Healthcare Ecosystem Insights - Overview
The “Healthcare Ecosystem Insights” report provides details of the healthcare industry in the U.S., Germany, the U.K., France, China, Japan, and Singapore. The healthcare industry in the U.S. is expected to reach $5,605.5 billion by 2024, registering a CAGR of 6.6% during the forecast period. The growth of the industry in the seven countries can be ascribed to the increasing prevalence of chronic diseases, government initiatives and improved healthcare infrastructure, increasing GDP and healthcare expenditure, rise in the adoption of healthcare insurance, surge in geriatric population, growing demand of in-vitro diagnostics (IVD) tests, and digitalization in healthcare industry.
The healthcare industry can be classified into various disease types, such as cardiovascular and circulatory diseases; cancer; chronic respiratory diseases (CRD); neuropsychiatric disorders; diabetes, blood, and endocrine disorders; musculoskeletal disorders; and chronic liver diseases, among others. Cardiovascular disorders being the most prevalent out of all the chronic diseases; which makes the cardiovascular and circulatory diseases category as a largest revenue generator in the German market, with an expected contribution of 42.6% by 2024, progressing at a CAGR of 3.3% during the forecast period. Cancer is likely to be the second leading category in the German industry, based on disease type, and is expected to contribute 26.5% share toward the total market by 2024.
Based on channel, the healthcare industry is divided into non-profit, for-profit, state/local, and others. The state/local category held the third place in the Japanese healthcare industry during the historical period, with 17.4% of the market share in 2018. This is mainly because very less services are offered by state/local channels of healthcare.
Healthcare Industry Dynamics
Some of the key factors driving the healthcare industry in the countries covered in the report are surge in geriatric population, growing demand of IVD tests, rise in the adoption of healthcare insurance, and digitalization in healthcare industry.
The process of aging is directly linked with various types of chronic diseases, including CVDs, rheumatoid arthritis, and neurological medical conditions. Increasing life expectancy and falling death rates are the major contributors for the growing geriatric population across the globe. According to the World Bank, the population of France aged 65 years and above increased from 11.5 million in 2012 to 13.2 million in 2017; whereas, in Japan it rose from 30.4 million in 2012 to 34.2 million in 2017.
Further, a study on Japanese citizens aged 75 or older by the National Center for Chronic Disease Prevention and Health Promotion (NCCDPHP) in 2019 showed that approximately 65% of patients had three or more co-occurring diseases, such as hypertension, coronary heart disease, and peptic ulcer disease. As older people are more susceptible to such diseases, the advancing aging population in these countries may contribute significantly to the high demand for medications and other healthcare facilities; thus, driving the growth of the healthcare industry in the countries covered in the report.
Further, increase in the demand for IVD tests have been observed in many countries due to their advantages such as faster results; multiple tests performing capability in same time; detection of different compounds; ease of recording data; and reliable results that can be quickly repeated to confirm the result. For instance, rising demand for IVD tests has been observed in China, which can be attributed to the outburst of chronic diseases within aging population living in China, that can be diagnosed and monitored using these IVD products.
Moreover, rise in adoption of healthcare insurance is directly related to the increase in the adoption of healthcare facilities as it lowers the financial burden on patients which may result in the growth of healthcare industry. Private and public funded health insurance plans have become an affordable healthcare services for the patients. Due to several initiatives implemented by the government organizations, the adoption of healthcare insurance is increasing across the globe. For instance, in November 2015, the Singaporean government implemented MediShield Life, a national catastrophic insurance program which covers all basic public hospital treatments of all Singaporean citizens and permanent residents.
Furthermore, digital transformation has proven to be an important factor in reducing the excessive healthcare expenditure in various countries across the globe. Giant healthcare players are actively engaged in developing digital platforms that help in providing better healthcare services. Cloud computing is a key factor transforming the healthcare industry, which helps hospitals and office-based physicians to store the patient records over the cloud and also connects the patients 24/7 to access their medical records and test results; telemedicine which involves the use of telecommunication technology, to remotely diagnose and treat the patients; wearables which helps in sending automatic prompts to the patients about their weight, sugar, oxygen level, pulse, and several other information.
Stringent regulations can be viewed as a major restraint for the healthcare industry across the seven countries. Excessive regulation and lengthy approval process make it hard for medical device and drug manufacturers to receive approval of new products, depriving patients form advanced treatments, that might benefit them. There are several organizations which are responsible for the approval of a wide range of medical products. For instance, in Japan, the Pharmaceuticals and Medical Devices Agency (PMDA) ensures safety measurements in the development phase of every drug and medical device. Further, the U.S. FDA in the U.S., and the Medicines and Healthcare products Regulatory Agency (MHRA) in the U.K., ensures safety measurement, and are responsible for the drug and device approval in these countries.
The approval of a medical device takes around 3 to 7 years; whereas, it takes approximately 12 years to bring a drug from developmental phase to the market. This costs huge capital, depriving patients of treatments that might benefit them. Thus, stringent regulations have made it difficult for drug and medical devices manufacturers, to bring such products to the market; thus, acting as a restraint for the healthcare industry.
Healthcare Industry Competitive Landscape
New product launches by the industry players is expected to increase the availability of technologically advanced products in the healthcare industry.
For instance, in February 2019, Agilent Technologies Inc., a provider of application focused solutions to life sciences, diagnostics, and applied chemical markets, launched Magnis, a fully-automated next-generation sequencing (NGS) library preparation system, which is specifically designed to run complex DNA sequencing assays, with the help of a button system. The NGS preparation system includes reagents and protocols that makes it easy to assay multiple genes and complex genetic aberrations from genomic DNA, including degraded samples like formalin-fixed paraffin embedded (FFPE).
Besides, in March 2019, Creative Biolabs Inc., a life-science company which offers integrated drug discovery services, launched its IVD antibody development services for a variety of disease areas such as cancer, autoimmune diseases, infectious diseases, and CVDs.
F. Hoffmann-La Roche Ltd., Danaher Corporation, Abbott Laboratories, Siemens AG, Sysmex Corporation, Thermo Fisher Scientific Inc., Becton, Dickinson and Company, bioMérieux SA, Bio-Rad Laboratories Inc., Johnson & Johnson, Agilent Technologies Inc., QIAGEN N.V., DiaSorin S.p.A., and Ortho-Clinical Diagnostics Inc. are the key IVD players operating in the healthcare industry in the seven countries covered in the scope of the report.