In vitro diagnostics (IVDs) are non-invasive tests performed on biological samples (for example blood, urine or tissues) to diagnose or exclude a disease. IVDs provide valuable information about how the body is functioning and the state of health. They are used for diagnosis, screening and therapeutic monitoring of diseases. IVDs have a broad scope ranging from sophisticated technologies performed in clinical laboratories to simple self-tests, such as those for pregnancy and glucose monitoring.
In vitro diagnostics are an essential part of today’s healthcare. IVDs are used to diagnose, monitor, screen and assess predispositions to diseases, thereby contributing to the available medical information regarding a patient. By allowing earlier and more targeted treatments, IVDs help to reduce hospitals stays and convalescences, resulting in a healthier population, reduced costs and economic growth in the long run.
Despite stagnating or decreasing revenues in four of the five largest European IVD markets (Germany being the exception), overall revenues across Europe increased by +0,5% to €10,543 million. However, this remains below the revenues recorded in 2012 (€10,603).
While the IVD revenues in Germany stagnated overall, modest growth was seen. Germany is the only large market to experience growth of +1%, modest growth was seen in both microbiology +2,2% and immunochemistry +2,5%. From the largest five markets, UK is experiencing the highest decrease of -2,9%, due to reduced reagent revenues mainly in Clinical Chemistry rapid test and POC. In Italy the IVD market dropped with -1.3% compared to 2014. After decreasing the previous three consecutive years, in 2015 the French IVD market is in stagnation with a tiny growth of +0,1%.
Although there are variations in healthcare systems, reimbursement policies, etc. from country to country, healthcare cost containment is a constant across the EU5 countries. Besides budget restrictions, greater centralization both in the public and private laboratory sectors has increased the power of purchasing organizations.
The German IVD-Market grew slightly around +1,0% in 2015. This indicates a slight recovery from the results of 2014 vs 2013 of -0,1% and versus the previous years. Compared to 2014 the changes in market size differ stronger in the individual market segments. Laboratory diagnostics (reagents and instruments) increased by +1,5%, which indicates a stronger growth compared to 2014 versus 2013 of +0,7%. The rapid test market made a turnaround in 2015. While this market segment decreased in the range of -1,5% in 2014 versus 2013, it grew by +0,2% in 2015.
Sales in the glucose self-testing market, the largest segment in the rapid testing market, decreased about -0,6%. While the decline was weaker than in 2014 versus 2013 of -3,2%, this market segment still suffers from the restrictive legal framework that forces medical doctors to prescribe generic, low-priced test strips to keep their respective budget.
Overall, as in 2014 the floating quota percentage for laboratory service fees, that remained unchanged in 2015, still caused strong price pressure on the IVD market in Germany. However, some market segments continued to grow, despite the restrictive legal framework. The sales in the market segment microbiology reagents rose by +2,2%. Even stronger, immunochemistry grew by +2,5%.
The Central Laboratory IVD Market in France is estimated at 1.418 billion €, in stagnation with a tiny growth of +0,1%, compared to 2014. This follows decreases of -0,4% in 2014 and of -0,3% in each of 2012 and 2013.
The total IVD market dropped by -2,9% (£21,8m) in 2015 due to reduced reagent revenues of -£24m, and of these -£25m due to Clinical Chemistry rapid test and POC. This is almost entirely due to reduction in reported revenues for glucose test strips (-£25m) which may reflect in part increased share by some of the companies.
The National Health Service (NHS) target remains to reduce the pathology laboratory budget by £500m. The main dynamics in the market continue to be determined by the consolidation of laboratory provision, tendering of pathology services and the increasing proportion of IVD revenues generated through Managed Service Contracts.
In 2015, the IVD market in Italy (1.635 million euro) decreased by -1.3% compared to 2014. According to the Stability Law 2015 regions were expected to reduce their healthcare expenditure, and specific financial caps were set for medical devices. In particular, the overall public expenditure for medical devices was kept under 4.4% of the NHS budget, no matter if such a limit is much lower than the actual public expenditure for medical devices (about 5.1% of the budget). Beyond that, the reduction of the number of laboratories and the strengthening of the centralized bids continues.
The IVD market in Spain remains declining slightly year over year -1,6% mainly due to the crisis and also the continuous laboratory consolidation. We expect the market to recover in the coming years, but not to the previous levels prior to the euro crisis.
The rapid testing market and POC -mainly diabetes test strips decreased -2,4%, in spite of a stable or even growing number of determinations, due to centralized purchasing and price pressures. Introducing new parameters, especially if those represent a budget increase are difficult for budgetary reasons but also due to the very long tender cycles that limit introduction of new tests during this period.