Special Report: Financial Firms Project Rapid Growth of Genetic Testing Market through 2030

July 25, 2023

Despite recent slowdowns and disruptions due to the COVID-19 pandemic, the outlook for the genetic testing market remains positive, with compound annual growth rate (CAGR) estimates ranging from 8 percent to as high as 22 percent over the balance of the decade, based on recent reports. Here’s a briefing on where the global genetic testing market seems to be heading based on the findings of five reports published by five financial consulting firms.

(Note: our analysis is based on the free versions of these reports, for the full data, you can purchase the reports).

Market Research Future (MRFR)¹
Meticulous Research (Meticulous);²
IMARC Group (IMARC);³
Grand View Research (Grand View)⁴
Global Market Insights (GMI)⁵

Current & Expected Value of the Genetic Testing Market

While the consulting firms define the market in slightly different ways, genetic testing generally involves analyzing human samples to detect variants or mutations in DNA that are associated with, or can lead to, chronic diseases. In addition to diagnosing diseases, genetic testing can help determine the risk of inherited diseases and guide treatment decisions.

The consensus among the consulting firms is that genetic testing is poised for major growth in the next seven years at a CAGR above 10 percent. Current valuations of the worldwide genetic test market, based on 2022 data, range from $7.4 billion to $15.9 billion, with predictions of 2030 market value ranging from $13 billion to $35.34 billion.

Predicted Growth of Global Genetic Testing Market, 2022 to 2030^1-5

Consulting Firm	2022 Market Value	2030 Market Value	CAGR
MRFR	$8.91 billion	$17.48 billion	10.5%
Meticulous	--	$28.24 billion	10.4%
IMARC	$15.9 billion	$29.0 billion	10.37%
Grand View	$7.4 billion	$35.3 billion	22.0%
GMI	> $9.5 billion	$13.0 billion	8%

Drivers of Growth in Genetic Testing

According the Meticulous, IMARC, and Grand View reports, the rise of precision medicine has been and will continue to be a primary driver of growth in the use, awareness, and availability of genetic testing. Genetic testing has also gotten a boost from advancements in technology, including the development of next-generation sequencing, chromosomal microarray analysis, and others, allowing for noninvasive detection of chromosomal abnormalities and single-gene disorders, according to the MRFR report.¹ Other factors identified by the reports as driving long-term growth in genetic testing include:

The worldwide increase in the incidence of genetic disorders and cancers
Greater consumer awareness and demand for genetic testing
Growing demand for direct-to-consumer testing
Significant increases in healthcare system and infrastructure investment in developing countries like China, India, Brazil, and the Middle East

According to the reports, nearly all these factors are expected to not only continue but also intensify the growth of the genetic testing market going forward.

Genetic Testing by Type of Testing

The variance in growth projections among the five financial consulting firms is attributable, in part, to differences in how the respective firms define the market. In general, the key segments of the genetic testing market by testing type include presymptomatic and predictive testing, carrier testing, pharmacogenetic (PGx) testing, diagnostic testing, carrier testing, and prenatal and newborn screening.

According to Meticulous, the prenatal segment—testing to detect abnormalities in the fetus—currently commands the largest share of the genetic testing market when broken down by test type, given its expanded use in both developed and developing countries. This conclusion agrees with the findings of earlier reports, including one by Allied Market Research, which showed that this segment will continue to “maintain its dominance” through 2027, due to increasing awareness of deaths from genetic diseases, as well as health care.⁶ However, the other four reports included in our main analysis listed other segments as the largest, though GMI does list prenatal testing as the second largest segment, trailing diagnostic testing.

In its September 2020 study, Allied Market Research found that while PGx testing is currently the smallest segment of the market, which fits with the more recent GMI report, it’s also projected to be one of the most lucrative as the use of precision medicine increases around the world.

Genetic Testing by Type of Technology

The genetic testing market can also be broken down by technology, i.e., molecular, chromosomal, and biochemical tests. Molecular tests range from single-gene targets to multigene panels, as well as whole genome sequencing (WGS) and whole exome sequencing.⁷ Molecular technology is used for many kinds of genetic testing, including but not limited to predictive and presymptomatic, diagnostic, and carrier testing. It can also analyze DNA gains or losses that routine chromosome analysis can’t detect.⁸

Accordingly, molecular testing accounts for the greatest share of the genetic testing market when broken down by test method, in the MRFR and Meticulous reports. The dominant position of the segment isn’t expected to be challenged for the remainder of the decade, according to the earlier Allied Market Research Report.

Genetic Testing Market by Region

According to MRFR’s calculations, North America is the largest consumer of genetic testing, accounting for $3.6 billion of the nearly $9 billion spent on genetic tests during 2021. Both MRFR and GMI recognize that Europe is the second largest market, and Asia Pacific the third, though the latter is expected to grow the fastest through 2030 due to its large population and “increasing adoption of innovative laboratory techniques,” according to the Grand View report.

Challenges to Genetic Testing Growth

Genetic testing will remain an area of rich opportunity for labs and lab companies in the years ahead. However, the optimism of the financial firms is somewhat tempered by a report published by the National Institutes of Health (NIH) in 2018, two years before the start of the pandemic, questioning the sustainability of current trends in genetic testing growth and spending.⁹

Among the challenges cited by the NIH is the “still relatively high” cost of sequencing technologies—though that cost has been dropping in recent years—and limited payer coverage and reimbursement for multigene tests, especially for large panels not targeted to specific conditions (like WGS). The reluctance of payers shifts the financial costs of testing to patients. Other obstacles to rapid growth in genetic testing listed in the NIH report include:

Clinical uncertainty and the “ongoing need to determine the clinical utility of genetic tests based on actionable mutations as well as […] for guidance regarding how tests can be implemented in clinical practice”
Fragmentation of the clinical lab industry and indications that the market is becoming bifurcated, “with the less numerous specialized tests performed by labs within organizations” leaving high-volume centralized labs to perform the large-scale tests
The lack of an FDA regulatory system for approving new lab-developed genetic tests in the US
The need for improved claims and electronic health record coding enabling more comprehensive and accurate identification of the use of and reimbursement for genetic tests, especially multigene tests

Bottom Line: The seeming consensus among financial analysts is that genetic testing will grow at a CAGR of around 10 percent through the end of the decade. At the same time, policymakers have expressed doubt about whether recent rapid growth can be sustained until fundamental challenges to the clinical science, reimbursement, and regulation of genetic tests are resolved.

References:

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This article originally appeared in G2 Intelligence, Laboratory Industry Report, July 2023.

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