Chem-Bio detector market reaches $400M.

The world market for chemical and biological warfare agent detectors could reach nearly $400 million in 2002, with the United States leading this sector as both the top investor in technology and the biggest buyer of new equipment.

Global spending forecasts for chem-bio detectors were revised after the Sept. 11 terrorist attacks, said Jenny Benavidez, research analyst for Frost & Sullivan Aerospace and Defense group. Her original forecast for 2002 sales was $322 million. It jumped to $383 million, given the recent surge in spending by the U.S. government. Revenues for this industry are expected to rise to $426 million by 2003, she said in an interview. By 2007, it could grow to more than $490 million.

The customers who are fueling the increased demand for GB warfare agent detection include the U.S. military services, security forces, first responders, emergency medical services and programs that deal with chemical weapons demilitarization, chemical arsenals/site remediation, strategic port/airfield monitoring, border management, and water and food testing.

After September 11, Benavidez said, first-responder agencies in the United States and the National Guard's weapons of mass destruction teams have generated new sales of chem-bio detectors.

"In the past, most of the agencies on the non-federal level received insufficient funding to enable them to purchase sophisticated detection systems," she said. "With a limited budget, the choice often is between one $150,000 detector or multiple protective suits with gas masks or other basic items." Before September 11, she added, not many agencies believed that they would be likely to use these derectots other than in training drills.

It is not clear, however, whether the additional revenues expected in this market will translate into new corporate investments in chem-bio protective systems, Benavidez said. Firms in this market, for the most part, develop new technologies under government contracts. "Research and development is not a cheap endeavor," she said. "Companies need government funding, usually from the services or from the Defense Advanced Research Projects Agency."

Before September 11, she added, companies were "operating under the assumption that 'it hasn't happened yet, so let's not worry about it."' Iris now possible, but not certain, that the increased fear of new attacks in the United States could make commercial companies more willing to spend the capital to design and develop the detectors.

"I expect that some new companies will be coming into the market," said Benavidez. Other firms may try to introduce existing detectors that have been used in the medical field, for example, and were not necessarily designed for agent detection. "Now, they can come into the market and say our system can detect anthrax too."' Most recently, a Pentagon solicitation for portable mass spectrometers generated proposals from 30 companies.

One challenge for newcomers, she said, is that the military organizations have their preferred manufacturers. The civilian market could grow, "but not enough to sustain new companies without a proven track record."

Another potential barrier to companies seeking to enter the chem-bio defense market is the high cost of technology, which means many new participants make their way into this sector through mergers and acquisitions. Other avenues of entry, she noted, include allying with a research lab and "thereby gaining some recognition and possibly production work.

"Obtaining lucrative government contracts is a vital component of companies' business plans," said Benavidez.

Chemical detection technology has improved vastly since Operation Desert Storm, where many of the systems used by the U.S. military and allies experienced high false-alarm rates.

Biological detection capabilities, meanwhile, have not matured as fast, said Benavidez. One problem that has not yet been solved is the timeliness of the detection. While chemical detectors work in about five-to-l0 seconds, biological devices require up to 10 minutes to sense and identify an agent. They need time to discriminate between the natural biologics in the air and potentially an agent that has been introduced intentionally, such as anthrax. More scientific-instrument firms are getting into the business, she said.

Benavidez predicts that these systems will get faster in the foreseeable future. "There have been great strides made in this area. I expect to see the response time drop."

Reasons for Growth

Worldwide expenditures on chemical detectors reached $120 million in 2000. By 2007, the market will surpass $201 million, she said. There are several reasons for this growth:

* Potential threats of chemical and biological terrorism has governments looking for protective measures.

* Concerns about the proliferation of weapons of mass destruction.

* Increased requirements for command-and-control and networking of detection systems.

The following factors, however, will restrain revenue growth:

* The high cost of chemical detectors is prohibitive for many organizations' budgets.

* The low replacement rates of detectors limits return business.

* An emphasis on biological threats diverts attention from chemical detection.

Revenues for biological warfare agent detectors amounted to $109 million in 2000. Benavidez said that, by 2007, this segment of the market could reach $217.7 million.

The expected growth is driven by:

* The threat of biological terrorism.

* The proliferation of biological weapons.

* Demand for cheaper and improved detection.

