Companion Animal Diagnostics Market Maintains Course

Companion Animal Diagnostics Market Maintains Course

Metrics used to construct the market projections of The World Market for Veterinary Diagnostics indicate the continuation of several previously observed market trends for companion animal diagnostics through the last half of 2014 and into 2015. While positive indicators abounded in past years across companion animal diagnostic product segments, some have fallen in performance recently. Opportunities to capture strong market growth remain available in companion animal diagnostics, though the overall market is not the fundamentally explosive growth proposition it once was.

The following reviews the prospects of major product areas in companion animal diagnostics:

  • In-practice analyzer placements are no longer progressing at a torrid place in the relatively established North American market. Market leader IDEXX Laboratories saw year-to-year decline in its companion animal instrument revenue in 2014. While the company attributed the revenue loss to deferred payment models, the trend has been consistent since 2012. Similarly, competitor Heska has reported declining instrument revenue over recent years. The performance of Abaxis - another supplier of in-practice chemistry and hematology analyzers - has stood out as the company dramatically grew in-practice instrument placements in 2014. However, the overall companion animal analyzer market has seen declining growth that does not surprise following years of new client placements in an otherwise relatively constant population of U.S. veterinary practices. While in-practice analyzers resemble and often are adapted from clinical point-of-care (POC) technologies, their market fate is likely similar to clinical core lab analyzers - a robust, mature market with marginal growth in established markets, but with high recurring revenue streams. For now though, veterinary in-clinic analyzers comfortably outpace clinical core lab instruments in terms of growth. Analyzer-specific market opportunities and market breakouts are provided in Kalorama’s latest report.
     
  • Companion animal rapid assays (immunoassays) represent a limited market opportunity. The market has traditionally been dominated by tests for infectious diseases, though growth has been marginal for the associated core test for heartworms.  Few other significant infectious disease threats exist for companion animals in North America and Europe outside of Lyme disease, ehrlichiosis, and anaplasmosis. Vendors have responded by multiplexing these tests to maximize the revenue opportunity of their application in annual companion animal patient screening. Long-term market growth for companion animal rapid assays is expected to be low due to the limited application of such assays, though some upside exists with recent menu expansion into non-infectious immunoassays and placements of immunoassay readers that aid results interpretation including semi-quantitative results.
     
  • The veterinary reference laboratory market has seemingly performed well in recent years. The traditional companion animal diagnostics market was largely limited to reference testing without common in-house testing capabilities. The subsequent explosion of placements of in-house analyzers in the past decade fueled a significant amount of growth in the companion animal diagnostics market. Vendors who led this market development such as IDEXX and Abaxis have notably worked recently to establish and expand reference testing businesses. Both companies have since achieved significant organic growth in reference testing while companion animal accessions in other (primarily university-associated) labs have similarly risen in recent years. Kalorama Information believes an improved outlook in companion animal reference testing is a result of increasing standards of care and the greater demands placed on diagnosis. Reference labs are not expected to be the core driver of companion animal diagnostics market growth in the near-term future, but could factor later into the emergence of more advanced companion animal markets in molecular testing, histology, and advanced disease biomarkers.

For additional discussion of companion animal and food animal diagnostics market factors, including market segmentation by product and geography, Kalorama Information offers the recent title The World Market for Veterinary Diagnostics.