The global companion diagnostics market size was valued at USD 4.61 billion in 2022 and is projected to reach USD 13.64 billion by 2031, with a CAGR of 12.8 % during the forecast period 2023–2031.
Companion diagnostics is a medical device used in conjunction with therapeutic drugs to assess the efficacy and applicability of those drugs on a particular human body. Alongside the development of drugs, companion diagnostics are created to select or exclude groups of patients based on their response to the therapy. This device assists the healthcare professional in determining whether a specific treatment is advantageous for the patient.
Recently, in 2020, Roche received FDA approval for the Cobas EGFR Mutation Test v2 companion diagnostics for the lung cancer treatment EGFR tyrosine kinase inhibitor. Companion Diagnostics (CDx) refers to a clinical test co-developed with a therapeutic drug to identify responders and non-responders to that drug. It identifies a patient population that can or cannot be treated with the corresponding medication. CDx enables practitioners to determine the benefits, side effects, and risks associated with therapeutic drug consumption, thereby ensuring patient safety.
Growing patient preferences for tailored therapy, expanding applications of personalized medications, increased prevalence of chronic diseases, and rising occurrences of allergies in patients due to medication side effects give rise to the development of customized CDx, thereby driving the global Market of Companion Diagnostics. In addition, the benefits offered by CDx tests, such as low cost, high sensitivity, and rapid and accurate results in shorter time frames, contribute to the expansion of the Companion Diagnostics Market.
The companion diagnostics market is primarily driven by the increasing demand for targeted therapy, the rising importance of personalized medicine, the surging global prevalence of cancer, and the burgeoning application of companion diagnostics. In addition, increasing cases of adverse drug reactions and the lack of efficacy of certain drugs drive market growth.
As a result of advances in genetic sequencing and genomics, it is now widely accepted that drugs can have different effects on different people. A better understanding of an individual's genetic characteristics or biomarkers can facilitate the administration of "the right drug, at the right time, in the right dose, to the right individual." Pharmaceutical and biopharmaceutical companies are persistently attempting to implement patient-selection diagnostic frameworks in the earliest phases of drug development in order to provide targeted therapies to the most suitable candidates. This bolsters the expansion of the market in companion diagnostics.
Currently, the market players are engaging in umpteen collaborations to develop cost-effective and advanced biomarkers and diagnostics. For instance, in January 2020, F. Hoffmann-La Roche Ltd and Illumina, Inc. collaborated to raise patient access to genomic testing. As per the agreement, Roche manufactures and distributes in-vitro diagnostic (IVD) tests for Illumina’s NextSeq 550Dx System as well as its future portfolio of diagnostic sequencing systems.
The market players are actively working and heavily investing in R&D activities to develop novel products to address the patients' critical unmet needs. For instance, in January 2017, Singulex, Inc. collaborated with QIAGEN N.V. to develop companion diagnostics using Singulex's patented single-molecule counting (SMC) immunodiagnostic platform.
The market is largely driven by rapid product approvals by regulatory authorities. For instance, in January 2018, Myriad Genetics, Inc. obtained the U.S. Food and Drug Administration (FDA) approval for BRAC Analysis CDx, which is used as a companion diagnostics to identify patients with HER2-negative metastatic breast cancer with BRCA mutation in geneline, and qualifying for Lynparza (olaparib) therapy. Additionally, in March 2019, F. Hoffmann-La Roche Ltd received the U.S. Food and Drug Administration (FDA) approval of the VENTANA PD-L1 (SP142) Assay, as the first companion diagnostics to help in identifying triple-negative breast cancer (TNBC) patients eligible for Roche immunotherapy treatment Tecentriq (atezolizumab) plus chemotherapy.
Immunotherapy has demonstrated significant promise as a cancer treatment, but its high cost has restricted patient access. Alternatively, physicians may determine that it is best to combine therapies, which could extend the duration of treatment from five months to over three years. In this instance, the longer the duration, the higher the cost. In addition, personalized immunotherapies are expensive. For instance, KYMRIAH, the approved CAR T-cell treatment from Novartis, and YESCARTA, from Gilead Sciences, range in price from USD 373,000 to USD 475,000 per patient, depending on the type of cancer being treated. Each CAR T-cell therapy is tailored to the individual patient, requiring substantial laboratory resources. Thus, the cost of the drug alone rises to approximately USD 60,000 per patient. Immunotherapies for cancer can be significantly more expensive than other treatment options, such as chemotherapy or radiation therapy. Consequently, the high cost of immuno-oncology therapies is anticipated to hinder the market expansion of companion diagnostics.
