As pharma companies invest in building the labs of the future, the pharma lab equipment market is expected to boom in the coming decade. A 360 Market Updates report predicts that the global pharma lab equipment market size is expected to gain market growth in the forecast period of 2021 to 2025, with a CAGR of 4.3 per cent and will touch $11710 million by 2025. As per a Market Insights report, “Over the next five years, pharmaceutical lab equipment market will grow at 4.7 per cent CAGR in terms of revenue and the global market size will touch $11850 million by 2026.” Let’s take a look at some of the primary drivers of growth in this segment.
The COVID-19 pandemic
In the near future, one of the key factors for the growth of the pharma lab equipment market is the COVID-19 pandemic. As the world raced to develop drugs and vaccines to tackle the novel coronavirus, significant investments have been made to upgrade lab infrastructure and equipment to aid and accelerate R&D efforts by private players and governments. India’s lab equipment market is also going to see a growth spurt as a result of government initiatives to make India Pharma Inc stronger and self-reliant, increasing funding for life sciences, expansion of clinical capabilities, and growing academic-industry collaborations.
A Research and Markets reports also informs, “The booming investments in the development of new vaccines along with a rapid increase in the number of sample tests have further led to an increased demand for lab equipment in various countries. In addition, the rising funding by the governments of various countries to boost the R&D for the development of vaccines and numerous medicines to meet the response of COVID is also anticipated to significantly drive the lab equipment market in the coming years. For instance, in April 2020, the Department of Biotechnology, India announced that around 16 companies were granted funds to boost their R&D for the development of drugs and vaccines to speed up the process with an aim to tackle the disease.”
Growing R&D spend
Even before the pandemic, spurred by the increased volume of drug discovery research, pharma lab equipment market was poised for growth. Rise in chronic diseases like cardiovascular diseases, cancer, Alzheimer’s disease, diabetes, chronic kidney disease etc had boosted the demand for new drugs. Now, the COVID-19 pandemic has also underscored the importance of increasing R&D endeavours to deal with emerging infectious diseases and enhance the preparedness of the sector to deal with such crises.
The growth potential of the lab equipment market is set to increase due to the growing demand for biologics as well. In 2018, as per WHO’s International Clinical Registry Platform, biologics comprised 40 per cent of the total trials in the pharma pipeline comprising over 50 countries.
Thus, mounting investments in pharma R&D is expected to impel progress of the pharma lab equipment market globally. Reports reveal that global life sciences companies are already spending over 20 per cent of their sales into new drug development.
India too is likely to witness a lot of growth in this segment due to similar reasons. “The pandemic has not just triggered the necessity of therapeutics but largely introduced the novelty and confidence in recombinant vaccines and monoclonal antibodies. Unfortunately, not all pharma is equipped to adapt new technologies and the ones that had the infrastructure and expertise in biologics benefited the most. Many more will expand into biologics, controlled processes using microbes or cultured mammalian or insect cells to produce therapeutics or other life-saving products instead of synthetic drugs. Investment in research is expected to increase substantially in areas of genomics, cell biology and proteomics,” informs Dr D Muruganand, Head of Operational Marketing – India, Middle East & Africa, Eppendorf India.
A report from Research and Markets also predicts, “The Asia Pacific region is anticipated to show robust growth opportunities during the coming years owing to the rising prevalence of chronic diseases and the growing investments in pharma research.”
The pharma industry needs to be in a state of continuous, steady improvement, to spur medical advances. And, as the life sciences industry evolves and progresses, advancements in lab equipment too will rise. Pharma laboratories will have to be at the cutting edge of science and technology to be more efficient, improve time-to-market and reduce costs. Be it spectroscopy, chromatography, DNA amplifiers and sequencers, lab automation, immunoassay analyzers, flow cytometry or any other process in the pharma sector, the demand for sophisticated equipment and instruments to aid and accelerate the process of drug discovery, development, analysis and modelling of the compounds will continue to grow.
Companies will also have to invest in emerging technologies and equipment for laboratory process optimisation, integrated automation for key data insights and even IP protection. Lab equipment will also be powered by digital technologies and be more connected to improve data traceability and integrity.
Beroe, a provider of procurement intelligence and supplier compliance solutions, in one of its reports, lists down technology trends that drive growth and progress in the life sciences lab equipment space. As per the report, some of them are as follows:
◆ Sustainability: Energy efficiency, minimising operating cost, increasing researchers’ productivity and decreasing waste productions, would continue as focus points of lab equipment buyers in future
◆ IP Protection: Increasing popularity of cloud computing and mobiles in analytical and quality laboratories is demanding the organisations to redefine the information access protocols
◆ Automation: Lab equipment automation would be more focused towards enabling the continuous flow and decreasing the batching requirements during experiments
◆ Portability of services: Suppliers are focusing on developing portable equipment, which can work as a supplement to the primary lab equipment that makes things easier for field scientists. It is cost-effective, as all samples would not be required to send to labs
◆ Increased focus on data integrity: Demand for efficient software for managing clinical workflow, in terms of regulatory compliance and data security, is increasing. Life science, the healthcare industry contributed to the major share in the overall laboratory informatics (LIMS, CDS and others) market.
Industry players’ views and their offerings validate the report’s findings.
Elaborating on the tech trends, Dr Muruganand says, “Lab equipment related to cell/microbial cultures, biosafety, sample preparation, sample processing, storage are expected to grow in the research, pilot or smallscale production while large volume shakers, fermenters, bioreactors, single use culture vessels, large volume or continuous centrifuges are expected to stay high. Digitalisation and connectivity are becoming key in the pharma segment where end-to-end tracking of standard processes such as storage, system data logs and documentation gains prominence. Also, consistent supply for certified high-quality consumables is becoming crucial for the pharma/biopharma segment.”
