Upcoming trends that will define IVD market

With the publication of Frost and Sullivan report in early to mid-2000s, POCT came into focus. However, 15 to 20 years later, the situation is more precipitated now. With the arrest of Elizabeth Holmes (Theranos) and sale of Alere (earlier Inverness) to Abbott, we all need to consider new technologies and commercial involvements in POCT segments and upcoming technologies more cautiously.

The record-breaking sales of Covid-19 Rapid tests and Covid-19 molecular biology tests would continue to skew the CAGR results of these market segments for the next 3–4 years, if one takes 2018 or 2019 as the base year and creates a forecasting outlook. However, unless something new comes up, one needs to remember the aberration in these segments before considering future growth trends with CAGR that may be reported.

POCT in general would have competition from advancements in other business processes (explained later), which would mean that this segment’s growth would be restricted to real emergencies or cases needing really fast results instead of this coming up as an alternate solution for centralized solutions.

Major trends defining the future of IVD industry
When we talk about future trends, most of the times, it is restricted to technology and technology platforms. However, the growth happens not only in terms of technology or technology platforms, it also happens in the processes/in the paradigms. It redefines the contours of business and completely challenges another set of business.

The growth of Thyrocare and Metropolis has put a lot of emphasis on “centralized reliable solutions” over “fast, local solutions.” A business model, based on a pooling in samples for centralized processing, has resulted in a pressure of solutions meant for smaller labs in certain segments, such as companies involved in selling 96 tests pack of thyroid testing kits in ELISA formats. This means that POCT would grow only for the real emergencies. Hormonal profile test kits meant for smaller labs that were not an emergency, but were being performed locally because of time and convenience, may suffer.

Another change in paradigm may be seen in cases of sample collection, where many people were skipping the check-ups because of the trouble of waking up in the morning and giving the sample without eating or drinking anything. Sample collection facilities from home is a growing segment to look out for and investors can look for growth in companies involved in this segment.

Medikabazaar is a prime example of how to bring in a revolution in an industry harnessing the powers of newer technologies without being an actual producer. If you look closely, they are distributors. While most of the companies were busy looking at innovations in tests and testing methodologies, Medikabazaar focused on bringing innovation in distribution.

So upcoming growth opportunities would not be restricted to only technology platforms, but also processes and paradigms.

Regulatory scenario impacting the IVD industry
The introduction of IVDR has already resulted in many companies restricting the manufacturing activities, which was way more liberal under IVDD regime allowing third-party manufacturing. Expect fewer options once IVDR is introduced fully. In India, third-party manufacturing regulations mandate that original manufacturer is mentioned on the boxes. If some clauses are added by which traceability is maintained, without divulging the original manufacturer’s name, this would help Indian manufacturers to offer private label manufacturing more aggressively, invest in bigger facilities to achieve scale of economies offering more employments, and earning better revenue.

Government policies affecting the industry
Regulatory framework is already a government domain. Besides, encouraging more insurance-based services would help in developing a more robust system.

Import policy
Basically, norms should be product-based over origin-based. This means that quality parameters should be of concern over origin. What brings out the best is competitiveness. We can see the growth in automobile sector, where introduction of foreign players created such a good impact that many companies from India are ruling the motorcycle market in the world. Same would happen in IVD industry with a phenomenal growth, if such competitiveness is allowed.