Diabetes Device Market: Innovation Highlights Road to Growth

Article preview from Medtech Insight - September, 2010

Despite the slumping economy, the diabetes market continues to be a very active area, with treatment-changing products recently launched or in late-stage development. Although no industry has been able to escape the effects of the US recession, and certain segments of the diabetes market have seen a decline in sales, other areas continue to move forward. Once the economy returns to healthier levels, the overall market is expected to see a renewal of growth. Meanwhile, an expanded emphasis on emerging international markets could help offset some of the sluggish numbers in the US and parts of Europe.

Diabetes Device Market: Innovation Highlights Road to Growth

Article preview from Medtech Insight - September, 2010

Despite the slumping economy, the diabetes market continues to be a very active arena, with treatment-changing products recently launched or in the latter stages of development. Although no industry has been able to escape the effects of the US recession, and certain segments of the diabetes market—particularly those that are more consumer-driven, such as test strips—have seen a decline in sales, other areas, such as continuous glucose monitoring (CGM), continue to move forward with fairly strong growth.

Once the economy returns to healthier levels, the overall market is expected to see a renewal of growth. Meanwhile, an expanded emphasis on emerging international markets could help offset some of the sluggish numbers in the US and parts of Europe.

Conventional Glucose Testing Feels the Pinch

In some ways, the diabetes market is more vulnerable to economic changes than other major medical concerns because a good deal of product purchases in this space are made directly by consumers, who must take charge of a significant portion of their own diabetes care. It is therefore not surprising to see that the portion of this market that has been hit the hardest during the recession is conventional glucose meters and testing strips, used by diabetics to monitor their glucose levels. With unemployment and under-employment figures high, a large number of people have been looking for ways to cut back on costs, and sluggish sales suggest diabetics have been reducing their purchases of meters and test strips.

According to Boston Biomedical Consultants, worldwide compound annual growth in the diabetes care market (meters and test strips) is expected to be about 3% between 2009 and 2014. Growth is expected to be significantly lower in the US and Europe, where the economic crisis has negatively affected all consumer-based health care markets and driven down pricing for diabetes supplies. The downturn is quite striking considering previous years had shown growth of about 8% to 10% worldwide, and although sales have picked up a bit in 2010, some companies have seen negative growth in the US over the past couple of years. The four major competitors in the diabetes meters and strips market are Roche Diagnostics/Roche, LifeScan Inc. (a Johnson & Johnson (J&J) subsidiary), Bayer HealthCare LLC/Bayer AG, and Abbott Diabetes Care Inc./Abbott Laboratories Inc., which combined control close to 90% of the US market. ( See Exhibit 1.)

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