In an interview, earlier this year with Express Pharma, Samir Vyas, Country Manager, Agilent India says, “Most laboratory challenges are associated with data handling and sample preparation. To enable automated data handling, Agilent provides an end-to-end integrated software solution, which covers the analytical workflow from the moment the analytical request is generated until the data are archived.”
He adds, “We have also built automation capability into the sample preparation side, as manual sample preparation can be variable and error-prone leading to time-consuming rework and poor results. While automation is becoming an integral part of each advanced laboratory, we also ensure that it comes with ease of operation as well as affordability.” (Check the whole interview at https://www.expresspharma.in/ agilent-continues-to-focus-onstrategic-ma-rd-investment-toexpand-product-portfolio/)
Growth in CRO services market
Pharma and biotech players are increasingly relying on strategic partnerships with Contract Research Organizations (CROs) for drug discovery and development. The pandemic has also spotlighted the importance of such collaborations. They have become key partners at all stages of drug development, from target selection to clinical trials. This has created opportunities for CROs and as a result, this segment is poised for growth.
“The global CRO services market is projected to reach $73.77 billion by 2025 from $47.77 billion in 2020, at a CAGR of 9.1 per cent during the forecast period. Market growth can be attributed to the growing R&D expenditure, increased outsourcing of R&D activities, and an increasing number of clinical trials,” forecasts a MarketsandMarkets report. As a result, CROs would be among the lead buyers for lab equipment.
Strategic Directions International (SDi), a firm providing business intelligence on the market for analytical and life science instruments, informs that the companies in this segment are “eyeing a market opportunity in the Contract Research Organization (CRO) industry.”
The report states, “As demand for CRO services increases, the market opportunities for suppliers of analytical instrumentation used by CROs will see significant growth, even in the face of the global COVID-19 pandemic and subsequent recession.”
Gung ho on growth…..
India’s lab equipment market is going to see a growth spurt as a result of government initiatives to make India Pharma Inc stronger and self-reliant, increasing funding for life sciences, expansion of clinical capabilities, and growing academic-industry collaborations.
The lab equipment players are also very optimistic about the growth potential in India. Some of them share their vision and plans with us. Amit Chopra, MD, India and South Asia, Thermo Fisher Scientific enlightens, “The COVID pandemic has highlighted the critical role of the Indian pharma industry. While we are the third largest global manufacturer of drugs by volume, India ranks 14th in terms of value. The pandemic has also underscored the importance of innovation, investment, and access. It has opened new avenues for the pharma laboratory equipment market from areas higher up in the value chain such as drug discovery, development, and API manufacturing.”
“Further, India is playing an incredibly important role in supplying critical drugs and vaccines during the pandemic. As the pharma industry is continually evolving, it is essential that we prepare for future advancements, which is why Thermo Fisher has taken strategic approach to ensure our investments in technology, processes, capabilities and people enable us to support our customers. Further, with proactive government initiatives and industry-academia collaboration we are well-positioned to respond to the rising demands of the pharmaceutical industry,” he asserts.
Similarly, Vyas informs, “India is one of the geographies for Agilent where we see great potential and we will continue to focus on expanding our local footprint.”
He says, “One of the focus areas for Agilent is to expand its capabilities and offer a complete biopharma workflow solutions portfolio. Our biopharma customers are moving away from classical offline QA/QC to more online/at-line testing, so they can decrease associated manufacturing costs and have a faster and more efficient release of the final product. Our biopharma strategies are very much focused on developing several analytical techniques so that we can provide trusted answers to the emerging and challenging needs of the current laboratory.”
Dr Muruganand states, “Eppendorf as a one stop solution for pharma workflows, especially for biologics customers, is our plan for next few years. And to delight their journey further with us by offering our service support such as installation, maintenance, repair, calibration services and our IQ, OQ, PQ performance plans for GMP facilities are the key initiatives.”
“Eppendorf offers solutions to support various workflows for pharma and biopharma with wider product ranges in liquid handing, centrifuges, shakers, CO2 incubators, ultra low temperature freezers, PCR cyclers, fermenter and bioreactors. The Eppendorf – himac range offers ultracentrifuges and floor large volume centrifuges that suits for various applications. Digital solutions from Eppendorf such as VisioNize and eLABInvertory and eLABjournal are best fit for connectivity needs.”
Shripad Joshi, President India and South Asia, PerkinElmer shares, “With Indian pharma expected to grow at a very impressive CAGR over the next few years, we are very well positioned to serve our customers. Our solutions span across the entire pharma value chain from disease discovery to quality control and manufacturing. The recent Production Linked Incentive (PLI) schemes for pharma will also trigger further investments. PerkinElmer has a strong leadership position in pre-clinical animal imaging, high throughput and high content screening, atomic and molecular spectroscopy as well as gas chromatography. Our recently launched liquid chromatography platform LC300 will further bolster our position in the life sciences and pharma segment.”
He adds, “India is a very important market for PerkinElmer and our footprint here goes beyond being a sales, service and application set-up. With the acquisition of Tulip Diagnostics in 2017, we also have a significant manufacturing footprint in the country. Furthermore, we believe that the commercialisation of technologies for local consumption will play a very important role in driving future growth in the country.
…but challenges exist
While the growth potential is huge, challenges like the financial crisis caused by the pandemic and high acquisition cost can decelerate the pace of growth. Likewise, the life sciences industry’s hesitancy in adopting advanced technology and automation can also put the growth story at risk. The disruption to R&D activities due to the pandemic is another challenge to be dealt with.
Outlook for the future
The pharma industry has a compelling need to optimise the efficiency and efficacy of its complex and critical lab operations, thereby offering lab equipment players armed with a strategic roadmap, great product portfolios, significant investments and meaningful collaborations, tremendous opportunities for growth.