The cost and time to bring an IVD to market

One of the most mis-understood parts of IVD commercialization is the cost and time to bring an IVD to regulatory approval, I discuss this in the embedded video below.

A summary of the video is here:

Introduction:

Hi, this video explores the time and investment required to bring an IVD (In Vitro Diagnostic) to the market. We'll delve into the following questions: How much does it cost and how long does it take? We'll draw examples from the last four decades to shed light on this topic.

Examples:

Let's start with iStat, launched in the early 1980s. The company, founded in the same year, developed a single cartridge per analyte. Another company, BioSite, shares similarities with iStat in terms of microfluidic cartridge technology. In contrast, Abaxis utilized a rotor for conducting multiple blood tests using a single sample. The investment in iStat in 1983 exceeded $50 million, while BioSite and Abaxis were in the range of $30 to $40 million. Cepheid, with a focus on molecular biology, entered the scene later, requiring an investment of approximately $80 to $90 million. Additionally, Epocal, founded by the same team as iStat, underwent two stages of product development and ceased operations around 2020. TLab stands out with its simpler assay, measuring tear film conductivity to assess dry eye.

Average Investment:

On average, the investment needed to bring these companies' initial products to market was $38 million, excluding TLab, which had a lower cost of approximately $7 million. Adjusting for inflation using the Consumer Price Index (CPI) to account for the years until 2021, the current investment required amounts to roughly $74.7 million. Excluding TLab, the figure reaches $83.8 million.

Years to Launch First Product:

The graph illustrates the time it took for these companies to launch their debut products, starting from their establishment. Sphere Medical and iStat had longer durations, with Sphere Medical experiencing two generations of products and concluding operations in 2020. On average, most companies required over seven years to launch their products, which aligns with anecdotal evidence. Notably, when comparing iStat and Epocal, both developed by the same team, Epocal achieved a one-third reduction in launch time (6 years) and a 50% decrease in costs compared to iStat (9 years).

Summary:

To embark on an IVD development project in 2021, securing funding of approximately $83.3 million would likely be necessary. However, it's important to mention that companies like Q Health have raised as much as $235 million for their IVD endeavors. Based on the analyzed examples, it is evident that companies typically take more than seven years to launch an IVD or obtain regulatory approval. Nevertheless, an experienced team, like ours at Zimmer Peacock, can significantly reduce both the timeline and costs by over one-third and 50%, respectively, compared to the average. If you have any inquiries about IVD development and manufacturing, please feel free to contact us. Thank you.