Companion diagnostics crossed the billion-dollar threshold in 2013: Report

The global companion diagnostics market crossed the billion-dollar threshold in 2013 and is continuing to climb rapidly as healthcare systems tap into the value of testing which patients would benefit most from targeted treatments.

That's according to Kalorama Information, which issued a new report on the industry sector. Consider these Kalorama-compiled numbers: The global companion diagnostics market was worth $1.2 billion in 2013, a 12.5% jump from the $950 million value calculated for 2011. What's more, companion diagnostics sales growth should accelerate over the next 5 years because it is now a primary focus of drug development and more commonly used for diagnosis and treatment, Kalorama said.

Kalorama noted that companion diagnostics is a small part of several larger, interconnected diagnostics sectors, including in vitro diagnostics, immunoassays and biomarkers. In the recent past, companion tests, which are used to identify which patients will benefit most from a particular drug, had not been very common. But that has changed with more FDA approvals and a realization of the benefit of tests in maximizing a drug's effectiveness and helping to control healthcare costs, Kalorama analyst Mary Ann Crandall said in a statement.

"One of the faster growing testing areas in terms of revenues is drug/test pairs. The emergence of new technology has opened doors for companion diagnostic research, discovery, development and commercialization," Crandall said. "The realization that companion diagnostics can decrease costs by identifying the patient population that will most likely benefit from a therapy and ruling out those therapies not likely to be effective has made companion diagnostics important to the delivery of care."

Companion diagnostic test development is furthest along in cancer. The year has seen a number of development deals in the space. Among them: Roche's ($RHHBY) Ventana Medical Systems sealed a deal in July with Germany's Merck KGaA to concoct a companion diagnostic test that can be used for many different types of cancer. Ventana already has deals in place with drug companies including MedImmune, Bayer, Pfizer ($PFE), Incyte and Takeda's Millennium Unit. Recently, Illumina ($ILMN) also sealed an agreement with Big Pharma outfits AstraZeneca ($AZN), Janssen Biotech and Sanofi ($SNY) to develop a universal gene-sequencing companion diagnostic test focused on cancer, and other strategic pharma partners are expected in the future.

In May, Qiagen ($QGEN) and Eli Lilly ($LLY) signed up for their fourth companion diagnostics development partnership, all involving various cancer drugs under development or approved.

Underscoring the maturity and growing presence of companion diagnostics in the marketplace, the FDA recently issued new guidance to govern approval or clearance of the tests.

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