The DNA Diagnostics Business

Report Highlights

• The overall worldwide market for molecular (DNA) assays is expected to reach $7.3 billion in 2004 and will rise at an AAGR (average annual growth rate) of 11% to $12.6 billion in 2009.
• As an indicator of the rapid expansion of this market, it is significant that its value in 2000 was $940 million.
• Drug discovery and life sciences applications represent more than 50% of the market. Clinical applications make up the bulk of the rest (24%) and are growing more rapidly (14% AAGR) than the total market.
• Ninety percent of DNA assays performed are concentrated in the developed world. By 2009 more affluent emerging nations are expected to participate in this market.

INTRODUCTION

Molecular (DNA, RNA) technologies are becoming the dominant platform for discovering and developing diagnostic tests, and also are emerging as significant tools for determining which treatment regimen doctors prescribe for patients. Molecular diagnostics represent one of the fastest growing segments of the diagnostics market. However, the contribution these tests can make to patient outcome faces significant barriers including reimbursement issues, lack of standardization across test platforms and the inability to fully interpret test data.

This BCC report builds on the information presented in two previous BCC studies and provides a critical overview of this rapidly expanding industry and the move of molecular tests from research into a routine testing mode. The document examines current status of the worldwide market for molecular tests performed for patient testing (clinical diagnostics), in drug discovery and life sciences research and related biomedical fields. It presents an analysis of market growth in these segments over a five-year period from 2004 to 2009. Of particular interest is the patient testing market segment, that has shown significant advancements in the past few years, and will continue to do so for the forecast period and beyond.

The main focus of the study is clinical nucleic acid diagnostics and refers to the tests that use DNA and RNA as bases for diagnostic tests. The clinical application of DNA diagnostics is to elucidate, diagnose and monitor human diseases from the perspective of the molecular basis of the disease and medical conditions.

SCOPE OF STUDY

The report contains:

• An overview and definition of molecular tests and test applications
• Discussion of the interplay of advances in the Human Genome Project and pharmaceutical research
• Analysis of each technology and technological issues including the latest trends
• Current worldwide market status of each, its impact on future markets, and forecasts for growth through 2009
• An examination of influential factors such as technological developments, bioinformatics, patent issues and patient demographics
• Government regulations regarding the commercialization of molecular tests in major regions of the world
• Market and company market share estimates.

METHODOLOGY

BCC presents an analysis, by each molecular test technology, of the market penetration of that technology. The estimated market value of each technology is based on what users have paid in non-depreciated dollars. No adjustments have been made for changes in currency exchange rates over this period or for the effects of inflation. Then, based on our surveys, the report analyzes the potential applications for each technology, and forecasts growth for 2004 and 2009. The report also presents market data for the major industry groups that use molecular tests.

This report has been developed solely for information purposes. The market assessments provided have been assembled based on publicly available information from January 2001 up to and including April 2004 and which are believed to be reliable. BCC, however, cannot make any representation as to the completeness and precision of the data presented.

The report attempts an analysis related to world markets. However the major manufacturers and users of sophisticated therapeutics and laboratory diagnostics are found in the developed areas of the globe - N. America, and Western Europe. The reader will therefore find a bias toward these countries and little information regarding the developing nations of the world. However where possible BCC has endeavored to relate trends to opportunities and threats in the emerging countries of the world as well.

Furthermore since the report covers a relatively immature industry, the reader is cautioned to use the quantitative data as a bellwether with which to assess these developing areas of molecular diagnostic technology. Although considerable effort has been devoted to assuring the accurateness of the market data provided, the report seeks to use the data to explore the potential of the various technologies and product groups discussed.

Developments in pharmacogenomics and gene-based diagnostic tests are evolving very quickly, such that some of the company and technology data presented here may be outdated as this report goes to press. BCC is fully cognizant of these developments and assures the reader that although some of the details may have changed by the time this report is published, the major themes, players and issues remain unchanged.

INFORMATION SOURCES

The information contained in this report has been assembled from primary and secondary data. Primary research was conducted via telephone conversations with selected diagnostic, biotechnology and pharmaceutical industry professionals to assess the current market and trends in their respective fields of interest. Secondary data was collected from peer review journals, industry media and industry generated press releases, as well as the author's attendance at the premier IVD trade shows and conferences, worldwide.

All information contained in this report is derived from public sources, including press releases and websites of companies and organizations mentioned here.

Market and company market share estimates were drawn from published reports of company sales and revenue statistics as well as information drawn from discussions with industry professionals.

Selected information sources include:

• GeneTests: A federally-funded site offering expert-authored disease reviews and international directories of genetic testing laboratories and diagnostic clinics "www.geneclinics.org"
• Association for Molecular Pathology "www.ampweb.org"
• National Cancer Institute "www.nci.nih.gov"
• American Association for Clinical Chemistry "www.aacc.org/" pharmacogenetics
• American Association of Blood Banks "www.aabb.org"
• American College of Medical Genetics "www.acmg.net"
• The National Human Genome Research Institute "www.nhgri.nih.gov"
• Genetic Conditions/Rare Conditions Information Site "www.kumc.edub/ gec/support/"
• Genetic Diseases"www.bioscience.org/atlases/disease/genedis/list.htm".

ANALYSTS CREDENTIALS

Research analyst Shara Rosen has been involved in the health care industry since 1971. She has worked as a laboratory technologist, a marketing services manager for a diagnostics company, a freelance journalist and editor for medical trade journals. Ms. Rosen provides market information services to the diagnostics and medical biotechnology industries and has authored reports on new technology commercialization biosensor technology, diagnostic trends, vaccines, infectious diseases, and virology and microbiology tests systems. R.T., Algonquin College, Ottawa; MBA, Concordia University, Montreal.