5 min readIn-Vitro Diagnostics: Promising Market With Tremendous Potential For Growth
The key trends driving the IVD market include the aging population which has led to increased diseases such as respiratory infections and urinary tract infections. Newer assays continue to be under exploited in Europe. However, healthcare providers have started to realize that the IVD test should play a central role in improving the overall cost-efficiency of healthcare systems. Every country in the EU faces budgetary restrictions which are reflected in the test menus and laboratory instruments and their reimbursement structures. The recently added countries to the EU such as Hungary and Malta do not take on well developed healthcare structures as seen in other parts of Western Europe; as they are facing public health problems such as HIV and TB which require high investments to eradicate. This indeed has created a wide market for IVD manufacturers but also increased social and economic pressures on the developing countries.
Unlike other markets in the medical field, the IVD market involves intense research in order to target the market. United States is the largest IVD market in the world; it holds close to 40 percent share in the world wide IVD market, U.S is also the largest IVD manufacturer contributing close to 80 percent of the IVDs used world wide. Western Europe is the second largest IVD market with a market share close to 30 percent. Frost & Sullivan estimates the IVD market in 2006 for Europe close to $ 7 Billion, growing at a rate of 5.6 percent. The Asian IVD market promises enormous future potential for the IVD market, strengthened by financial and economical improvements in the Asian market.
Challenges Faced by the IVD Market
The IVD industry constantly comes across a myriad of challenges which in turn has an impact on the diagnostic companies:
- Research and Development is a key feature for the promising growth of an IVD company. Rising IVD costs and price pressures have compelled the IVD manufacturers to invest more in R&D to have an edge in this technologically driven market.
- Feedback from laboratories suggests that they prefer automated analyzers in order to decrease the labour pool which simplifies the work flow at a lesser cost.
- The development of the IVD market is facing problems because industry participants are looking for partners to maintain the balance between marketing costs and sliding market returns.
- Clinical tests are vital for the diagnosis of a disease, however reimbursements of clinical tests are considered a burden in healthcare budgets. The concept of DRG (Diagnostic related group) has encouraged many European countries to follow its footsteps.
- The number of clinical tests, to be prescribed are decreasing in many parts of Europe due to the cost associated with the tests which threatens advancements in the market because the reagent sale, the primary revenue generator in the IVD market is severely compromised.