The medical laboratories market - France

1.2 Health expenditure in the EU

Europe presents a rather large panorama of medical biology laboratories. There are many differences between countries. These differences are reflected in the health care systems and the divergence in health care spending by European country.

An article from EM consulte provides a typology of health systems in Europe:

The Bismarckian wage-based system; The tax-financed Beveridgian system; Mixed models; Private, legalized systems.

Health expenditure as a percentage of GDP

The touteleurope.eu site presents Eurostat data on the health systems of the European Union countries.

Health expenditure in EU countries Europe, ****, in % of the country's GDP Source: ****

The highest spenders are France and Germany, which will spend **.*% and **.**% of their GDP respectively on their healthcare systems in February ****. France and Germany spend the highest amounts in the whole of the European Union. For France, spending is around *** billion euros, while Germany takes first place with *** billion euros.

1.3 Medical laboratories in the consumption of medical care and goods

Each year, the Institute of Information and Professional Conjunctures (***) publishes a report on the Extra-Hospital Medical Biology Laboratories.

Similarly, each year the DREES publishes the results of the health accounts. The **** edition: Health spendings in **** reports and updates health data.

The annual reports of the I+C (***) and the DREES data provide the evolution of the consumption of care and medical goods in France.

Evolution of the consumption of care and medical goods France, ****-****, € billion Source: ****

Consumption of care and medical goods will grow by *.*% in ****. This consumption is divided between hospital care, outpatient care, outpatient drugs, patient transport and laboratory analyses.

The DREES annual report also reveals the breakdown of this expenditure by the above-mentioned expenditure categories.

Breakdown of CSBM by expenditure category France, ****, in % Source: ****

The share of laboratory analysis in the CSBM has been stable since ****. Medical biology laboratories account for *.**% of total spending on care and medical goods.

Finally, the DREES report presents the evolution of the CSBM for the "Analysis laboratories" expenditure pole.

evolution of the CSBM for analysis laboratories France, ****-****, in billions of euros Source: ****

Spending by analysis laboratories reached a record level of *.* billion euros in **** (***). 

1.4 The profession's turnover

The latest I+C annual industry reports provide us with the evolution of the turnover of medical laboratories.

evolution of the turnover of medical laboratories (***) France, **** / **** - ****, billion euros Source: ****

Revenues have risen sharply in recent years after a stable period to reach €** billion in ****. This strong increase in revenue in **** (***) is notably due to the health crisis, which has led to a strong demand for Covid-** PCR and antigenic tests.

1.5 Biology laboratories in high demand in 2020

Analytical laboratories have been at the heart of the global pandemic. It is clear that they have not suffered too much from the crisis benefiting both from the continuity of activity even during containment but also from the increased demand for Covid-** testing.

The test was widely consumed during the year ****. Its cost established at ** € was reimbursed by the health insurance (***). For serological tests the cost was established at *.** € and **.** € during the pandemic. [***]

The crisis has nevertheless generated tensions in terms of supplies. Laboratory supplies are of two types:

Reagents: products necessary for analysis; Consumables: masks, gloves, test tubes, etc.

French laboratories had to deal with strong price inflation and delivery delays throughout the first half of the year, before showing a good capacity for resilience in the second half.

In fact, laboratories were dependent on foreign countries for their supply of reagents (***), as France did not have sufficient production capacity. Thus, the laboratories integrated into large networks are those that have managed best to manage the tensions in the value chain. It is therefore the independent laboratories that have experienced supply difficulties. However, all of them have benefited from the crisis.[***]

2.1 Client profile and test use by disease

Biological tests throughout life

In December ****, Medicare published Benchmarks - Issue **, which conducts a focus on the medical biology sector in ****. According to this issue, in ****, a medical biology test was prescribed for nearly ** million people, or **% of the population.

Distribution of persons having had a medical biology analysis prescription by sex France, ****, in % Source: ****

The trends that emerge from the **** Health Insurance data also show that the proportion of people requesting analyses increases with age. The peak in demand is reached between the ages of ** and **. If a decrease is then observed after ** years of age, it is explained by the fact that a relay function is provided by hospitals and medicalized establishments that house a large part of this population.

Another interesting peak in demand was recorded in **** with women between ** and ** years old. At these ages, pregnancy follow-ups are numerous and therefore see an increase in requests for biological analyses.

Biological follow-up of pathologies

The proportion of people who have had biological analyses is extremely different depending on whether the person has certain pathologies. For example, in **** the proportion of people with diabetes who had at least one biological analysis was **%. Similarly, this proportion reaches more than **% for ...

2.2 The main prescribers of biological analyses

Benchmarks - Issue ** (***) also presents **** data for the most active private prescribers of medical biology procedures.

