Mixed Reviews on Final Medical Device Tax Rules

Is the medical device industry full of cheer about the newly-defined healthcare tax parameters?  Yes and no.  The IRS released its guidelines for how the 2.3% excise tax associated with the Patient Protection and Affordable Care Act of 2010 will be implemented.  This was anticipated by an industry that is soon to face the impact of the taxes.  The guidelines were met with a mixed reaction from device companies.   Some breathed a sigh of relief, others still are concerned about the tax's impact.

On one hand, the IRS waived some late fees and clarified the policy on prepackaged kits (in most cases, if a product within a kit already incurred a tax liability, companies would not be double-taxed.) and clarified on combination drugs (in most cases, combo drug/device products would not be taxed.  

On the other hand, some things the industry wanted such as a delay in implementation, a waiver for dental products, and an exemption for leased products were rejected by the IRS.

Major device companies still say profits and layoffs will be impacted by the tax.  Cook Medical's CEO recently indicated his company would not expand manufacturing in the United States given the tax policy.

Kalorama Information's The Global Market for Medical Devices 3rd Edition examines the overall medical device market and assesses the impact of the tax on several companies.    

The Next Wave in Cancer Treatment

 Historically, cancer treatments have been very invasive and detrimental to the body as a whole. However, there are numerous new techniques available for those with cancer that are not as invasive and detrimental to the body as a whole. These treatments range from the severely alternative to the more traditional.   Kinase Inhibitors are one of these treatments known to mitigate the spread of cancerous cells.   In the past, the treatment of choice was to remove the cancer and as much of the surrounding normal tissue as possible. Therefore most of the surgical procedures used were considered to be radical in nature. In the mid-1950s even though the radical procedures were technically sophisticated, the mortality rates associated with certain cancer sites were not improving. Many cancers that were thought to be local disease processes were found to be systemic diseases with metastatic lesions located in anatomic sites other than the site of the primary disease. On analysis of these findings, it became obvious that surgery alone regardless of the extent of the procedure was not an effective treatment for every type of cancer. 

There have been many cancer therapeutics approved over the last 50+ years for a wide range of cancer indications. The largest numbers of treatments approved are for breast cancer, leukemia, lung cancer, and lymphoma. 
The market for one type of these treatments, kinase inhibitors is heating up.   Although the market is becoming more established and several billion dollar drugs have emerged this segment has enormous room for growth.  

Several factors continue to influence the double-digit growth this market has experienced, including the continued success of targeted therapy in cancer treatment, rising incidence of cancer, and increased cost for newly approved therapies in the advanced treatment area.   

Our new Kalorama Information market research report – The Next Wave in Cancer Treatment--Kinase Inhibitors - is focused on a growing area of cancer treatment, kinase inhibitors. Several cancers are being treated with these newer therapies, which provide a focus of cancer profiled in this report, including:

• Breast
• Colorectal
• Head/Neck
• Kidney
• Leukemia
• Liver
• Lung
• Melanoma
• Ovarian
• Pancreatic
• Prostate
• Stomach

DNA Sequencing Market Report Cited in Live Scientist

An article in Live Scientist quotes Kalorama Information's DNA Sequencing Report 

The market for DNA sequencers increased in the last year with the introduction of new systems and a growing demand for sequencing, according to Kalorama Information.

The healthcare market research publisher said that the introductions of the Ion Torrent PGM, PacBio RS and MiSeq grew the sequencer market nearly 5 per cent to US$560m (EUR429m) in 2011. More new technologies are expected from Ion Torrent as well as from Oxford Nanopore that may further change the market and introduce price changes, according to Kalorama's report, 'DNA sequencing equipment and services markets, 3rd edition'.

"This was getting to be a stable market, but that changed in the last two years," said Justin Saeks, Kalorama analyst and author of the report. "Now it's more volatile and complicated; we think customers will acquire new systems, but pricing and feature preferences will get interesting."

More here

View our report on DNA Sequencing.

