Tissue Diagnostics Projected to Reach USD 3.5 Billion by 2017

The global market for tissue diagnostic products accounted for USD 2.4 billion in 2012 and is estimated to reach USD 3.5 billion by 2017. Together, Europe and the United States contribute to about 79% of the market, leaving the remaining share to Asia-Pacific (APAC) and rest of world economies.

For most Tier 1 companies, factors such as reimbursement cuts and heavy hospital consolidation have massively affected the sale of equipment. Advanced technology applications like automatic stainers, microtomes, and tissue processors require capital financing and capital budgets are always a problem.

"Customer consolidation is a key challenge which leaves vendors with very few customers to compete for," notes Frost & Sullivan (San Antonio, TX, USA) Healthcare Research Analyst Divyaa Ravishankar. "Both in Europe and the United States, consolidation is affecting the hospital industry, as well as clinical laboratories. Vendors are therefore reworking and redefining their strategies, for instance focusing on acquisition and procurement strategies that will benefit customers. These may include offering competitive monthly payments or tax benefits in connection with the IRS section or providing incentives and deferring payments to help overcome budgetary constraints."

Opportunities may also lie in emerging countries, such as China, Brazil and APAC. When the rest of the economy was suffering from budget cuts and slash downs, most companies witnessed massive growth in APAC and rest of world countries. By increasing their direct sales force and acquiring distributors in these countries, companies have been able to successfully reap business.

Governments in several APAC countries are setting up favorable guidelines for growth of the hospital sector, such as investing in and improving services for the poor from state hospitals and Public Private Partnerships (PPPs). Private hospitals are also growing by virtue of government policies. For example, China allowed 100 percent foreign direct investment in the private hospital industry. This will positively impact the purchasing power and result in an increase in test volumes, leading to better accessibility.

"The future of pathology aims at collaborating with clinical next-generation sequencing to be able to provide a combination of pathology and genomic information," concludes Divyaa Ravishankar. "The tremendous growth in gene expression, micro RNA (miRNA) profiling, and genotyping studies on Formalin-Fixed Paraffin-Embedded FFPE will drive the demand for improved upstream processes. Vendors of FFPE sample prep solutions must understand the current customer trends and future needs to capitalize on the expanding opportunities driven by clinical application of advanced genomic platforms."

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