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Faster, Better, Cheaper… What’s Most Important in a Pathogen Test?

SCI interviewed major food companies and food contract labs to determine what’s most important when choosing a pathogen test method.

For close to 20 years, Strategic Consulting (SCI) has been following the industrial microbiology market, and food safety testing applications in particular. As part of the data gathering for our most recent report, Industrial Microbiology Market Review, SCI interviewed 15 senior managers at major food companies and food contract labs (FCLs) to understand their priorities when choosing a pathogen diagnostic method. The interviews were roughly split between food companies and food contract labs.

SCI identified ten important attributes for evaluating a diagnostic method or instrument, and asked the interviewees to stack rank the top five items most important to them.

pathogen test, diagnostic methodThe three top-ranked choices were the same at both food companies and FCLs, with sensitivity/specificity the most important attribute. Second in importance was the ability of the method to be utilized in a broad range of food matrices. Ranking third was the cost-per-test for diagnostic reagents.

For food companies, time-to-results (TTR) was tied for third in the stack ranking, followed by ease-of-use (EOU)/automation in fifth place. Clearly food companies want quick results but only after they are assured that the pathogen diagnostic they are using provides accurate results and is able to work with a range of food types.

For food contract labs, the cost of the pathogen diagnostic instrument ranks fourth, and TTR is tied with the cost of labor per test for fifth. For FCLs, most of the key attributes in method selection are based on operational considerations, which makes perfect sense given testing is their business.

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Where Has the Growth in Food Safety Testing Gone?

Recent earnings reports from large industrial diagnostic companies in the food safety sector indicate a slowing of growth in this typically robust market. What’s going on? Has growth in the food safety testing market peaked, paused with the economic downturn, or just moved elsewhere?

Strategic Consulting (SCI) has just released our 19th market research report on the industrial microbiology market. Industrial Microbiology Market Review: Global Review of Microbiology Testing in the Industrial Market (IMMR-4) examines the industrial diagnostics market, which includes the food, beverage, pharmaceutical, personal care products, environmental water and industrial process sectors. You can read more about IMMR-4 here.

In addition to a detailed analysis by test volume, market value, organisms tested and methods used, IMMR-4 also provides a thorough discussion of market trends, drivers, and regulatory and topical issues specific to each sector. IMMR-4 also includes a business review of competition, consolidation and key success factors, and profiles 20 leading test manufacturers serving the industrial diagnostics market.

Extensive Primary Research in the Industrial Market

industrial market, primary research, strategic consultingIMMR-4 is based on extensive primary research into all aspects of the industrial microbiology market, including detailed interviews with producers, regulators and diagnostics competitors. SCI conducted more than 650 interviews in 23 countries around the world, with close to one-third of those interviews conducted in Asia (China, India, Indonesia, Thailand, Singapore and Vietnam) due to the region’s economic importance, in both production and consumption, in the industrial market sectors.

Interview data and other information were analyzed using a combined bottom-up and top-down approach. For example, overall market estimates were derived from the test volume numbers given by production companies, and then triangulated with other information gathered through SCI interviews and pubic information research.

In hundreds of interviews over the last two years, when QA/QC managers in production plants were asked about test volume growth, the general response was “yes, growth”. The drivers for test volume growth, such as new regulations and ongoing customer demand, are not consistent across all geographies however. North American and Asian/ROW plants report growth in test volumes, while test volume in European facilities remain flat. Although somewhat diminished, growth in micro test volumes continues even in the face of world economic issues.

In fact, the total market for industrial microbiology tests is projected to increase 25.7% over the next five years, from 2.0 billion tests in 2014 to 2.5 billion tests in 2019. This represents a 4.7% compound annual growth rate (CAGR) in test volumes, which is slower than over the past 20 years. In other words, testing is increasing but not as robustly. With many production companies implementing process improvements over the last decade, growth in test volume may be tied to increased consumption alone going forward.

What’s Up with Recent Financial Reports from Diagnostics Companies?

Given the test volumes and projected growth reported by food production companies, I was a bit surprised by the financial reports of some key companies in the food safety testing market. Roka Bioscience had no new sales of its Atlas System last quarter. Neogen reported that their food safety business grew only marginally (3%) for the current quarter. And although we can’t isolate the food safety business of industry giant bioMérieux, overall their industrial business was flat for the first nine months of the year.

