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IVD Market Sustains Momentum: 3 Stocks in Focus

Trina Mukherjee

In the face of growing incidence of acute and chronic diseases globally, In-vitro Diagnostics (IVD) has made a considerable impact on the quality of health outcomes, patient treatment, care and downstream resource requirements. IVD has been a game changer when it comes to early detection of a patient’s health condition and the risk associated with the same, thereby resulting in creation of new opportunities for early intervention and prevention.

In fact, according to EvaluateMedtech’s consensus forecast, IVD is projected to lead through 2024 comprising 13.4% of the total medical device market with an annual growth of 6.1%. Roche Holding AG RHHBY is estimated to lead this space with 18% market share and sales of $12.30 billion by 2024.

With the industry majors like Roche or Abbott ABT taking an aggressive M&A stance to expand presence within this niche space, it is high time that investors take interest in stocks engaged in the in-vitro diagnostics space.

Let us delve deep:

Factors Driving IVD Market

Burden of Chronic Diseases Increasing

Per the definition provided by National Center for Chronic Disease Prevention and Health Promotion (NCCDPHP), chronic diseases are conditions that last for one year or more and require continued medical attention or limit activities of daily living or both. Chronic diseases like heart disease, cancer and diabetes constitute the leading causes of death and disability in the United States. Moreover, these chronic illnesses are the primary reason behind the nation’s $3.3 trillion in annual healthcare costs.

High prevalence of chronic diseases is one of the key factors propelling growth of this market. According to a report by World Health Organization, the burden of chronic diseases rising rapidly worldwide, with the same contributing around 60% of the 56.5 million total reported deaths in the world and about 46% of the global burden of disease. The proportion of the burden of NCDs is expected to increase to 57% by 2020.

Point-of-Care Diagnostics Market Dominates

Point-of-Care (POC) diagnostic devices are utilized to obtain diagnostic results while with the patient or close to the patient.

According to a report by Research and Markets, POC Diagnostics market dominates the US IVD market and the rising preference of the same also forms one of the primary factors fueling growth of US IVD market.

In fact, per a report by Research and Markets, the U.S. POC diagnostics market is estimated to generate revenues of around $11 billion by 2024, at a CAGR of more than 7% during 2018-2024.

U.S. IVD Market Prospects Huge

Per a Research and Markets report, the U.S. IVD market is projected to be more than $35 billion by the end of 2024. Apart from chronic diseases and POC diagnostics, technological advancements in the field of diagnostics, and rise in awareness and acceptance pertaining to personalized medicine have been driving growth of U.S. IVD market.

IVD Investing Appears Sensible Now

The abovementioned factors clearly indicate about the vast potential of the IVD market. The most significant fact is that the benefit of In-vitro diagnostics is not limited to any particular country or geographic territory. In fact, going by a recent report by MarketWatch, Asia Pacific IVD market is estimated to exceed $18.5 billion by 2024 due to increase in geriatric population in emerging economies such as India, China and Japan that are prone to chronic infections. With the rising prevalence of chronic diseases worldwide and with the U.S. economy expected to remain strong in the second half of the year as well, this space should be under investors’ radar.

3 Promising Stocks in the IVD Space

Thermo Fisher Scientific Inc. TMO can be considered as one the top companies involved in developing products in the IVD space. Thermo Fisher is touted as the world leader in-vitro allergy diagnostics, offering tests to accurately measure specific IgE antibody blood levels and other important allergy markers. Thermo Scientific ImmunoCAP lab tests are some of the most important tools for understanding allergy, thereby helping clinicians make sense of symptoms such as rhinitis, eczema, wheezing, and asthma. The stock carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Bio-Rad Laboratories, Inc. BIO is another company involved in the creation and development of products in this space. One of such products, the QXDx BCR-ABL %IS Kit, is a digital PCR (polymerase chain reaction) test that monitors the p210 BCR-ABL major translocation in the peripheral blood of patients with Chronic Myeloid Leukemia (CML). The stock carries a Zacks Rank #3 (Hold).

Becton, Dickinson and Company BDX is a prominent player in this space constantly innovating and developing products. One of its products that deserve a mention is the BD Max system. Further, in 2017, the FDA granted 510(k) clearance to BD’s IVD device, FACSLyric flow cytometer system to use with BD Multitest assays to immunologically assess patients with or suspected of having an immune deficiency. The stock carries a Zacks Rank #3.

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Roche Holding AG (RHHBY) : Free Stock Analysis Report
 
Abbott Laboratories (ABT) : Free Stock Analysis Report
 
Thermo Fisher Scientific Inc. (TMO) : Free Stock Analysis Report
 
Bio-Rad Laboratories, Inc. (BIO) : Free Stock Analysis Report
 
Becton, Dickinson and Company (BDX) : Free Stock Analysis Report
 
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