Sleep apnea gadget maker’s shares slide on FDA ruling on Eli Lilly’s Zepbound

• Shares of ResMed and Encourage Medical Techniques fell after the FDA accepted Eli Lilly’s weight-loss drug Zepbound to deal with reasonable to extreme obstructive sleep apnea in overweight adults.

• The regulators’ transfer raised issues that pharmaceuticals might take market share from makers of merchandise that presently deal with respiratory issues.

• ResMed’s chief medical officer recommended that docs prescribe medication and gadgets corresponding to these made by his firm to supply aid to individuals with sleep apnea.

ResMed shares (RMD) and Inspiring Medical Techniques (INSP) fell Monday as firms behind merchandise to deal with sleep apnea confronted a brand new menace from weight-loss medication.

Friday, Eli Lilly (LLY) reported that the Food and Drug Administration (FDA) has accepted its weight problems drug, Zepbound, as the primary and solely drug to deal with reasonable to extreme obstructive sleep apnea in overweight adults.

Lilly famous that the FDA choice got here after part 3 clinical trials which confirmed that Zepbound was about 5 occasions simpler than placebo in lowering respiration disturbances in sufferers who weren’t utilizing a constructive airway stress (PAP) gadget that helped them sleep.

Carlos Nunez, medical director of ResMed, stated the constructive outcomes of weight-loss medication give docs extra choices in treating sleep apnea, and that these medication will probably be used “along side constructive airway stress remedy.” respiratory tract (PAP)”, just like the merchandise supplied by his firm. .

Even with a drop of about 4% right now, ResMed shares have added a few third of their worth this yr. Shares of Encourage Medical Techniques, which fell 1.4% in latest buying and selling, are down 9% in 2024. Amongst analysts tracked by Seen Alpha, three fee ResMed a “purchase” and 4 a “maintain,” and 7 fee Encourage Medical Techniques as a “purchase.” ” and two one ” maintain “.

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