Hospitals are the prominent contributors to the clinical laboratory services industry with the ability to provide tests and diagnostics for both inpatient and outpatient requirements, as well as walk-in customers that aim to take advantage of the medical expertise at the facilities post receiving the results.
Diagnostic techniques have evolved tremendously over the years and continue to be considered among the key aspects of medical operations, making clinical laboratory services an integral part of the modern medical infrastructure. The earliest known medical diagnoses made by humans were dependent on information physicians could glean through observation with their ears and eyes, sometimes also including examination of the human specimens.
The history of medical laboratories is one of the major indicators of the evolution of medicine from empirical to experimental methods, thus positioning the clinical lab as an indispensable part of the medical domain. More than ever the importance of laboratory services is highlighted now, during the global coronavirus pandemic. The existing crisis has only fostered global clinical laboratory services market size, which is anticipated to reach a valuation of US$426 billion by 2026.
Overview of clinical laboratory services
Medical laboratories or clinical laboratories refer to healthcare facilities that offer a vast array of lab-based procedures to help physicians diagnose, treat and manage patients efficiently. Most clinical labs are located within or nearby hospitals, in order to give both physicians and their patients easier access. Clinical laboratory services are classified by various parameters and involve different types of laboratory tests needed to address public and medical health requirements.
Based on test type, for instance, the industry is categorised into human & tumor genetics, other esoteric tests, medical microbiology & cytology and clinical chemistry, which includes specialised chemistry testing, routine chemistry testing, endocrinology chemistry testing and Therapeutic Drug Monitoring (TDM) testing.
Medical labs have been touted as the nerve center of diagnostic medicine, given their ability to deliver information essential to not just diagnosis and supervision, but also prevention, screening, early diagnosis, customised treatment and more effective supervision of human diseases. Laboratory services are crucial aspects of medical decision-making and play an important role in developing tailored treatment programs for individual patients.
According to estimates, nearly 60-70% medical decisions are reliant to a certain extent on laboratory results. Clinical laboratory services help physicians gather important diagnostic information related to various ailments. For instance, the services are essential for effective management of diseases like diabetes.
Tests such as the glucose tolerance test, the fasting glucose test and the hemoglobin A1c test are crucial for the diagnosis of pre-diabetes, as well as for the monitoring of changes in diet and other risks. These diagnostic tests can allow for better control over blood glucose, which in turn can help delay or prevent complications associated with diabetes, such as stroke, kidney disease, amputation, blindness, stroke, or even death.
Clinical lab services are also essential for early detection and curbing the spread of various infectious diseases.
Rising prevalence of infectious diseases
Infectious or contagious diseases are ailments caused due to microscopic pathogens, such as viruses, parasites, bacteria or fungi, which affect myriad populations worldwide. While infectious diseases have a relatively minor risk of complications if diagnosed early and treated properly, left untreated, they can lead to several life-threatening conditions including HIV, TB (tuberculosis), meningitis and pneumonia.
In 2014 alone, reports suggest that infectious diseases were responsible for an economic burden of over US$120 billion in the United States.
Clinical laboratory services are considered crucial for early and precise diagnosis of infectious diseases. Diagnosis of these ailments in time can help medical practitioners deliver more effective treatments, prevent long-term complications, and can help stop outbreaks by treating patients before they unknowingly spread the disease to others. Additionally, efficient diagnostic testing can address the issue of antibiotic resistance, by determining when antibiotics are the correct course of treatment, thus avoiding misuse or overuse.
Diagnostic test manufacturers are involved in persistent efforts to develop more sophisticated solutions to match the evolution of the medical domain, and the rise of new infectious diseases. These advancements are allowing healthcare providers to achieve faster diagnoses, better patient outcomes and lower healthcare costs over the long run.
Hospital-based laboratories take the lead
The clinical laboratory services market is vast and is bifurcated based on parameters like service providers or test types. Clinical laboratories can be clinic-based, standalone or hospital-based. According to estimates from the American Clinical Laboratory Association, over 7 billion laboratory tests are conducted annually in the US.
Hospital-based laboratories are responsible for conducting most of these tests, and generally perform more tests than all the other laboratory types, combined. These medical labs mainly address inpatient and outpatient testing needs in the associated hospital, but also conduct diagnostic tests for patients that are not admitted to the hospital, which is known as “outreach testing”. The number of hospital-based labs in the United States surpasses the number of hospitals, given that some hospitals are responsible for the operation of more than one lab.
One of the main drivers for the competition between independent labs and hospital-based labs is the presence of various government regulations. For instance, the CMS (Federal Centers for Medicare and Medicaid Services), provides more payments for hospital-based laboratory services as compared to independent laboratories.
Additionally, hospital-based labs have the advantage of 24/7 presence of medical personnel, who can work with clinicians to deliver more advanced and experienced diagnostic solutions. The presence of EHR, or electronic health records, give hospital-based labs the distinct advantage of faster delivery of test results to doctors and patients.
Effect of the COVID-19 pandemic on clinical lab services
The COVID-19 outbreak, which was caused due to the SARS-CoV-2 virus, has created significant socio-economic upheavals, since it was declared a pandemic in March 2020. The disease has spread rapidly since its identification, affecting billions of people worldwide, with numbers still rising rapidly.
As a response to this pandemic, various commercial companies and state authorities busied themselves with developing targeted diagnostic assays, designed to test for SARS-CoV-2 infection. More than 40 diagnostic assays have received EUAs (Emergency Use Authorizations) from authorities like the US FDA. Clinical laboratory services are crucial in the implementation of testing under the EUA, as they are needed to conduct bridging studies on these FDA-approved assays.
It is evident that the coronavirus outbreak has asserted a significant impact on the healthcare domain, especially the clinical laboratory service providers. Many labs are rapidly adopting newer and more advanced diagnostic techniques, in order to provide more reliable and accurate patient care.
In Feb 2020, a new policy was issued by the U.S. FDA (Food and Drug Administration), aimed at specific medical laboratories seeking to develop COVID-19-related diagnostic tests, allowing them to expedite testing capacity in the United States.
For instance, in March last year, Enzo Biochem, Inc. revealed that Enzo Clinical Labs, its wholly owned subsidiary would start accepting specimens for COVID-19 testing. Enzo was aiming to develop next-gen COVID-19 testing options, using its own technical know-how in molecular diagnostics. Furthermore, the company’s innovations like specimen collection media with virus-inactivating properties to reduce transmission risks for clinical lab personnel and healthcare providers, improved sensitivity and more relevant positive test controls were a key part of the organisation’s efforts to tackle the pandemic.
Meanwhile, a team of researchers at the Yale School of Public Health developed a saliva-based laboratory diagnostic test for COVID-19 in August 2020, which earned an EUA from the U.S. FDA. The test, dubbed SalivaDirect, was used on a research basis for the testing of asymptomatic staff and players from the NBA (National Basketball Association), and is designed to offer an economical, simpler and less invasive option to the conventional nasal swabbing-based testing method for SARS-CoV-2 testing.
Technological innovations transforming medical laboratory operations
Digital empowerment of clinical laboratories and the utilisation of top-of-the-line research to turn them into innovation powerhouses is the need of the hour for the medical industry. With technology triggering a change in nearly every aspect of modern human life, the need for a more advanced, and quality driven digital approach for clinical lab services becomes more urgent than ever.
Home diagnostics are quickly emerging as the future of diagnostic services, allowing phlebotomists to conduct faster testing and rapid delivery of results. This innovation is aimed at creating a new generation of medicine, where clinical lab operations can be extended into patients’ homes, facilitating an accessible, connected and omnipresent view of healthcare across the globe, most notably in developing countries.