Cytology and HPV Testing World Markets

TABLE OF CONTENTS

1. Overview 6
1.1 Statement of Report 6
1.2 About this Report 6
1.3 Scope of the Report 7
1.4 Objectives 8
1.5 Methodology 8

2. Introduction to Cancer Biology and the Diagnostic Industry 10
2.1 Cancer 10
2.1.1 The Disease 10
2.1.2 Metastasis 10
2.1.3 Demographics and Statistics of Cancer 11
2.2 The Drivers of the Biotech and Diagnostics Industry 18
2.2.1 Top Ten Biotech Corporations 19
2.2.2 Technological Innovation 19
2.2.3 Government Funding 20
2.2.4 Pharmaceutical Development 20
2.3 Outlook for Tumor Markers 21
2.4 The Cancer Market 22

3. Cervical Cytology Testing Overview 25
3.1 Sector Background 25
3.2 Market Opportunity 25
3.3 Cervical Cancer 25
3.3.1 Screening for Cervical Cancer 26
3.3.2 Screening Procedures and Pap Smear Technology 27

4. Human Papillomavirus (HPV) Testing Overview 31
4.1 Market Overview 31
4.1.1 Human Papillomavirus 31
4.1.2 North American Market 34
4.1.3 European Market 35
4.1.4 Latin American Market 35
4.2 Hybrid Capture 2 Technology 35
4.3 Histology Market Overview 37

5. Cytology Market Structure 40
5.1 Key Players 40
5.1.1 BD, TriPath 40
5.1.2 Cytyc (Acquired by Hologic) 40
5.1.3 CytoCore, Inc. (formerly known as Molecular Diagnostics, Inc.) 41
5.2 BD, TriPath Products 42
5.2.1. Cervical Cytology Product Line 42
5.2.1.1 BD SurePath Pap Test 42
5.2.1.2 BD PrepStain Slide Processor 43
5.2.1.3 BD FocalPoint GS Imaging System 43
5.2.1.4 BD FocalPoint Slide Profiler 44
5.2.1.5 Molecular Oncology 44
5.2.1.6 Molecular Imaging Systems 45
5.2.1.7 Blood-based Reagents 45
5.2.2 Hologic Products 45
5.2.2.1 The ThinPrep System 45
5.2.2.1.1 Additional Applications of the ThinPrep System 46
5.2.2.2 The ThinPrep Process 47
5.2.2.3 Clinical Studies Evaluating the ThinPrep Pap Test 47
5.2.2.4 Competition 48
5.2.2.5 Surgical Products 48
5.2.2.6 The NovaSure System 49
5.2.2.7 Competition 50
5.2.3 CytoCore Inc., Products and Services 50
5.2.3.1 SoftPAP Cervical Cell Collector 51
5.3 Marketing and Sales Strategies 51
5.3.1 BD, TriPath Sales and Marketing 52
5.3.1.1 Total Sales and Marketing 52
5.3.1.2 Commercial Operations 52
5.3.1.3 Marketing Strategy 53
5.3.1.4 BD, TriPath’s Molecular Diagnostic Products 55
5.3.2 Cytyc (Acquired by Hologic) Marketing and Sales 56
5.3.2.1 Sales and Marketing Costs 57
5.3.2.2 Hologic’s Marketing and Sales Strategy 57
5.3.2.2.1 Domestic Strategy 57
5.3.2.2.2 International Strategy 58
5.3.2.3 Sales Strategy - Cervical Cytology Product Line 58
5.3.2.3.1 Molecular Diagnostics 58
5.3.2.3.2 Marketing and Sales Organizations 59
5.3.2.3.3 Outside the U.S. with the Exception of Canada 59
5.4 Manufacturing BD, TriPath, BD SurePath and BD PrepStain 60
5.4.1 Manufacturing Standards for Diagnostic Products 60
5.5 Competition 61
5.5.1 Molecular Diagnostic Reagents 62

6. Human Papillomavirus (HPV) Testing Market Structure 63
6.1 Key Players 63
6.1.1 Digene (Acquired by QIAGEN) 63
6.1.1.1 Digene Products 64
6.1.2 Ventana Medical Systems 64
6.2 Products 65
6.2.1 HPV Tests 66
6.2.2 Chlamydia and Gonorrhea Tests 66
6.2.3 Blood Virus Tests 66
6.2.4 Instrumentation and Accessory Products 67
6.2.5 Vaccine 67
6.3 Sales and Marketing 68
6.3.1 International Markets 68
6.3.2 Europe 68
6.3.3 Central and South America 69
6.3.4 Asia/Pacific 69
6.3.5 Strategy 70
6.4 Manufacturing 70
6.5 Competition 71
6.5.1 Ventana 73
6.6 Ventana Staining Products 73
6.6.1 Ventana Products 73