With leading businesses showing little or no growth in the sizeable food safety testing market, are we seeing a market that has become overcrowded, with little or no growth remaining? Based on financial reports, it’s hard to know specifically where growth remains and where things are flat or declining, as these large companies do not report on a geographic or product basis.

Is it time to recalibrate expectations for the traditionally robust food safety testing market? Has the food safety diagnostics business reached its peak in spite of major drivers such as continued media coverage of foodborne outbreaks, ongoing implementation of FSMA, industry-wide efforts such as the Global Food Safety Initiative (GFSI), and the increased consumption of food that is sourced from all over the world?

Perhaps it’s time to recalibrate expectations for the traditionally robust food safety testing market.

I’m going to venture an uncharacteristic answer and say “perhaps”. Perhaps the increased focus on industry testing over the last ten years means that for the most part, major food producers have their testing programs (and thus volumes) in place. Perhaps the five-year economic malaise that has impacted so many countries and businesses is now affecting the until now unmatched growth engine of food safety diagnostics? Or perhaps it is all of the above.

Food Contract Labs Taking Market Share

One other possibility comes out of SCI’s recent review of a particular segment of the market, contract test labs. Over the past few years, there has been a shift in where analysis is performed with some sectors sending a greater percentage of samples outside to corporate facilities or contract testing labs. The Food Sector, driven by lab accreditation requirements among other factors, is utilizing contract labs more heavily in certain geographies.

Is competition for diagnostic manufacturers coming from businesses that had previously been among their best customers? Eurofins reported 15% growth in revenues for the first nine months of 2014. As food contract labs grow their market share in food safety testing, they are able to increase their influence over the test methods and products in use, and their purchase patterns can be different from food plant labs.

Stay tuned. As 2015 approaches, we’ll continue to watch, report and comment, here and on Linked In and Twitter.

And in the meantime, let us know what you think. Are the days of double-digit growth in food safety testing a thing of the past?

 

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Insight into the $6.5 Billion Global Industrial Microbiology Market

New research from Strategic Consulting, Inc. details microbiology testing conducted by companies around the world to ensure the quality and safety of products in the food, beverage, pharmaceutical and personal care markets, and in environmental water and industrial processes.

Strategic Consulting, Inc., the leading information resource for industrial diagnostics companies, has published a comprehensive new market report on microbiology testing in the global industrial market. Industrial Microbiology Market Review, Fourth Edition: Global Review of Microbiology Testing in the Industrial Market” (IMMR—4) tracks and compares past, current and future (projected) microbiology test volumes, market values and test methods for six sectors of the industrial market (Food, Beverage, Pharmaceutical, Personal Care Products, Environmental Water and Industrial Processes) in North America, Europe, Asia and the rest of the world (ROW).

industrial microbiology, market research, safety, quality

The industrial microbiology market is large and growing, the second largest diagnostics market after clinical diagnostics in test volume and market value. More than 90,000 industrial plants worldwide conduct close to 2 billion tests each year, which represents a market value of $6.5 billion. Because the demand for consumer products is growing as the world’s population grows, increases in product quality and safety testing appear to continue undaunted by current worldwide economic problems.

The global industrial market is complex, however, with varying testing requirements and regulations resulting in variations in growth across market sectors and geographies. According to Tom Weschler, president of Strategic Consulting, the rate of growth in the broader market is slowing when compared to previous years. “Numerous drivers for industrial testing, such as public and regulatory concern about product safety, continue to offer pockets of opportunity, but not in all areas. One example is rapid microbiology methods, which have seen significant adoption in certain sectors and geographies, and little or no uptake in others,” Weschler said.

Numerous drivers for industrial testing, such as public and regulatory concern about product safety, continue to offer pockets of opportunity, but not in all areas.

Industrial Microbiology Market Review (IMMR-4) provides detailed analysis and insights into the complexities of this market, including:

  • Past, current and projected test volumes and market values, with breakdowns by market sector, geographic regions, test methods and organisms tested.
  • In-depth views of the six market sectors, including market trends and drivers within each sector.
  • Test methods and technologies, from “traditional” to newer, rapid methods such as immunoassay and molecular methods.
  • Organisms of interest in “routine” microbiology testing including TVO, Coliform/E. coli and Yeast/Mold, as well as testing for specific pathogens.
  • Detailed business reviews, including profiles of 20 leading diagnostic companies such as bioMérieux, Neogen and Merck Millipore.

