Frost & Sullivan releases the 'Global and China Bioreagent Market Independent Research Report'

Frost & Sullivan (Frost & Sullivan, abbreviated as 'Frost & Sullivan') continues to pay attention to the development of bioreagent research and development and application fields, and has officially released an 'Independent Market Research Report on Global and Chinese Bioreagents'.This report is the first multi-dimensional industry analysis of biological reagents, providing the most comprehensive and in-depth analysis at the levels of research investment, industry development, and application areas. The report indicates that the global and Chinese markets for biological reagents will expand rapidly, driving the development of downstream application fields such as medical research, pharmaceutical R&D, health and epidemic prevention, and laboratory research. Frost & Sullivan looks forward to advancing more downstream application fields through the development of the biological reagent industry in the future.

This article delves into the market and development of biological reagents.Analyze the comparison between scientific research and industrial uses of biological reagents, as well as the market scale of biological reagents and the market prospects of downstream application fields.

Important advancements and breakthroughs in modern biotechnology are accelerating their penetration into application fields, increasingly highlighting their strategic position in leading future economic and social development. Global research funding in the field of life sciences has grown rapidly, increasing from $124.7 billion in 2016 to $157.6 billion in 2020, with an annual compound growth rate of 6.0%. At the same time, with China's emphasis on the life sciences and continuous improvement and enhancement of the scientific and technological innovation system, investment in research funds for the life sciences in China has also continued to grow, from 49.6 billion yuan in 2016 to 97.8 billion yuan in 2020. The proportion of investment in global research funds for the life sciences has also increased from 6.0% in 2016 to 9.0% in 2020.

Data sources: National Science Foundation, OECD, Statistics Bureau Japan, National Bureau of Statistics, Frost & Sullivan

Over hundreds of years, the development of life sciences has undergone a continuous deepening process, from tissue to cells, subcellular and molecular levels, to systems biology.Milestone discoveries such as the DNA double helix structure marked a shift in the research level of life sciences into the era of molecular biology. To this day, molecular biology has become one of the fastest-growing and most cutting-edge fields within life sciences. Nucleic acids and proteins are the main subjects of molecular biology research, especially the omics study of nucleic acids and proteins has become a hot topic in recent years. With the development of purification and testing technologies and the increasing demand for detection, systems biology effectively combines popular disciplines such as genomics and proteomics, driving technological advancement. As an important basic raw material for life science experiments, biological reagents are indispensable and accompany the development of the life sciences field.

Data source: Frost & Sullivan

The global market size for bioreagent research and development was $139 billion in 2016, and it grew at a compound annual rate of 6.92% to reach $182 billion by 2020. This investment is expected to reach $272 billion by 2025, with a compound annual growth rate of 8.40% between 2020 and 2025.

Data source: Frost & Sullivan

The market scale of bioreagent research and development in China reached 82 billion yuan in 2016, and it grew to 151 billion yuan by 2020 at a compound annual growth rate of 16.51%, which is higher than the global bioreagent research and development market during the same period. This investment is expected to reach 346 billion yuan by 2025, with an annual compound growth rate of 18.10% during this period.

Data source: Frost & Sullivan

The bioreagent research market can be divided into industrial research users and research institution users based on user type..In 2020, research institution users accounted for 61.6% of the global bioreagent research market. During the same period, in the Chinese market, research institution users made up 67.3%, with their proportion exceeding that of industrial research users. In addition, the Chinese bioreagent research market can be divided into three categories based on reagent type: cell-based, protein-based, and molecular-based. Among them, molecular-based bioreagents account for the highest proportion, at 50.5%.

Data source: Frost & Sullivan

The user market for Chinese bioreagent research institutions is relatively fragmented. Leading enterprises led by foreign companies such as Thermo Fisher, Takara, and QIAGEN have been developing for many years. Their reagents are of high quality and have been recognized by the market, thus occupying the main share of the Chinese bioreagent research institution user market. Among domestic manufacturers, companies such as Novogene, Yisheng Biotech, and WuXi AppTec are still in the development stage, accounting for about 10% of the market share. Although the quality of some domestic reagents is comparable to that of foreign products, market recognition still needs further improvement.

Data source: Corporate annual reports, Frost & Sullivan

The market scale of China's in vitro diagnostic reagent industry increased from 45 billion yuan in 2016 to 107.5 billion yuan in 2020. In the future, with the intensification of the aging population trend, the growth of per capita medical expenses, and technological progress, the market for in vitro diagnostic reagents is expected to gradually grow.By 2025, the market scale of China's in vitro diagnostic reagent industry is expected to reach 219.8 billion RMB, with a compound annual growth rate of 15.38% from 2020 to 2025.

