ResMed firing on all cylinders

SAN DIEGO – ResMed posted a 48% increase in device sales in the U.S., Canada and Latin America for the third quarter of FY2023 compared to the same period in 2022, on the backs of “unconstrained access” to its AirSense 10 cloud-connected CPAP machine. 

“Incredible growth – an all-time high,” said Mick Farrell, CEO, during a conference call to discuss the company’s financial results on April 27. “Many factors have gone into that, but primarily, we were able to deliver on our promise to get unconstrained on AirSense 10. We were able to take care of all the demand of customers in the U.S. market – period, end of story. We said we’d be there by the end of the calendar year, but we’re already there right now.” 

Healthy device sales helped ResMed post $1.1 billion in revenue for the third quarter, a 29% increase compared to the same period last year, and a net income of $232.5 million, a 30% increase. 

An ample supply of AirSense 10s in the third quarter meant ResMed and its provider customers could make a big dent in a patient backlog that resulted from supply chain constraints and a large recall by its largest competitor, Philips, during the pandemic. 

“We have now reached the point that new patient flow is well above the levels we saw pre-COVID,” Farrell said. “In fact, this March was our highest quarter ever for new patient setups in our cloud- based patient management system called AirView.” 

ResMed has now set its sights on improving access to its AirSense 10 outside of the U.S. and improving access to its AirSense 11 CPAP machine globally. Late last year, the company more than doubled its footprint in Singapore with a new 270,000-square-foot manufacturing facility in Tuas to scale production of AirSense 11. 

“We’re working country by country to secure the necessary regulatory approvals as we ramp production and delivery of the AirSense 11 across global markets,” Farrell said. “Given this, we expect to remain on allocation for AirSense 11 for the next few quarters, with AirSense 10 covering all the difference in demand.” 

Other highlights from the quarter: 

Sales from masks and accessories increased 14% in the third quarter, driven not only by the increase in new patient setups but also by a continued emphasis on hygiene that started during the pandemic. “I think there were some skeptics,” Farrell said. “Two or three years ago, people were like, ‘Oh, this step-up in hygiene in mask replenishment – that’s a short-term trend due to COVID.’ With three years since the start of this, that has been 12 quarters of strong growth. So, I think that strong mask growth is sustainable for the future.”  

In the coming quarters, ResMed plans to launch a number of products leveraging artificial intelligence and machine learning to triage compliance and other parts of sleep therapy. “That sort of triage, if you like, which has previously been done manually is now going to an automated way,” Farrell said. “We’ve always had some levels of that automation, but to have an algorithm that learns as it goes and to get better and better at it – it serves the doctor and the respiratory therapist, (who) are super pleased to see that level of efficiency and focus on the toughest patients.” 

• Read about how ResMed took its AirSense 10 off allocation in the U.S. in January.