For many diagnostic companies, industrial microbiology is one piece of a larger diagnostics portfolio. As a result, market metrics can be difficult to ascertain. IMMR-4 fills this gap, and provides more than 200 pages of detailed discussion and 150 charts and diagrams. Importantly, these data and insights are based on extensive primary research into all aspects of the industrial microbiology market, including:

  • Detailed interviews with 650 production plants conducted in 23 countries in North America, Europe and Asia/ROW
  • 200 interviews in six countries of Asia (China, India, Vietnam, Indonesia, Singapore and Thailand)
  • Discussions with key opinion leaders, regulators and senior management at contract testing labs and diagnostic companies.

IMMR-4 offers five additional appendices with further detail on Organisms and Methods, the Food, Pharmaceutical and Personal Care Product sectors, and a completely new Review of Microbial Identification practices and technologies in the industrial market.

For more information about Industrial Microbiology Market Review, Fourth Edition: Global Review of Microbiology Testing in the Industrial Market(IMMR—4) download a prospectus or contact Strategic Consulting.

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High False Negative Rates For Pathogen Food Safety Testing

Even in best case scenarios, food safety testing labs are still averaging greater than 6% FALSE NEGATIVES on pathogen testing. Is this acceptable?

Continuing on the theme of pathogen diagnostics and observations from the recent IAFP meeting in Indianapolis, this blog looks at proficiency testing (PT) for pathogen analysis, and the recent finding by the the American Proficiency Institute (API) of a 6.6% false-negative rate on food safety PT samples (14-year average for the 1999-2012 period).

While at IAFP I met with Heather Jordan, who directs food PT programs at the American Proficiency Institute. API proficiency testing programs are used at many food labs in conjunction with lab accreditation programs. Proficiency testing is done at food plant labs (FPLs) and corporate labs, as well as at food contract testing labs (FCLs) as a way to demonstrate quality results in their food micro and chemistry testing.

More Proficiency Tests But Less Proficiency?

In fact, the use of PTs is increasing in food labs, which is probably tied in part to the push for lab accreditation by FSMA and non-government groups like GFSI.

Yet it seems to me that the current use of PTs doesn’t go far enough to enable an FPL or FCL to demonstrate overall laboratory competency, and gain or maintain accreditation (ISO 17025).

In most labs, PTs are done just a few times a year. And really, they test the competency of the lab technician and protocols used in analyzing the PT samples. They are not a holistic measure of the lab and its ability to consistently generate quality results on every test run by every operator in the lab.

In a previous life I ran a group of environmental testing labs, which also are required to run PT samples during the year. From this experience, I know that lab personnel are aware that PTs are in-house: The sample-receiving group logs them in, and then alerts management. As a result, the best operators usually are assigned to run the PTs. This kid-glove treatment is not representative of day-to-day practices and processes. If we really want to validate and accredit the proficiency of an entire lab, shouldn’t every operator be tested on all protocols in use?

Plus, if labs know when they are running PT samples, and likely have their best operators running them, shouldn’t there be few, if any, false-negative or false-positive results?

Surprisingly, that’s not what the API research found…

API Study: “Performance Accuracy for Food Pathogens Remains Problematic”

In a retrospective study, “Pathogen Detection in Food Microbiology Laboratories: An Analysis of Proficiency Test Performance,” API analyzed the results from 39,500 food proficiency tests conducted between 1999 and 2012 to see how U.S. labs are doing in detecting or ruling out contamination of four common food pathogens.

Over the 14-year period, “False negative results ranged from 3.3% to 14.0% for E. coli O157:H7; 1.9% to 10.6% for Salmonella spp; 3.4% to 11.0% for L. monocytogenes; and 0% to 19.8% for Campylobacter spp.” Most concerning is that while both false positive and false negative rates were down in the last year of the study, the cumulative false negative rate for the 14-year period was 6.6%.

As we know, false positive results (in which a sample that does not contain pathogens is incorrectly shown as positive) are a nuisance. But false negative test results—which fail to detect true pathogenic organisms in the sample—are not unacceptable.

API, false negative, proficiency test, pathogen

The cumulative average false positive rate was 3.1%, less than half of the false negative rate for the same period.

