Skip to Content

ResMed makes play for oxygen market

ResMed makes play for oxygen market 'We see an excellent opportunity,' says Jim Hollingshead

SAN DIEGO - Manufacturers of oxygen therapy devices will soon have a new competitor: ResMed.

ResMed, a manufacturer of largely sleep therapy devices, announced last week that it plans to buy Austin, Texas-based Inova Technologies, manufacturer of the LifeChoice Activox, an ultra-light portable oxygen concentrator, and the Activox DUO2, an integrated stationary and POC system.

“Portable oxygen concentrators are a growing category,” said Jim Hollingshead, president, Americas, for ResMed. “The acquisition will help us to reach more patients.”

In 2014, Medicare spent about $24 million on POCs (E1392), according to the HME Databank.

ResMed has a small stake in the oxygen market already, in the form of two non-invasive ventilators (the AirCurve10 and Stella series) and a non-invasive life support platform (the Astral). But with Inova, it's making a more serious move for the oxygen market, which largely serves COPD patients.

“COPD is a key strategic area for ResMed,” Hollingshead said. “But non-invasive ventilation is only part of the treatment, as it is generally used toward the end of the clinical pathway. Because oxygen therapy is typically prescribed much earlier in the patient's care journey, the acquisition of Inova Labs will complement our existing solutions and enable us to help many more people coping with COPD.”

ResMed plans to “accelerate” the growth of Inova through its HME sales and distribution capabilities, and through its global footprint, Hollingshead says.

“We see an excellent opportunity,” he said.

(ResMed CEO Mick Farrell told Reuters that the company plans to eventually add a computer chip to Inova's devices to help doctors remotely monitor patient breathing, as it has done with its CPAP devices.)

John Rush, CEO of Inova, is looking forward to having the power of a company like ResMed behind it.

“ResMed has significantly more capability and reach than we do at this stage of our development,” he said. “It sells into 100 different countries today.”

At the same time, Rush says Inova gives ResMed a good foothold in the oxygen market from the get-go.

“(Our) approach of making our technology available to all patients has led our company to product compound annual growth rates of close to 70% for four years beginning in 2011,” he said.

Both ResMed and Inova are betting on the market for POCs, specifically, to grow exponentially as Medicare expands its competitive bidding program.

“The real move to the non-delivery model began to happen in the U.S. post the July 2013 introduction of bid prices,” Rush said. “The implementation of these non-delivery models has progressed at varying rates, with early adopters driving the growth in the first year. The shift continues today with a growing number of HMEs adopting the POC as a front-line solution for their patient's mobility needs.”

Comments

To comment on this post, please log in to your account or set up an account now.