Inogen targets non-invasive vents

GOLETA, Calif. - Inogen is set to enter the non-invasive ventilator market with its planned acquisition of New Aera for $70.4 million in cash.

The San Ramon, Cailf.-based New Aera manufactures the Tidal Assist Ventilator system, which includes the SideKick TAV, a 4-ounce, pocket-sized portable non-invasive vent for people suffering from various chronic lung diseases.

“We plan to use this technology as a platform to expand our total addressable market into high growth non-invasive ventilation or NIV market,” said Scott Wilkinson, CEO of Inogen, during a conference call to discuss the company's financial results for the second quarter. “We estimate NIV to be an addressable U.S. market opportunity of over $400 million in 2019 based on the estimated claims paid for traditional fee-for-service Medicare beneficiaries and has been growing at over 20% per year since 2016.”

Inogen plans to incorporate New Aera's technology directly into its portable oxygen concentrators and make the SideKick TAV compatible with its at-home stationary concentrator.

In discussing what drew Inogen to the vents market, Wilkinson said it's a market poised to “undergo disruption” due to CMS's decision to include non-invasive vents in Round 2021 of its competitive bidding program and due to the “immobile nature” of existing products. He also noted that reimbursement for NIV is much higher than oxygen at a minimum of $934 per month.

Additionally, Wilkinson noted that CMS has approved a new HCPCS code and billing for multi-function vents and Inogen plans to launch a product in that category in 2021.

Helping to sway Inogen that New Aera was the right way to enter the vents market: a small peer-reviewed clinical trial comparing the use of the SideKick TAV with oxygen and oxygen alone for patients with either moderate to very severe COPD or interstitial lung disease. It found 83% of patients responded positively to the SideKick TAV with oxygen vs. 11% on oxygen alone. It also showed a 136% mean endurance increase.

“The trial showed these patients were able to exercise longer with markedly better oxygenation and less dyspnea and leg fatigue on TAV therapy than on oxygen therapy alone,” Wilkinson said.

Inogen plans to begin selling the SideKick TAV in 2020 directly to consumers, as well as through physicians and providers.