The objective of the study—and, I would think, of proficiency testing in general—is to demonstrate improvement in lab performance year over year. The results of the API report concluded to the contrary, however: “Performance accuracy for food pathogens remains problematic with the recent cumulative trend showing a slight decrease for false positive and false negative results.”

Performance accuracy for food pathogens remains problematic with the recent cumulative trend showing a slight decrease for false positive and false negative results.

Clearly if false negatives happen in proficiency programs, they happen in the course of regular testing at food labs. I’m told that many FCLs and FPLs rely on other parts of their QA systems to make sure testing is being conducted properly. Even so, the documentation of ongoing and unacceptably high false negative rates in PT testing is a big concern for everyone.

It also points to a number of follow-on questions:

  • Would the false negative and false positive results be even higher if every technician, rather than the best operator, performed the analysis?
  • PT samples are created in only a couple of sample matrices. Would results be even worse if performed on the myriad of sample matrices present in the food industry?
  • What are the performance results among all of the pathogen methods available? Are some methods better than others when measured in real world conditions? Do the more complex protocols of some pathogen diagnostic systems result in poorer PT performance results?
  • Would PT results and, even more important, lab proficiency improve if the frequency of PTs increased, and were required of every technician involved with real food samples?
  • How can proficiency testing be used to isolate problem areas, whether in the pathogen diagnostic method or the competency of lab operators and processes?
  • Is the performance data different between food contract labs and food plant labs? And are all FCLs are equal, or are some more able to deliver quality results?

 

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2 Billion Industrial Microbiology Tests Conducted for Product Quality and Safety Worldwide

New market research from Strategic Consulting, Inc. reports on the industrial microbiology testing conducted by companies worldwide to ensure safe and wholesome products that meet label claims.

Industrial Microbiology Market Review, Fourth Editionis based on primary research with more than 650 production facilities in 23 countries in North America, Europe and Asia, including China and India.

Woodstock, Vt. — A new market research report detailing industrial microbiology testing around the world is available from Strategic Consulting, Inc., the leading information resource for industrial diagnostics companies. Industrial Microbiology Market Review, Fourth Edition: Global Review of Microbiology Testing in the Industrial Market (IMMR—4) tracks and compares microbiology test volumes, market values and methods used in in North America, Europe and Asia, and forecasts future volumes and market values through to 2019.

According to IMMR—4, industrial microbiology test volume will reach 2 billion tests in 2014, an increase of 500 million tests per year since last surveyed in 2008.

IMMR—4 is based on primary research with the quality assurance managers of production facilities in the food, beverage, pharmaceutical, personal care products / cosmetics (including nutraceuticals), environmental water, and industrial processes sectors. Strategic Consulting conducted more than 650 detailed interviews in 23 countries around the world. Close to one-third of the interviews were conducted in six countries of Asia (China, India, Indonesia, Thailand, Singapore and Vietnam) due to the region’s economic importance, in both production and consumption, in the industrial market sectors.

Close to 1/3 of the interviews were conducted in Asia due to the region’s economic importance in the industrial market sectors.

IMMR—4 details testing practices and methods used by geographic regions (North America, Europe and Asia/ROW-Rest of the World) for each business sector. Differences in the test method used, the organisms tested, and the frequency of testing is reviewed.

Rapid Micro Methods Taking Market Share

industrial microbiology, test volume, IMMR-4, rapid micro methods

According to Tom Weschler, president of Strategic Consulting and lead author of IMMR—4, newer, rapid microbiological methods (RMMs) are growing and taking market share in the industrial market. “Rapid micro methods will account for more than 50% of test volume growth in 2014,” Weschler said. Adoption of RMMs varies by business sector and geographic region, however, in some cases significantly, Weschler added. For example, in China use of rapid micro methods in the food sector is minimal, while the use of RMMs in the personal care products and pharmaceutical sectors is more prevalent.

Industrial Microbiology Market Review, Fourth Edition includes a thorough review of the pharmaceutical and personal care product sectors, and new coverage of microbiology testing in the fast growing nutraceuticals market.

Rapid micro methods will account for more than 50% of test volume growth in 2014.

IMMR—4 offers a detailed business review of the leading diagnostic companies serving the industrial market, including revenues, sectors covered and products/technologies offered. “While there are no dominant competitors that cross all business sectors, leading companies are emerging in certain areas,” Weschler said. In addition, IMMR—4 profiles 20 competitors in the industrial market including bioMerieux, Merck Millipore, DuPont, 3M, Bio-Rad and Neogen.

