Companion Diagnostics Market

The global size of companion diagnostics market in terms of revenue was estimated to be worth $7.5 billion in 2024 and is poised to reach $13.6 billion by 2029, growing at a CAGR of 12.6% from 2024 to 2029. The new research study consists of an industry trend analysis of the market. The new research study consists of industry trends, pricing analysis, patent analysis, conference and webinar materials, key stakeholders, and buying behaviour in the market.

In recent years, there has been a rapid advancement in medical technology, leading to significant changes in therapies and medicine. This progress has contributed to the substantial growth of the companion diagnostics market. Factors such as the increasing importance of companion diagnostics in drug development, the rising prevalence of cancer, and the growing adoption of targeted therapies are driving the growth of the market.

Companion Diagnostics Market Size, Dynamics & Ecosystem

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Companion Diagnostics Market Dynamics

Driver: Increasing significance of personalized medicine

Growing awareness of the advantages of personalized medicine is a key factor driving the increasing utilization of companion diagnostics and genomics & proteomics technologies. Companion diagnostic tests, which involve analyzing specific indications for particular drugs in individual patients, are integral to tailored treatment plans for numerous chronic diseases and conditions. These tests empower healthcare providers to make informed clinical decisions and lower the risk of unnecessary adverse events. The shift towards personalized medicine is reshaping healthcare practices, with a focus on delivering more precise and effective treatments. This shift further fuels the demand for companion diagnostics products as they enable healthcare providers to make informed and targeted treatment choices, ultimately improving patient outcomes.

Restraint: High capital investment and low cost-benefit ratio

Substantial capital investments are necessary for the discovery, development, and validation of biomarkers. The significant challenge arises from the high drug attrition rate during clinical trials, where nearly 30% of drugs fail in phase III. This poses substantial financial hurdles for diagnostic manufacturers. Manufacturers must achieve successful phase III clinical trials to obtain approval for in vitro diagnostics (IVD) from regulators, which relies on well-validated biomarker tests. Running clinical trials and meeting rigorous regulatory requirements demand considerable investments, impacting the ability of small companies to develop biomarkers and affecting innovation. Consequently, the companion diagnostics market for biomarker detection is hindered not only by the substantial capital required but also by the low cost-benefit ratio.

Opportunity: Increasing importance of companion diagnostics in drug development

The importance of companion diagnostics in aiding healthcare providers with treatment decisions for patients is steadily growing. The co-development of companion diagnostics alongside therapeutic products has the potential to significantly transform the drug development process and streamline the commercialization of drug candidates. This co-development can lead to the creation of safer drugs with enhanced therapeutic efficacy in a quicker and more cost-effective manner. As the demand rises for high-priced specialist therapies and safer medications, the market for companion diagnostics is poised for substantial growth.

Challenge: The shortage of adequately trained professionals

Companion diagnostic testing is a complex and technical process that requires trained professionals. Proficiency in companion diagnostic technologies is essential for conducting tests accurately. There is a lack of awareness among clinicians about the latest advancements in companion diagnostic tests, creating a gap in operational knowledge for clinical laboratories. Additionally, the reluctance to transition from manual operations to automation poses a challenge for market growth. Many providers struggle to switch from manual or traditional methods to IT-based approaches or may resist the change altogether. Hence, the scarcity of skilled, well-trained, and technically knowledgeable laboratory technicians to operate advanced companion diagnostic products is limiting their widespread adoption, particularly in emerging markets.

The market is highly consolidated. The top players—F. Hoffmann-La Roche Ltd. (Switzerland), Agilent Technologies, Inc. (US), Qiagen N.V. (Germany), Thermo Fisher Scientific, Inc. (US), Abbott Laboratories, Inc. (US) -in the market accounted for a combined majority market share in 2020. There is a high degree of competition among the market players. Only major companies can afford high-capital investments as well as the high cost of R&D and manufacturing. This will prevent new entrants from entering this market.

Companion Diagnostics Market Segmentation & Geographical Spread

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In 2023, the assays, kits & reagents segment held the largest portion of the companion diagnostics industry, by product & service

Based on product & service, the companion diagnostics market is divided into assays, kits & reagents, instruments/systems and software & services. In 2023, the assays, kits & reagents segment dominated the companion diagnostics market, primarily attributed to the wide variety of available products and the growing utilization of assays and kits across various therapeutic areas.

In 2023, the PCR segment held the companion diagnostics industry largest market share, by technology

The companion diagnostics market is divided into polymerase chain reaction (PCR), next-generation sequencing (NGS), in situ hybridization (ISH), immunohistochemistry (IHC), and other technologies, based on technology. In 2023, the PCR segment captured the highest market share, primarily due to its ease of use and extensive availability of PCR kits & reagents for companion diagnostic testing. Additionally, PCR's growing applications in detecting gene mutants with limited or low allele frequencies further contributed to its dominance in the market.