Companion diagnostics tests based on NGS aim to decode molecular information from each patient's tumor genome to direct cancer treatment decisions. Next-generation sequencing detects multiple biomarkers for multiple drug therapies in a shorter amount of time than other sequencing techniques. Utilizing NGS panels for biomarker measurement in a single test has the potential to aid in the treatment of a variety of cancer types. The various technological advancements in NGS provide market participants with an immediate competitive advantage over those offering competing technologies, such as PCR, ICH, and ISH. Consequently, market leaders are concentrating on developing companion diagnostics based on NGS.
The global market for Companion diagnostics is categorized by Technology and Indication.
Based on Technology, the market is divided into immunohistochemistry and molecular diagnostics. Immunohistochemistry technology helps to clarify the tissue distribution of an antigen, which is a crucial application of monoclonal and polyclonal antibody therapies. It is used to identify enzymes, tumor suppressor genes, antigens, and the proliferation of tumor cells. It has gained popularity in the field of companion diagnostics as it is used in the diagnosis of chronic diseases such as cancer, infectious diseases, cardiovascular diseases, and autoimmune diseases. The immunohistochemistry segment is expected to witness significant growth owing to the growing prevalence of chronic diseases and the increasing demand for immunohistochemistry solutions.
On the other hand, the molecular diagnostics segment holds the highest share in the market of companion diagnostics and can be further segmented into In Situ hybridization, real-time PCR, and gene sequencing. The gene sequencing segment holds the largest market share on account of large-scale gene sequencing projects focusing on rare disease therapeutics and oncology. For instance, in May 2018, QIAGEN partnered with Freenome, a genomics solution provider based on artificial intelligence, to accelerate the development and marketing of gene sequencing-based companion diagnostics tests for precision cancer treatment.
Based on Indication, the market is segmented into oncology, autoimmune diseases, cardiovascular diseases, central nervous system disorders, and virology diseases. The oncology companion diagnostics segment held the highest market share in 2018 because of the increasing collaboration activities among key diagnostics manufacturers and pharmaceutical companies to develop effective solutions. For instance, in January 2016, NanoString Technologies, Inc. signed a collaboration agreement with Astellas and Medivation to upgrade its PAM50-based Prosigna Breast Cancer Assay and use the test as a potential companion diagnostics test with enzalutamide, a drug used to treat triple-negative breast malignancy.
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.
The global market for Companion Diagnostics has been segmented based on geography into North America, Europe, Asia Pacific, and LAMEA.
North America dominates the market of companion diagnostics as the region is backed by well-established manufacturers offering advanced companion diagnostics. For instance, in June 2018, the U.S. Food and Drug Administration (FDA) approved the Dako PD-L1 IHC 22C3 pharmDx assay developed by Agilent Technologies Inc. For the record, PD-L1 IHC 22C3 pharmDx is the first FDA-approved immunohistochemistry test for determining PD-L1 expression in cervical cancer. As reported by the National Cancer Institute (NCI), in the U.S., around 1,735,350 new cancer cases and 609,640 cancer-related deaths were reported in 2018. Thus, increasing the prevalence of cancer has compelled manufacturers to develop novel products, further driving regional market growth.
Asia-Pacific is projected to grow with the highest CAGR in the market of companion diagnostics. High incidences of cancer, increasing proteomics and genomics research, rising funding for research and diagnostics, and growing awareness about personalized medicines drive market growth. For instance, in November 2018, the Pharmaceuticals and Medical Devices Agency of Japan issued perspectives for evaluating comprehensive genomic panels for oncology companion diagnostics. Similarly, Japan has launched a nationwide cancer genome screening project, SCRUM Japan, using companion diagnostics for gastrointestinal and lung cancer patients.
In addition, in the market for companion diagnostics in Europe, companies are focusing on mergers and acquisitions to strengthen the development of diagnostic procedures, which is anticipated to drive market growth in this region. For example, Myriad Genetics, Inc., a leader in personalized medicines, announced its merger with AstraZeneca and Merck in 2019. The merger will result in using BRACAnalysis CDx to identify BRCA mutations in men with castrate-resistant metastatic cancer.
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