Kalorama Finds 21% of U.S. Adults Have Visited a Retail Clinic

 The number of adults who are familiar with retail clinics and have used them has increased greatly in the past five years, according to Kalorama Information.  The healthcare market research firm conducted a survey of 2,000 U.S. adults and found  21.3% of those surveyed have visited a retail clinic.  The Kalorama survey result is a significant increase over polls six years ago which showed less than 10%.     

Take Care Clinic Locations in Atlanta

We've studied retail clinics in depth since 2007.  We attribute the result to the growth of stores at top retail chains, growth of clinic traffic and the bunching of clinics in certain cities.  The finding was made in our complete market research survey on retail clinics, Retail Clinics 2012: Growth of Stores, Consumer Opinion Surveys, Winning Competitors, Supplier Sales of Products to Clinics, Clinic Sales Forecasts and Trends.

Retail clinics, also called convenience clinics, are mostly located in drug stores but also in retailers such as Walmarts and Targets, grocery stores and even malls.

  The basic premise is that they take advantage of the retailers traffic, and provide defined services generally though a nurse practitioner or a physician assistant..  Especially attractive to customers, they offer walk in service, better hours than the average physician office, and lower costs.  The concept survived the recession, the opposition of medical associations and state legislatures.  A shortage of primary care physicians, rising concerns about access and costs, and now a health reform plan which has so met political and constitutional challenges, is expected to send new patients to clinics.   

 This and the ever-older Baby Boomer population have combined to create a unique prescription for success.  Most importantly, drug stores embraced the concept and the two largest drugstore chains in the United States, CVS and Walgreens are behind the concept. 

The other side of the survey result, of course, is that nearly eighty percent have not visited a clinic There has been improvement in popular opinion, though there is still room to grow.  Almost all surveys show high satisfaction with retail clinics.   There are over 1,300 retail clinics, and we expect that number to grow, but growth in the amount of stores that house clinics has never been linear, and store count went down in the midst of the recession.   Stores have struggled with getting patients in summer and spring months.   Some well-known chains closed clinics in their stores.  These developments could produce a misinterpretation that the concept was on the decline.  But there are counter-developments to such a decline.  Prestigious academic medical centers entered the retail clinic business at the same time a number of chains dropped the idea.   

Physician practice and urgent care competition, labor shortages, competition for retail space and even limited non-clinic drugstore care options such as flu shot stations administered by pharmacies and patient management are limiting growth of clinics in stores.  

Kalorama’s report, Retail Clinics 2012 is a detailed look at the market for clinics in retail settings.  The report can be obtained at  

DNA Sequencing Market Heats Up With Illumina-BGI Battle

As Complete Genomics sought to boost its resources with a partnership with a Chinese biotechnology concern, a rival company has made a competitive bid.   Illumina  said last week that the company made a competing bid for Complete Genomics Inc. at a 5% premium over what Chinese firm BGI-Shenzhen has offered shareholders.   Previous to the offer, Complete Genomics agreed to be acquired.   

Complete Genomics said  that Illumina's bid  wasn't in the best interests of the stockholders, because a potential deal would likely not achieve antitrust clearance. Complete Genomics and Illumina compete  for whole human genome sequencing as an outsourced service.

The competition is indicative of the attention that companies are giving the DNA Sequencing market, as expected clinical application drive development of new systems and applications.  Kalorama Information's report on The  DNA Sequencing Equipment and Services Market  provides complete forecasts for systems and consumables used in DNA Sequencing.  It also contains company profiles, grant trends and other information.  The report can be found at: http://www.kaloramainformation.com/DNA-Sequencing-Equipment-7118427/

Using 'Good' Epigenetics To Combat 'Bad' Epigenetics

From our author K. John Morrow some disturbing news and also a sense of where may be in the future for epigenetics..  “There are two deeply disturbing properties of epigenetic inheritance that have been receiving much attention of late,” Morrow says.   “The first is the ability of certain classes of chemicals to cause epigenetic changes that can be transmitted transgenerationally. The second is the propensity of genetically stable tumor cells to display great epigenetic variation, driving their evolution and malignancy.”

