Dr. Morice discusses lab market trends with the Advisory Board

William Morice II, M.D., Ph.D., recently joined the Advisory Board for a webinar discussion on 2024 lab market trends. Dr. Morice and Rachael Peroutky, consultant, Advisory Board pharmacy and diagnostics, discussed the current lab market outlook, the priority trends, and opportunities for future growth.

The lab market outlook

The current lab market reflects a post-COVID-19 environment where diagnostic companies are adjusting to the new landscape. Growth is expected to continue, with the need for diagnostic testing being driven by an aging population, new and reemerging diseases, and technological innovations. These lab innovations add meaningful value to the healthcare system, improving the quality of treatment decisions, efficiency, and access.

Lab market trends

Two important factors driving decisions in 2024 are regulatory developments and financial pressures. The U.S. Food and Drug Administration (FDA) issued its final rule earlier this year that laboratory-developed tests (LDTs) will be regulated as medical devices, and it will phase out its enforcement discretion policy over the next four years. This new regulatory environment will have a widespread impact on laboratories and diagnostic companies.

In addition, the industry still faces a workforce shortage and rising healthcare costs, challenging hospital administrators to balance short- and long-term financial sustainability with high standards of care. “Consolidation in healthcare is being driven by multiple factors including finance and staffing challenges. Still, this trend comes with downside risks, especially for patients and their doctors,” said Dr. Morice.

Opportunities for growth

Disruptive technologies continue to change the landscape and create new possibilities. It’s important to align technology adoption with an organization’s business goals and values, investing in solutions that fill a need and keep the patient at the center. Digital pathology is one example of a growth opportunity that organizations should consider for future investment.

“Digital pathology has the promise to revolutionize medical practice, creating digital assets that increase knowledge, enhance quality, expand consultation capabilities, and improve diagnostic workflows,” said Dr. Morice.    

Another area poised for growth is out-of-lab testing. At-home and point-of-care tests have gained traction after the COVID-19 pandemic, establishing a familiarity and infrastructure for lab testing to occur outside the traditional setting. These shifting sites and preferences are leading to new wearable devices, testing options, and remote diagnostics.

“Broader healthcare trends are leading to exciting developments in diagnostics,” said Dr. Morice. “As opportunities for at-home testing expand, it’s important for laboratorians to collaborate with the manufacturers, inform test utilization strategies, and to help ensure their use creates value for patients and for the healthcare system at large.”

Watch the Advisory Board webinar.

Note: Advisory Board requires name and email address to access the recording.