Companion Diagnostics Market

Market Overview

The global companion diagnostics market size was valued at USD 5.37 billion in 2023. It is estimated to reach USD 15.87 billion by 2032, growing at a CAGR of 12.8% during the forecast period (2024–2032). The growing prevalence of chronic diseases like cancers worldwide has led to an increasing demand for efficient treatment approaches, thereby leading to a rise in the adoption of target therapy, boosting the global market. Moreover, the growing preference for personalized medicine amongst patients is also augmenting the global market.

Companion diagnostics (CDx) are medical tests or devices that give crucial information necessary to safely and efficiently utilize an associated therapeutic product, usually targeted therapy or personalized medicine. These diagnostics aim to detect particular attributes of a patient's sickness at the molecular or genetic level, aiding physicians in making well-informed treatment choices.
The fundamental concept underlying companion diagnostics is to customize medical treatment based on the unique attributes of each patient. Healthcare providers can ascertain a patient's likelihood of responding to a specific therapy or treatment by identifying specific biomarkers, genetic mutations, or other molecular characteristics. Companion diagnostics are primarily utilized in fields such as cancer, where identifying particular genetic alterations is essential in selecting the most suitable course of treatment.

Highlights

• PCR dominates the technology segment
• Oncology dominates the indication segment
• North America is the highest shareholder in the global market

Market Dynamics

Global Companion Diagnostics Market Drivers:

Growing Significance of Personalized Medicine

Personalized medicine is a process that tailors medical treatment according to the distinct attributes of individual patients. Personalized medicines are precise and tailored to individual patients for enhanced treatment based on the body's response and illness susceptibility. Personalized medicine can potentially improve patient outcomes and quality of life while mitigating therapy's negative effects and expenses. Companion diagnostics play a crucial role in personalized medicine by aiding in selecting the optimal treatment and dosage for individual patients, considering their genetic profile or biomarker expression. 
Companion diagnostics can also aid in the surveillance of treatment response and resistance, facilitating therapy adjustment as necessary. In 2016, the Tailored Medicine Coalition (PMC) reported that 20% of the novel molecular entities authorized by the FDA were tailored medications. Consequently, the increasing popularity of personalized medicine is expected to propel the expansion of the global market.

Rising Incidence of Cancer and Growing Adoption of Targeted Therapies

Cancer is a prominent contributor to global mortality and morbidity, impacting millions of individuals annually. The World Health Organization (WHO) reported that there were approximately 19.3 million new instances of cancer and 10 million deaths caused by cancer in the year 2020. Targeted therapies are pharmaceutical agents that selectively target the molecular aberrations responsible for promoting the proliferation and viability of cancerous cells. 
Furthermore, targeted therapies provide cancer patients with treatment choices that are more efficient and less harmful than traditional chemotherapy and radiation. However, it is important to note that only some patients respond favorably to identical targeted medication, and some individuals may eventually acquire resistance. Companion diagnostics help find resistance mutations and identify patients who mostly benefit from a specific targeted therapy. In the near future, it is expected that the growing use of targeted therapies and the rising incidence of cancer will propel the companion diagnostics market's growth.

Global Companion Diagnostics Market Restraint:

High Cost of Immunotherapy Treatment

Immunotherapy is a therapeutic approach that harnesses the body's innate immune system to combat cancer. Immunotherapy has shown considerable potential as a cancer therapy, but its exorbitant price has limited patient availability. Alternatively, physicians may integrate therapies, prolonging the therapy time from five months to more than three years. In this case, the cost increases proportionally with the duration. 
Furthermore, personalized immunotherapies come with a high cost. For instance, KYMRIAH, the authorized CAR T-cell therapy developed by Novartis, and YESCARTA, created by Gilead Sciences, have a price range of USD 373,000 to USD 475,000 per patient, varying based on the specific form of cancer being treated. Immunotherapies for cancer can incur considerably higher costs compared to alternative treatment methods, such as chemotherapy or radiation therapy. Hence, the exorbitant expenses associated with immuno-oncology treatments are expected to impede the growth of the global market.

Global Companion Diagnostics Market Opportunities:

Increasing Product Approval

Regulatory bodies, such as the U.S. Food and Drug Administration (FDA) and the European Medicines Agency, emphasize integrating companion diagnostics into developing and approving drugs. Therefore, these organizations are quickly companion diagnostic equipment. For instance, in November 2023, the FDA approved the use of FoundationOne® CDx as a companion diagnostic to identify patients with advanced hormone receptor–positive, HER2-negative advanced breast cancer who might be eligible for treatment with the combination of capivasertib (Truqap) and fulvestrant (Faslodex). 
Similarly, Tempus has announced that the FDA has awarded HLA-LOH with a breakthrough device designation as a companion diagnostic test. The test includes a machine-learning model created to examine data from the xT CDx assay, a next-generation sequencing (NGS) based assay that analyzes 648 genes for profiling solid tumors. It is also a companion diagnosis for patients with colorectal cancer, and the FDA approved it in May 2023. These variables create opportunities for market growth.

Regional Analysis

Based on region, the global companion diagnostics market is bifurcated into North America, Europe, Asia-Pacific, Central and South America, and the Middle East and Africa. 

