Kalorama Information forecasts the library preparation and target enrichment for next-generation sequencing (NGS) market will have a 19.9% CAGR from 2021-2026.

 

The next-generation sequencing (NGS) library preparation and target enrichment market is estimated to have global sales of $1.2 billion in 2021, and is forecast to surpass $3.0 billion in 2026. This amounts to a compound annual growth rate (CAGR) of 19.9%, according to leading medical market research publisher Kalorama Information in the recent report The Market for Library Preparation and Target Enrichment for Next-Generation Sequencing 2021.

Spending slowed significantly in parts of 2020 due to COVID-19, primarily in Q2 2020.  But spending began to approach typical levels in Q3 2020 and Q4 2020. Ultimately, sales volume reached its former trajectory in Q1 2021, based on sequencing consumables sales from Illumina, the dominant supplier of sequencers and sequencing consumables.

Illumina has experienced extremely rapid growth in the last few years. The consistent rate of adoption of Illumina’s systems has generated steadily high growth in consumables revenues. As a result, the share of revenues coming from Illumina’s sequencing consumables continues to rise. It went from 53% of the company’s revenues in 2016 to 62% of total revenues in 2020.

Overall, the market has maintained its roughly 20%-25% growth rate over several years, and the technologies continue to be improved and become more user-friendly. Automation, streamlining of workflows, and other innovations have gradually made the library preparation process easier and less time-consuming. The usage of sequencing spans an ever broader range of applications, industries, and specializations, but the focus has mostly been life science research-related. As the science becomes more established, various clinical applications are becoming more proven, and there are certain areas such as cancer where there are expected to be rapidly growing benefits in the near future.

In addition, NGS library preparation methods continue to evolve and the overall sequencer market is in an ongoing state of flux as more labs gain access to these resources. New products are allowing NGS to be used for a wider range of applications, with a wider range of sample types, with decreasing volumes of sample, and many without the requirement for PCR amplification. Innovative methods are enabling long read and long-range data to be obtained using short-read sequencers.

“With a huge number of product introductions, the competition in library preparation and target enrichment products has increased greatly in recent years,” reports Kalorama Information. “Further, the market has benefited as the installed base of sequencers has grown consistently, the workflows are gradually being improved, and new applications and new regions are seeing adoption.”

Conversely, growth will likely be offset by decreasing prices as the competition increases and end-users increasingly cut costs. Smaller systems are being introduced with reduced cost per run, albeit with lower output. The price of sequencing has been falling constantly, akin to Moore’s Law with chips and transistors, but this has been slowing to some extent. As prices drop, end-users find more ways to use the sequencers. Longer-term, as prices continue to drop, diagnostic labs, the healthcare industry and other applications seem to have constant uses for sequencers.

Drug discovery is a high-cost, risky business because only a fraction of the therapeutic targets selected for study will actually yield products that achieve regulatory approval by the U.S. Food & Drug Administration (FDA) or other global regulatory agencies. The average drug can take 10+ years to progress from the discovery phase to the clinic, with only one compound out of 10,000 evolving into a viable product. The increasing demand for outsourcing has spawned a proliferation of companies offering contract drug discovery services. Contractors competing in this sector range from small regional companies with a limited geographic reach to medium and large CROs with a large global footprint. As more pharmaceutical companies from emerging countries become major players in the pharmaceutical industry, and multinational pharmaceutical companies expand into emerging countries, the global demand for drug discovery services will continue to expand, although it will be affected by the 2020 corona virus pandemic, lockdown and expected recession.

According to Kalorama Information’s latest report, the market for outsourced drug discovery services has been robust. This is expected to change dramatically in 2020, with ongoing recovery through the five-year forecast period of this report. The global market is estimated at $31.6 billion in 2019 up 15.8% from $27.3 billion in 2018,

The net impact of the corona virus and lockdown will be to inhibit global drug discovery outsourcing while creating opportunities for the development of corona-related vaccines and therapies.

