship management have revolutionized this segment and contributed toward providing accurate and precise diagnosis at much faster rates.

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. Through the foreseeable future, India will continue to offer one of the fastest growing markets for IVD products. As the industry grows and matures, organizations will need to demonstrate flexibility, resilience, and an appetite for investment to participate in what will certainly be a large and exciting opportunity that will also significantly improve diagnostic services in India.

Indian Market Dynamics

The Indian IVD instruments and reagents market is valued at more than 5000 crore and expected to cross 10,050 crore by 2018 with a compounded annual growth rate (CAGR) of 20 percent. Increased healthcare awareness, preventive health checkups, and shift from manual to semi-automated and automated instruments are key drivers.

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.

The Indian market for biochemistry instruments and reagents in 2016 is estimated at 1425.2 crore, with reagents dominating with an 81 percent market share. The market is steadily shifting to open systems. The analyzers segment, which is estimated at 275.2 crore, is gradually transitioning to fully automated (FA) analyzers, which in 2016 constituted 53 percent of the market in value terms. In volume terms, the semi-automated segment dominates with an 88 percent share.

The Indian hematology instruments and reagents market in 2016 is estimated at 952 crore, with reagents constituting a 63 percent market share.

The Indian market for urinalysis analyzers and reagents in 2016 is estimated at 138.45 crore. Reagents continue to dominate with an 83 percent share, valued at 115 crore, in 2016 saw a 21 percent increase over 2015.

The Indian market for coagulation reagents and instruments in 2015-16 was estimated at 122 crore, with reagents dominating at 107.36 crore. This includes 16 percent customs duty and 10 percent freight.

The microbiology instruments and reagents market for the clinical sector in 2015-16 was valued at 290 crore. Contributing a major 238 crore, reagents are the mainstay.

The Indian molecular diagnostics market is estimated at 104 crore in 2015-16, with reagents contributing 100 percent to sales. Analyzers are placed. The revenue generation takes place from the reagents procured for the closed systems supplied by the vendors or some plastic consumables.

Diagnostic Services

The diagnostics industry is witnessing a great deal of visibility and interest with more organized players driving regional growth. This is also resulting in gradual shift of the market from unorganized to more organized players thereby driving quality and efficiency standards. This sector has also attracted investments further fuelling competition but at the same time improving industry standards. India still has large rural markets that are either under serviced or not serviced at all by diagnostics and this provides the opportunity for growth in under penetrated areas although at significantly lower price points. In the urban markets too there are pockets of growth opportunities given the overall awareness on healthcare and health attitudes.

The Indian diagnostic services market is estimated at 53,910 crore in 2016 and expected to continue growing at 30 percent to reach 80,000 crore by 2020. This growth is likely to be driven by improving healthcare facilities, medical diagnostic and pathological laboratories, private-public projects, and the health insurance sector. Moreover, with the rise in health consciousness in the society and the rising burden of chronic diseases, the Indian healthcare market is expected to reach 1,876,000 crore in revenues by 2020.

The diagnostics services industry has traditionally been fragmented and unorganized. However, large PE funded reference lab networks have significantly expanded presence across the country and are representative of the ongoing shift from unorganized, non-branded service providers to organized and branded diagnostic chains for higher quality and reliability. National chains such as Super Religare Laboratories (SRL), Dr. Lal PathLabs, and Metropolis led this trend and regional/niche players have now followed. While Thyrocare and Oncquest represent niche players focused on specific therapeutic areas, regional players as Vijaya Diagnostics, Bimta Labs, Encube Ethicals, Sutures India, Intas Pharmaceuticals, Concord Biotech, and Morepen Noware are gaining strength. While consolidation and competitive advantage were earlier largely driven by quality assurance and pricing, the leading reference labs are now focused on expanding the portfolio of tests to offer more contemporary diagnostic tests to Indian population. They have also expanded their footprint beyond India and are able to service markets such as the Middle East through their reference lab model.