Future demand for biological detection equipment could suffer if:

* Requirements for small size and rapid detection are not met by current technology.

* Costs for detectors remain too high for non-government customers.

While there is considerable potential for growth in the chemical and biological warfare agent detector markets, the stakes are "very high," she said. "Opportunities worth large sums of money are contracted on an infrequent basis. ... Many of the market leaders in this industry today are those that have won large lucrative contracts for engineering and manufacturing development and/or production."

Outside the United States, only the United Kingdom is expected to make any significant expenditures in new chem-bio defense technology.

In 1998-1999, the U.K. Ministry of Defence spent about $60 million on chem-bio defense research, about $45 million on chem-bio defense related procurement, and about $6 million on chem-bio medical countermeasures. From 2000 through 2002, the British government is forecast to spend about $380 million on chem-bio defense-Sandra I. Erwin

RELATED ARTICLE: Chemical Warfare Agents

Nerve agents (organophosphorus agents)

Blister agents (mustard, lewisite)

Blood agents (cyanide)

Choking gases (phosgene)

Biological Warfare Agents

Anthrax

Botulinum toxin (BOTOX)

Staphylococcal Enterotoxin B 

Clostridium perfringens

U.S. Government Programs for Detection of Chemical and Biological Agents:

Air Base/Port Biological Detection (Portal Shield)

Automatic Chemical Agent Alarm (ACADA)

Biological Aerosol Warning System (BAWS)

Improved Chemical Agent Monitor (ICAM)

Joint Biological Point Detection System (JBPDS)

Joint Biological Remote Early Warning System (JBREWS)

Joint Chemical Agent Detector (JCAD)

Joint Chem/Bio Agent Water Monitor (JCBAWM)

Joint Chem/Bio Universal Detector (JCBUD)

Joint Service Agent Water Monitor

Joint Service Lightweight NBC Reconnaissance System (JSLNBCRS)

Joint Service Lightweight Standoff Chemical Agent Detector (JSLSCAD)

Joint Service Warning and Identification Lidar Detector (JSWILD)

Long Range Biological Standoff Detection System (LR-BSDS)

Multipurpose Integrated Chemical Agent Detector (MICAD)

Shipboard Automatic Liquid Agent Detector (SALAD)

Small Unit Biological Detector (SUBD)

Germ-Warfare Defenses Tested in D.C. Subway

Elizabeth G. Book

The Washington, D.C., subway system, known simply as "Metro," is "the first test-bed in the world for surface acoustical wave technology, which can detect the presence of chemical agents," said the system's police chief, Barry J. McDevitt.

The 103-mile long Metro hosts approximately 1 million riders a year and boasts the longest escalator in the westem hemisphere.

The chemical detection system, which is now in use in portions of the Metro, is able to detect chemical, nerve and blister agents, McDevitt said in an interview.

Though Metro's chemical-detection system made its debut following the terrorist attacks of September 11, the program has been in development and test phases for three years. Metro authorities started the project following the 1995 sarin-gas attack on the Tokyo subway system. Cult members accused of that attack dispensed the gas in the subway by piercing poison-filled plastic bags with umbrella tips.

"We had grant money and an initial 12-month test bed to make sure we weren't getting false positives or false negatives," McDevitt said.

The Argonne and Sandia National Laboratories assisted Metro personnel with testing and installation. The program was developed in cooperation with the Departments of Energy, Transportation, Justice, as well as the National Institute of Justice (the technology arm of the Justice Department).

The tests accomplished so far, McDevitt said, "not only met, but exceeded our expectations."

McDevitt said he hopes that the use of this technology will expand over time. "This program has applications at stadiums, shopping malls, airports, etc. It's not just for subways."

"The world has changed since September 11," McDevitt said. "From January 1 to September 10, 2001, we had no calls for investigation of liquid or suspicious substances. During that time, we had reports of 70 suspicious packages and 13 bomb threats.

"But from September 11 to December 12, 2001, there were 113 calls for suspicious liquids, 341 suspicious packages and 23 bomb threats," he said.

"We're lucky we were ahead of the curve on this one. We were trying to make this program operational even before September 11. Now, there's much more of a focus on security issues, and the goal is to save the lives of people in close proximity if an agent is released. We also will try to prevent injury or death to first responders. We don't want them to become part of the problem. We simply want to limit casualties and protect life."