Resmed advocates for fair reimbursement, stands behind CPAP

SAN DIEGO – Resmed CEO Mick Farrell addressed the latest potential threats to the CPAP therapy market during a recent webcast: The resurgence of Medicare’s competitive bidding program and the development of a new pill to treat obstructive sleep apnea (OSA). 

Questioning bid program, savings 

Farrell said Resmed is discussing competitive bidding directly with leadership at Health and Human Services and CMS, and working with AAHomecare and AdvaMed to respond to the proposed next round of the program.  

“I was there in Washington, D.C., just last month,” said Farrell, incoming chair of AdvaMed. “I was in CMS, with Dr. Oz and team and I was also over at HHS with RFK Jr’s office there. This administration is listening to and taking feedback from the industry. So, we're going to make sure we protect patient's (and) HME’s rights to be able to freely access great therapies like Resmed has. We’ll be advocating for that.” 

Farrell noted that it isn’t the industry’s “first rodeo” with competitive bidding and over the years HME providers of all sizes have upped their game, putting them in a better position to navigate the program. 

“I think we’ve seen some really good, I would say, mature infrastructure investments by our HME providers,” he said. “So, I think we’re going to do very well through this competitive bidding environment.” 

Like other stakeholders in the industry, however, Farrell questioned whether there are even savings to be had in Medicare reimbursement, noting the gap with private payers has closed. 

“I think when this sort of started – Round 1, Round 2 – Medicare reimbursement was significantly above private payer reimbursement,” he said. “As I look at it now, Medicare and private payers are very much in sync.” 

Therapies jockeying for position 

Amid increased interest in GLP-1s and now Apnimed’s oral medication to treat OSA, Farrell maintains that CPAP therapy is the gold standard for treating OSA. He quoted Prof. Jean-Louis Pepin from Grenoble University in France, who said, “The best alternative to failing positive airway pressure therapy is positive airway pressure therapy again.” 

Farrell acknowledged, however, that Resmed has been diversifying its portfolio to also include, for example, oral appliances like Narval CC, which is available in the European Union and other regions. “I think Olympic medals – the silver goes to dental MRDs,” he said. “ResMed is the No. 1 provider of 3D printed dental devices in Western Europe, Northern Europe and beyond.” 

Farrell believes Apnimed, which recently announced positive results for its pill to treat OSA, will be battling it out with GLP-1s for a bronze medal. “I think (GLP-1s) have taken the wind out of the sales of Apnimed, frankly," he said. "It's more likely that Zepbound or that type of a drug would be used as that third-tier versus an Apnimed, which only half treats the apnea. But we'll watch this space.” 

Other highlights from the call 

• Farrell commented on Resmed’s recent acquisition of VirtuOx, saying the company, along with Somnoware and NightOwl, form an ecosystem that will help free up the funnel of patients seeking CPAP therapy. “Physician prescriptions, payer requirements and the need for personalized setup and support make HME providers our essential partners in ensuring patients receive and stay on therapy,” he said. Resmed acquired the company, which has an annual revenue run rate of about $45 million, for $140 million. 

• Farrell announced that Bobby Ghoshal, chief commercial officer for the Residential Care Software business, which includes Brightree, has left the company to become president and COO of a software business that is not a competitor. The leaders of Brightree, MEDIFOX DAN and MatrixCare will now report to Mike Fliss, global chief revenue officer.