There are multiple formats in which a diagnostic business can operate; as standalone centers offering basic testing, hospital based centers, where some of the work may yet get outsourced to third-party laboratories, and diagnostic chains that have an all-India network and offer a complete suite of services.

Diagnostic chains prefer a hub-and-spoke approach in order to reach out to a wider audience. A typical arrangement will have any combination of a Reference Laboratory, Satellite Laboratories, and Collection Centers or Patient Service Centers.

Diagnostics essay the role of an intermediary, bearing information that can be used for correct diagnosis and treatment. It gets broadly classified into imaging diagnostics or radiology – that identifies anatomical and physiological changes in the body and pathology services – that involves testing of samples of blood, urine, stools, and other fluids from the body.

Typically, pathology services account for the larger share within diagnostics, given it has gained prominence as the preferred mode for testing a number of conditions. Within pathology it is the biochemistry related tests that represent a greater share – these pertain to determination of changes in chemical composition of body fluids in response to underlying disease. Given the rising prevalence of chronic conditions like diabetes and cardiovascular problems, a far greater number of tests are getting prescribed and consequently blood sugar and lipid profile tests have come to occupy a dominant share within the diagnostics industry.

Global Market

The global IVD market was estimated at USD 61.85 billion in 2016 and is expected to reach at USD 122.9 billion by 2027, predicts Visiongain, reflecting a CAGR of 6.4 percent. The recent trend in the market is toward less invasive and more accurate diagnostic procedures, as the population demographic is shifting upwards and with it the number of chronic age-related situations such as cardiovascular disease, cancer, and neurological disease, is escalating.

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 POC test devices, which will have a positive impact on diagnostic testing.

Getting information to caregivers and patients is now not an added plus, but a prerequisite of 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.

In the area of test economics, outcomes 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.

Among the broad division of the IVD market by type, viz. clinical chemistry, immunoassays, whole blood glucose monitoring, molecular diagnostics, microbiology, anatomic pathology, hematology, coagulation, critical care, and urinalysis among others, the molecular diagnostics market is projected to grow the fastest, with CAGR projected at 7.3 percent. Commercial introduction of innovative technologies will be the key driver of growth in these segments. Tools enabling earlier, more accurate diagnosis, improved treatment decision, and better treatment monitoring will encourage adoption of innovation.

Market Trends

Several of the same powerful trends reshaping healthcare and clinical laboratory services are having equally significant influence on IVD manufacturers. In particular, the consolidation of hospitals and physicians, as well as the emergence of new sites of servicesuch as urgent care centers and retail clinicsare motivating IVD companies to tailor new diagnostic systems to the unique needs of these entities. Top trends that will affect IVD developers in the near future include:

China FDA’s seal of approval. Along with US Food and Drug Administration (FDA) approval and European CE marking, China FDA (CFDA) approval is also highly sought by IVD companies. Roche had received CFDA approval for its CINtec PLUS Cytology test. This test is designed to improve the detection and early intervention of pre-cancerous cervical disease. About 62,000 new cases of cervical cancer are reported annually in China, and about 30,000 women in China annually die from the disease.

Urgent care. Urgent care centers are increasingly gaining popularity as they include full-service urgent care medicine, clinical laboratory, and X-ray services.

Pace of IVD Brand Mergers Brisk. Companies need many parts to succeed in IVD, and so experts expect merger activity, as well as partnerships and other arrangements to be robust in 2017. Some M&As allow larger companies to acquire new technologies but there is a distinct move for globalization of IVD knowledge. Last year, LabCorp purchased Sequenom; Cepheid was purchased by Danaher Corporation,; and Bio-Techne acquired ACD for USD 250 million, marking Bio-Techne’s entry into the genomics field and market. 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 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.

