Recently, I’ve seen posts on LinkedIn and the web for a cord blood market report titled “Global Cord Blood Banking Services (Stem Cell) Market, Size, Share, Trends, Forecast, Global Analysis, Research, Report, Segmentation, and Future Demand, 2012 – 2020.”
I rarely reflect on products by other companies, but this report is disturbing in that it is painfully inaccurate.
As global business expert Joe Polish likes to say, “The most expensive information is bad information,” and this is a case of that situation.
In the Executive Summary, a highlight of the main findings for this report, Allied Market Research states that the “Cord blood market is expected to grow at 33.5% CAGR from 2012-2020.”
Having tracked the cord blood banking market for a full decade (2006 to present) and being a regular at the World Cord Blood Congress, Perinatal Stem Cell Society Conference,World Stem Cell Summit, and other related events, I respectfully have to disagree with the findings of this report.
The World Cord Blood Congress is the largest commercial cord blood banking and therapy conference in North America, an event that brings together stakeholders from across the cord blood market. The Perinatal Stem Cell Society Conference is a 3-day event featuring the world’s leading perinatal stem cell researchers, specializing in amnion, amniotic fluid, and the use of cord blood and tissue for regenerative purposes. The World Stem Cell Summit is a 3-day event featuring more than 225 renowned international speakers and 90+ hours of programming.
At not one of these events did a single speaker indicate that the cord blood industry was experiencing this dramatic level of growth. Rather, most speakers agreed that the market is both maturing and consolidating.
How Can We Get a More Accurate Growth Rate for the Cord Blood Industry?
For the limited number of publicly-listed cord blood storage operators that report their revenues, their growth rates do not project a rate of growth anywhere near 33.5% CAGR.
Therefore, the question becomes, how do we establish a more accurate growth rate for the cord blood industry?
First, revenue data within the global cord blood market is largely limited to companies listed on public stock exchanges. As such, the revenue figures from China Cord Blood Corporation, itself a public company, and Cord Blood America, Inc., which wholly owns CorCell, are valuable. In addition, ViaCord is owned by the public healthcare company Perkin Elmer, and LifeBank USA is owned by the public biomedical company Celgene, so high-level revenue data is available through these parent companies.
Secondly, as for the very small number of private cord blood storage operators that are disclosing revenue metrics, such as Americord that is aiming for the Inc. 500’s list of fastest growing companies, these companies tend to have small market share relative to the total global market. Consequently, there is no evidence to substantiate an industry-wide growth rate anywhere near 33.5% CAGR based on these contributions.
Individually, Americord has reported rapid levels of growth (2,200% for 2011 to 2013), but the company is not yet a dominant industry player, having collected only approximately 35,000 cord blood and cord tissue units to date, as compared to 500,000+ for the market leader, Cord Blood Registry. As such, Americord will be a very interesting company to watch over the next few years, but it cannot yet be heavily weighted in a global market analysis for the cord blood industry.
When assessing market size and growth rates for the global cord blood industry, it is essential to recognize that the market is dominated by a few industry behemoths.
While most industries worldwide are dominated by a few large industry players, this is particularly true for the global cord blood industry. Key market leaders within this market include:
- Cord Blood Registry (USA): 500,000+ cord blood and tissue units
- ViaCord (USA): 350,000 cord blood and tissue units
- China Cord Blood Corporation (China): 312,000 cord blood and tissue units
- Cryo-Save (Europe): 268,000 cord blood and tissue units
- Cryo-Cell (USA): 240,000 cord blood and tissue units
Even More Evidence That Growth Rates are Lower Than 33.5% CAGR
Finally, no matter what other metrics you consider, from cord blood scientific publication rates, to grant funding rates and clinical trials rates, the annual growth rate for the cord blood market cannot be projected anywhere near 33.5%.
Even China Cord Blood Corporation, a publicly listed cord blood storage operator (stock ticker: CO) and one of the fastest growing cord blood banks in the world, is reporting growth rates lower than 33.5% CAGR, according to the CEO of the company, Mr. Chen, who recently presented revenue data for China Cord Blood Corporation at the World Cord Blood Congress in Boston, MA, on September 17, 2014.
For those seeking substantiated cord blood industry metrics, you should expect data that can be verified by third-party analysis.
This includes, but not limited to the following:
- Publicly stated revenue metrics for cord blood banks worldwide (many cord blood storage operators are private companies, but there is limited public revenue data available)
- Cord blood storage rates
- Cord blood transplant rates
- Cord blood scientific publication rates
- Cord blood grant rates
- Cord blood clinical trial rates
- Cord blood patent rates
As a resource that you may want to consider, BioInformant recently released the global strategic report, “Complete 2015-16 Global Cord Blood Banking Industry Report,” on November 7, 2014. It is based on BioInformant’s real-time monitoring of the global cord blood marketplace, including cord blood databases that have been continuously updated for nearly a decade. It presents data sourced from global public databases, including scientific publication databases, clinical trial databases, grant funding databases, patents databases, cord blood storage registries, cord blood transplant registries, Google Adwords, Google News, and more. It also presents publicly stated revenue figures for cord blood banks worldwide. Importantly, all sources are verifiable by third-party analysis.
Summary of the Cord Blood Banking Marketplace
In summary, the global cord blood industry is a complex marketplace, dominated by key industry leaders. Understanding market dynamics for the largest industry players significantly helps with understanding the global marketplace.
Additionally, the cord blood industry has matured substantially over the past few years, creating a larger, slower growing industry dynamic, where it is anticipated that consolidation and elimination will occur.
There is still substantial opportunity within the marketplace, with companies like China Cord Blood Corporation having a high gross margin, low debt to assets ratio, and healthy free cash flow, but it is expected that these industry leaders will continue to differentiate themselves and achieve market dominance over the next five years.
BioInformant is the only research firm that has served the cord blood sector since it emerged. BioInformant has been featured on news outlets including the Wall Street Journal, Nature Biotechnology, Xconomy, and Vogue Magazine. Serving Fortune 500 leaders that include GE Healthcare, Pfizer, and Goldman Sachs, BioInformant is your global leader in cord blood industry data.
To learn more, view the “Complete 2015-16 Global Cord Blood Banking Industry Report” now.