Clinica's Complete Guide to Diagnostics - Volume 1: Successful Business Strategies for Companies in the Diagnostics Industry

EXECUTIVE SUMMARY
In vitro diagnostics (IVD) has evolved over the past decade from a market exhibiting double-digit growth to a mature industry. Some traditional segments of the market for products used in the central laboratory are stable or declining in revenues. However, areas of opportunity remain, and the industry appears to be poised for revolutionary changes that will radically alter both the nature of the market and the role of clinical diagnostics in medicine.

Major technology-driven changes discussed in the report will have a serious impact on the course of this market. New information on the genetic basis of disease is expected to fuel growth of nucleic acid diagnostics to include applications outside the existing focus on infectious disease, while an increasing proportion of other types of testing will move out of the hospital laboratory. Miniaturisation of IVD systems may prove to be a revolutionary advance, allowing the cost of testing to be greatly reduced while shortening the time required to generate results.

Key trends in the central laboratory segment of the clinical diagnostics market are discussed in detail in this report. These trends are altering the types of systems in demand in the market, with major implications for product manufacturers. Most laboratory directors believe that existing products are only a first step toward the types of systems that are truly needed.

Key segments of the clinical diagnostics market, discussed in detail with 1997 sales and forecast growth rates provided, include:

Growth in various subsegments of the clinical chemistry market will differ significantly, with sales in the routine chemistry products subsegment expected to decline while sales grow in the critical care and whole blood glucose subsegments. In the immunochemistry segment, important areas of opportunity remain, and are analysed in detail in the report.

The microbiology and nucleic acid diagnostics segment is expected to exhibit strong growth, due to the rapid adoption of new nucleic acid diagnostic tests for infectious disease. The introduction of automated and semi-automated nucleic acid diagnostic systems has allowed the technology to be adopted by a wider range of laboratories, and new products now being launched, which are described in the report, will accelerate this trend. In the long term, the market will be further stimulated by the introduction of nucleic acid diagnostic test kits addressing new applications.

Overview of suppliers in the IVD market
There has been a significant degree of consolidation in the IVD market over the past few years. With the completion of the recent acquisition of Chiron Diagnostics by Bayer, approximately three-quarters of the worldwide market is shared by only eight companies, while the remaining one-quarter of the market is shared by approximately 200 companies with sales ranging from under $5 million to almost $300 million.

Key players in the IVD market include Roche Diagnostics, Abbott Diagnostics, Ortho Clinical Diagnostics/LifeScan (units of Johnson & Johnson), Bayer Diagnostics, Beckman Coulter, Dade Behring, Becton Dickinson, and bioM�rieux. A number of smaller companies are achieving success in the marketplace by focusing on certain high-growth niches. These niches include point-of-care testing, nucleic acid diagnostics, automated cellular analysis, and home and self-testing products.

Mergers and acquisitions reshape the industry
The IVD industry, both because of its maturity and because of declining reimbursement and restrictions on test usage, reached a stage of significant over-capacity in the product sector in the early 1990s. This situation resulted in a wave of mergers and acquisitions that has yet to fully subside. The report analyses the reasons behind these transactions, as well as the changing strategies of the new, larger companies in today's IVD market. In addition, the report identifies numerous small companies developing innovative new technologies, and describes the potential impact these companies will have on the market.

Changes in regulations ease market access
Recent changes in regulations pertaining to IVD products will ease access to markets in a number of countries, particularly in North America and Europe. A general trend in most other regions of the world is attempts by individual countries to harmonise their regulatory requirements with those of other countries, particularly with the new requirements that are now being implemented in the European Union. However, suppliers will generally need to review the regulatory requirements in detail for each target country for at least the next few years in order to ensure that all specifications are met.

Technology developments will have major impact on the market
Although technology has generally been a key driver of the IVD market throughout its evolution, the past few years have not witnessed major new innovations as suppliers have struggled with consolidation and cost-cutting trends. However, it now appears that a new wave of technology-driven change is about to begin. Point-of-care (POC) testing technology is advancing at a rapid rate, and nucleic acid diagnostics technology is already having a major impact on infectious disease testing. Analysers soon to be available, which are discussed more fully in the report, will have the capability to perform chemistry, blood gas/electrolyte, immunoassay, haematology (haematocrit), and coagulation testing using hand-held instruments at the bedside. The timetable for implementation of the new IVD Medical Devices Directive (MDD) in Europe is discussed in detail, as are the ramifications of the directive for manufacturers. Furthermore, testing in the central laboratory will be revolutionised by emerging miniaturised laboratory systems technology. More than ever before, IVD suppliers must be able to react quickly to changing market needs, and to assess future trends accurately in order to develop winning strategies.

