January 15, 2008 (Vol. 28, No. 2)

Lucy J. Sannes

Advances in Technology, Genetics, Genomics, and Personalized Medicine Drive Growth

As technology advances, so does the molecular diagnostics market. New tests and new instruments to perform and automate analysis continue to expand the capabilities of companies in this segment. Furthermore, the identification and validation of novel genes and biomarkers makes it possible to develop and introduce even more tests. Molecular diagnostics is a rapidly growing and rapidly changing market.

It’s a market that includes sales of reagents, instruments, and kits to clinical laboratories and research reagents that can be used by labs to develop their own in-house procedures. It also includes testing services by those clinical labs that have developed their own products, plus diagnostics companies that operate their own branded, certified testing services. Examples of the latter include Genomic Health’s Oncotype DX and the various tests offered by Myriad Genetics.

In 2007, the in vitro molecular diagnostics market was expected to increase from $1.3 billion to $1.5 billion in the U.S., and $2.5 billion to $2.8 billion worldwide. Clinical lab testing services are expected to amount to about $3.2 billion for the U.S., according to Jorge Leon, Ph.D., president of Leomics Associates (www.leomics.com).

The first and largest molecular diagnostics market segment is infectious diseases, which has been dominated by tests for sexually transmitted diseases and hepatitis (Figure). One additional infectious agent, human papillomavirus, has joined this list of major tests in the form of the Digene HPV test. Within the U.S. clinical laboratories service portion of the market, infectious disease testing is the largest segment with about 70% of the total market, or about $2.2 billion in 2007.

Other market segments include traditional genetics, personalized medicine, and cancer with 13%, 9%, and 8% of the U.S. clinical labs services market, respectively. Because infectious diseases is a mature segment, these other categories are growing more rapidly on a relative basis. For instance, Leon projects that the cancer segment is growing at about 20% a year, traditional genetics about 15% a year, and personalized medicine about 20% a year, compared to the 5–10% growth rate for infectious diseases.

Growth also varies by individual tests within segments. For the Digene HPV test, the company reported a 38% increase in sales from fiscal 2005 to 2006, or $97.4 million to $134.4 million, then a 42% growth rate for the first nine months of fiscal 2007 compared with the same period in 2006. The company has since been acquired by Qiagen. For the Oncotype DX test, Genomic Health reported revenues of $4.8 million in 2005, $27 million in 2006, and $27.7 million for just the first six months of 2007.

In a recent web survey, over 250 participants ranked the segments poised for growth over the next two years and the next five years. Many of the survey respondents work in research areas such as biomarker discovery and validation, diagnostics research, diagnostics product development, discovery or preclinical research, and clinical research. The responses hence reflect more of the R&D phase rather than already commercialized products.

Near term, respondents predicted significant growth in oncology at 33% and infectious disease at 30.1% with less growth seen for genetic testing at 14.5%, and pharmacogenomics at 12.5%.

Longer-term growth, as predicted by the survey respondents, remained the same categorically, but priorities changed. Increase in the oncology market was about the same at 34%, the pharmacogenomics prediction increased to 26.5% long term, infectious diseases growth over the long haul fell to 14.6%, and genetic testing was also forecasted to see less growth at just 12.3%.


Lucy J. Sannes, Ph.D., is president of Sannes & Associates and author of Molecular Diagnostics: A Rapidly Shifting Commercial and Technology Landscape, a new report from Insight Pharma Reports, a division of CHI. Web: www.insightpharmareports.com.

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