By Don Jergler

When it comes to the veterinary diagnostics market, "the word of the day is 'interoperability'—the ability of diagnostic equipment and practice management software to freely share and interpret data," said Amy Harlacher, executive director of equipment and supply for Dublin, Ohio-based Henry Schein Animal Health. "Interoperability is critical when it comes to helping practices efficiently manage patient data and workflow, capture missed charges, maximize staff productivity, and ultimately become more profitable."

Diagnostics have become a vital component to veterinary medicine, so it makes sense as clinics add greater diagnostic capabilities to their practices that managing, and if possible integrating, all that data, takes on greater importance.

According to a recent report from Modor Intelligence, the global veterinary diagnostics market accounts for around 22 percent of the entire veterinary market. It also claims this segment is expected to experience a 55 percent overall increase by 2022.

Providers of this equipment—whether it is any of the various forms of polymerase chain reaction assays or equipment like ultrasound and X-ray—are reporting increasing sales.

"Radiology-based equipment sales tend to be the on the rise in my world," said Eric Lindquist DMV, DABVP, Cert. IVUSS, CEO of SonoPath.com. "Capital equipment such as X-ray units are always in demand, and ultrasound diagnostics are thankfully becoming more mainstay in-house modalities as radiographs were 20 and 30 years ago."

Sales of computed tomography equipment also are moving well in the larger, or "semi-specialized," facilities, according to Dr. Lindquist.

"The software updates on some of this technology can adjust the quality of the units over time, as well, so this is logically attractive and gives more shelf life," Lindquist said. "These are the best modalities to get to the diagnostic answer quickly and mediums through which telemedicine may be utilized to access opinions worldwide on any particular case."

Creating, enhancing clinic revenue

Adding these modalities to a clinic's business plan makes economic sense because capital equipment creates new revenue streams or enhances current ones.

"Pet owners love the technology in general," Lindquist said. "It has a solid 'wow factor,' especially when the answer to the diagnosis is found rapidly."

Chemistry and hematology analyzers continue to be the prominent point-of-care diagnostic test instruments, according to Harlacher.

"However, sediment analyzers currently being introduced to the market allows practitioners to view images of cells from the urinary tract, blood cells, crystals, bacteria, parasites, and cells from tumors," she said. "This test is often used to confirm the findings of other tests or add information to a diagnosis."

Early bloodwork testing to establish a baseline is another trend Harlacher is keeping an eye on within the diagnostic space.

"Conducting regular testing one to two times a year as opposed to only testing when the veterinarian thinks an animal may be sick," compares to a similar trend in human health, which focuses on prevention, she said.

Just some of the benefits include ensuring all internal organs are working properly; helping to detect and prevent bigger health problems later; tracking changes of a pet's health over time; assisting the practitioner and the client in creating protocols that address treatment and quality of life for the animal; and preparing the client for any financial planning in regard to their pet's care, she said.

Consumable, portable, evolutionary

"Consumable," might be what J.K. Waldsmith, DVM, president of San Luis Obispo, Calif.-based Vetel Diagnostics, would use to describe the market.

"For bench top in-house chemistry systems, the Razor-razor blade business model is in place," Dr. Waldsmith said. "The companies make the money on the consumables."

He advised attempting to negotiate with seller reps, as quite often nowadays clinics can get the equipment given to them "for little or nothing" in exchange for a commitment to buy the consumables—test kits, reagent strips, etc.

"Portability" is another a word Waldsmith used to comment on the market.

"This is one area where the technology is advancing very rapidly in precision and portability, and the state of the art advances yearly," Waldsmith said. "If having the latest and greatest is important to you, I would not enter into any long-term obligations. Also, I do not think the service contacts are a good value on this equipment. You are usually better off to discipline yourself to set 3 to 4 percent of the practice gross income aside for purchase and maintenance of all of the capital equipment in the practice."

Steve Eyl, executive vice president of global sales and marketing for Heska Corp., used the word "evolving" to describe the market.

"It is imperative as a diagnostics provider to lead by listening to the expectations of the veterinary industry—creating new solution sets that support pet owner compliance and quicker patient treatment, through affordable, timely and, above all, accurate testing options," Eyl said. "Having a reliable in-house lab provider to partner with these goals is vital."

Veterinarians are becoming increasingly interested in reducing operating costs and decreasing time to diagnosis, he added. Buyers are often interested in subscription-based lab agreements with little to no upfront equipment cost, no service cost, and "fair consumable pricing that is guaranteed for years," as well as in expanding their in-house test menu, he said.

"The ability to discuss treatment plans more quickly, while the pet owner and patient are in the clinic, maximizes treatment time for better outcomes," Eyl said. "In-house options to diagnose and confirm hyperthyroidism and hypothyroidism (T4 and cTSH), Cushing, and Addison's Disease (cortisol) liver disease (bile acids), and bleeding disorders (COAG) are some of the urgent care parameters veterinarians should rely upon when diagnosing critical patients."