As of May 2020, economic analysts around the world broadly predict an economic recession resulting from the dramatic slowdown in business activities during the corona virus lockdown. The full impact of the global corona virus contagion is not yet understood. In fact, even as a clearer picture emerges in the coming months, the economic ramifications are unlikely to be fully grasped until 2021 or beyond.

As the lockdown requirements are designed to prevent the spread of the corona virus in large groups of individuals who have direct physical contact with each other, manufacturing operations of many companies have been suspended. The pharmaceutical and biotechnology industries, however, are considered life sustaining and therefore medicines and vaccines continue to be produced. As of early May 2020, no significant shortages have been reported.

This could change, however, if the lockdown requirements become more stringent; while the current trend appears to be easing of lockdown restrictions, a significant subsequent wave of infection could reverse this. Furthermore, the industry remains subject to market forces, economic cycles and consumer demand. Although low cost generic medications will probably maintain their sales levels, branded medicines are likely to suffer.

The DNA sequencer market has continued to provide powerful tools that hold the promise of bringing major changes to healthcare in the near future.  In the last decade, explosive growth has occurred in terms of product introductions, new applications, and the end-user labs rushing to participate in these new areas. It is a 4 billion dollar market, but that doesn’t mean every system over is completely satisfied and/or isn’t looking out for a new model to purchase.

This was the finding our Next-Generation Sequencing Market and Kalorama Survey of NGS Laboratories.  The report was both a secondary market analysis effort and a survey of laboratories.  There is a 4 billion-dollar market for sequencing, according to Kalorama Information’s research.  With a sizeable portion, over 12% of that demand in China.

According to the report, the ongoing technological advances are still enabling a Moore’s Law type of phenomenon in relation to the performance of the systems, although the consumables costs are dropping less rapidly.  A lot of the structural change in labs appears to have slowed down, as the scientific and medical advances are being produced gradually.

Kalorama’s study aimed to identify some of the key trends taking place with both next-generation systems and capillary sequencers in relation to their usage in labs, and in relation to the sequencing of clinical samples for diagnostic or clinical research purposes.

The study focuses on a survey of 70 laboratories which was carried out from March to July of 2019.  The survey effort targeted labs with some likelihood to be doing, or to be planning, applications of sequencing in either diagnostic or clinical research settings in the future.  This is not straightforward to determine beforehand, as there are many different factors that drive a lab to consider diagnostics.

Among the findings of the survey:

  • Most labs think their sequencing volume growth will grow between 1-20%.  Resequencing/ targeted
  • mRNA-seq / transcriptome were among usages demonstrating an increase.
  • Labs mix models There was a trend for instance to have one Miseq, one Nextseq or NovaSeq, and one Hiseq.  This combination provides the range of run time and throughput that gives the lab as much flexibility as possible.
  • MiSeq was the commonly owned model in the survey, followed by next Seq
  • Respondents want to reduce costs of systems first.  The next priority is improving sample prep.
  • Libarary preparation remains a key concern of labs, a key bottleneck.
  • Sanger Sequencing is present at many sites along next gen systems though labs with a large amount of NGS models tended to minimize the Sanger

Customers also revealed purchasing plans and bottleneck areas where they’d like improvements.  Scores of questions were addressed in the report.  Kalorama’s report is available at: https://kaloramainformation.com/product/the-market-for-next-generation-sequencing/

It has been little more than a year since the U.S. Food and Drug Administration (FDA) approved the first next generation sequencing (NGS) test for clinical use, and only a few months since the U.S. Centers for Medicare and Medicaid Services (CMS) announced it would provide national coverage for NGS tests for advanced cancer patients. Yet clinical sequencing is already advancing rapidly. In vitro diagnostics companies and individual clinical laboratories are creating ever-broader test panels for cancer diagnostics and non-invasive prenatal testing, and studies are underway exploring whether everybody should have their entire genome sequenced at birth.