Source: ****

General practitioners are therefore the largest prescribers (***). Gynecologists, cardiologists, and anesthesiologists come next. It can be stated that the majority of procedures prescribed by general practitioners are low-cost procedures: in fact, they prescribe */* of the procedures for only **% of the amount. Conversely, obstetrician-gynecologists prescribe *% of the total for *% of the amount. They are therefore the main prescribers of certain high-cost procedures.

2.3 The star acts of the demand: amount and volume

The most reimbursed procedures in ****

The I+C branch report reveals the ** most reimbursed medical biology procedures in ****.

Source: ****

The top procedures in the ranking changes very little. The most reimbursed examinations are mainly Covid-** tests (***) and general check-ups such as haemograms and ionograms, which are blood tests.

For haemograms (***). In ****, it still accounted for *% in **** and remained in the *ᵉ position of reimbursables.

3.1 Local sampling sites: a constant territorial network

The profession in the region includes all the local sampling sites and the laboratories that manage these sites. The sites are registered in the Insee nomenclature under the following NAF code, **.**B: Medical analysis laboratories .

The ACOSS database of the national URSSAF network allows us to obtain the evolution of the number of sampling sites and the number of employees at these sites on French territory.

evolution of the number of local collection sites (***) France, **** - ****, in units Source: ****

While the number of sites remained relatively stable between **** and ****, the number of sites (***) .

The distribution of sites in France by region in **** is shown in the map below:

Source: ****

The regions with the largest number of medical analysis laboratories are Ile-de-France and the PACA region.

3.2 Laboratories: mergers and rationalization of the sector, key players

Number of laboratories

The I+C industry report shows this decrease in the number of laboratories with at least one employee.

change in the number of laboratories (***) employing at least one employee France, **** - ****, in units Source: ****

Over the past ** years, the profession has restructured. Faced with the challenges of cost control imposed by the public authorities, medical biology has been rationalized. Today, the landscape is made up of multi-site structures, which are the result of numerous mergers of private sector laboratories.

Size of laboratories

The activity report of the sector carried out by I+C also reports the distribution of the *** or so laboratories active in France according to their number of employees.

Distribution of laboratories by size France, ****, in % Source: ****

The evolution of this distribution confirms the restructuring of the sector. In ****, the trend towards a decrease in the number of medical laboratories with fewer than ** employees will continue, in favor of larger laboratories. Their share of the market is **.*%, down from **% in ****. At the same time, the share of laboratories with *** or more employees has increased significantly since ****, from *% to **.*% of the total.

Breakdown of revenue

The industry activity report conducted by I+C finally provides us with ...

3.3 Financing of medical biology laboratories

Overview and ****-**** changes in the financing of the CSBM for analysis laboratories

The financing of medical laboratories is provided by various actors: social security, complementary organizations and households. The table below shows the breakdown of the financing of the CSBM for analysis laboratories according to the various public and private financiers.

Source: ****

Social security financing

In the DREES report: Health expenditure in ****, we can obtain the evolution of consumption financed by social security for analysis laboratories.

evolution of CSBM financing for the analysis laboratory sector by social security France, **** - ****, in billions of euros Source: ****

Social security funding for medical laboratories will reach *.* billion euros in ****. Thus, in ****, social security will cover **.*% of the consumption of medical care and goods in analysis laboratories .

Financing by complementary organizations (***)

Supplementary organizations are insurance companies, mutual insurance companies and provident institutions.

The table below shows the breakdown of funding from complementary organizations in **** for medical laboratories.

Source: ****

FBOs therefore cover **% of the consumption of medical care and goods by analysis laboratories.

Out-of-pocket expenses for households

Finally, the report presents the evolution of the remaining cost to households.

changes in the remaining out-of-pocket expenses of households for the CSBM of the analysis laboratory segment France, ...

3.4 Salary structure

Gender of the workforce

The activity report of the sector conducted by the I+C in ****, allows us to approach the panorama of the number of employees in the sector in ****.

Breakdown of analysis laboratory employees by gender France, ****, in % Source: ****

The activity therefore employs a large majority of women. This distribution has not changed since **** and remains broadly similar regardless of the size of the laboratories.

Average age

The average age recorded in **** is ** years, with ** years for women and **.* years for men. This average remains similar regardless of laboratory size. The age distribution is relatively equitable as shown in the graph below.

Distribution of employees by age group France, ****, in % of employees Source: ****

Men are therefore more represented in the under-** age group (***). However, it must be recognized that this distribution remains fairly equitable and all age groups are represented in the profession.

Contracts

Finally, the sector report establishes the distribution of employees according to the nature of their contracts.

Distribution of employees in analysis laboratories by type of contract France, ****, in % Source: ****

The proportion of permanent contracts among employees is slightly decreasing: in ****, **% of contracts were permanent.

3.5 Business expenses: payroll and training

The wage bill

*.* billion in ****, i.e. **% of the profession's turnover. The proportion of laboratories with a profit-sharing agreement in **** is **% and **% of profit-sharing agreements have resulted in a payment.

