According to a report by Future Market Insights (FMI), the healthcare and laboratory labels market is valued at US$9.2 billion in 2022. By 2030, this figure is set to rise to US$13.5 billion, with a compound annual growth rate (CAGR) of 4.9% over the next eight years. The COVID-19 pandemic, demographic shifts, and advancements in medical technologies are likely to continue driving this growth – although as pharmaceutical regulations tighten, and adjacent industries struggle with supply chain tensions, there could be challenges ahead.

COVID-19 changes

The COVID-19 pandemic has resulted in a significant shift in the way consumers interact with and relate to all products, not least of all pharmaceuticals. Heightened awareness about the spread of disease through contact with surfaces – especially at the start of the pandemic, before this was suggested to be a low-risk transmission route for SARS-CoV-2 – has driven up demand for contactless solutions across industries.

The possible implications of this, FMI suggests, is the use of labelling to support contactless healthcare, allowing data to be transmitted between healthcare workers and patients while minimising contact and potentially the spread of infection. This could signify changes, such as in the way doctors and pharmacists label and therefore prescribe medications.

Consumers appear to have become more aware of digital integration through methods such as QR codes, which were used, for example, to ‘check in’ at venues so that anyone exposed to COVID-19 infection could be tracked and traced. However, as COVID-19 infection rates continue to rise, it has become more difficult to track, trace, and record data, especially as the healthcare sector is increasingly under pressure due to issues like staff shortages. The use of digital labelling could, in the future, help to streamline interactions between healthcare professionals and patients.

In addition, laboratory labels have become essential for applications such as national COVID-19 testing schemes. With research into infectious diseases like COVID-19 also likely to be an expanding segment, FMI points to the importance of laboratory labels in helping with the safety and efficacy of ongoing and future research.

“On the back of these factors, the COVID-19 pandemic has catalysed the growth of the market and the demand for labels will persist high through the pandemic period,” FMI writes.

The demographic drivers of growth

As FMI explains, medical labelling is an established and essential industry already. Labels support patients in various ways – for example, understanding how to use, safely store, or maintain a medical device or medication. Patients need to be aware of the risks and benefits of a medical aid in a way they can understand, FMI adds, with labels being a key part of enabling this communication.

The main drives of growth in the industry, then, appears to be guided by changes in the medical industry and in the way patients are treated. FMI says that the use of complex medical devices and treatments in the home is rising, supported by research and development for both new and updated technologies conducted by competitive pharmaceutical companies. This will apparently make safe and effective medical labelling even more important.

Importantly, the medical industry is trialling new devices and medications on a large scale, with multiple locations around the world. FMI adds that this will also push up the demand for healthcare and laboratory labels as companies will need to ensure they are providing relevant information during production, storage, transportation, and distribution. The labels will also need to be printed in multiple languages to ensure clear, localised communication, again increasing demand, according to FMI.

FMI also notes that there are some significant demographic shifts happening that are changing the way people interact with the healthcare system in their country or region, again with ripple effects for labelling. With many countries having an ageing population, demand for healthcare is likely to increase, thus driving up demand for healthcare labels. A recent study from the University of Waterloo in Ontario, Canada, found that older adults were willing to use smart packaging, which could include RFID or NFC-enabled labels, if it was easy to use, consistent, and not too costly.

As for Millennials, FMI claims that this is a generation that is prioritising healthcare labelling. This group is allegedly more likely to research products before making purchasing decisions and will gravitate towards brands that are transparent about environmental and social issues. Healthcare labelling will be important, FMI says, in promoting brand authenticity to Millennial consumers and offering enhanced information streams, such as a supporting app for labelling solutions.

The Millennial generation is also interested in healthcare solutions that promote a healthy lifestyle, such as nutraceuticals, FMI reports. Again, this will seemingly require brands to ensure clear and transparent labelling to attract this demographic and the growth potential they offer. It seems that brands are taking note; for example, Berocca recently underwent a redesign courtesy of Free the Birds that aimed to make its scientific aspects more accessible to consumers.

Mapping the industry and its materials

In terms of the material composition of healthcare labels, FMI predicts that paper-based labels will remain the most in-demand material type. Reportedly easily available and affordable, paper-based labels account for nearly 65% of the healthcare label market value.

Polyolefin-based labels are expected to generate an incremental opportunity of US$1.45 million between 2022 and 2030, according to FMI. The group attributes this to the strong adhesive properties of polyolefin-based labels, which are especially important for growing segments such as nutraceuticals.

In terms of regional distribution, FMI expects North America to remain the dominant market for healthcare labels. The region allegedly accounts for nearly 30% of the market share of healthcare labels, which FMI attributes to its emphasis on safety, such as stringent FDA regulations, across its healthcare and pharmaceutical sectors.

East Asia represents the second-biggest market for healthcare labels. According to FMI, the region is “exhibiting tremendous growth potential” because of more spending on healthcare, resulting perhaps from its growing population and the popularity of so-called health tourism in places like India, China, Malaysia, and Thailand. Meanwhile, FMI claims that the healthcare label industry could similarly expand in South Asia, at a 7.5% value CAGR.

FMI also identifies Europe as a region likely to undergo significant market expansion for healthcare labelling. Within Europe, the UK, Belgium, Denmark, Italy, Germany, and France apparently lead in terms of demand. In this region, FMI expects that the demand for advanced pharmaceuticals and nutraceuticals will drive research and development in both products and labelling opportunities. FMI anticipates that the clinical research market in NAFTA countries will also expand.

“The healthcare and laboratory labels market is a fragmented market,” FMI adds. “The key players operating in the market are focusing on expanding their research globally, diversifying their product portfolio, and rapid product development to gain a competitive edge.”

Challenges ahead

The healthcare and laboratory labels market is not without challenges. Labelling companies must account for location-specific regulations, meaning that labels may have to be altered depending on the region in which the product is being sold, which adds to operational costs and timings. 

FMI explains: “For medical devices and diagnostics that are to be sold across the EU and non-EU countries, legal difficulties raise their head. There is limited space on labels, and large information needs to be included. Translations may be required to be technically accurate, but most of the time it is literal.” This issue could also be compounded by Brexit, which has caused a number of difficulties for various packaging segments over a lack of clarity on regulations and pricing issues with imports and exports.

The changing nature of end-user requirements also complicates the material composition, dimensions, and printing of medical labels, according to FMI. Some medical labelling companies appear to view this as a constraint, as it can make operations unpredictable. 

There are some emerging solutions for these challenges. For example, Schreiner MediPharm recently announced a Freeze-lock cryogenic label with an interlocking layer solution that enhances its adhesive strength for deep-frozen medicine containers. The company offers labels with a booklet that can be unfolded or unrolled, allowing space for more information, which apparently makes these solutions especially suitable for clinical trials conducted across different locales.

However, FINAT recently released a report on the European label industry that suggested the increased demand for labelstock could be undermined by raw material shortages, supply chain tensions, and ongoing strikes. In addition, Russia’s invasion of Ukraine could further destabilise the supply of materials such as wood, as well as drive up energy prices with energy-intensive industries like paper and plastics – two of the main materials used in healthcare labels – likely to take a big hit. FINAT says that this could mean printers will shortly be unable to fulfil orders, with bottlenecks and label shortages potentially impacting essential industries like pharmaceutical labelling in the weeks and months to come.