7. Business Trends in the Industry 76
7.1 Industry Consolidation 76
7.2 Breath of Product Offering and Pricing 77
7.3 Government Regulation of Medical Devices 77
7.4 Strategic Business and Marketing Considerations 78
7.5 Commercial Opportunities in Cancer Markers 79
7.6 Moderators of Growth 80
7.7 Biotechnology Industry Trends 81
7.8 Pharmaceutical Industry Trends 81
7.9 Acquisition, License Agreement and Partnerships 82
7.10 Legal Developments 83
7.11 Sales and Marketing Strategies for Tumor Marker Tests 84
7.11.1 North American Market 85

8. Government Regulation 86
8.1 Government Regulation 86
8.2 U.S. FDA Approval 87
8.2.1 Clinical Laboratory Improvement Act of 1988 and State Laboratory Laws 89
8.2.2 Foreign Regulatory Approval 89

9. Legal Developments 91
9.1 Cytyc Legal Proceedings 91
9.2 Ventana Legal Proceedings 92

10. Third-Party Reimbursement 96
10.1 Limited Reimbursements by Third-party Payers Obstruct Sales 96
10.2 Cytyc ThinPrep 96
10.3 CPT Codes and HCPCS Codes 97
10.4 Professional Component Fee 98
10.5 Regional Payer Relations Managers 98
10.6 Reimbursement Codes Classification 98
10.6.1 Reporting Screening and Diagnostic Pap Smears 98
10.6.2 HCPCS (HCFA Common Procedure Coding System) Code Definitions 98
10.6.3 CPT (Current Procedural Terminology) Code Definitions 99
10.7 A Note on Statutory Limitations 99
10.8 Cervical Cytology Product Line 99
10.9 Molecular Diagnostic Products and Imaging Systems 100

11. Barriers in Business 102
11.1 Barriers in the Business Section 102
11.1.1 Hologic Barriers 102
11.1.2 QIAGEN Risk Factors 108
11.1.3 Ventana 116
11.1.3.1 Ventana factors that could affect future results 116

12. Acquisition Activity 120
12.1 Acquisition 120
12.2 Hologic Acquires Cytyc 120

13. Research & Development Activity 121
13.1 Hologic In-Process R&D and Developed Technology 121
13.2 BD, TriPath Research & Development 121
13.2.1 Development of Molecular Diagnostic Products 121
13.3 Digene Research & Development 123
13.4 Ventana Research & Development 124
13.4.1 Instrumentation Development Projects 124
13.4.2 Reagent Development Projects 124

14. Intellectual Property 125
14.1 BD, TriPath Proprietary Technology and Intellectual Property 125
14.2 Digene Intellectual Property 126
14.2.1 Hybrid Capture Technology 126
14.2.2 Rights to HPV Types 126
14.2.3 Other Intellectual Property 128
14.3 Ventana Patents and Proprietary Rights 128

15. Hologic and Cytyc Profile 129
15.1 Company Information 129
15.1.1 Contact 129
15.1.2 About Cytyc and Hologic Together 129
15.2 Products/Business Segments 129
15.2.1 Diagnostic Products 129
15.2.2 The ThinPrep Process 130

16. Analytical Section 131
16.1 Financial Analysis 131
16.2 Company’s Strategies 131
16.3 SWOT Analysis 132

17. Industry/Market Landscape 135
17.1 Industry Overview 135
17.1.1 Industry Key Players 135
17.1.1.1 Cytology Screening Testing Market Structure 135
17.1.1.2 Human papillomavirus (HPV) Testing Market Structure 135
17.2 Outlook on the Industry 135
17.3 Trends, Issues, Challenges and Opportunities: An Analysis 137
17.4 Molecular Diagnostics Products 139
17.4.1 Microscopic Slide Based Reagents 139
17.4.2 Molecular Imaging Systems 140
17.4.3 Blood-Based Reagents 140
17.5 Competitive Landscape 141
17.6 Products/Business Segments 142
17.6.1 Digene’s HPV Tests 144
17.6.2 Digene’s Chlamydia and Gonorrhea Tests 144
17.6.3 Digene’s Blood Virus Tests 144
17.6.4 Digene’s Instrumentation and Accessory Products 145

