DUNN

IVD companies are becoming more and more dependent on the relationships that they build with their customers than necessarily their test menu. We have interviewed many of our clients' customers and they, without any prompting on our part, are the ones who mention the term partnership. This shows that they are not only looking for a company that is going to have the product line able to fulfill their basic testing needs. They also want companies to have the flexibility to modify their internal procedures and policies that allows with them to adjust to some of the buyers' requirements, particularly those of the buying groups. When competitors' technology is essentially equal, then I think that it is the relationship with the company that will tell the tale.

CHOW

I think there is still a lot of opportunity for real product differentiation. We see some of our clients and leaders in the industry focus on the clinical value of the diagnostic or therapy they market. There will be many diagnostics coming out of the Human Genome Project that offer more personalized diagnostic tools and more interesting diagnostics. Another example are novel biochemical markers that can replace more expensive procedures such as echocardiography for diagnosing heart failure. These are the kinds of products and services that bring value that provide the healthcare system a bottom line saving or an improvement in patient care.

DIAGNOSTIC INSIGHT

How do you counsel your clients to go about establishing this type of outcomes statistics?

CHOW

This type of outcomes approach is pretty standard in the pharmaceutical industry and now the diagnostic industry is catching up. Companies are looking at how to demonstrate that their products can provide a return on investment. For example in an emergency room's triage of heart attack patients, some diagnostic products can immediately reduce the cost of unnecessary admissions or the liability costs of missing someone who is truly having a heart attack. More diagnostic companies are doing these types of studies and they are seeing that the investment does pay off.