Kalorama Information’s Report on Next Generation Sequencing: Complete Market Sizing, Forecasts, Profiles and Trend Tracking: https://www.kaloramainformation.com/Generation-Sequencing-Instrumentation-Consumables-Services-Competitive-Trends-11594541/

As sequencing technology has moved from science fiction to reality, many of the social and ethical questions they raise have grown more pressing. Should people be told about incidental findings when their genes are sequenced? Do NGS test really offer useful insights beyond routine testing for targeted mutations and are the high costs justified? And of course, how long before NGS is cheap enough that consumers will choose to skip the doctor entirely and pay out of pocket to have their whole genomes sequenced?

These are just some of the topics that have been appearing in news reports and academic journals in recent months related to clinical sequencing.

Should We Sequence Everybody At Birth?

Until recently, the debate about whether healthy people should have their genomes sequenced at birth was an abstract discussion. Now that the cost of sequencing is falling, the question is suddenly concrete and urgent. Geneticist Robert C. Green, coleader of the federally funded BabySeq Project, predicted in a 2017 Scientific American article that genome sequencing would be widely available, even given away for free, within 5 years.

That’s why the U.S. National Human Genome Research Institute (part of the National Institutes of Health) is supporting research efforts, such as the BabySeq project, to explore the ethical and social implications of routine newborn genome sequencing. These studies are exploring how parents use genetic information, particularly if it reveals information about untreatable diseases; to what extent sequencing data could lead to privacy concerns and discrimination; and whether parents even want this information and, if so, if it will make a difference in the clinical care of the child.

One of the most recent publications out of the BabySeq project was a study published in September 2018 that examined why more than 80 percent of families declined the opportunity for free whole exome sequencing of their babies through enrollment in the BabySeq study. While many parents of newborns did not want to participate in any research study, regardless of the genetic component, many attended an enrollment session and declined afterward, citing concerns about receiving potentially troubling genetic information about their child and about potential discrimination in insurance coverage.

A new federally-funded multi-center study is looking at a more targeted approach to sequencing babies. The “Precision Medicine in the Diagnosis of Genetic Disorders in Neonates” trial, which began in August 2018, is evaluating offering only actionable sequencing results rather than the whole genome. The trial will offer whole genome sequencing to some newborns, while others will receive a targeted gene sequencing panel developed by Quest Diagnostics for 1,722 genetic disorders known to affect newborns.

“When a newborn’s entire genome is sequenced, unintended information may be learned, including potential issues that could affect the child later in life,” said Jill Maron, MD, co-principal investigator at Tufts Medical Center, one of the study sites, in a press release. “Since the targeted panel only screens for genetic disorders that appear in the newborn stage and can be addressed immediately, its use would eliminate any ethical dilemmas for physicians and avoid burdening families with information on adult onset diseases they may not want to know about.”

While these studies delve into the ethical issues of genome sequencing for babies, a panel of experts associated with the BabySeq trial and other related NIH-sponsored research recently released a report recommending against large-scale programs to sequence healthy babies. The report, “The Ethics of Sequencing Newborns: Recommendations and Reflections,” published in August 2018 by the Hastings Center, argues that sequencing may be useful in the diagnostic work-up of a newborn with disease symptoms. However, they write, sequencing has limited usefulness as a tool for screening healthy individuals, while it exposes the individual to the risk of discrimination, distress, and the burden and expense of follow-up care, monitoring, and counseling.

Should Patients Be Told About Incidental Findings?

One of the success stories that the coleader of the BabySeq project has described is the anecdote of the baby who was discovered to have a BRCA2 mutation, meaning they would be at high risk for developing breast or ovarian cancer as an adult. The knowledge of that mutation was not actionable for the baby at that moment, which raised the question of whether it should be reported? What would be the benefits and risks of sharing that information?

The American College of Medical Genetics and Genomics (ACMG) takes the position that there are some genetic variants that the laboratory and clinician should report whenever they are discovered in clinical sequencing, even if that discovery is incidental. The BRCA2 mutation is one of nearly 60 variants on the current list, most of which are related to cancer or cardiovascular disease.

