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UPDATE: Global Bioinformatics Market to Double by 06; Proteomics and Pharmacogenomics Spending to Outpace Genomics

NEW YORK, Jan. 21 - Faster and cheaper technologies will help the worldwide bioinformatics market double in size over the next five years and reach $1.7 billion, according to an industry analysis released on Monday.

The report, produced by Front Line Strategic Consulting, also found that although the genomics space is currently the richest consumer of bioinformatics tools and technology, "the most significant growth opportunities" will be in proteomics and pharmacogenomics, which will garner $469 million and $351 million, respectively, in 2006.

"Consisting of the content, analysis software, and IT infrastructure provider segments, bioinformatics will grow at a compound annual growth rate of 20 percent, with the largest growth in the analysis software segment," said the report, called Bioinformatics, A Strategic Market Analysis. The bioinformatics market at the end of 2001, the latest available year, was worth roughly $697 million, according to Front Line.

"Large volume data mining and the need for analysis and visualization tools to support complex analysis, such as relationship modeling, will drive the $202 million analysis software segment to grow to $634 million in 2006," the analysis predicts. It found that new bioinformatics applications might cut the cost of drug discovery by one-third and accelerate the process by 2 years.

Saying that "one of the biggest questions facing users of bioinformatics" is whether to develop IT tools and technology in-house or to license them from the many vendors on the market today, the report says that pharma and biotech firms "will continue to allocate 60 percent of their total bioinformatics spending to commercial vendors"-expenditures that Front Line estimates will blossom to $1.1 billion in 4 years.

Today, the report says, companies spend the largest chunk of their bioinformatics budget-some $225 million in 2001-on content. This figure will grow to $445 million in 2006 "as the availability of comprehensive and annotated data sets increases," the report predicts.
In terms of new applications, the Front Line report  says that bioinformatics spending by proteomics firms will grow at a 39 percent compound annual growth rate through 2006, while pharmacogenomics will grow at a 38 percent clip.

However, the analysis cautioned that "a lack of standard data formats, the lack of common protocols, and interoperable technologies" may stifle research in these segments and "will present a significant barrier for end-users when it comes time to integrate data from various sources."

"Nonetheless, pharmaceutical and biotechnology companies will continue to seek tools to aid them in identifying relationships across biological data types," according to the report.


A Front Line official, Joanne Toran, remarked that these trends indicate that "the best suppliers are going to rise to the top. "We say ... that the fittest shall survive. It's really going to come down to the quality of the tools and the quality of the technologies that's out there," she said. "And there's a lot of consistency about who the market thinks the leading companies are and who it thinks the leading companies will be in the next three to five years."

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