Global mammography X-ray sales decline during the third-quarter

Mammography Imaging, X-ray System

It is estimated that global revenues from mammography solutions declined by a high-single-digit (e.g. -9%) during the third quarter, relative to Q3 2019. Some OEMs reported a material improvement in sales activity during the quarter, although sales remain significantly lower for the year. It is estimated that cumulative 2020 sales are lower by a low-double-digit (-15%), compared with the same period in 2019.

The sales contraction during the quarter as well as the first nine months was driven by lower equipment sales from both 3D digital breast tomosynthesis (DBT) and 2D systems. It is estimated that the U.S. market continues to account for over 50% of global sales revenue. This market was significantly impacted by the pandemic situation from the second quarter as customers deferred capital purchasing decisions and installations were delayed or postponed. For the first nine months of 2020, it is estimated that installation volumes of mammography x-ray systems in the U.S were approximately -20% lower year-on-year[1]. Hologic reported that Q3 sales from its breast health division were approximately USD $53m (-16%) lower, resulting in a cumulative sales contraction of USD $169m (-17%) for the first nine months[2]. It is worthwhile noting that Hologic’s breast health portfolio is not exclusively mammography x-ray although provides some indication to the magnitude of the sales decline.

Despite turbulent sales, OEMs have not lost sight of the longer-term opportunities within breast imaging and continued to launch innovative solutions. For example in October, Hologic launched its 3DQuorum™ imaging technology in Europe. This technology is AI-driven image processing which promises to significantly reduce the time it takes for radiologists to assess breast exams without compromising image quality, sensitivity or accuracy. In addition, during the third quarter, Hologic announced a collaboration with RadNet in order to develop AI-driven tools for breast health. Software solutions, alongside equipment sales, are anticipated to become an increasingly significant revenue stream for OEMs and present a sizeable commercial opportunity for both new and existing systems via upgrades. Another product launch, although ancillary to mammography equipment, was GE’s launch of its contrast-enhanced guided biopsy solution, Serena Bright™, within the U.S. This solution enables clinicians to conduct a contrast enhanced spectral mammography (CESM) biopsy’s directly after an abnormality is detected using the same mammography equipment. This solution has the potential to speed-up the diagnosis of breast cancer as well as avoid the need for follow up ultrasound or MRI biopsies, a common source of both cost and delayed diagnosis. Earlier in the year, DRTECH, the Korean x-ray detector manufacturer, entered the mammography systems market for the first time. The company launched its AIDIA platform which is predicated upon its detector technology. Initial sales appear to have been brisk as sales from its ‘x-ray system’ segment accounted for 10%[3] of total company sales during the first nine months of 2020. Dr. Ahn Sung-Hyun, CEO, commented: “we will compete on an equal footing with global image diagnostic system leaders such as Hologic, GE, and Siemens.” The AIDIA system uses a large panel size as well as applying two detectors with the industry’s smallest pixel size. This is anticipated to deliver operational efficiency gains through reducing repeat examinations, especially for larger patients, as well as deliver exceptional image quality.

Short-term Outlook

For the fourth quarter of 2020, the expectation is that sales activity will continue to show sequential improvement in percentage terms, relative to the prior quarters. In absolute dollar terms the market is expected to be lower, relative to Q3, as there is typically some seasonality in demand around the holiday period. Sales of mammography solutions continues to be dependent on the evolution and dynamics of Coronavirus pandemic. Given that the U.S. remains the largest market for mammography solutions, the recent growing number of Coronavirus cases creates greater uncertainty in terms of sales projections. Unfortunately, it’s not difficult to envisage a scenario were  breast health continues to be a lower priority for the healthcare system as well as patients in the coming quarters. Although breast cancer has certainly not gone away and remains the second most common cancer among women in the United States[4]; patients are concerned about the risks from the Coronavirus and we think that the healthcare system is likely to prioritise the pandemic response over breast health in the short-term.

Extract from Global Market Sales Report

References

[1] U.S Installation Volumes Database, 2020, Prerequisite Market Intelligence

[2] Hologic Q3 2020 financial results

[3] DRTECH, Q3 report

[4] Centres for Disease Control and Prevention (CDC)