North America Dominates the Global Market

North America is the most significant global companion diagnostics market shareholder and is expected to expand substantially over the forecast period. The North American market is projected to be at the forefront globally due to the significant instances of cancer and other chronic illnesses, the presence of major market participants and advanced healthcare infrastructure, the robust backing from regulatory authorities and reimbursement policies, and the widespread acceptance of personalized medicine and companion diagnostics in the region. The Centers for Disease Control and Prevention (CDC) estimated that in 2020, there were 1,603,844 newly diagnosed cases of cancer and 602,347 cancer-related deaths in the United States. There were 403 newly reported cancer cases and 144 cancer-related deaths per 100,000 individuals. According to the American Cancer Society, it is projected that there will be around 2,001,140 new cases of cancer and 611,720 deaths from cancer in the United States in 2024. Hence, the increasing incidence of cancer in this area is propelling the expansion of the companion diagnostics market share.
Furthermore, the North American market benefits from the support of reputable manufacturers who provide sophisticated companion diagnostics. These diagnostics are also gaining approval from regulatory bodies at an increasing rate. For instance, in December 2023, AnHeart Therapeutics, a global clinical-stage biopharmaceutical company specializing in innovative precision therapies for individuals with cancer, and Foundation Medicine, Inc., declared a strategic collaboration. The purpose of this collaboration is to develop and obtain regulatory approval for Foundation Medicine's comprehensive genomic profiling tests, FoundationOne®CDx and FoundationOne®Liquid CDx, as companion diagnostics for AnHeart's investigational next-generation ROS1 inhibitor, taletrectinib, in the United States. As a consequence, these factors enhance the growth of the local market.

Europe is projected to be a significant companion diagnostics market. Companies in this region are prioritizing mergers and acquisitions to enhance the advancement of diagnostic techniques, which is expected to propel market growth. For instance, in October 2023, ARUP Laboratories and Medicover announced a partnership to enhance the availability of AAV5 DetectCDx, a companion diagnostic test developed by ARUP Laboratories. This test is used to determine the eligibility of hemophilia A patients for Roctavian (valoctocogene roxaparvovec-rvox) in the European Union (EU). The collaboration enables patients residing in all European countries where Roctavian is authorized to undergo testing at one of Medicover's German facilities. This agreement is anticipated to enhance the availability of BioMarin Pharmaceutical's gene therapy ultimately.

The Asia-Pacific region is forecasted to have the most significant increase in the growth rate within the worldwide market. The reasons for this are a substantial and untapped patient demographic, advancements in healthcare infrastructure, and increased disposable income in the area. Increased funding for research and diagnostics, elevated cancer incidence rates, a surge in proteomics and genomics research, and a heightened awareness of personalized medicines contribute to market expansion. For instance, in November 2018, the Pharmaceuticals and Medical Devices Agency of Japan released guidelines for assessing complete genetic panels used in oncology companion diagnostics. Similarly, Japan has initiated a countrywide cancer genome screening effort called SCRUM Japan. This project employs companion diagnostics to identify genetic abnormalities in gastrointestinal and lung cancer patients. These characteristics facilitate the expansion of the regional market.

Segmental Analysis

The global companion diagnostics market is bifurcated into technology and indication.

Based on technology, the global companion diagnostics market is segmented into polymerase chain reaction (PCR), next-generation sequencing (NGS), in-situ hybridization (ISH), immunohistochemistry (IHC), and others.

The PCR segment owns the highest market share. Polymerase Chain Reaction (PCR) is a prevalent technique in molecular biology that allows the amplification of a targeted DNA sequence. Kary Mullis developed it in 1983, and it has since become a crucial instrument in scientific, medicinal, and forensic fields. PCR is employed in medical laboratories to identify pathogenic microorganisms, such as viruses or bacteria, through amplifying their DNA or RNA. Moreover, it is utilized in diverse genetic examinations to detect and examine particular DNA sequences linked to hereditary abnormalities or diseases. The PCR segment is projected to dominate the market due to its extensive utilization and established status as a technology for companion diagnostics, particularly in identifying gene mutations and amplifications.

Based on indication, the global market is bifurcated into oncology, autoimmune diseases, cardiovascular diseases, central nervous system disorders, virology diseases, and others. 

The oncology segment dominates the global market. Oncology Companion Diagnostics (CDx) are medical tests or diagnostic tools healthcare providers use to identify the most optimal and suitable treatment for a patient with cancer. Oncology companion diagnostics primarily aim to detect distinct biomarkers or genetic mutations within a patient's tumor that can be specifically addressed by a particular medication. This enables healthcare providers to customize the treatment based on the specific attributes of the patient's cancer, optimizing the likelihood of success while minimizing potential adverse effects.

Moreover, the oncology companion diagnostics segment dominated the market due to the growing partnership efforts between prominent diagnostics manufacturers and pharmaceutical firms to create efficient solutions. For instance, in January 2016, NanoString Technologies, Inc. collaborated with Astellas and Medivation to enhance its PAM50-based Prosigna Breast Cancer Assay. The aim was to utilize this test as a potential companion diagnostic test with enzalutamide, a medication employed in the treatment of triple-negative breast malignancy.

Impact of covid-19

Companion diagnostics testing helps to determine a patient's health status and guide the patient to appropriate treatment, determine potential adverse effects, and predict recovery of patients from umpteen diseases. Researchers also hypothesized that patients and local healthcare settings may benefit from the responses obtained from these diagnostic systems, which can detect virus genetic material and assess whether the treatment given to patients infected with the virus are responding or not, further driving the market growth.

Recent Developments

• November 2023- Foundation Medicine and Pierre Fabre Laboratories partnered to create companion diagnostics specifically for non-small cell lung cancer (NSCLC).
• January 2024- Flagship Biosciences and Offspring Biosciences formed a strategic partnership to enhance precision drug development. Flagship Biosciences specializes in spatial biology and biomarker analytics services, while Offspring Biosciences focuses on pre-clinical biomarker assay solutions. This collaboration aims to provide a comprehensive biomarker offering, covering the entire process from discovery to companion diagnostics development.