18. QIAGEN 146
18.3 Analytical Section 146
18.3.1 Financial Analysis 146
18.4 Company’s Strategies 146
18.5 SWOT Analysis 147

19. Industry/Market Landscape 150
19.1 Digene Industry Overview 150
19.1.1 Industry Definition 150
19.1.1.1 Cytology Products 150
19.1.2 Industry Key Players 151
19.1.3 Company’s Outlook on the Industry 151
19.2 Trends, Issues, Challenges and Opportunities - An Analysis 152
19.3 Competitive Landscape 153
19.4 Competition 153
19.4.1 Digene’s Competitive Advantage 154
19.4.2 Molecular Diagnostic Reagents 154
19.4.3 BD, TriPath 155
19.5 Products/Business Segments 156
19.5.1 Cervical Cytology Product Line (Formerly the i3 Series Product Line) 156
19.5.1.1 BD PrepStain Slide Processor 156
19.5.1.2 BD FocalPoint Imaging System 157
19.5.1.3 BD SlideWizard Product Line 158
19.5.2 Molecular Oncology Products 158
19.5.2.1 Microscopic Slide Based Reagents 158
19.5.2.2 Molecular Imaging Systems 159
19.5.2.3 Blood-Based Reagents 159

20. Analytical Section 160
20.1 Financial Analysis 160
20.1.2 BD, TriPath Oncology Revenues 161
20.2 Company’s Strategies 161
20.3 SWOT Analysis 161

21. Industry/Market Landscape 165
21.1 Industry Overview 165
21.1.1 Industry Definition 166
21.1.1.1 Cytology Products 166
21.1.1.2 Molecular Diagnostic Products 166
21.1.2 Industry Key Players 166
21.2 Company’s Outlook on the Industry 166
21.3 Trends, Issues, Challenges and Opportunities: An Analysis 167
21.4 Molecular Diagnostics Products 169
21.4.1 Blood-Based Reagents 169
21.5 Competitive Landscape 170
21.5.1 Competition 170
21.5.1.2 BD, TriPath’s Competitive Advantage 170
21.5.1.3 Molecular Diagnostic Reagents 171
21.5.1.4 Ventana 172

Appendix 1: Breast Cancer 173

Appendix 2: Ovarian Cancer 175

Appendix 3: Malignant Melanoma 176


INDEX OF TABLES

Table 2.1: Drug Development by Type of Cancer 11
Table 2.2: The 402 Organ Specific Medicines in Development for Cancer 12
Table 2.3: Leading Sites of Cancer Cases and Deaths in the U.S. by Sex 13
Table 2.4: Estimated New Cancer Cases and Deaths by Type of Cancer, 2008 14
Table 2.5: Estimated Number of New Cancer Cases and Deaths by World Area 2007 15
Table 2.6: Cancer Death Rates per 100,000 Population (and Rank) for All Cancer Sites by Country 16
Table 2.7: Cancer-Associated Genes 16
Table 2.8: Carcinogens in the Workplace 17
Table 2.9: Private Funding Levels for the Biotechnology Segment, 1995 to 2007 18
Table 2.10: Global Pharmaceutical Industry R&D Spending, 1995 to 2007 20
Table 2.11: U.S. Government NIH Research Budget, 1995 to 2008 21
Table 2.12: Herceptin Worldwide Sales, 1999 to 2007 22
Table 2.13: Classes of Drugs Used to Treat Breast Cancer 22
Table 2.14: Women’s Cancers in the U.S., 2008 23
Table 2.15: Five-Year Relative Survival Rates by Stage at Diagnosis 23
Table 3.1: Number of Pap Smears Performed by Country 29
Table 5.1: Pap Tests in Top European Markets 52
Table 5.2: Pap Tests in Top Asian Markets 52
Table 6.1: HPV Market Size, 2003 to 2011 64
Table 6.2: Product, Infection and Market 65
Table 6.3: Instrumentation and Accessories, Infection and Market 65
Table 7.1: List and Discounted Pricing for Abbott Tumor Marker Tests 77
Table 10.1: CPT and HCPCS Codes 97
Table 10.2: National Limitation Amounts 98
Table 10.3: NLAs for Various CPT Codes 100
Table 14.1: HPV Types Status and Patents 127
Table 17.1: Diagnostic Test Kit Products and Markets 143