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Signify Research has recently released its Interventional & Surgical X-ray – World Market Analysis which details the nuance of the market in the face of turbulence brought by the global Covid pandemic, and its subsequent recovery. The interventional and surgical markets were growing reasonably strongly in 2019 before the pandemic, consistently posting growth of mid-single digits. But, these were some of the markets most affected by the pandemic, with restrictions brought in to combat the virus leading to the cancellation of 30%-40% of elective procedures in some countries during the height of the pandemic.
Such a significant fall in procedures led to anticipation of a similar market decline, however, as the report’s author, Research Manager Bhvita Jani, points out, this wasn’t necessarily the case.
The Signify View
“On the Interventional side, the decline wasn’t as drastic as anticipated,” she explains. “There was softening but the drop, given the situation, was moderate with a high-single-digit to low-double-digit declines.
“On top of this we also saw the market bounce back quickly in 2021, so 2022 so far has been very much like a typical pre-covid year. The markets are stable and within the normal range.”
There have been several drivers of this return to normality. “It was in part a recovery after the pandemic, with a return to elective procedures and the fulfilling of pent-up demand, but, what is actually driving a lot of the growth is demographic factors.
“There is an ageing population, obesity is on the rise and the subsequent incidence of related diseases and conditions, such as cardiovascular disease and stroke among other things. All this means that procedures are becoming more complex and hospitals require more complex equipment to carry out these procedures.
“One of the biggest growth segments in interventional imaging is neurology, for example. Lots of developed countries are placing increased importance in dedicated stroke pathways and increasing the number of stroke centres accordingly.”
Such factors are not only driving the market forward, they are also shaping the product trends within the market. The increased demand for complex neurology procedures, oncology procedures and cardiovascular procedures means that hospitals are increasingly prioritising advanced multidisciplinary equipment. As such sophisticated biplane systems, for example, are proving increasingly popular in developed markets.
There are also other considerations for vendors looking to capitalise on the growth in the interventional radiology market. Increasingly providers are looking beyond simple transactions for a piece of hardware, and instead are looking to purchase complete patient care pathway solutions.
“So now, when stroke interventional neurology systems are sold, providers want the entire stroke treatment pathway, including the IT environment that can streamline the process,” Jani adds. “So, we expect more of those type of solutions to become available.”
Another factor contributing to market growth is the changes in settings in which interventional systems are used.
“In certain developed markets, one of the biggest growth factors is office-based labs. This growth stems from such labs being more profitable to the interventional radiologist or cardiologist, as it is a lower cost setting, which results in higher reimbursement.
“So, from a business perspective, these settings represent a higher return on investment. These settings are driving new demand, which is growing the market, compared to inpatient settings, where demand for equipment is almost entirely on a replacement basis.”
As well as meeting the distinct requirements of different customer groups, vendors are also having to react to the changing needs of different geographic markets.
“Vendors in India and China are among those disrupting the market, as they are driving down prices and continuing to increase the affordability and access to interventional technology,” Jani notes.
“In some markets, including China and India, governments are actively pushing more local vendors. This prioritisation of local companies and the incentives that are in place, could begin to threaten some of the international players’ share in those markets.”
For these international vendors, this challenge from lower-priced competitors could also exacerbate pressures closer to home stemming from changing purchasing practices.
“Hospitals are increasingly becoming part of bigger hospital chains. This means that the buying power now sits with group purchasing organisations, and that means there is more competition for these deals and more consolidation. Another more direct impact of this is that, with these bulk deals, the average selling price of systems is going down.”
Carry on Regardless
While such trends will have an impact, and there may be some pricing pressures in the market, according to Jani it remains an attractive area for vendors to serve.
“Despite these changes, providers are still keen to invest in very high-end equipment,” she explains.
“I’d say that compared to other areas of X-ray, decisions about interventional equipment are less driven by price. There is still a significant focus given to a system’s specifications, how the equipment can directly impact clinical outcomes, and the preference of the end user.
“This means, that in developed markets, it is a very hard market to disrupt, with hospitals and clinicians unlikely to want to go through the hassle of shifting from one brand’s equipment to another. Providers tend to replace the equipment from one vendor with equipment from the same brand, so it is very difficult for one brand to steal share from another.”
New technologies could, however, make such shifts more likely, with innovations within AI, for example, which focus on features such as radiation dose management or treatment planning potentially giving providers more of a reason to switch to another vendor’s products.
As well as focusing on these new technologies, there are also other priorities that vendors in the interventional and surgical X-ray markets should concentrate on to best capitalise on market trends.
“While the high end is very important, if vendors want to maintain a market presence in some of the highest growth markets like China and India, they need to have a performance offering as well. This will allow them to continue to compete against the lower-cost system offerings from those countries.
“Another opportunity for vendors is to focus on more sustainable solutions,” Jani continues. “So, for example vendors offering providers software updates when they are launched by the vendor instead of providers being stuck with the software that was current when they purchased the system.
“This goes hand in hand with the increase in smart subscriptions that we are also seeing in the market, which makes the solutions more stable and improves their longevity, giving the vendors that offer these subscriptions an advantage.”
Strength in Surgical
Many of these trends seen in the interventional imaging market are mirrored in the surgical market, although there are some differences. For instance, one of the major trends in that market is the shift from image intensifier-based systems to systems that use flat panel detectors (FPD). There is also an increasing shift to 3D imaging, a transition that began gathering pace after 3D mobile C-arms were released by the likes of Ziehm Imaging, Siemens Healthineers and GE Healthcare. This has changed the complexion of the market somewhat. Before these releases most growth was expected in Europe, in countries like Germany, for example, but with the release of 3D systems, China is increasingly looking like a big driver of growth. This is particularly important given the levels of competition in the 2D C-arm market.
“Competition is much higher in the 2D mobile C-arm market,” Jani explains. “We are seeing a lot more domestic manufacturers in China and India which are offering systems at a lower price and making it more difficult for multinational companies to grow in those markets. However, there are some opportunities in developing markets, with 2D C-arms providing access to basic imaging in rural areas.
“In developed markets, mobile C-arms are also being used for overspill procedures and as backup to the fixed C-arm, although typically the purchase of an interventional system is prioritised over a mobile system.”
Possibilities and Market Potential
Despite these nuances the interventional and surgical X-ray markets both represent strong growth markets, with a great deal of potential in both developed and developing markets.
“There are going to be disruptive new entrants to the market,” Jani continues, “that is really going to cause a shake up.”
“The affordability of systems is going to increase, which means there is going to a much faster roll out with domestic vendors in India and China particularly accelerating growth in the market.
“Growth will also come from hybrid operating rooms, which are a fast-growing segment. That growth is set to continue in the coming years in both developed and emerging markets, just because of the multi-disciplinary clinical usage and the return on investment.”
“However, the US and China will remain the key growth drivers,” Jani concludes. “There is simply more demand for interventional and surgical X-ray systems due to the increased numbers of procedures that are being carried out, and an increased focus on interventions.
“This, ultimately, is the key driver of growth going forward.”
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This Insight is part of your subscription to Signify Premium Insights – Medical Imaging. This content is only available to individuals with an active account for this paid-for service and is the copyright of Signify Research. Content cannot be shared or distributed to non-subscribers or other third parties without express written consent from Signify Research. To view other recent Premium Insights that are part of the service please click here