The majority of new cancer tests coming to market are proprietary assays with the test services being provided by certified labs opened by the IVD companies that developed the tests. All the major reference labs in North America and Europe are also offering a slew of in-house developed diagnostic tests. This shift is leading to greater profits for those companies offering test services, notes health care market research publisher Kalorama Information in its new report "The Worldwide Market for Cancer Diagnostics, 4th Edition."
Test services are not a new business model. Myriad Genetics was the first company, in the mid 1990s, to offer its patented and proprietary cancer assays as a service in its own laboratory. The first generation of these tests targeted small markets where the financial investment for FDA market clearance would be difficult to recuperate with a commercial test kit.
However, in the past few years many IVD companies have begun to establish cGMP and CLIA-certified labs by which they offer their proprietary tests to physicians, hospitals and reference labs. Nowhere is this trend more evident than in the commercialization of cancer diagnostics.
In 2007 there were at least 40 company and lab developed cancer tests either already available or very near market. In 2008 and 2009 another 70 or so have been or are in development. The market for these tests is getting very competitive. Reference labs such as LabCorp, Quest Diagnostics, Specialty Labs and ARUP, as well as numerous private pathology labs, now offer sophisticated genetic and proteomic tests that they have developed alone and in collaboration with IVD companies.
Growth rates demonstrate the results of this strategy, according to Kalorama. Average annual revenue growth from 2005 to 2009 for the major cancer test service companies, including Clarient, Genomic Health, Genoptix, and Myriad Genetics, was 60%; while average annual revenue growth was 14% for the major cancer diagnostics companies during the same period.
"Success in this new test commercialization model may appear like serendipity and a function of being in the right place at the right time," notes Shara Rosen, Kalorama Information’s diagnostic analyst. "While there is an element of this in success, it is more a question of successful product development; success is built on a test that fulfills a perceived unmet need, fulfills good test practices of sensitivity and specificity (good science) and has an element of proprietary technology (cannot be performed easily in a routine laboratory)."
Molecular biology is expected to lead to an exponential growth in the number of cancer tests available. Some 25,000 to 30,000 molecular and protein biomarkers may someday become part of the medical toolbox. The mix and match of molecular and protein markers opens the door to a whole new generation of tests. It is as part of this new generation of tests that company developed and in-lab developed cancer tests are aiming to make their mark.
Source: Kalorama Information