IMMR—4 is based on detailed interviews conducted by Strategic Consulting and integrated into its database of industrial microbiology diagnostics trends and practices, which has been published in 19 market research reports over the last 18 years. Delivering both extensive new data and a detailed historical perspective, Strategic Consulting market research reports are widely accepted by leading diagnostic manufacturers and investors as highly credible analyses of the industry.

For more information about Industrial Microbiology Market Review, Fourth Edition: Global Review of Microbiology Testing in the Industrial Market(IMMR—4), contact Strategic Consulting.

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Pathogen Diagnostic Platforms and the Jam Study

The explosion in the number of food safety pathogen diagnostic systems is confusing the customer and hindering change.

What a great IAFP (International Association for Food Protection) Annual Meeting last week in Indianapolis! It was bigger and better than ever.

A couple of things made a huge impression on me:

There were more than 25 pathogen diagnostic platforms on the exhibit floor.

While not an official accounting, someone who was counting as they walked the floor told me they quit at 30. This represents a dramatic increase from even five to ten years ago. Maybe all of these companies are reading SCI’s market reports extolling the size and growth of the pathogen testing market.

pathogen diagnostic, food safety testing

Too many choices and too much risk are hindering change.

On the IAFP exhibit floor, I had a conversation with a long time contact who is director of quality at a national food company. We talked about the proliferation of pathogen diagnostic choices and how it is inhibiting rather than fostering change. He sees no significant benefit in switching from his current platform, which not only works well but is well established in his plants. Changing to save $.50 or trim a few hours of production time is not worth it to him.

He was frank in admitting that he is afraid of the risks involved in change, and overwhelmed by the choices. In essence, he said: Who knows, in six months something newer and better might come along and I will have wasted time, effort and money in switching. Plus my boss will be upset with the money spent on the instrument.

Has the pathogen testing market become like the 24-flavor jam table?

There is a classic study on choice known as the jam study. In 2000, Sheena Iyengar and Mark Lepper published “When Choice is Demotivating: Can One Desire Too Much of a Good Thing?” which examined the consequences of having limited versus extensive choices. The research involved a field experiment in an upscale grocery store in which customers encountered either a table with a limited choice of six Wilkin & Sons jams or a table with an extensive choice of 24 jams from the same company. Everyone who approached the display table was invited to taste as many jams as they liked, and was given a $1 off coupon to purchase a Wilkin & Sons jam.

The key finding was that the 24-flavor table attracted more attention yet it resulted in fewer buyers: Just 3% of people who stopped at the 24-flavor table went on to buy jam, while 30% of shoppers who visited the 6-flavor table left the store with jam in hand. And while it seems logical that people who had more options would sample more flavors, that was not the case. People able to sample from 24 jams tasted an average of 1.50, while those who could chose from six sampled an average of 1.38 jams.

Has the pathogen testing market become like the 24-flavor jam table? Are there just too many choices without significant differentiation, and is that causing hesitation to change?

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Troubling Times for Food Safety Diagnostic Companies

Increased competition, the growing dominance of food contract testing labs, and changes in product mix are turning good times to troubled ones for some food safety diagnostic companies.

For much of the past 20 years, the food safety market has been very, very good to the diagnostic companies, especially those making pathogen testing instruments and consumables. A number of dramatic shifts in the market, however, resulting from increased competition, the growing dominance of food contract testing labs and the subsequent change in product mix, have turned good times to troubled ones for some pathogen test manufacturers.

The story of big changes for pathogen testing and the food safety diagnostics industry begins with the Jack-in-the-Box disaster in 1993. Described by Jeff Benedict, author of the 2011 book, Poisoned, as “far and away the most infamous food poison outbreak in contemporary history,” the E. coli outbreak from tainted ground beef sickened 732 people and killed four children, and set a number of pivotal market drivers in motion.

Most importantly, this incident (and a number of other egregious recalls later the 1990s) raised food safety to a top-of-mind issue and compromised the public’s trust in the safety of their food. This drove major changes in government regulation as well as food industry processing and testing practices, and greatly increased the level of pathogen testing conducted by food processing companies worldwide.

food safety testing, pathogen testingAt the same time, the food supply chain was growing increasingly complex, with imports accounting for 15-20% of U.S. food consumption. The increase in imports led to even more pathogen testing to monitor food safety at every point along the global food chain.