During the forecast period, the market for in vitro diagnostic reagents in China has grown rapidly. One of the main driving factors is the increase in chronic diseases. Due to unhealthy eating habits, high stress levels, lack of physical activity, etc., chronic diseases have become increasingly common. In addition, the prevalence of infectious diseases has also created a great demand for rapid disease testing. Compared with the overall growth rate of the medical device market, the market for in vitro diagnostic reagents has grown even faster.It is expected that the market share of medical devices in China will grow from 14.7% in 2020 to 17.9% by 2025.

Data source: Frost & Sullivan

The Chinese in vitro diagnostic market can be divided into molecular diagnostics, immunodiagnosis, biochemical diagnostics, and point-of-care testing (POCT) according to the type of test. In 2020, affected by the COVID-19 pandemic, the total scale of China's IVD market reached 107.5 billion yuan. Among them, molecular diagnostics are the largest sub-market in the IVD field, with a market scale of 28.6 billion yuan, accounting for 26.6% of the total IVD market; immunodiagnosis and biochemical diagnostics are the second and third largest sub-markets, respectively, with market scales reaching 27.8 billion yuan and 15.2 billion yuan in 2020.

Data source: Frost & Sullivan

The Chinese IVD reagent raw material market mainly refers to the core raw materials of IVD reagents, such as antibodies, antigens, enzymes, etc., which are still dominated by imported products at present. The overall rapid development of China's IVD industry has driven the synchronous growth of upstream industrial chains, thus continuously expanding the scale of the IVD reagent raw material market. The Chinese IVD reagent raw material market grew from 4.1 billion yuan in 2016 to 10.4 billion yuan in 2020, with an annual compound growth rate of 26.23% during this period. In the future, it is expected to grow at a rate of 17.01% to reach 228 billion yuan by 2025.

Data source: Frost & Sullivan

The molecular diagnostic reagent raw material enzyme industry is upstream of the molecular diagnostic industry chain. Affected by the novel coronavirus epidemic, Chinese residents have generated a huge demand for testing, thus urgently necessitating the market to meet the demand for molecular diagnostic reagent raw material enzymes. The promising molecular diagnostic industry will boost the growth of the molecular diagnostic reagent raw material enzyme market.The market scale of molecular diagnostic reagents in China increased from 1.4 billion yuan in 2016 to 3.2 billion yuan in 2020, with a compound annual growth rate of 23.0%. It is estimated that by 2025, the market scale of molecular detection reagents in China will reach 52 billion yuan, with a compound annual growth rate of 10.0%.

The main driving forces behind the rapid growth of China's molecular diagnostic reagent raw material enzyme market include: 1) The increased penetration rate of molecular diagnostics after the novel coronavirus outbreak, along with the continuous increase in testing needs from testing institutions and residents; 2) The rapid development of China's molecular diagnostic market and the research-use molecular diagnostic reagent market has continuously driven the development of the molecular diagnostic enzyme raw material industry; 3) National policies encourage and emphasize the autonomy and control of key raw materials for molecular diagnostic reagents, accelerating the localization of the raw material enzyme industry.

Data source: Frost & Sullivan

The market for molecular diagnostic reagents in China started relatively late. Apart from foreign companies such as Roche, Thermo Fisher, and Takara, there are few domestic manufacturers that can provide molecular diagnostic reagents. Affected by the COVID-19 pandemic, the market share of domestic manufacturers is mainly concentrated among listed or pre-listed companies such as Novogene, Feipeng Biotech, Yisheng Biotech, Kangwei Century, and Nearshore Protein, accounting for about 40% of the Chinese molecular diagnostic reagent market. The upstream raw materials for molecular diagnostics have high technical requirements and entry barriers. With continuous policy encouragement for core molecular diagnostic raw materials in China, the localization substitution of molecular diagnostic reagents will accelerate, and it is expected that the dependence on imported reagents will gradually decrease in the future.

Data source: Corporate annual reports, Frost & Sullivan

The market for raw material enzymes and reagents for constructing NGS libraries in China is mainly dominated by foreign companies (Illumina, Thermo Fisher), accounting for about 66.83% of the market share. Novogene and Yisheng Biotech, as companies with independent enzyme R&D technology platforms, can not only provide raw material enzymes for library construction but also reagents, making them highly competitive. They account for 16.82% and 4.50% of the Chinese market for raw material enzymes and reagents for constructing NGS libraries, respectively. In the future, with continuous improvement in enzyme R&D technology and acceleration of the localization process of raw material enzymes, domestic manufacturers led by Novogene and Yisheng Biotech will further expand their share in the market for raw material enzymes and reagents for constructing NGS libraries.