Morrow, author of Kalorama’s Epigenetics market research report notes that.  Manikkam et al [PLOS ONE 7(9):e46249] report that Dioxin, a potent epimutagen, can induce multiple adult onset disease in the F3 generation when administered to gestating female rats. In another important study Ujvari and coworkers (Proc Biol Sci. 2012 Nov 7. [Epub ahead of print]) find that a bizarre transmissable facial cancer in the Tasmanian Devil, although genomically stable, undergoes extensive epigenetic changes that drive its tumorigenicity. Because of this variability the tumors evolves over time, and these changes can be transmitted to other animals through bodily contact. This rare marsupial has been pushed to the edge of extinction by this cancer.

"Connecting these two sets of observations, it seems highly possible that exposure of human populations to epimutagenic agents could induce rapidly evolving and extremely lethal cancers. Moreover, it is also possible that subsequent generations could inherit this genetic alteration."

Epigenetic investigations have focused largely on use of therapies that target methylation site next to controller elements of various oncogenes, as described in a recent Kalorama report. There is a high probability that combining epigenetic drugs with conventional therapies could stop tumor growth and at the same time slow down the uncontrolled variability of cancer that enables it to outrun therapeutic intervention.

At the same time, there is a pressing need for studies that investigate the role of environmental epimutagens in driving disease in both animal and  human populations.    

Kalorama Identifies 5 Areas Next Gen Sequencing Will Impact Healthcare

The idea of a patient’s DNA being routinely tested by a next-generation sequencer to help a doctor make a diagnosis may seem a bit futuristic right now.  We suggest that sequencers are expected to see usage in at least five clinical areas over the next several years.   At the same time, we warn, there are unpredictable variables which will affect the timing for each clinical application, including science, regulation and economics, not to mention the strengths and weaknesses of different sequencing technologies.

 Kalorama recently released a white paper titled "Next-Generation Sequencing Moves Into Clinical Applications" covering some of these perspectives, following the third edition of its full market research report on this industry, DNA Sequencing Equipment and Services Markets.

"There are several clinical areas where next-generation sequencers are likely to see rapid growth, causing the overall segment to become a large fraction of the sequencer market within five years," said Justin Saeks, Kalorama analyst and author of the report.  

According to Kalorama Information, these areas include:

• ·         cancer diagnostics and treatment
• ·         HLA/ MHC typing
• ·         neonatal and prenatal testing
• ·         pathogen detection
• ·         pharmacogenetics.

Kalorama notes these areas are progressing gradually, due to the regulatory process, the complexity of the science, and the medical community's cautious approach with new tests.  Eventually, the technology is expected to gain significant momentum in healthcare, possibly more rapidly in Europe's easier regulatory environment, as the complex issues are addressed and the individual systems become proven in their applications.  

Kalorama suggests that different areas can have different requirements in terms of read length, accuracy, coverage, throughput, run time, sample size and other features, which may result in niches. For example, cancer applications might have specific needs for higher accuracy/ coverage, longer read length, and/ or single cell capability due to the large variety of cancers, the large genetic aberrations, and the heterogeneity of the tissue often involved, respectively. Over time, medical discoveries a long with technological advances in hardware, software, and reagents will continue to change this landscape.

"The continuing drop in sequencer and consumables costs, along with increases in performance, are the primary drivers of adoption into new applications," Saeks said. "But the exponential drop in the cost of sequencing may slow the revenue growth in the near term, as the complex factors affecting adoption will likely take some time to shake out."

A range of new challenges and questions are also likely to manifest in unforeseen ways, for example, relating to ethical, legal, and social aspects. Along with the scientific challenges, these may take ten years or more to address before a tipping point is reached. But in the long term, sequencers are eventually expected to become ubiquitous in healthcare, with patients having the DNA in their circulating blood tested regularly. In the meantime, instrument suppliers, diagnostics companies, and clinical labs will need to consider how the various trends will impact these applications in the rapidly changing market.

Kalorama Information's report, DNA Sequencing Equipment and Services Markets, 3rd Edition, contains a deeper discussion of some of these trends, a review of products currently on the market, and competitive positions of players. In addition to analyzing DNA sequencer sales and making forecasts for future sales, it also looks at sequencer consumables and services sales. The report can be found at http://www.kaloramainformation.com/DNA-Sequencing-Equipment-7118427/