ResMed seeing sales surge: ‘Can’t keep up’ as profits continue to rise amid Phillips recall
ResMed, a medical device company, and a top competitor of Philips Respironics in the sleep apnea CPAP device market, sees boosts in sales as customers rid themselves of defective CPAP machines and turn to the competition for quality care.
The company reported a 12% increase in sales in its latest quarterly review.
The reason for the sharp increase? It’s partially related to the June 2021 Phillips CPAP device recall issued on Phillips 3M DreamStation devices. These devices, like other sleep apnea respirators, help open the airways to improve air flow for people with the condition that causes them to stop breathing, sporadically, in their sleep.
An investigation into Phillips 3M CPAP machines found that sound abatement foam used to quiet the device can degrade and break down and be inhaled into the lungs of patients who rely on the device to get healthy sleep. The recall has since been expanded to include over 5 million Phillips CPAP and BiPAP machines.
“We have to be the No. 1 player and the No. 2 player by market share to cover the needs and we just simply, with supply chain shortages — particularly around electronic components and semiconductors — can’t keep up with all the demand,” says ResMed’s ceo, Mark Farrell.
Analysts suggest it could be as late as 2023 before Phillips re-enters the market as a competitor. Still, Farrell, reminds “I think the hardest hit in an event like this with five-plus million devices affected are the patients.”
As many companies face new challenges under COVID-19 conditions, no industry has been harder hit than the medical field. With supply chain shortages and other obstacles, both COVID related and market related, ResMed is looking forward to incremental improvement in their fulfillment process starting this summer.