Data source: Corporate annual reports, Frost & Sullivan

NGS is relatively expensive in the field of tumor detection, with an average cost per test exceeding 9,000 yuan, far higher than the NIPT cost (1,000 - 2,000 yuan per test). The reason is that upstream instruments and reagents are mainly monopolized by imported brands. In the future, as upstream instruments and reagents gradually become domestically produced and replaced, the price of NGS testing is expected to continue to decrease.

1) Non-invasive prenatal testing (NIPT):NIPT is the most mature field in clinical application of NGS. Compared to traditional detection techniques, NIPT has advantages such as high detection rate, short testing cycle, and convenient operation. It can improve prenatal diagnosis efficiency, reduce the birth of deformed fetuses, and has higher safety than invasive prenatal diagnosis, making it highly valuable for clinical practice. In some regions of China, NIPT has been included in medical insurance. In the future, with continuous price reductions and increasing awareness of NIPT, its penetration rate will gradually rise. The market scale of NGS-based NIPT in China increased from 1.9 billion yuan in 2016 to 6.8 billion yuan in 2020.It is estimated that the market size will reach 208 billion RMB in 2025, with an annual compound growth rate of 24.97% during this period.

Data source: Frost & Sullivan

2) Oncology:Companion diagnostics, early tumor screening, and drug research and development are the three major application scenarios of NGS in the field of oncology. As NGS technology continues to mature in the precision medicine sector, the market for NGS-based companion diagnostic guidance for clinical medication in China has been growing steadily, increasing from 700 million yuan in 2016 to 3.7 billion yuan in 2021, with a compound annual growth rate of 37.60%.In the future, it is expected that the penetration rate of NGS in the field of companion diagnostic guidance for clinical medication will continue to increase, reaching RMB 7.7 billion by 2025, with an average annual compound growth rate of 20.62% during this period.

Data source: Frost & Sullivan

The development and production process of mRNA drugs mainly includes the screening of target proteins, mRNA template design, plasmid construction, mRNA stock preparation, and formulation production. The urgency of clinical demand has prompted relevant Chinese regulatory authorities to respond quickly to the production requirements for mRNA vaccines.

In August 2020, the Center for Drug Evaluation organized the formulation of the 'Technical Guidelines for Pharmaceutical Research on mRNA Vaccines for the Prevention of Novel Coronavirus (Trial Implementation)', providing guidance and standardization for the production of this innovative vaccine. The 'Guidelines' point out that although mRNA vaccines have made certain progress in clinical studies of various infectious diseases, there are still many issues that need to be confirmed, such as the potential immunogenicity of mRNA itself, the stability of delivery systems (such as lipid nanoparticles), the safety of nanoformulations, the safety of cationic polymers/liposomes used, the targeting and efficacy of delivery, among other issues, which affect the effectiveness, safety, and quality controllability of the vaccine. With continuous investment by Chinese enterprises in mRNA drug development, their production processes will receive more attention in the future.

1) Target protein screening:Determine the target protein, such as a target antigen, viral surface spike protein, etc. Analyze the genetic material that transcribes into the target protein to obtain the corresponding DNA and mRNA sequences.

2) mRNA template sequence design:Optimize the mRNA template sequence, including non-translated regions, coding region codons, secondary structure, and tertiary structure, to improve the translation performance of mRNA. Perform molecular modifications on mRNA, including cap addition, tail addition, and modification of nucleotides, to enhance the stability of mRNA.

3) Plasmid construction:Mass-produce (replicate and amplify) plasmids containing mRNA sequences using Escherichia coli or other routes. Extract and purify the DNA plasmid, and obtain linearized pDNA using restriction endonucleases.

4) mRNA stock preparation:Transcription refers to the process of placing a linearized pDNA template and other raw materials (enzymes, nucleotides, etc.) in an acellular reactor for transcription and capping. Purification refers to the removal of impurities such as template DNA, enzymes, and short terminators RNA, ultimately concentrating the material into an original solution.

5) mRNA preparation production:Utilize delivery carriers such as liposomal particles to encapsulate mRNA stock solutions into finished products, fill them, label them, and finally complete the production of the formulation.

Data source: Frost & Sullivan, Biorender

With the gradual maturation of mRNA therapies, more and more companies are allocating resources to the research and development of mRNA drugs, which will also cover a wider range of indications. As a result, companies' demand for mRNA raw materials will continue to expand. Among them, enzyme raw materials account for 39.58% of the production cost of mRNA vaccines.In 2020, the Chinese mRNA enzyme raw material market reached 150 million RMB, and it is expected that this market will grow to 1.47 billion RMB by 2025 at a compound annual growth rate of 58.2%.

Data source: Frost & Sullivan