Healthcare market research publisher Kalorama Information has identified the top five trends in the healthcare field that made an impact in 2014 and will continue to be an influence throughout 2015. Kalorama compiled its list based on news events, growth rates of markets the firm studied in 2014, and information requests the firm receives from industry participants.
Here are some of the biggest talking points for 2015:
1. The Next-Generation Sequencer Goes Clinical
Sequencing has always been used to understand cancer generally, but expect them in the future to be part of cancer testing strategies for specific patients. Expect companies who can deliver this technology, and most importantly can provide the software to make sense of the voluminous data created by NGS systems, to prosper and become acquisition targets. You will see increased use of systems in clinical labs, as sequencers were once bulky systems to be found only in a few sophisticated laboratories. New ‘next generation” benchtop models from Life Technologies and Illumina have changed that. There is considerable interest in the healthcare industry in using DNA sequencing to better understand disease and specific abnormalities, particularly in enhancing the study of tumors. The increased use of sequencing may enhance some existing test products and may compete with others.
2. Companies Look Beyond the BRICs For Growth
In 2015, BRIC nations will still be part of US companies’ strategy for growth as these fast-growers continue to invest in healthcare for citizens, but they may not provide the same level double-digit growth as they once did. Brazil and China are favorites and are still growing at a faster rate than the United States markets but not as fast as in previous years. For instance, inflation surged in Brazil and growth slowed to 2.5%. China’s 7.7% is still admirable compared to most of the world, but both nations were at 10% in 2010. Russia, plagued by oil price woes and sanctions, is estimated to see GDP growth of less than one-half of 1%. Kalorama believes this will impact manufacturers’ plans to use these emerging markets to counter slow revenue growth in developed markets. Expect to hear about new growth nations, such as Singapore, Indonesia, South Africa, Mexico, Turkey, and Poland, in 2015 as device manufacturers seek revenues.
3. Interest in Patient Monitoring Solutions and Telemedicine
One market that can safely grow in the United States and Europe as other areas are reduced is patient monitoring. Aging Baby Boomer populations in the US will require solutions outside the hospital. Strained nursing care systems will drive hospitals and physicians to treat patients at home, spurring demand for systems that allow them to do this safely. Remote patient monitoring systems inside hospitals or connecting healthcare workers to patients at home continue to demonstrate revenue growth and customer demand. The market is expected to reach $29 billion by year end and will grow at a rate of 9% for the next four years, according to Kalorama Information’s report.
4. Demand For Biopharmaceutical Production
The need to produce new biopharmaceutical drugs is driving the market for the companies that will handle the production and for the equipment used in the process. The Biopharmaceutical Production market demonstrated 11% revenue growth and reached $41 billion this year, according to Kalorama’s estimates. With the investment in recent years in biotechnology companies, this type of growth is expected to continue.
5. Medical Device Companies Make Large Acquisitions
2014 was a year of buying in medical devices, most notably Medtronic and Covidien. Developed markets where the big healthcare dollars are spent are not growing fast enough, so revenue growth was slow – just 3% according to Kalorama’s report on the topic – therefore, acquiring competitors was one way to achieve faster revenue growth for the big companies. Several large device mergers were concluded or announced in 2014. In addition to several acquisitions by Stryker, Zimmer announced this year the acquisition of Biomet Inc. Becton Dickinson also announced it would purchase CareFusion. The rate of growth shouldn’t change much in the device market, and this year, competitors will need to respond to these giant concerns created by the deals of last year. The result: Expect more announcements of device company mergers in 2015.
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