Changing core lab. Not 10–15 years ago, most microbiology and anatomic pathology labs were tucked away somewhere in the basement. The major test areas similarly were separated by impenetrable walls. Those days are long gone, imagine a centralized hospital lab where clinical chemistry, immunoassays, hematology, coagulation, urinalysis, some microbiology, and some cytology tests are all performed in one room and often on instrumentation that are linked by an automated track line and all in the same room. More importantly tests are carried out by a lab information system that consolidates test results to an electronic patient record, or EMR.

Emerging markets. High growth countries, primarily Saudi Arabia, Brazil, China and India are experiencing in vitro diagnostics market growth of double digits. This is fueled by privatization and health insurance initiatives by governments and employers. However, this growth has a negligible effect to compensate for the lack of significant growth in major healthcare markets of Europe, Japan, and the U.S.

Automation. There is also a lack of trained lab technologists, so there is a decreasing availability of human resources needed to run the more 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 hematology, blood banking, microbiology, and histology. Demand for healthcare and thus in vitro diagnostic tests in all the major healthcare markets is driven by aging populations and increased incidence of conditions such as cancer, diabetes, cardiovascular disease, arthritis, and obesity. In light of the demand for these IVD tests, they have been reformulated for automated analyzers where the cost per test is traditionally low.

New sampling. No more blood sampling, be prepared for an IVD market of breath tests for conditions that includes respiratory infections, gastrointestinal disorders, cancer, and even chronic diseases. Wearable patch sensors have been commercialized for glucose and vital signs monitoring; more and more applications are in development.

Sequencing enters the clinic. In the 21st century, understanding a patient’s personal genomic profile equips physicians with valuable information to better diagnose, predict, treat, and prevent disease. Personalized medicine using genomic information improves patient outcomes and reduces healthcare costs and adverse drug reactions. The NGS data analysis market includes the market by product (software and services) and by applications such as whole genome sequencing, exome sequencing, targeted re-sequencing, de novo sequencing, RNA-Seq, ChIP-Seq, and Methyl-Seq. As experience with sequencing intensifies, researchers are beginning to discover some of the ways in which the technology can be used. It is generally anticipated that whole genome sequencing is most appropriate for broad research looking for linkages between gene mutations and disease development.

Growth Drivers and Restraints

Growing adoption of advanced diagnostic techniques such as digital pathology, which uses digital instruments for diagnosis, portable point-of-care testing devices for HIV & pregnancy, use of non-invasive procedures over conventional techniques, increasing incidences of cancer, cardiac, urological, and infectious diseases, and rising count of technological breakthroughs such as automated instruments and instruments with high throughput are major factors boosting the market growth.

There are challenges to the IVD industry’s growth. While the development of IVD product choices has been a boon for medical care, it also puts a great deal of pressure on physicians to make the right choices and for payers to pay for new technologies that may still be unproven. As an aging society begins to use more healthcare services, cost efficiency imperatives continue to put pressure on payers, providers, and suppliers. As a result, healthcare organizations have developed strict cost/performance and care guideline directives. One of the ways to achieve these directives is to use medical and financial data to evaluate and prescribe the use of medical devices.

What does all this mean for IVD marketers? Data, data, and more data accompanied by the inevitable use of data to evaluate the medical usefulness and necessity of using a specific device. Medical device usage will be based on performance data, peer review research articles, contribution to patient outcome, and a cost/benefit analysis. Wide dissemination of medical information in the media and on the Internet has spawned a more informed population that is prepared to seek out new technologies.

Way Forward

The Indian IVD industry has tremendous potential given India’s demographic and under-served healthcare market. The government has taken positive steps to boost the capacities of the domestic IVD sector. The formulation of the Medical Devices Rule 2017, which will come into effect from January 1, 2018, is a key measure that will direct investment inflows in the sector and reduce the production cost of instruments, whose benefits, in turn, can be passed on to the end-user. The healthcare sector is likely to receive a flurry of investments with the government considering coming out with a new FDI policy.