As seen in the chart at right, these factors have driven worldwide pathogen testing volumes up by more than 400% in the past 15 years.

Competition Among Diagnostic Companies Increases

As test volumes increased, food diagnostic companies began to introduce new technologies to help food plant labs (FPLs) handle the growing workload and testing requirements. The higher cost of these new test methods sent the market value for pathogen testing up, faster even than the impressive 9.4% compound annual growth rate (CAGR) for test volume seen over the same period.

The increased sales and success of the food diagnostic companies with their new, “rapid” pathogen systems attracted many other participants to the market. The number of companies providing pathogen-testing products went from a handful in the 1990s to more than 20 a decade later. While each new participant offered advances in testing technology, most were evolutionary and not revolutionary. And every improvement—for example, reduced enrichment time or increased system sensitivity/specificity—would soon be matched by others manufacturers.

With numerous pathogen systems on the market and competitors finding it hard to differentiate themselves, many pathogen diagnostic companies were forced to compete on price. Their customers at food industry plant labs (FPLs) and corporate labs, and particularly at food contract labs (FCLs), soon saw that price per test had become a very big lever they could use with competing pathogen diagnostic companies having somewhat interchangeable systems. Price per test has been under pressure ever since, and the profitability of pathogen test diagnostic companies has suffered as a result.

Fewer—and Bigger Laboratories Drive Test Costs and Requirements

Compounding the increased price competition has been the concentration of pathogen analysis (and other food safety testing) in fewer and larger facilities. As discussed in the three previous blogs in this series, more and more pathogen analysis is now conducted at FCLs or in larger FPLs. Small and mid-sized food plant labs seem to be closing, and looking to third-party contract testing labs for their food safety analytical needs. This concentration puts more buying power in fewer—and bigger—hands, and further exacerbates price competition among test manufacturers.

Customer concentration also is changing the requirements for pathogen testing systems, as automation, throughput and matrix versatility become increasingly important for large volume testing laboratories. Some pathogen diagnostic companies are having difficulty matching the revised product requirements, and as a result are not competing as effectively in the new environment.

Although pathogen diagnostic companies are already challenged, SCI sees another big change in the market with the potential for even greater profit impact. IEH Laboratories, one of the larger FCLs, has been producing their own “home brew” reagents for pathogen test analysis for the past 10 years. By making their own reagents, at a cost of roughly $1-$2 per test, IEH avoids the added costs of purchasing reagents from diagnostic companies, with prices ranging from $4-$8 per test. As a result, IEH has had a lower cost basis—and greater profits—than its competitors. This “home brew” approach is also affecting profits for the pathogen diagnostic companies.

Other FCLs are aware of their competitor’s “home-brew” reagent approach. With the leading FCLs running 100+ labs worldwide, to avoid paying full price to diagnostic companies for reagents is compelling. While a country-by-country approval of this approach would need to be secured (e.g., AOAC approval is required in the U.S.), the leading FCLs have the critical mass/size—and profit incentive—to move forward. IEH has, in fact, received AOAC approval for its methodology/system for pathogen analysis. If and, most likely, when more of the larger FCLs follow the “home-brew” route, the impact on the food diagnostic companies could be significant.

It should be noted that not all pathogen diagnostic companies are being equally impacted by these trends. Anticipating the increasing importance of FCLs, some diagnostic companies already have introduced automated sample prep and analysis systems with higher throughput, targeted to the needs of larger corporate and food contract labs. Others diagnostic companies are using a different strategy, developing and selling pathogen-testing approaches that specifically target small and medium food plant labs. The hope is to get FPLs to keep pathogen analysis at the food plant or, even better, to bring it back from the FCLs because of lower costs, better control and quicker results.

From the good times of the 1990s and early 2000s to the increasing price competition over the past 3-5 years and the possibility of being cut out of the food safety testing market completely—these are troubling times for some diagnostic test companies. Some are positioned with differentiated products, and others have strong market channels and broad product lines. They should be fine. Many diagnostic companies, however, could find themselves in the wrong place at the wrong time. For them, the recent evolution of the food safety testing market, and the lucrative pathogen testing market in particular, could prove costly.

