The last year has been a very busy period in the UK in vitro diagnostic sector. Here, Doris-Ann Williams gives Laboratory News an overview of everything that has been happening in clinical diagnostics over the past year

The last year has been a very busy period in the UK in vitro diagnostic sector. Here, Doris-Ann Williams gives Laboratory News an overview of everything that has been happening in clinical diagnostics over the past year The market has continued to grow with sales in the UK for 2005 of £447 million. On the face of it this seems an enormous amount, increasing by more than 6% from 2004 when sales were £420 million - clearly higher than the level of inflation. But first of all consider that this is all the clinical sales, including consumable products that diabetics use for self-monitoring their blood glucose levels as well as all screening tests for the blood supply. Then it must be considered that hospital laboratories saw their workloads from primary care increase in 2005 by up to 25% but the budgets to run their services remain the same as the previous year. Then think about the variety of tests this figure encompasses, with input into virtually every patient treated by the NHS and compare it with an NHS expenditure of £895 million on statins alone in 2005 (i.e. practically double spent on one type of drug alone) and you will begin to realise two points; the NHS get tremendous value for money from the IVD sector and that the margins for industry are tighter than ever before.

Meanwhile back in the NHS we are facing a cash crisis – the newspapers have been covering this heavily over the past few months but the problem has been evident for much longer. Hence the introduction by the Department of Health of a group focusing on getting better value for money - or to paraphrase, even lower prices from suppliers - under an initiative known as the Supply Chain Excellence Programme (SCEP).

As a sector we fully took this on board – however, we were truly SCEPtical! The first wave did not include pathology supplies but had a devastating effect on other supply sectors such as wound dressings. So you can imagine the concern that BIVDA and IVD companies had when it was announced that we would be included in the second wave of product categories last summer.

The supply of pathology products to the NHS has become very complex – we are all aware that despite increasing automation, no manufacturer has a perfect range of tests on their system - leading to most laboratories using a range of laboratory instruments and systems to ensure their needs are met for throughput, tets range and technical specifications. The purchasing methods have also increased in sophistication with suppliers finding innovative solutions to provide equipment with minimal capital outlay - automated systems now can cost six figure sums! So simple reagent rental schemes have developed and the latest model is going towards complete managed services for all hospital laboratory services within one Trust (but covering more than one site). These are huge projects for suppliers and customers alike and there is not room on this page to describe their scope.
However, this complexity of supply helped with SCEP - it became clear to the Department of Health that pathology would be 'very hard to do' and just at this point the Health Minister, Lord Warner announced an independent review of pathology services to be led by Lord Carter of Coles. This enabled the Department to remove pathology supplies from wave 2 of SCEP as it was expected that the cost of supplies would be included by the review panel.

The review panel was appointed by November 2005 and included Prof. Chris Price who was then the president of the Association for Clinical Biochemistry and who has had a long career in clinical laboratories before more recently working for an IVD company. The timelines for the review were very tight and the report was due to be published in the Spring 2006. The review team travelled widely in the UK and overseas looking at different models for pathology services in both public and private sector while at the same time inviting responses from intereted thrid parties – I believe they received more than 100 of these. Certainly BIVDA supplied a full response to the team, supplemented with meetings and additional information. The key elements for industry were be the introduction of reimbursement for each test which would allow more rapid uptake of new technology; appropriate levels of evidence to support cost effectiveness - those demanded for pharmaceuticals are not applicable to diagnostics; and proximity of testing to patients. This last point was not meant to mean wholesale point of care testing except where this is both clinically and economically appropriate but that the convenience and needs of the patient should be considered; a patient centred service.

All of this activity took us up to the end of April – so what is happening now?
Across the sector there was concern about unpaid invoices (at that point more than £50 million overdue). There is a separate ongoing move to reduce reimbursement of blood glucose testing strips by 15% from August which could have a potentially devastating effect on the industry and patient services alike. The publication of the report of the Review of Pathology Services has also been delayed until an disclosed date later this summer – a major disappointment for industry and clinical laboratory professionals.

There have been a few 'wins' from what is overall a pretty gloomy picture though. The industry has been closely engaged with the customer base and this relationship is continuing to develop - we will be working together towards the holy grail of a National Service Framework for Laboratory Medicine.

Also it seems that there is no such thing as bad publicity. The public affairs and media campaigns which have been running have highlighted the use of diagnostics, and the professionals who run the service, at high levels of government and within the media - including recent coverage by the BBC.