Published: January 1999
Ref: CBS798E
Pages: 150
Price: £695/$1,460/¥167,000

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CONTENTS
LIST OF TABLES
LIST OF FIGURES
EXECUTIVE SUMMARY
Key segments of the IVD market
Overview of suppliers in the IVD market
Mergers and acquisitions reshape the industry
Changes in regulations ease market access
Technology developments will have major impact on market

SCOPE AND METHODOLOGY
GLOSSARY
ABBREVIATIONS

CHAPTER 1 INTRODUCTION
1.1 Technology-driven changes in clinical diagnostics
1.1.1 Nucleic acid diagnostics
1.1.2 Point-of-care testing
1.1.3 Microminiaturisation
1.1.4 Laboratory automation
1.1.5 Informatics
1.1.6 Advanced communication technologies
1.2 Other factors driving change in the worldwide clinical diagnostics market
1.3 Key trends in the IVD market
1.3.1 Laboratory consolidation
1.3.2 Workstation consolidation
1.3.3 Standardisation
1.4 Segments of opportunity and risk in the IVD market

CHAPTER 2 INDUSTRY OVERVIEW
2.1 Clinical chemistry segment
2.1.1 Trends in serum/plasma chemistry testing
2.1.2 Blood gas/electrolyte testing products
2.1.3 Urinalysis testing products
2.1.4 Whole blood glucose testing products
2.2 Immunodiagnostics market subsegments
2.3 Microbiology and nucleic acid diagnostics market subsegment
2.4 Haematology and flow cytometry products
2.5 Other IVD market subsegments
2.5.1 Coagulation testing products
2.5.2 Other testing products
2.6 Overview of IVD product suppliers
2.6.1 Large suppliers
2.6.2 Smaller suppliers
2.7 Merger and acquisition activity in the IVD industry
2.8 Perspectives and strategies of key suppliers
2.8.1 Beckman Coulter
2.8.2 Bayer Diagnostics
2.8.3 Roche Diagnostics

CHAPTER 3 REGULATIONS GOVERNING IVDS
3.1 MDD
3.2 Changes in US regulatory requirements
3.3 Regulatory requirements in Japan
3.4 Regulatory requirements in other regions
3.4.1 Regulatory requirements in China
3.4.2 Regulatory requirements in other Asian countries
3.4.3 Africa
3.4.4 Canada
3.4.5 Australia
3.4.6 Latin America
3.5 New environmental waste regulations pertaining to the IVD industry

CHAPTER 4 TECHNOLOGY DEVELOPMENTS
4.1 POC testing technology
4.1.1 The i-STAT system
4.1.2 Other POC test systems
4.2 Nucleic acid diagnostics technologies
4.2.1 Assay formats and nucleic acid amplification technologies
4.2.2 Next generation nucleic acid diagnostic technologies
4.2.3 Automation in nucleic acid diagnostic testing
4.3 Advances in informatics technology
4.4 New developments in cellular analysis technology

CHAPTER 5 COUNTRY MARKETS
5.1 US market
5.2 Japanese market
5.3 German market
5.4 Italian market
5.5 French market
5.6 UK market
5.7 Spanish market

CHAPTER 6 DIAGNOSTIC COMPANY ANALYSIS
6.1 Overview of suppliers in the IVD market
6.2 Mergers and acquisitions reshape the IVD industry
6.3 Company profiles
6.3.1 Roche Diagnostics
6.3.2 Abbott Laboratories
6.3.3 Beckman Coulter
6.3.4 Bayer AG/Chiron Diagnostics
6.3.5 Johnson & Johnson/Ortho Clinical Diagnostics/LifeScan
6.3.6 Dade Behring
6.3.7 Becton Dickinson
6.3.8 bioM�rieux
6.3.9 TOA Medical Electronics/Sysmex
6.3.10 Instrumentation Laboratory
6.3.11 Organon Teknika
6.3.12 Olympus Clinical Instruments
6.3.13 Pharmacia Diagnostics
6.3.14 Diagnostic Products Corporation
6.3.15 Sanofi Diagnostics Pasteur
6.3.16 Bio-Rad Laboratories
6.3.17 Tosoh Corporation
6.3.18 A Menarini Diagnostics
6.3.19 Radiometer Copenhagen
6.3.20 Sorin Biomedica Diagnostics SpA

CHAPTER 7 STRATEGIES FOR SUCCESS
7.1 Product line breadth versus high-margin value-added focus
7.2 Targeting of high growth segments
7.3 Technology strategies
7.4 Marketing and distribution strategies for the IVD market

DIRECTORY
REFERENCES

LIST OF TABLES
Table 1.1 Clinical laboratory automation products
Table 1.2 Trends in hospital admissions versus outpatient visits in the US, 1976-1996
Table 1.3 High and low-growth product segments in the IVD market
Table 2.1 Trends in doctor-ordered chemistry panel test volume for Medicare patients in the US, 1993-1997
Table 2.2 Chemistry testing products
Table 2.3 Blood gas/electrolyte testing products
Table 2.4 Trends in reported chlamydia cases in the US, 1984-1996
Table 2.5 Development-stage less invasive and non-invasive blood glucose monitoring products
Table 2.6 Immunoassay products
Table 2.7 Microbiology test systems
Table 2.8 Haematology/flow cytometry products
Table 2.9 Coagulation testing products
Table 2.10 Market segment participation of the leading suppliers of IVD products
Table 2.11 Emerging companies in the IVD market
Table 2.12 Recent mergers and acquisitions in the IVD industry
Table 2.13 Key alliances and partnerships in the IVD industry
Table 3.1 Timetable for implementation of the MDD
Table 4.1 Overview of analytical technologies for POC testing
Table 4.2 Microarray technologies for nucleic acid probe diagnostic applications
Table 4.3 Automated nucleic acid probe assay systems
Table 5.1 Recent trends in average patient stay in US non-federal short term general and other special hospitals
Table 6.1 Key players in the IVD market, 1997
Table 7.1 Recent IVD/pharmaceutical company partnerships focused on disease management
Table 7.2 Important strategic initiatives in the diagnostics industry

LIST OF FIGURES
Figure 6.1 Key players in the IVD market, 1997

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