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SCI Research Poster Compares Global Food Micro Testing

Download the research poster “Comparison of Current Food Microbiology Testing Practices in North America, Europe, and Asia” presented at the 2014 American Society for Microbiology (ASM) General Meeting in Boston.

Food safety is a concern worldwide, particularly with the increased globalization of the food supply. Strategic Consulting, Inc. (SCI) investigated food micro testing practices in food plants around the world to document similarities and differences in food safety testing. Tom Weschler, president of Strategic Consulting, presented a summary of the research findings at the 2014 American Society for Microbiology General Meeting in Boston.

food micro testing, food safety, research, SCI

Download SCI’s research poster on global food micro testing.

A detailed report on the research, entitled “Food Micro, Eighth Edition: Microbiology Testing in the Global Food Industry (Food Micro—8),” also is available from Strategic Consulting.

Get more information on Food Micro—8.

The data presented in the SCI poster and in Food Micro—8 is compiled from 450 detailed interviews conducted in 19 countries. Strategic Consulting has accumulated in-depth information on food microbiology testing trends and practices over the last 15 years, and has published the information in eight food micro market research reports. All SCI market research reports deliver extensive new data as well as detailed historical perspective and, as a result, are widely accepted by leading diagnostic manufacturers and investors as highly credible analyses of the industry.

Visit Our Market Reports page for more information on all of Strategic Consulting’s market research reports, or call us at 1-802-457-9933.

Follow SCI president and industry expert, Tom Weschler, on LinkedIn or Twitter @TomWeschler.

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Microbiology Testing for Food Safety Differs Around the World

Given the increased globalization of the food supply, Strategic Consulting, Inc. investigated food microbiology testing practices in food plants around the world to document similarities and differences in food safety testing. The findings were presented last week at the American Society for Microbiology General Meeting in Boston.

Food safety is a concern worldwide, and one that is growing in visibility for the public, food companies and regulators. Food recalls are frequent, and regulations to help address food safety do not always meet expectations. Consumer concern grows along with the increasing recalls and resulting media coverage. Food producers continue to make sizable investments in food safety improvements but still remain at risk, and food service and retail companies continue to increase requirements of food producers. These issues are exacerbated as the global sourcing of the food we eat increases.

Strategic Consulting, Inc. (SCI) investigated global food microbiology testing to better understand variations in food safety testing practices across the globe. A summary of SCI findings were presented in a poster delivered last week at the American Society for Microbiology General Meeting in Boston. A detailed report on the findings entitled “Food Micro, Eighth Edition: Microbiology Testing in the Global Food Industry (Food Micro—8)” also is available from Strategic Consulting.

Download SCI’s research poster on global food micro testing.

The specific areas investigated were:

  • Food microbiology test volume
  • Routine versus pathogen testing
  • Points in the production process where food microbiology samples are collected
  • Microbiology methods used for test methods

Similarities in Food Safety Testing Around the World

Overall, food microbiology testing is high and growing all around the globe. Food microbiology test volumes are similar in North America (NA), Europe (EU) and Asia. The populations of these regions are quite different, however, and the ratio of tests/population varies, from highest in North America to lowest in Asia.

microbiology testing, food safety, world

Food microbiology testing is divided between routine microbiology, which tests for indicators of contamination in food plants and finished products, and pathogen testing, which looks for specific pathogenic organisms known to cause foodborne illness. The split between routine and pathogen testing is similar in all regions. In North America routine microbiology accounts for 76% of test volume, and in the EU and Asia it accounts for 81% and 72% of test volume respectively. The testing by organism for both routine and pathogen tests also is generally similar around the world.

Greatest Differences Are in Sample Collection and Test Methods

SCI research found that where food safety samples are collected is one of the major areas of difference around the world, and food plants in Asia differ most from those in other regions. In-process/environmental testing accounts for just 9% of total test volume in Asian food plants, while worldwide 25% of test samples are collected in process and in the production environment. Other regions collect more in-process/environmental samples to support proactive HACCP programs among other reasons. In all regions, testing of end-products accounts for 44% to 59% of test volume.

For pathogen tests, food plants in North America collect just 8% of samples from raw materials, and in-process/environmental sampling is much more prevalent at 44% of samples. In contrast, 8% of pathogen samples are collected from in-process/ environmental sources in food plants in Asia.

