HEOR Services Market Size, Share & Industry Outlook by 2027

The health economics and outcomes research (HEOR) services market was valued at US$ 1,116.38 million in 2019 and it is projected to reach US$ 2,699.56 million by 2027; it is expected to grow at a CAGR of 11.9% from 2020 to 2027.

Health economics and outcomes research (HEOR) services play a significant role in drug approval and reimbursement with payers. The HEOR services allow to evaluate the economics of treatment and quantify the associated results. Likewise, in the healthcare industry, decision-makers experience the pressure to opt for therapeutic ‘interventions’ from various treatment options made available by pharmaceuticals, medical devices, and biotechnology companies. The growth of the overall healthcare economics and outcomes research (HEOR) services market is attributed to the increasing product development and growing healthcare spending. However, restrictions on access to real-world data (RWD) is the major factor hindering the market growth.

The healthcare economics and outcomes research (HEOR) services market is expected to witness substantial growth post-pandemic. The global healthcare infrastructure observed limitations and capabilities during the sudden emergence of coronavirus. In order to deal with such situations in years to come, healthcare organizations as well as governments are expected to increase the utilization of HEOR services, which will eventually drive the market growth. Moreover, demand for advanced data analysis technologies are also anticipated to drive the market growth.

Lucrative Regions for Health Economics and Outcomes Research (HEOR) Services Market

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Market Insights

Growing Healthcare Spending to Drive Health Economics and Outcomes Research (HEOR) Services Market Growth

Rise in disposable income, increase in awareness regarding technically advanced products and services, surge in demand for excellent healthcare services, and reimbursement policies and healthcare insurances are leading to increasing healthcare expenditure worldwide. According to the World Health Organization (WHO)'s report, “Public Spending on Health: A Closer Look at Global Trends,” published in 2016, ~US$ 7.5 trillion was spent on health. It is nearly 10% of the global gross domestic product (GDP). Similarly, according to WHO's updated report for 2018, “Public Spending on Health: A Closer Look at Global Trends,” the total healthcare spending is growing faster than GDP. It is increasing more rapidly in low and middle-income countries with an average of nearly 6% compared to high-income countries, which is ~4%.

However, this spending can be saved by properly managing the money to avoid more spending on the 'waste domains,' such as failure of care, improper coordination, overtreatment or low-value care, pricing failure, fraud and abuse, and several administrative complexities. Organisation for Economic Co-operation and Development (OECD) is trying to figure out the minimum wastage of healthcare spending. According to an OECD report for 2017, “A significant share of health spending in OECD countries is at best ineffective and at worst, wasteful.” One-fifth of the total health spending can be properly channelized for efficient use. More than 9% of GDP is spent across the OECD countries, among which three quarters are paid for by governments. Such waste weakens the financial sustainability of health systems. Hence, financial sustainability requires proper management, and the money can be used by appropriate diagnosis and treatment planning to reduce the cost of healthcare services.

In such cases, the HEOR plays a vital role in providing comparative evidence for choosing products and services. Selecting the appropriate product or service would assist in improving patients' health outcomes with justified healthcare spending. It provides the most valued insights that lead to reduced waste of products, services, and money. Such evidence is essential to identify the best deployment policies for healthcare budgets that would benefit patients. The HEOR services would also help healthcare service providers to pay attention to uncertain spending on unnecessary surgeries and clinical procedures. The consultation by HEOR is likely to encourage the use of generic drugs, increase focus on updating nursing skills of nurses to manage chronic conditions of patients, and ensure no hospital stays for patients who do not require hospital care and can be treated with fewer resources as primary care. Thus, growing healthcare expenditure is likely to influence the HEOR service market's growth during the forecast period.

Service-Based Insights

In terms of service, the healthcare economics and outcomes research (HEOR) services market is segmented into economic modelling/evaluation, real-world data analysis and information systems, clinical outcome, and market access solutions and reimbursement. The clinical outcome segment held the largest market share in 2019, and the real-world data analysis and information systems segment is estimated to register the highest CAGR during the forecast period.

Health Economics and Outcomes Research (HEOR) Services Market, by Service – 2019 and 2027

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Service Provider-Based Insights

Based on service provider, the health economics and outcomes research (HEOR) services market is segmented into consultancy and contract research organization. In 2019, the contract research organization segment held larger share of the market, also, the same segment is estimated to register higher CAGR during 2020–2027.

End User-Based Insights

The health economics and outcomes research (HEOR) services market, by service provider, is segmented into consultancy and contract research organization. In 2019, the contract research organization segment held largest share of the market, also, the same segment is estimated to register higher CAGR during 2020-2027.

Strategic Insights

The health economics and outcomes research (HEOR) market players are adopting the product launch and expansion strategies to cater to changing customer demands worldwide, which also allows them to maintain their brand name globally.

Health Economics and Outcomes Research (HEOR) Services Market – by Service

• Economic Modelling/Evaluation
• Real-World Data Analysis and Information Systems
• Clinical Outcome
• Market Access Solutions and Reimbursement

Health Economics and Outcomes Research (HEOR) Services Market – by Service Provider

• Consultancy
• Contract Research Organizations

Health Economics and Outcomes Research (HEOR) Services Market – by End User

• Healthcare Providers
• Healthcare Payers
• Biotech/Pharma Companies
• Government Organizations

Health Economics and Outcomes Research (HEOR) Services Market – by Geography

• North America
  • US
  • Canada
  • Mexico
• Europe
  • France
  • Germany
  • Italy
  • UK
  • Spain
  • Rest of Europe
• Asia Pacific (APAC)
  • China
  • India
  • South Korea
  • Japan
  • Australia
  • Rest of APAC
• Middle East & Africa (MEA)
  • South Africa
  • Saudi Arabia
  • UAE
  • Rest of MEA
• South America and Central America (SCAM)
  • Brazil
  • Argentina
  • Rest of SCAM

Company Profiles

• Axtria, Inc.
• Avalon Health Economics LLC
• MEDLIOR
• PHARMALEX GMBH
• Analysis Group
• ICON PLC
• IQVIA Inc.
• McKESSON CORPORATION
• Syneos Health
• Optum, Inc.