The scenario: your team has recently reached a key milestone. You have promising preclinical results, or a successful clinical readout, a regulatory green light, or a product ready to scale. Innovation is strong, the team moving fast, and the next steps feel clear. Exciting? Definitely. But before you commit time, budget, and strategy to the next phase, there is one essential question to answer. Take a step back for a moment and consider: how does your product fit into the market today, and where will it fit tomorrow?
In this article, I will discuss what a market analysis is, why it is so important, and what you need to undertake to do one yourself.
I. Four pillars of analysis
In short, a market analysis is the structured process of understanding the environment your innovation will enter or operates in, so that scientific and technical success can translate into real-world value.
It can be adjusted to different stages and questions. In practice, it usually rests on four pillars: understanding the current state of the market , where the market is heading, how your product fits that market, and how big and attractive the opportunity really is.
1. What is the current state of the market and where is the unmet need?
Start by mapping the current landscape. What is the standard of care, what are existing products or technologies, how are patients or users segmented, and what solutions are already adopted in practice. Mapping the landscape allows you to identify the true unmet need, or in other words, which gaps remain, how serious they are, and whether your product is solving a problem relevant today.
2. Where is the market going?
Next, look forward in addition to looking sideways. Review the development pipeline of direct and indirect competitors, the modalities that are emerging, and the expected timelines to market. Do so by using reliable sources. Identify the key players shaping the field. The goal here is to understand what the competitive and clinical reality may look like by the time you launch, expand, or reposition.
3. What is your positioning and product–market fit?
Once the “now” and the “next” are clear, define where you fit in. How does your product compare to existing options and to products that are likely coming? What is your real differentiation, and is it defendable? Why would clinicians, patients, hospitals, or buyers choose you over alternatives? This pillar tests whether you can credibly expect adoption and capture part of the market gaining technical, clinical, and regulatory success.
4. How big is the opportunity and what are the market trends?
Finally, quantify and contextualize the opportunity. Market sizing is central here. Usually by combining top down and bottom-up approaches to estimate the Total Addressable Market (TAM) and the Serviceable Addressable Market (SAM) in a realistic way. Alongside sizing, this includes assessing market trends such as growth drivers, shifts in clinical practice, and where investment or partnering and acquisition activity is concentrating. This is to understand how attractive and dynamic the space is in reality.
II. Keep it dynamic
Market analysis supports decision making at every stage of a life sciences project. Whether you are selecting or expanding indications, preparing for launch, entering new geographies or considering partnering, in licensing, or acquisition options, it helps ground your choices. It tests whether the unmet need is still there in real clinical practice, whether the market will remain open by the time you reach approval or scale, and whether your differentiation can drive adoption and a defensible share.
Life Sciences markets evolve quickly through new entrants, clinical readouts, approvals, guideline changes, and shifting investment climates. Because of this, market analysis should be revisited regularly as your project progresses , at least once a year.
III. Add depth when needed
Most analyses start with secondary (desk) research. But depending on the question you seek to answer, primary research can add decisive insight. Interviews with Key Opinion Leaders, often leading clinicians or experts, can validate unmet need, reveal adoption barriers, and refine positioning based on how decisions are made in practice.
IV. Foundation for commercial forecasting
A market analysis often opens the door to sales forecasting and broader commercial planning. Expected penetration and adoption dynamics only make sense when anchored in a clear view of the current landscape and how the market will likely evolve.
FFUND for market clarity and direction
At FFUND, we regularly perform market analyses for life sciences companies at any stage, from early development to clinical expansion and commercialization. We start by aligning with you on the key strategic questions, defining the right scope and segments, and choosing the level of depth needed. We then deliver a structured market view with various levels of complexity adapted to your needs and timeline.
Need a clearer picture of your market, your positioning, or your next strategic move? Take a look at the Venture Finance page or contact us directly via info@ffund.nl.
