A Depressing Market

The market for treating depression represents one of the most promising applications of current and future neurotechnology devices. As we discuss in our two page 1 articles this month, both vagus nerve stimulation (VNS) and repetitive transcranial magnetic stimulation (rTMS) are being targeted at the condition.

It doesn’t take a lot of market research to see the potential market opportunity here. Government and nonprofit sources peg the size of the population at between 15 and 20 million people in the U.S. alone. This corresponds to a market value of $12 to $15 billion. Cyberonics estimates that if its product achieves the same rate of penetration in depression that it did in the epilepsy market, the company would achieve $1 billion in annual sales by its fifth year in the market.

Perhaps the most striking aspect of the market potential for depression is that about 30 percent of the existing population is resistant to current treatments. This not only opens the door to a willing customer base, it also encourages regulatory agencies and insurance companies to be more receptive to new treatments that address the patients who fall through the cracks of drug treatment.

While the upfront cost of devices such as Neuronetics’ rTMS stimulator and Cyberonics’ NCP is considerably greater than that for pharmaceutical treatment, it should be clear to any bean counter that that cost differential could be easily eaten up by several years’ supply of antidepressants that just don’t work. Factor in the cost of extra medical treatment, testing, psychiatric evaluation, and lost productivity during the time that the unresponsive 30 percent discover that they actually are unresponsive, and the equipment costs here become more bearable.

The competitive case against electroconvulsive therapy will likely be an easier one for neurotechnology vendors to make. To begin with, ECT is already a hardware approach to treating depression, and not one that has always conjured up a positive reaction among the general public. The capability for greater parametric control that neurotech devices offer should also appeal to clinicians and patients.

Of course, it is still too early to predict enormous growth rates for neurotechnology devices in the depression market. There is much more research, testing, and approval cycles that must be completed before either device penetrates the market in a big way. Research on uncovering the mechanisms by which neuromodulation—be it via direct stimulation of the cortex or indirect via the vagus nerves—exerts its effects on mood and behavior will be of paramount importance. But these are issues that the pharmaceutical industry must also address. We suspect that as more is learned about how and why we become depressed, the opportunity for specific device approaches will make neurotech vendors more cheerful.

James Cavuoto
Editor and Publisher