There are also major differences in the microbiological methods used for analysis of food safety tests. For routine testing, NA uses more easy-to-use “convenience methods” (e.g. PetrifilmTM), which account for 52% of all routine testing. The EU uses more traditional, culture-based methods, which make up 63% of routine test analysis. Pathogen testing in NA also is highly oriented toward rapid methods, with 94% of test analysis conducted with molecular and antibody-based methods. The EU still relies heavily on traditional or convenience culture methods for pathogen tests, with 61% of tests analyzed using them. Asia relies most heavily on traditional methods, for both routine and pathogen testing, of all the regions studied.

Food Micro—8 is based on 450 detailed interviews conducted in 19 countries by Strategic Consulting, Inc. SCI has researched and integrated data on food microbiology diagnostics trends and practices over the last 15 years, and published the data in eight market research reports. Delivering both extensive new data and a detailed historical perspective, Strategic Consulting market research reports are widely accepted by leading diagnostic manufacturers and investors as highly credible analyses of the industry.

 

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The Food Contract Lab Business Approaches 50

The third in our series of blog posts discussing the importance of food contract labs (FCLs) to the food safety testing market, this week we look at the evolution of the FCL market over the last 50 years.

Food contract labs were started by entrepreneurial scientists beginning in the late 1960s. The early FCL entrepreneurs often had areas of specialization, and set up independent laboratories to provide food company clients with services and analyses in those areas (mainly microbiology).

Over time, some of these labs grew into regional, and even national, networks of labs. Deibel and Silliker Labs are prime examples of FCLs that followed this path in the 1970s and ‘80s, and into the early ‘90s.

food contract lab, Silliker, Deibel, SGS, Eurofins

As 2000 approached, the FCL industry was undergoing major changes:

  • With financial support from their new owner, Merieux Alliance, Silliker undertook an aggressive, international growth-by-acquisition initiative.
  • IEH Laboratories began its extensive growth, principally through acquisitions of independent U.S. labs.
  • With its public listing in 1997, Eurofins embarked on an impressive growth spurt, also fueled mainly by acquisitions, that now totals 190 labs.
  • SGS began to expand into the food contract lab space, becoming a major player in the field.

TIC Companies Enter the Food Contract Lab Market

It is also worth mentioning that over the last ten years, more and more TIC (Testing, Inspection, Certification) companies are entering the FCL market. What was originally a business based on food safety expertise is evolving into one more tightly tied to the broader testing, inspection, and certification market.

Testing Inspection Certification Company, SCS, Bureau Veritas, Dekra, TUV, DNV,Germanisher Lloyd

The global TIC industry is huge, with revenues of more than $120 billion in 2010. TIC companies started over 300 years ago to provide common measurements for shipping and other commercial activities. Today the TIC industry is growing worldwide, but particularly in the emerging economies of Asia and South America, spurred by a combination of regulatory and economic factors. One key driver is increased global trade and a resulting consumer demand for improved food quality and safety. As a result, leading food manufacturers are requiring third party inspections and certifications of products and services.

Like the food contract lab market, the TIC market also is consolidating, and over the past five years there have been significant and sizable acquisitions. The ten leading TIC companies represent only 37% of the global market, but all are billion-dollar companies with tens of thousands of employees and more than 1,000 locations globally. In addition, all of these companies occupy market-leading positions in both emerging and developed economies. Most of the top-10 companies provide testing, inspection, verification, audit, accreditation and consulting services, and attempt to manage global supply chains and reduce operational, product and market risks to clients. In other words, these TIC companies have strong existing relationships with all the global food companies.

These strong, multi-faceted relationships are powerful springboards for the TIC companies in the food contract lab market—and NOT something that the traditional FCL companies have to offer. Thus TIC companies have some unique advantages over other FCLs (e.g., bundled pricing and multiple international contact points), even the more global traditional FCLs. As of now, at least four of the top-10 TIC companies are in the FCL business, and two of them (SGS and Eurofins) are among the top-3 global FCL companies based on 2013 revenue estimates.

It is hard to forecast what’s next for the food contract lab market. Given current trends and drivers, the market clearly will continue to grow and take share. Not as clear is which companies will be the dominant FCL companies five years from now.

In our next blog: What does the boom in FCLs mean for food safety diagnostics companies?

 

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