The medical gases market - France (2023)

1.2 A growing global market

The global medical gases market is valued at $**.** billion in **** , and is expected to grow at a CAGR of *. **% over the period ****-****, reaching a value of $**.** billion in ****.

Estimated size of the medical gases market World, ****, in billions of US Source: ****

The market is therefore booming. This growth is notably the fruit of medical research, combined with improved access to healthcare in developing countries, and favorable government initiatives. It is also the result of an ageing population in developed countries, the burden of respiratory illnesses and, consequently, a growing demand for home healthcare.

Finally, the COVID-** pandemic has had a real positive impact on this market. It amplified demand for medical gases, particularly oxygen, following deaths due to shortages in various healthcare establishments worldwide. WHO estimates that around half a million people required daily oxygen treatment during the second wave of the pandemic. This crisis resulted in an urgent financial requirement of $** million in more than ** low- and middle-income countries. In addition, hospitals, after experiencing a break in the supply chain during the pandemic, are stockpiling more and more oxygen. [***]

1.3 A healthy French market

Sales of medical gases are driven by consumption in the healthcare sector. Each year, the Comité économique des produits de santé (***), the French health products economic committee, reveals the reimbursable amounts for respiratory assistance in France. This data is a very good indicator of the size of the medical gases segment within the industrial gases market.

Medical gases are used in * main areas of expenditure:

Continuous positive airway pressure (***) ; Oxygen therapy: consists in delivering oxygen to a person who needs it via the respiratory tract; Assisted mechanical ventilation: consists in replacing, partially or totally, the failing respiratory function for a period ranging from several minutes to several weeks.

These expenditure items are detailed in the chart below.

Reimbursement of respiratory assistance devices, continuous positive airway pressure (***) and aerosol therapy France, ****-****, in millions of euros *AR, oxygen therapy and tracheostomies - ** chambers, nebulizers and generators Source: ****

From **** to ****, Assurance Maladie Obligatoire (***) spending in flat-rate sectors recorded a **% increase, from €* billion to €*.* billion. This rise in reimbursements had repercussions on all the predominant flat-rate sectors.

The forfeited sector, which accounts for the lion's share of AMO costs among fixed-price and individual benefits, is dominated by expenditure on continuous positive airway pressure (***).

Over ...

1.4 Impact of Covid-19 on the sector

sales trends for industrial gas production activities

Industrial gas manufacturing activities are recorded in the Insee nomenclature under NAF code **.**Z: Manufacture of industrial gases. According to Insee, this sub-class includes :

The manufacture of liquefied or compressed inorganic industrial or medical gases: Elementary gases ; Liquid or compressed air ; Refrigerant gases ; Mixed industrial gases; Inert gases such as carbon dioxide; Insulating gases.

Insee provides a comparison of trends in the monthly sales index for activities registered under this code. This comparison is detailed in the table below:

industrial gas production sales index trends France, November **** - October ****, base *** in **** Source: ****

Industrial gas production therefore experienced a drop in sales during the Covid-** crisis and in particular during the two containment periods, as the evolution of the curve suggests, over the last months available at the date of creation of this study (***). By April ****, sales of companies registered under this code had fallen by **. *% year-on-year. The timid recovery in August seems to have been held back by the second confinement.

Nevertheless, this data comes up against the limits of segmentation: medical gases are a sub-segment of industrial gases, and their production (***), necessary for the treatment of Covid-**, logically increased during the crisis.

Medical ...

2.1 Demographic trends should boost the sector

Global demographics

The United Nations predicts that by ****, the number of elderly people (***) in the world will have doubled, from *** million in **** to *.* billion. Their share of the world's population would thus increasefrom*,* % à **,* %.

France's aging population: already a reality...

Proportion of French population aged ** or over France, ****-****, in % Source: ****

...which will continue to be a growth driver for the future of the sector

Population projections to **** in millions of inhabitants, France, ****-****, as a % of total population Source: CNSA (***) based on INSEE The aging of the French population is real, as this graph shows. While thoseaged ** and over willrepresent only *.*% of the population in ****, their weight in the French population will double to **.*% in ****. This aging is linked to longer life expectancy and the arrival of the baby-boomer generation at retirement age: * factors favoring the number of potential consumers of medical gases .These gases are used for home treatment of patients suffering from respiratory diseases, including sleep apnea, chronic obstructive pulmonary disease and chronic respiratory insufficiency. These symptoms are more prevalent in the older part of the population.

2.2 The uses of the main medical gases

Each medical gas can have different properties. According to Linde Healthcare France, there are three main uses for medical gases:

Therapeutic indications : use of the gas as a medicine; Specific medical use; Facilitating a medical/paramedical procedure.

According to the same source, we can draw up a table of the main medical gases in demand in France, according to their use:

Source: ****

An aging population and the development of new curative methods are driving the development and production of medical gases .

2.3 Different types of care requiring medical gases

Traditionally, medical gases are supplied to healthcare facilities including:

Hospitals ; ePHAD ; clinics.

Air Liquide supplies around **,*** hospitals and clinics with medical gases. Some laboratories also use them. Medical gases are also used in emergency medicine, particularly in first aid.

