ResMed’s active pipeline for masks pays off

Company also comments on partnerships, tariffs and Mobi
Friday, October 25, 2019

SAN DIEGO – The four new CPAP masks that ResMed introduced in the past 12 months helped to push growth in that product category to 19% on a constant current basis globally for the first quarter of fiscal year 2020.

The newest: The AirFit N30, a tube-down nasal cradle mask that the company launched just last week at Medtrade and that CEO Mick Farrell places in the “minimalist category” due to its small size, light weight and minimal noise.

“We have the right mask for every patient, every time,” he said during an Oct. 24 conference call to discuss financial results.

Overall, ResMed reported revenues of $681.1 million for the first quarter of fiscal year 2020, a 16% increase compared to the same period last year. Net income was $120.1 million vs. $105.7 million, a 14% increase.

ResMed also saw strong growth in devices: 6% on a constant currency basis globally, and 8% in the United States, Canada and Latin America.

“To be at 8% growth in the U.S. shows that we’re taking some share due to the value of Air Solutions, AirView, myAir and all the digital health solutions that are there,” Farrell said.

During the call, company officials also commented on:

Integration with Cerner

“The area of interoperability is incredibly important,” Farrell said. “We have 100 API calls per second into our Air Solutions ecosystem. So every second, there are 100 interactions with another EMR/EHR, whether it’s an individual person or myAir app or physician looking over 20,000 patients to do some management by exception protocol.”

Joint venture with Verily

“(We’re) working on software solutions to help identify and engage and better manage more people with sleep apnea,” Farrell said. “It’s still very early days, but our philosophy is the more a person knows about how they suffocate every night and the consequences of that suffocation on their own personal healthcare outcomes, the more likely they will seek solutions. Over time, we know this partnership will drive incremental growth in our core sleep apnea business, while allowing ResMed to participate in a broader chronic disease management ecosystem, covering not just sleep apnea, but also cardiovascular disease, diabetes, COPD and beyond.”

China tariffs

“The way our whole supply chain is configured, we’re not really affected,” said Rob Douglas, COO. “We export very little into China from the U.S. and very little from China to the U.S. Our supply chain is more Southeast Asia focused. And we’ve got a great team in China doing local products from China. So that’s pretty solid.”

Mobi POC

“We’re still in a learning mode,” Douglas said. “It’s a great product. We’re actually learning a lot about the performance. What we’re also learning is that it is challenging, though, particularly through the U.S. reimbursement model. Really, we’re learning what future pathways to market would be and how we can make it best suitable for our HME customers to support patients.”