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16th July 2007

Consumer diagnostics on verge of growth explosion, says report

According to a number of leading experts from across the diagnostics industry, the market for over-the-counter (OTC) tests is poised for exceptional growth. However, the diagnostics industry's ability to seize this opportunity hinges upon greater collaboration with consumer and pharmaceutical companies, concludes a report released today. The drivers for such growth, beyond the current market for glucose and pregnancy tests, come from the healthcare providers who want to reduce the burden of care and identify conditions much sooner; and the consumers who want to play a more active role in managing their health. Between 2005 and 2010 this new OTC market is predicted to grow by at least 5% CAGR to $690m. Beyond 2010 the market will expand more into the consumer sector, and could rival that for glucose testing, which currently stands at around $6 billion.

At the moment the worldwide consumer diagnostics sector is predominantly focused on glucose and pregnancy testing. However, the delegates discussed that with the prevalence of conditions such as cardiovascular disease, high cholesterol and obesity there is a major commercial opportunity and patient benefit for in-home testing and monitoring. In the near future these conditions will be the leading causes of death and disability. By making positive changes to their lifestyles, as the result of early identification and subsequent monitoring, patients can eliminate or better manage these conditions.

There is a clear opportunity within Europe, especially nations with centralised healthcare providers, such as those in the UK and Italy provide the most fertile ground, delegates said. As they face an increasing burden of care, such providers have extra incentives to make use of other outlets for patient testing, including pharmacies and even supermarkets. This new approach will empower consumers as well as increasing the chances of the early identification of serious conditions.

Even with such strong drivers and clear market opportunities, the diagnostics industry is not capable of this step-change on its own, delegates asserted. This is where collaboration comes in. Through partnerships with the pharmaceutical industry, the diagnostics companies will work with people used to funding outcome studies; and through working with consumer companies the diagnostics industry gets access to consumer design expertise, as well as channels to market. Evidence suggests such change is already happening albeit to a limited extent - for example, with Inverness Medical and Procter & Gamble setting up a joint consumer diagnostics joint venture in July 2006 to explore the opportunities for co-development and joint marketing.

Dr Simon Burnell, author of the report and head of Cambridge Consultants' diagnostics group, said: "In both the US and worldwide, the diagnostics industry hasn't really changed in a number of years. We see incremental innovations and new products, but these are typically aimed at the same target customers - the healthcare providers. If they continue as they are, the diagnostics industry, or at least the slow movers, run the risk of missing a massive opportunity for profit and growth."

"Diagnostics companies everywhere should be feeling anxious. Reaching this new market involves significant change and investment, which some companies do not have the resources to exploit. This is why the attendees at the recent workshop identified collaboration as the way forward. Successful collaborations between key players from the pharmaceutical, diagnostics and consumer sectors will create a powerful and convincing offering for consumers," continued Dr Burnell.

The group discussed the core diagnostic technology needed and as a whole felt that it already existed to make this new sector a reality. However, the group identified that new approaches to product design would be needed as the products migrated from OTC to more of a consumer product and that, as patient compliance is poor for certain conditions, some consumer-friendly diagnostics would need to be integrated with other products, such as a toothbrush to detect tooth decay or gum disease, a computer mouse that monitors hydration or a mobile phone that can monitor your temperature; all of which eliminate the need for testing. In essence, new products need to be simple, reliable and produce an actionable result.

The free report follows a workshop hosted by Cambridge Consultants in late June 2007, where senior thought-leaders from across Europe discussed the future of diagnostics as a consumer-driven market. The attendees discussed the current market, the opportunities available and how technology would enable firms to profit. The report provides a valuable insight for global diagnostics companies who see Europe as a key market. In autumn 2007 the workshop and report are to be repeated, this time with a wholly North American audience - providing a contrasting and global perspective.

The report is free of charge and can be requested here.

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