Many patients cared for by PSADs (***) require respiratory assistance:

The development of home treatment for certain pathologies has opened up a new market for players in the medical gas sector. This sector is growing with

The development of numerous chronic diseases; the Covid-** pandemic and possible future pandemics; the development of technologies for the management of pathologies (***).

By ****, *.* million people will be using PSAD services. The reasons for using PSAD services are diverse, but those linked to respiratory problems, and therefore requiring medical gases, are very widespread: *.* million patients, or **. *%, suffer from sleep apnea or respiratory insufficiency.

Patients cared for by home medical assistance, by type of assistance France, ****, in % of total Source: ****

The number of patients being cared for is increasing every year, and is therefore the main factor driving growth in expenditure.

2.4 Focus on a few pathologies requiring the use of medical gases

Acute pulmonary embolism

Number of cases of pulmonary embolism by age group France, ****, in number of cases Source: ****

The graph above represents the number of people treated for acute pulmonary embolism (***) in France in ****, by age group. In that year, around **,*** people aged ** and over were treated for pulmonary embolism, out of a total of **,***. as an example, we can observe that this disease is statistically significantly more prevalent in individuals aged ** or over.

Given the structural ageing of the population, the demand for medical care is set to increase. Indeed, as the elderly are more likely to fall ill, the demand for medical gases should also increase.

Sleep apnea:

Sleep apnea is also known as obstructive sleep apnea-hypopnea syndrome (***) breathing during sleep, according to Ameli.

This leads to a lack of oxygen, causing the person to wake up to resume breathing. Sleep is then no longer restorative, which can cause major health problems.

In ****, around *% of the French population will suffer from SAHOS syndrome, i.e. some *.** million people. This syndrome is more common with age, and it is estimated that **% of people over ** are affected.

The disease particularly affects the obese(***), and is sometimes associated with other illnesses such ...

3.1 Medical gas production: a sub-segment of industrial gas production

Sales of industrial gas production activities

The French industrial gas manufacturing business is listed by INSEE under the NAF **.**Znomenclature code: "Manufacture of industrial gases". INSEE gives this market size for ****: it amounted to *.** billion euros. This figure can be used to estimate the size of the medical imaging market in France in ****, by multiplying it by the annualized sales index for ****, also given by INSEE, then dividing it by the sales index for ****. This formula gives: *.** billion euros * ***,***/*** = *.** billion euros for ****. The same applies to other years:

French industrial gas market size France, ****-****, € billion Source: INSEE We note that the market has been in steady decline between **** and ****, with national sales falling from €*.** billion to €*.** billion (***).the years **** and **** were years of growth, with sales increasing by **% and **% respectively.

In ****, January-August sales are still higher than all sales for the period ****-****, giving hope for the future of the French industrial gas market. [***]

The decline in sales between **** and **** can be explained by the fact that France has become increasingly dependent on imports, which has reduced the country's revenues. This does not mean that the overall use of industrial gas has followed the same trend; on the contrary, it ...

3.2 Close proximity of production sites and high transport risks

Industrial gas production sites in France

TheUrssaf database also provides a regional breakdown of companies registered under NAF code **.**Z.

Medical gas production sites of major industrial gas groups

The most active medical gas production sites in France are often subsidiaries of major industrial gas groups.

The sector leader is the giant Air Liquide. The group is far from limiting itself to medical gases, but healthcare is one of the * markets targeted by Air Liquide. the pharmaceutical laboratory Air Liquide Santé France designs and manufactures medical analysis gases. The laboratory currently has ** sites throughout France, which distribute its products.

The second group, and a major competitor in the medical gases segment, is the American Air Products & Chemicals. This giant distributes a large number of industrial gases in France, notably oxygen via its subsidiary Air Products, but it is its subsidiary Lida (***) that specializes in the production and packaging of medical gases. In the case of Lida, the company is also partly owned by Linde and Messer.

Transport and distribution

Because of the complexity and high cost of transport, the main manufacturers of industrial gases are also the main distributors. Air Liquide explains that transport costs limit the operating zone to a ...

3.3 Medical gas distribution networks

Medical gas distribution networks enable medical gases to be delivered in the best possible conditions, mainly to healthcare establishments (***), but also to laboratories.

In France, there are three players specializing in this type of service:

Tonnoir Fluides Médicaux RESOGAZ - Medical fluids and specialty gases for hospitals and laboratories MGM - Mauger Gas Medicaux

Leading manufacturers such as Linde Healthcare and Air Liquide can also offer this type of service. For example, the Technologies Hospitalières companies are subsidiaries of Air Liquide Santé France, with a regional presence in hospital care facilities. These subsidiaries are responsible for the installation and maintenance of Distribution Systems and the production of Medical Gases, as well as the provision of related services.

Key stages in the development of medical gas distribution networks

Source: ****

According to Economie.gouv, around *,*** km of medical gas pipelines are installed every year in France, with over **,*** outlets. The total annual market is thus estimated at ** million euros (***).

3.4 The homecare market: a booming market for industry players

In ****, Les Echos estimated the home medical assistance market at €*.* billion, with an average annual growth rate of *% in recent years. According to the Fédération des prestataires de soins à domicile (***).

