Genetic tests may become a $25 billion annual market in the U.S. within a decade, highlighting the need to identify which exams work the best, insurer UnitedHealth Group Inc. (UNH) said.
A majority of the 1,800 DNA tests developed to identify or manage medical conditions still haven’t been studied enough to prove their effectiveness, UnitedHealth, the biggest U.S. insurer by sales, said in a report today. The technology generated $5 billion in 2010, the insurer said, and three to five new tests are being introduced each month.
The projections bode well for diagnostics companies including Genomic Health Inc. (GHDX), Myriad Genetics Inc. (MYGN) and Life Technologies Corp. (LIFE), said Daniel Leonard, a Leerink Swann & Co. analyst in New York. They also raise questions about the effect on consumers, doctors and governments struggling with rising medical bills, UnitedHealth said.
While genetic exams “hold great promise for better health and medical care,” the Minnetonka, Minnesota-based insurer said in the report. “They also pose significant challenges to a system that is increasingly unaffordable.”
The paper, released to coincide with a Washington D.C. conference on gene testing, calls for cheaper, quicker methods to evaluate the quality of the technology, as well as better education for consumers about privacy protections.