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Instrument sales growing despite Washington.

Instrument sales growing despite Washington

The national market for laboratory instruments will grow by nearly 6 per cent annually during the next few years, from almost $511 million in 1985 to $679 million in 1990. That's the word in "Clinical Laboratory Instrumentation in the U.S.,' a 310-page study from Frost & Sullivan, the international market research firm.

The firm notes, however, that laboratories would buy more instruments if it weren't for Federal policies: "In what has elements of a classic catch 22, governmental efforts to control health care costs in the U.S. might instead be limiting purchases by hospitals and independent labs of labor- and dollar-saving equipment for the 7.7 billion in vitro diagnostic tests they will run this year.'

Restraints on laboratory spending include general reimbursement pressures brought on by prospective payment and the uncertainty of the Government's position regarding accounting for hospital capital equipment. While a life span of three to six years has been the norm for instruments in hospital or independent labs in the past, the study now indicates "an upward trend toward five to seven years before replacement.'

Hospital and independent labs billed for more than $5.4 billion in tests during 1985, according to Frost & Sullivan. They performed 88 per cent of the 8.1 billion in vitro diagnostic tests that were run in the U.S., but the firm says this share of volume will shrink toward 80 per cent by 1990 as testing grows in physicians' offices, HMOs, other outpatient care facilities, and the home. Consolidations have caused a 28 per cent decrease in "traditional' testing sites since 1981--a trend Frost & Sullivan expects to continue.

Therapeutic drug monitoring is cited as a key growth area for chemistry analyzers, which account for half the current instrument sales market (see Figure I). Later in the decade, spending on chemistry analyzers will increase by more than 8 per cent a year, the report states. Multiparameter instruments will still dominate, but their sales will decline to less than three-quarters of total chemistry analyzer wolume. Dry chemistry analyzers will go from a tenth of volume at present to a fifth.

Hematology instruments form the second largest instrument category, close to a third of the market, but Frost & Sullivan notes this share is contracting. On the other hand, spending on automated microbiology instruments will increaseant roughly three times the growth are of the total instrument market and account for a tenth of the market by 1990.

The next decade is almost upon us, so some of these projections would represent fairly sharp changes. But we're used to that. It was only three years ago that DRGs came on the scene.

Photo: Figure I Current clinical laboratory markets by product category
COPYRIGHT 1986 Nelson Publishing
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Copyright 1986 Gale, Cengage Learning. All rights reserved.

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Title Annotation:in spite of federal policies national market for laboratory instruments will grow
Author:Fitzgibbon, Robert J.
Publication:Medical Laboratory Observer
Article Type:editorial
Date:Dec 1, 1986
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