The Federation also gives a breakdown of these sales by activity, the * main segments being :

CPAP(***) ; oxygen therapy and ventilation(***) insulin pump therapy(***) ; medical beds(***) ; perfusion(***).

We conclude that the pathologies that generate the most sales for players in the sector are respiratory problems (***), sleep apnea and diabetes.

Sales of home healthcare service providers France, ****, as % of sector sales Source: ****

The main players in the PSAD market in the respiratory segment include:

Air Liquide subsidiaries:

Orkyn (***) Vitalaire (***) LVL Medical (***)

Other players in the sector:

SOS Oxygène, specialized in oxygen therapy, sleep apnea and respiratory assistance (***) The Sapio Group, one of Italy's leading industrial and medical gas companies, which in **** acquired Homeperf, a homecare player in France. With sales of *** million euros by ****, half of the group's business is in the medical sector, with products such as oxygen therapy equipment, infusion pumps and pulmonary ventilators. As France is one of the most dynamic markets in the homecare sector (***), this transaction underlines the growing importance of the homecare segment. [***]

4.1 Highly regulated product types

Three categories of medical gases

The omedit-paysdelaloire.fr website explains that medical gases are grouped into three categories:

Medicinal gases: (***) Ventilation, oxygenation, anesthesia, pain relief Oxygen (***)

The quality of medicinal gases is based on the specifications and methods of the European Pharmacopoeia monographs, where they exist, otherwise on those described in the manufacturers' A.M.M. files.

Medical device gases: These are considered to be medical devices. They must carry a CE mark (***). Carbon dioxide (***) for laser surgery, liquid nitrogen, etc. Non-status gases: not bearing a marketing authorization or CE mark Medical air, vacuum, medical suction, various gas mixtures (***)[***]

Home use

First of all, it should be noted that only two medical gases are used in the home:

Oxygen, in various forms: oxygen from concentrators, liquid oxygen containers, gaseous oxygen cylinders; Nitrous oxide-oxygen mixture, as part of a drug reserved for professional use and in accordance with a risk management plan.

Physical states

Gases for medical use come in a variety of physical states:

Compressed gas under pressure: oxygen, air, etc. ; Pressurized liquefied gas: nitrous oxide, carbon dioxide... ; Cryogenic gas (***): liquid oxygen, liquid nitrogen...

They are often packaged in gas cylinders, whose appearance and characteristics vary according to :

Their capacity ; Their ...

4.2 Highly polluting products that will have to adapt to the energy transition

One of the sector's future challenges will be to integrate into the energy transition, with the use of less polluting products such as hydrogen.

A study published at the end of **** in The Lancet claimed that each surgical operation emits an average of between *** and *** kg of CO* due to a highly polluting anesthetic. By way of comparison, a Paris-Lyon journey by car emits an average of *** kg of CO*.

In this study, anesthetic gases and energy consumption were the main sources of greenhouse gas emissions. In the Canadian and American hospitals studied, the gases analyzed (***) accounted for **% and **% of operating room emissions respectively.

A Canadian company has developed a device, the Deltasorb, which is not yet available in France, to capture gases in the operating room, purify them and reuse them.

Amount of the CCE (***) or carbon tax provided for in the French Energy Transition Act France, ****-****, in euros per tonne of CO* Source: ****

The chart above illustrates the trajectory of the contribution climat-énergie (***) forecast between **** and **** by the law on energy transition, passed in July ****. We can see that in ****, the CCE should rise to ** euros per tonne of CO* emitted, then to *** euros per tonne in ...

5.1 Strict standards

General regulations

The French Public Health Code (***) regulates the packaging and distribution of medical gases in France.

The regulations make it compulsory to

A label on the cylinder body identifying the gas contained; The presence of an instruction leaflet, as well as a Summary of Product Characteristics (***) in the case of drugs.

These texts are the source of marks painted, engraved or affixed by labeling on the cylinder. Each mark corresponds to a piece of information for a specific target audience.

Source: ****

Secondly, the manufacture of industrial gases presents numerous health risks and is therefore closely regulated, from production to transport and storage.

Ainsin Messer details the regulations governing the storage of the following gases, related to medical gases:

Gas storageregulations; Oxygen storage regulations; Essential rules for the storage of gas cylinders.

Procedures must also comply with European pharmaceutical standards.

European regulations:

On May **, ****, the European Medical Devices Directive led to a modernization of the system on several points such as: [***]

Stricter prior control of high-risk devices; tighter criteria for designating and monitoring notified bodies; new risk classification system for in vitro diagnostic medical devices; greater transparency; introduction of an "implant card" for implants (***); tighter rules on clinical data; stricter standards ...

6.1 Segmentation

• Faber Cylinders
• A.I.R Partenaire santé
• Spengler
• Gas Control Equipement
• Resogaz
• Mauger Gaz Médicaux (MGM)
• SOL
• Technologie médicale
• Linde
• Air Liquide
• Messer France
• Messer
• Air Products,7
• GCE (ESAB Groupe)
• Carbagas (Air Liquide)
• Vitalaire (AIR Liquide)
• Novair