As the government is working toward the goal of providing good quality healthcare services in an affordable manner, industry has to align itself with the same goal put forth by the government and work constructively in sync to iron out operational issues and work toward growing the industry. Domestic manufacturers should bear in mind that they have an opportunity to create a place for themselves in the market. The startups in the sector have clearly demonstrated that providing quality healthcare at affordable cost is possible, provided one is ready to embrace technology. The government needs to clearly signal that it is willing to encourage and reward innovation.

The industry is on the cusp of metamorphosis and has the opportunity to shape the future. The transformation that will follow should create an industry, which is technologically advanced, patient-friendly, and affordable.

Industry Speak

The Use of LED Technology in Clinical Analysis

For the last 35 years Biosystems has been driven to address the needs of clinical analysis laboratories worldwide, defining and maintaining its leader position in the IVD market.

BioSystems, as a company interested in analytical system innovation for clinical analysis laboratories, develops a new generation of automatic analyzers based on LED (Light-Emitting Diode) technology, optimized for biochemistry and turbidimetric assays, paving a new path for automated analyzers performance.

In general terms, a biochemistry analyzer consists of three different sub-systems:

  • Fluidic System: responsible for moving samples, reagents and additional solutions
  • Thermal System: responsible for maintaining the correct temperature of the reagents (4–8C) and to temperate the reaction (37C)
  • Optical System: responsible for reading absorbance

Until now, only the technology of halogen lamps was applied in optical systems. A halogen lamp is a variant of incandescent lamp that emits light by heat through an electric current. Halogen lamp requires high power consumption (20-50W), has a limited lifetime (approx.2000h.) and 95 percent of the energy used in an incandescent lamp is lost in the form of heat. It requires a cooling system such as fans or liquid cooling systems around the lamp to dissipate heat.

A LED is a solid-state emitting light diode that commonly consists of a piece of semiconductor crystal connected to two electrical terminals. When the current passes through the semiconductor, a free electron from the negative terminal is combined with the positive terminal and energy is released as a photon of light during this process. The amount of energy released determines the frequency and therefore the color of the LED.

LED has evolved a lot since 1962, when Dr Nick Holonyak invented it, and we are also able to use this technology as a light source in biochemical analyzers.

The technology characteristics of LED are:

  • Low power consumption
  • Minimum energy loss in the form of heat
  • High durability
  • Possibility of immediate readings after switch on
  • Low cost and No maintenance required

The definitive success of the use of the LED was when a LED of 340nm, critical in spectrophotometric readings, was able to develop. The developed and patented optical system of BioSystems is based on a succession of monochromatic LEDs (one for each wavelength) and two photodiodes (main and reference) that receive the light from each LED simultaneously to stabilize any drift of the light source. The reference photodiode checks light emitted from the respective LEDs before the light traverses the sample source and the main photodiode takes the actual measurement.

The use of LEDs allows the adjustment of each wavelength independently, achieving a more balanced and compensated light source. This technology permits the blinking of the light, allowing reading every 10 milliseconds, 25 cuvettes (reactions) per second and assuring high stability of the light source.

This innovative technology gives higher stability of measurements (0.0001Abs during three hours lighting) over the analyzers that use the traditional system with halogen lamps. The optical components are sealed inside a black box, as it is completely protected; it makes dust free and no maintenance in optics and filters. Additionally, they have low energy consumption and are durable with practically unlimited lifetime (more than 50,000 hours in continuous use), avoiding manipulation and dust.

The validation of the functionality of this new technology is demonstrated in the multicentric study of imprecision and trueness, carried out in different reference laboratories in Barcelona, published as: Multicentric evaluation of the new BA400 analytical system (LEDs) and comparison of measurement procedures. Journal Clinical Laboratory. Rev Lab Clin. 2013; 6 (4): 157-167. Dr Javier Gella et al.

The conclusions of this study are that the use of monochromatic LEDs as a light source in automatic analyzers in patient samples provides equivalent results as analyzers that have a traditional halogen lamp system, adding all the advantages that LED technology can offer.

Ignasi Roig
International Product Manager,
BioSystems S.A.

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