Quidel (QDEL)

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• Alere Inc (ALR)
• Meridian Bioscience (VIVO)

TOP CONTRIBUTORS

Isaac Middendorf

Quidel Corporation develops and commmercializes healthcare diagnostic testing solutions. The company creates tests primarly for infectious diseases such as influenza and Strep A, and also reproductive and women's health. It primarly sells its products in the U.S., Japan, Europe, and the Middle East. The company develops tests that can be used near patients, deemed point of care testing (POCT). This close proximity testing allows for immediate diagnosis and treatment of patients, without having to wait hours or even days for results from central laboratories.^[1]

The companies strong position in infectious diseases, especially influenza testing led the company to benefit strongly from the 2009 H1N1 outbreak (also known as swine flu).^[1] Additionally, a global aging population will continue to effect the need for diagnostic testing.

Business Growth

During the 2009/2010 flu season (Q3 2009- Q1 2010) Quidel saw a sharp increase in sales due to a high number of infections and awareness in testing by the public.^[1] With such potential in infectious disease Quidel acquired Diagnostic Hybrids in 2010 to expand its product lines by accessing more non-seasonal infectious disease tests.^[2] Additionally, in 2009 Quidel formed a partnership with BioHelix to take advantage of movements towards the use of molecular diagnostics in point of care testing.^[3]

Trends and Forces

New outbreaks and infectious diseases continue to arise

Infectious disease are particularlly prone to outbreaks due to strain mutations, lack of immunizations, and development of new diseases.

As an example, for influenza in just the U.S. alone, according to the CDC, every year 5 to 20 percent of the U.S. population gets the flu, causing more than 200,000 hospitalizations and about 36,000 flu related deaths.^[4] In 2009, this average was driven higher due to the emergence of the 2009 H1N1 virus (also know as "Swine Flu"). Average estimates for the impact of 2009 H1N1 between April and mid December of 2009 had 55 million people infected, of which 246,000 were hospitalized and over eleven thousand people died due to the virus. Infections were much higher outside of the U.S. and along with it also was testing.^[4]

In comparison to seasonal influenza, 2009 H1N1 affected a much different patient population, which also fueled concern and drove testing. According to the CDC, for seasonal flu about 60 percent of hospitalizations and 90 percent of deaths occur in people 65 years and older. While for 2009 H1N1, approximately 90 percent of estimated hospitalizations and 88 percent of estimated deaths occurred in people younger than 65 years old.^[4]

Expanded testing needs due to growing aging populations

The diagnostic testing market will continue to be impacted by increases in the aging and treatment populations. According to the U.S. Census Bureau in 2008, over 94 million people, roughly 31 percent of the population, was over the age of 50. This population is growing at just under three percent. Unfortunately, chronic diseases affect older adults disproportionately and, as a result, the U.S. will be increasingly pressured to handle a growing sick population.^[5] Even with over 225,000 physician offices in the U.S., the American College of Physicians forecasts an estimated shortage of 44,000-46,000 physicians by 2025.^[6] According to the American Hospital Association (AHA), at least half of the emergency departments are at or over capacity, citing a lack of beds as the main reason.^[7] The increase in acutely ill patients, coupled with personnel shortages, is straining clinical laboratory resources from providing test results in a timely manner. In order to relieve the growing burden on clinical laboratories, POCT is becoming increasingly adopted to diagnose and treat patients rapidly for improved patient outcomes.

Competition

The U.S. POCT market is highly fragmented, with several types of competitors vying for business with hospitals, physician office labs, community health clinics and fairs, and self-testing patients. It is made up of large multinational diagnostics companies, specialized POCT firms and participants tend to focus on certain market segments.

• Alere Inc (ALR)- is the dominant player in the POCT space and competes with Quidel in almost every type of tests that it makes.
• Beckman Coulter (BEC)- competes with Quidel in pregnancy and fecal occult blood testing.
• Meridian Bioscience (VIVO)- is a quickly growing player that competes directly with Quidel in the infectious disease space.

References

1. ↑ ^{1.0 1.1 1.2} Quidel 2010 10-k
2. ↑ Key Developments: Quidel Corp. Accessed on March 25, 2011
3. ↑ Quidel, BioHelix to Co-Develop POC MDx Tests Genomeweb.com, October 6, 2009
4. ↑ ^{4.0 4.1 4.2} Updated CDC Estimates of 2009 H1N1 Influenza Cases, Hospitalizations and Deaths in the United States, April 2009 – April 10, 2010, CDC.gov, May 14, 2010
5. ↑ An Aging Wolrd: 2008 Census.gov
6. ↑ Worsening Primary Care Shortage Predicted American College of Physicians, December 2, 2008
7. ↑ Ehrhardt, Jane Psychiatric Patients Wait in Overcrowded ERs birminghammedicalnews.com, Accessed on May 25, 2011