Training expenses

The system that allows professionals in the sector to train their employees is the training plan. In ****, the training plan for the business theoretically amounted to **.* million euros. In reality, the amount of actual training expenditure was *.* million euros.

changes in theoretical and actual training expenditure under the training plan France, ****-****, in millions of euros Source: ****

Laboratories can delegate this training to organizations such as Actalians or manage this training internally. In total, nearly **% of employees received training in ****, with an average of * hours of training per employee trained during the year. The number of trainees is once again on the rise in the sector after a drastic drop during the health crisis; it reached *,*** in **** (***).

4.1 Breakdown of medical biology expenditure by pathology: a range of diagnostics

Benchmarks - Issue ** (***) presents medical biology expenditures by pathology

Breakdown of medical biology expenditures by pathology France, ****, in * or analgesic or anti-inflammatory treatment ** : with or without pathologies, treatments or maternity ***: chronic respiratory diseases (***). Source: ****

Nearly **% of laboratory spending is fairly generalist spending that is not related to a specific pathology. These are routine care, pain relief treatments, one-time hospitalizations, etc. For the rest of the expenditures, cardiovascular diseases and cancers are the most important items with *.*% and *.*% of total expenditures respectively.

These observations are logical, since the core of the activity is the establishment of diagnoses, it is therefore normal that the majority of analyses are not attached to a particular pathology.

4.2 Evolution of the CSBM price index for medical analysis laboratories

The **** edition of the results of the health accounts (***) reports the evolution of the price index in the consumption of care and medical goods for analysis laboratories.

annual change in the CSBM price index for analysis laboratories France, ****-****, index *** in **** and % Source: ****

This index has therefore been falling steadily for more than ** years; the restructuring of the sector and policies to harmonize supply at the European level are factors that can explain this decline. This decline is also a factor in the decrease in out-of-pocket expenses for households observed in ****.

4.3 The two main types of laboratories

Two types of laboratories can be distinguished on the market:

Routine biology laboratories

These are the non-specialized laboratories that are the most present on the territory. Their role is to respond to a standard demand for medical analysis. These laboratories are often grouped around technical platforms. A place that gathers equipment shared by several health institutions. The most present on the territory are the following: Inovie, Biogroup-LCD, Cerballiance, Unilabs, and Laborizon...

Specialized biology laboratories

These laboratories are those which carry out more specific analyses. Their customers are hospitals and other laboratories. They are specialized in confidential, rare and very technical services. They require expensive and advanced equipment in terms of development. Among them are Cerba, HealthCare and Eurofins Biomnis...

5.1 Legislative developments

History of legislations

The LBMs are essentially operated in the form of liberal practice structures (***). 

Decree of ****: in order to find a balance between the need for financing and professional independence, this decree :

Limits the holding of capital and voting rights authorized to non-biologists to **%; Limits the participation of non practising biologists to * SEL of biologists; Prohibits certain industrialists (***) or insurance and capitalization companies and organizations from taking direct or indirect holdings.

MURCEF law of ****: authorizes biologists (***) not practising in an SEL to be able to hold a majority of the capital.

Law ****-*** of * August **** (***).

The decree of July **, **** recommends that an SEL should no longer be limited either in number or geographically for practice on several sites.

The law n°****-*** of ** May **** specifies that article *-* of the law of n°**-**** of ** December **** relating to SELs does not apply to SELs of medical biologists: the majority of the capital and rights must be held directly or indirectly by medical biologists practicing within the SEL.

However, SELs created prior to the publication of the law and using article *-* may remain as they are.

Source: ****

5.2 General regulations

Constraints to the installation:

The professional must have a State diploma of Doctor of Medicine or Pharmacy as well as a Diploma of Specialized Studies in Medical Biology.

To set up a company, the majority of the capital must be held by one or more biologists in charge of the company (***). The number of laboratories held by a single legal entity is unlimited, but the structures must be located in the same region and may not extend over more than three adjacent sub-regional health territories.

Tariffs

The rates for analyses are set by reference to the NGAP (***). This is composed of key letters and coefficients assigned to the procedures. The price of an analysis is established by multiplying the value of the letter by its coefficient.

The ordinance n°****-** of January **, **** ratified by the law n°****-*** of May **, **** stipulates that the accreditation of laboratories according to the ISO ** *** standard is mandatory.

This accreditation, which guarantees the quality of analyses and diagnoses, was to be achieved gradually by November **** (***).

The accreditation is issued by COFRAC for a period of * years for the first cycle and then renewable by periods of * years maximum.

Source: ****

In a context where medical laboratories have ...

6.1 Segmentation

• Inovie
• Biogroup
• Synlab Groupe
• Cerba Healthcare
• Unilabs
• Eurofins Groupe
• Oriade-Noviale
• Eurofins
• BioMerieux Groupe
• Ouest Biologie