In the BabySeq case, the team did reveal the information to the baby’s family. As a consequence, the mother got tested and discovered she, too, has the BRCA2 mutation. If the mother now has a better chance of avoiding or surviving cancer, it benefits the whole family, including the baby, Green said in an interview with GenomeWeb. Green cites another case from BabySeq in which a newborn was discovered to be a carrier for an inherited disease. This prompted the child’s parents to get tested, which revealed that they both carried the recessive trait and their future children had a 25% risk of inheriting the disease. Knowing this, they used preimplantation screening of their embryos to ensure their second child was healthy.

An October 2018 study found that reporting incidental sequencing results generally did not cause undue distress or other adverse impacts on patients. The study looked at participants in the Clinical Sequencing Exploratory Research (CSER) Consortium program and found that only about 1 percent of the more than 6,000 participants had an incidental finding for one of the genes on the ACMG list. It also found that reporting these results lead to only modest costs for medical follow-up, at least within the first year.

Will Clinical Sequencing Actually Improve Care?

One of the fastest growing areas of clinical sequencing has been in cancer diagnostics, which has only intensified since the CMS decision in March 2018 to offer national coverage for NGS testing in advanced cancer patients.

Yet an August 2018 article in the Journal of the American Medical Association offered a sobering evaluation of NGS cancer testingso far. The authors reviewed the electronic medical records of more than 5,000 patients with advanced non-small cell lung cancer at 191 community oncology practices in the United States during the first 7 months of 2016. They concluded that the patients who received broad-based genomic sequencing (any multigene panel sequencing assay examining more than 30 genes) had no better survival rates than those who received only routine testing for specific mutations and/or rearrangements.

These results are not meant as a call to clinicians to stop using broad-based sequencing for patients with advanced cancer, a study co-author told GenomeWeb. Rather, they highlight the reality that many patients who could benefit from targeted cancer therapies do not receive them, even when their genes have been sequenced, whether due to the cost or a lack of access to clinical trials.

They concluded that the patients who received broad-based genomic sequencing (any multigene panel sequencing assay examining more than 30 genes) had no better survival rates than those who received only routine testing for specific mutations and/or rearrangements.

Research presented by at the American Society of Human Genetics meeting in October 2018 suggested that clinical sequencing could be helpful for pediatric cancer patients. Although the researchers didn’t examine survival outcomes, they reported that in a sample of 253 pediatric cancer patients who had whole genome or exome sequencing at St. Jude Children’s Research Hospital, 79 percent had at least one finding that could help guide care.

What If Consumers Want Genome Sequencing Anyway?

While the medical community considers the nuances and tradeoffs inherent in clinical sequencing, the market for direct-to-consumer genetic tests is racing ahead at remarkable speed.

An August 2018 report in Genome Biology said consumer genomics has been growing exponentially since 2016 and could increase 10-fold by 2021 when, the authors predict, more than 100 billion people will have been genotyped.

While the big names in direct-to-consumer ancestry and personal health genetic testing do not use NGS technology, new startups such as Helix (backed by Illumina) and Veritas Genetics are commercializing whole exome and whole genome sequencing, alone or in combination with existing methods of direct-to-consumer genetic testing.

The Hastings Center’s “Ethics of Sequencing Newborns” report recommends that health care providers discourage patients from using direct-to-consumer sequencing, noting that often these companies have a business model that depends on sharing genomic data with third parties for drug development and other purposes. They worry that these companies will hype the benefits of sequencing while downplaying the negatives.

The authors of a 2016 report on consumer genome sequencing in Applied & Translational Genomics agree, highlighting the lack of transparency in how these companies use the genomic information they collect and questioning whether customers have enough information to give informed consent.

Yet there’s only so much the medical community can do to caution consumers, write the authors of the Hastings Center report.

“We recognize that strictly precautionary admonitions may prove insufficient in the face of rapid industry growth and advertisement-driven consumer demand,” they write.

While academics continue to ask the tough questions about clinical sequencing – What are the risks? When are the benefits worth costs? How should results be disclosed? – consumers may end up being the ultimate drivers of rapid adoption of this exciting and fraught new technology.