World diabetes glucose monitoring devices markets

Glucose self-monitoring business — tough challenges in a high-growth market

Sustained efforts of educators and manufacturers in the healthcare industry have not only enhanced public awareness about diabetes worldwide, but also increased the demand for glucose self-monitoring devices among diagnosed diabetics. This, in turn, is leading to product innovation aimed at enhancing ease of use and convenience. However, this vibrant growth is accompanied by a unique set of challenges, making the glucose monitoring business highly competitive and expensive.

'Free meters' is one of the key challenges faced by glucose self-monitoring equipment manufacturers. Glucose meters are either heavily discounted or distributed free with the purchase of multiple packs of glucose strips. This is forcing participants to amortise the cost of meters over a given time period. Deployment of such a business practice could prove detrimental in case of infrequent meter use by diabetics.

"With glucose meters proving to be 'loss leaders', participants have quickly realised that they need to aggressively market glucose test strips having the potential to generate higher profit margins", says Seemeen Mirza, Research Analyst from Frost & Sullivan (http://medicaldevices.frost.com ).

The challenge lies in identification of 'ideal' diabetic patients that are likely to use these test strips and meters frequently and generate repeat sales. This is a formidable task, especially when cost can be an important factor among diabetic patients in the selection of a test strip/meter or its upgradation.

The cost factor has assumed further importance, as insurance companies-in their efforts to contain expenditure in the wake of economic slowdown-are passing more costs to consumers in the form of higher co-pays. As a result, professional healthcare agencies that play a decisive role in end users' initial purchase decisions are demanding elastic pricing from equipment manufacturers. Going forward, participants are expected to concentrate on providing flexible pricing schemes-a factor reckoned to be more important than 'time-to-market'-to step up adoption rates.

Revision of marketing strategies is another significant challenge for manufacturers of glucose monitoring devices. Growing 'self-selection' of glucose self-monitoring kits by diabetics has forced participants to adopt a consumer-focused approach rather than continuing with marketing strategies that were traditionally aimed at professional healthcare agencies.

Currently, many leading companies such as Roche Diagnostics, LifeScan (J&J), Abbott and Bayer are channelling substantial funds toward direct-to-consumer advertising in an effort to enhance brand recognition.

"Brand awareness has become extremely important as most consumers 'self-select' their glucose monitoring kit during subsequent purchases and upgrades", says Ms Mirza. "The expensive, direct-to-consumer advertising enables firms to effectively communicate product differentiation, generate brand recall and extend their market reach."

The adoption of a consumer-focused approach has forced participants to continuously innovate, a vital factor that will enable them to stay ahead of competition. This requires balanced allocation of funds for state-of- the-art R&D capabilities and marketing.

Only tier one companies with huge resources at their disposal are capable of sustained spending on these key fronts. Small enterprises lack funds for such prolific spending, triggering consolidation within the industry. The global diabetes monitoring industry has had a long history of acquisitions.

The most recent news in this area involved Abbott Laboratories and TheraSense Inc. Small, innovative companies are merging with large, resource-rich enterprises that have extensive distribution channels, strong marketing clout and abundant funds for R&D. This strategy is expected to benefit the merging entities immensely.

Long-term market prospects are promising, if the recent findings of healthcare studies are any indication. The studies have revealed that obesity in America is reaching a crisis point. Correlations have been established between obesity and numerous degenerative diseases such as heart problems and diabetes.

Additionally, poor health habits and sedentary lifestyles are contributing to the growing incidence of Type 2 diabetes. This has increased the patient population, especially in the 60 and above age category and in turn, is escalating the demand for modern self-monitoring technologies.

"The new non-invasive or minimally invasive options on the horizon could revolutionise blood glucose self-monitoring in the near future", says Ms Mirza. "Technologically, participants will be striving to move from being adjunctive to the finger-stick method and thereby, provide viable stand-alone alternatives."

The coming years will witness a more holistic approach toward diabetes monitoring, encompassing active management of the co-morbidities associated with diabetes, for instance, hypertension, obesity and cardiovascular disease.

Enterprises that can offer 'one-stop shop' for the entire range of diabetes management tools - right from glucose self-monitoring supplies to nutrition and diet control drugs - are likely to reap rich benefits. Such developments could even create a situation where continuous glucose monitoring systems cannibalise the market for discrete glucose monitoring technologies.

More information

If you are interested in an analysis extract providing you with an overview, summary, challenges and latest coverage of the Strategic Analysis of the World Diabetes Glucose Monitoring Devices Market, then send an email to Katja Feick, Public Relations Manager at katja.feick@frost.com with the following information: full name, company name, title, contact tel number, email. Upon receipt of the above information, an overview will be emailed to you.