Vol. 19 • Issue 7
• Page 12
The Molecular Edge
Despite the difficult economic conditions, the U.S. diagnostic nucleic acid testing (NAT) market continues to grow due to increased test volumes in the infectious disease and cancer (HPV and KRAS) testing market segments. Although historically NAT has been performed in higher volume, highly complex labs, testing is expanding into smaller labs; the number of labs performing molecular testing continues to increase. This shift is a result of improved technologies and automated instruments building on the desire to improve clinical outcomes. Many of these institutions, especially those that recently brought molecular testing in-house, may only perform one or two molecular assays but expect to expand their offering over the next couple of years.
NAT is often viewed as the future of diagnostics and an area of rapid growth, but where and how is this growth happening? In the fall of 2009, Boston Biomedical Consultants surveyed 100 laboratories throughout the U.S. to better understand the growth in the market. The survey focused on small community hospital laboratories (hospitals with <500 beds) but also captured a representative sample of medium and large hospitals. Of the 100 respondents, most offer a wide variety of molecular tests but perform a very limited number of them in-house.
The desire to perform molecular testing in-house is driven by several clinical and economic factors. However, this desire is stymied by high cost, budget constraints and low volume. As such, most institutions begin by bringing in one or two of their highest-volume molecular tests and performing the testing in one of their existing labs, most often microbiology (approximately 70% of respondents), underscoring the legacy of NAT-based sexually transmitted disease testing. Survey results indicate a correlation between the length of time performing molecular testing and the number of tests performed in-house with laboratories that have been performing NAT for <2 years conducting only two or three tests. Within the past few years, the same labs have seen these test volumes increase significantly-more than 50% experienced high single-digit or low double-digit growth, with ~25% of respondents noting >+10% growth.
Assays that have recently seen rapid growth (i.e., influenza testing) are not driving the expansion in the market. It is the more developed assays such as CT/GC and HPV that are performed in small community hospitals. MRSA testing is being adopted by small hospitals, as they can easily begin testing given available automation, with the Cepheid GeneXpert® frequently cited by respondents. Within the labs sampled, CT/GC was the test most frequently offered and the assay experiencing the highest test volumes and fastest rate of growth.
When choosing a system, most laboratories cited "performance characteristics" as the most important decision factor; this was followed by price. Within the laboratories surveyed, Roche instruments had the greatest presence in the market, reflective of the company's leading market position; the majority of these instruments are in the larger hospital laboratories which may have several Roche instruments. When looking at laboratories that have been performing NAT for <2 years, the most common manufacturer in this group is Cepheid followed by Roche, Gen-Probe and BD. These competitors reflect the high volume of MRSA and CT/GC tests performed in the U.S., the high level of automation offered, as well as the lower complexity of qualitative bacterial testing compared to, for example, a quantitative RNA-based viral test. NAT instruments are dissimilar to other IVD market instruments in that most have limited testing menus; with only a handful of FDA-approved assays on any given platform, the need for multiple instruments is high. Of the 53 small hospital laboratories surveyed, approximately 70% had only one to two instruments; expanding beyond these responses, that percent declined.
The expansion of NAT into smaller labs seen in the past few years is expected to continue for some of the more established/mature tests. "Molecular diagnostics [NAT] utilization in the U.S. will continue to improve as increasing levels of automation become available. Healthcare reform is concerning us, because it may result in reimbursement cuts, so we are starting to look at cutting costs by moving toward more automated assays," says John Little, lab administrative director, Decatur (IL) Memorial Hospital.
Within the next two years, nearly 30% of labs expressed the intent to expand by increasing the number of tests performed in-house. Oncology tests, such as KRAS, as well as companion diagnostics are expected to continue to be "hot" testing categories, but not among the small hospital labs. The majority of laboratories see high cost as the single strongest barrier to adoption of molecular testing (of note, reimbursement was the lowest ranked barrier). Of great surprise were the responses when laboratories were asked, "What is one test that you would like available as an FDA-approved test?" More than 40% of labs cited analytes for which there are currently FDA-approved testing kits available, such as MRSA, C. difficile and respiratory viral panels.
Kerri Weinert, Carrie Cresenzi and Andrew Demeusy are consultants with Boston Biomedical Consultants Inc.