Global wound care market segmentation best done one country at a time

In March 2018, MedMarket Diligence published its biennial report on the global wound care market, “Worldwide Wound Management, Forecast to 2026: Established and Emerging Products, Technologies and Markets in the Americas, Europe, Asia/Pacific and Rest of World.Details.


Markets for medical technologies work according to the forces in play where products sell. There is no “global market”, per se, but an amalgamation of far-flung markets where, in one country, a new technology is embraced, and in another it’s passe or taboo or too expensive or de rigueur.

Cultural differences regarding medicine can be significant. How the sick are treated socially, how wounds are considered, the value of an innovation — may all be viewed differently through local lenses.

Differences in effective sales and distribution can exist, particularly for new technologies, in technology-importing countries.

Regulatory differences can be HUGE.  Besides the timing of FDA PMA or 510(K) versus the CE mark for the same technology, the regulatory entities are not entirely in sync regarding approval for new technologies.

On the global playing field, all active players know that some countries sre better than others at allowing foreign conpetition.

Even well established products, like traditional wound products (gauze, adherent, non-adherent), remain less well established in emerging markets.

below are the shares of each country’s total wound market represented by each technology, for non-adherent dressings, adherent dressings, gauze dressings, NPWT, and antimicrobial wound products.

The  net effect on local markets? — Each country has greater/lesser relative demand for different technologies, without respect to overall market size.


Technology/Treatment Share of Country Total Wound Market

The balance of sales across different wound technologies varies by country, with different products accounting for greater or lesser shares of the total wound sales per country. Below are illustrated, for example, that non-adherent dressings account for a higher share of wound product sales in China than in all other countries.

Source: MedMarket Diligence, LLC; Report S254.

Other traditional products like adherent dressings and gauze show a pattern of lesser use in the U.S., western European countries, and Japan.

Traditional gauze is a less significant component of the U.S. or Japan, both of which have rapidly adopted and instead use more advanced technologies.

Negative Pressure Wound Therapy, a more involved wound care technology, shows different patterns in demand across countries than other wound products.

The actual level of risk of infection, the perceived risk of infection, and the resulting differences in adoption of antimicrobials give rise to some different adoption than one might expect.

Markets for advanced wound care technologies, such bioengineered skin or growth factors (not shown), illustrates a common dynamic, with the highest country use being the U.S. and whose manufacturers have often pursued the U.S. market for new technology introduction, to be followed by Europe, Asia, South America, etc. as technology migrates to less well developed markets.

Other products in wound with their own country-to-country dynamics include film dressings, foam, hydrogel, hydrocolloid, alginate, collagen, and growth factors.


See Report #S254, published March 2018.

 

Country and Regional Variability in Growth of Wound Management Sales

As illustrated in a previous post, wound management products are a spectrum from the simple to the complex:

Source: MedMarket Diligence Report #S254.

Generally, the longer the product has been around (e.g., gauze), the less complex it is compared to emerging technologies…

…BUT simpler is easy to adopt and, with well established sales, growth on a percentage basis will be low (see area in red).

Generally, new technologies incorporate rarer materials, have more complex construction, and may cost considerably more…

…BUT complex technologies may be far more effective clinically than older technologies and may allow treatment where no older technology could, and with low initial sales (penetrated potential), growth on a percentage bases will be high (see area in green).

Country and Regional Variation in Growth Rates

While this size-to-growth dynamic exists for most product types, the dynamic varies from one geographic region to the next. The time point at which a particular product/technology starts to be more rapidly adopted — or the rate at which use of  established products are use starts to decline — can vary considerably from country to country.

As a result, there will be variability in sales growth rates for a product in one country/region versus another.

For example, the 2017 to 2026 compound annual growth rate in sales of Alginates in wound management range from a low of 5.3% in one country to a high of 24.3% in another country. (If you make alginates, in which country would YOU like to compete?)

Regionally, as in USA versus Europe versus Asia/Pacific, etc., there is less variation in growth rates for any given product in that region. For alginates:

country-to-country variation in CAGR: 19%
region-to-region variation in CAGR: 7.8%

In other words, the difference between the countries with the highest and lowest CAGRs for alginate sales is 19%, while the difference between regions shows one region with a 7.8% higher CAGR for alginates than the lowest growth region.

Source: MedMarket Diligence, LLC; Report #S254.

Before chasing after that high growth rate, it is important to know the underlying volume. (Sales of $1 in year 1 and $2 in year 2 is a 100% growth rate, but it’s absolute growth of only $1.)


See the full REPORT, “Wound Management to 2026” details or order online. Please also see the forecast and market share data available separately from the report.

 

Changes in Fortunes for Wound Management Products

Over the 2017 to 2026 period, the compound annual growth rate for the entire wound management market will approach 6%, a respectable rate of growth for an established market, though not quite high enough to encourage investment in the market as a whole.

Of course, the total wound market is comprised of a number of VERY large, slow-growing segments, like traditional adhesive dressings, gauze dressings, and non-adherent dressings, which have annual sales at $3.8 billion, $3.2 billion, and $1.3 billion, respectively.

The large volume, slow growth of the aggregate masks growth in the following segments:

  • Bioengineered skin and skin substitutes
  • Alginates
  • Foam dressings
  • Growth factors

These wound care segments have had, and will continue to have, annual growth rates at or near double-digit through 2026.

The end result of variable growth rates is that the 2026 Wound Care Market (worldwide), by comparison to 2017, will show the following changes (up/down) in each segment’s share of the total market.

Source: MedMarket Diligence, LLC; Report #S254 (publishing Mar. 2018).

Bioengineered skin, alginates lead wound market growth

Big revenues, as in $ billions, are turned over every year in traditional wound dressings and gauze, while emerging technologies designed to have far more impact on wound management are driving the fastest percentage revenue growth. Data from “Wound Management to 2026” (report S254) shows the size-to-growth distribution of wound product revenue streams over the 2017 to 2026 period.

Source: MedMarket Diligence, LLC; Report #S254.

Bioengineered skin displacing traditional wound management products

Very decided shifts are taking place in the wound management market as advanced wound technologies take up caseload from traditional technologies like gauze and others. It becomes evident that traditional products once representing above average sales are now projected to be below average (gauze) as are even a moderately new technology, “negative pressure wound therapy devices” (NPWD), while bioengineered skin and skin substitutes will represent “above average”.

Global Wound Management Market,
Above/Below Average Sectors, 2015 & 2024

Screen-Shot-2016-03-16-at-8.02.29-AM

Source: Report #S251.

Global Wound Management Market, Sales, 2015 & 2024

Screen Shot 2016-03-16 at 8.02.44 AM

Source: Report #S251.

Despite the tepid growth of traditional wound management products, they remain very large markets that even the most aggressively growing segments will require time to match that volume. Bioengineered skin and skin substitutes are moving fast in that direction.

Global CAGR 2016-2024 for Wound Management Segments

Screen-Shot-2016-03-16-at-8.09.10-AM

Source: Report #S251.

If you would like excerpts from this report, Click Here.