In 2023, the largest share of the companion diagnostics industry was held by the cancer segment, based on indication

The companion diagnostics market is categorized into cancer, cardiovascular diseases (CVDs), neurological diseases, infectious diseases, and other indications. In 2023, the cancer segment held the largest portion of the companion diagnostics market. This is driven by factors such as the increasing role of companion diagnostics in personalized medicine treatments for cancer and the growing significance of biomarkers in cancer diagnosis.

Tissue sample segment accounted for the largest companion diagnostics industry share in 2023, based on sample type

Categorized by sample type, the companion diagnostics market is divided into tissue sample, blood sample and other sample types. In 2023, the tissue sample segment held the largest market share in the companion diagnostics market. Tissue samples are preferred in companion diagnostics because they allow for a direct analysis of the tumor, providing a comprehensive view of genetic mutations and biomarkers, which in turn enables more accurate and personalized treatment decisions.

The pharmaceutical & biotechnology companies and reference laboratories segment accounted for the largest companion diagnostics industry share in 2023, by end user

Based on end user, the companion diagnostics market is segmented into pharmaceutical & biotechnology companies, reference laboratories, CROs, and other end users. The pharmaceutical & biotechnology companies segment dominated the market share in 2023. This was driven by the rising adoption of companion diagnostics due to their growing significance in drug development, as well as the increasing importance placed on companion diagnostic biomarkers.

North America holds the leading position as the largest region for companion diagnostics industry

The global companion diagnostics market is segmented into six major regions—North America, Europe, Asia Pacific, Latin America, the Middle East & Africa and GCC countries. In 2023, North America, particularly the U.S. and Canada, leads the global companion diagnostics market. The region's technological advancement and a high number of product approvals by regulatory authorities, such as the FDA, are driving market growth. For example, in October 2022, F. Hoffmann-La Roche Ltd. received FDA approval for the first companion diagnostic to identify patients with HER2 low metastatic breast cancer.

The major players in this market are F. Hoffmann-La Roche Ltd (Switzerland), Agilent Technologies, Inc. (US), QIAGEN (Netherlands), Thermo Fisher Scientific Inc. (US) and Abbott (US). These players lead the market because of their extensive product portfolios and wide geographic presence. These dominant market players also have numerous advantages, such as more robust marketing and distribution networks, larger budgets for R&D, and better brand recognition.

Scope of the Companion Diagnostics Industry

This study categorizes the global companion diagnostics market to forecast revenue and analyze trends in each of the following submarkets:

By Product & Service

• Assays, Kits & Reagents
• Instruments/systems
• Software & Services

By Technology

• Polymerase Chain Reaction
• Next-generation Sequencing
• In Situ Hybridization
• Immunohistochemistry
• Other Technologies

By Indication

• Cancer `
  • Lung Cancer
  • Breast Cancer
  • Blood Cancer
  • Colorectal Cancer
  • Other Cancer Types
• Neurological Disorders
• Cardiovascular Diseases
• Infectious Diseases
• Other Indications

By Sample Type

• Tissue Samples
• Blood Samples
• Other Sample Types

By End User

• Pharmaceutical & Biopharmaceutical Companies
• Reference Laboratories
• Contract Research Organizations
• Other End Users

By Region

• North America
  • US
  • Canada
• Europe
  • Germany
  • UK
  • Switzerland
  • France
  • Italy
  • Spain
  • Rest of Europe
• Asia Pacific
  • China
  • Japan
  • India
  • Australia
  • Rest of Asia Pacific
• Latin America
  • Brazil
  • Mexico
  • Rest of Latin America
• Middle East & Africa
• GCC Countries

Recent Developments of Companion Diagnostics Industry

• In August 2023, Agilent Technologies, Inc. (US) received European IVDR Certification for Companion Diagnostic Assay.
• In August 2023, QIAGEN (Netherlands). received FDA approval for companion diagnostic to Blueprint Medicines’ AYVAKIT (avapritinib) in gastrointestinal stromal tumors.
• In March 2023, F. Hoffmann-La Roche Ltd (Switzerland) received FDA approval of label expansion for VENTANA PD- L1 (SP263) Assay to identify patients with locally advanced and metastatic non-small cell lung cancer eligible for Libtayo.
• In September 2022, Thermo Fisher Scientific Inc. (US) announced FDA Approval of Oncomine Dx Target Test as the First NGS-Based Companion Diagnostic to Aid in Therapy Selection for Patients with RET Mutations/Fusions in Thyroid Cancers.
• In January 2021, F. Hoffmann-La Roche Ltd (Switzerland) launched two digital pathology image analysis algorithms for precision patient diagnosis in breast cancer.

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