ResMed is a leading developer, manufacturer, and marketer of medical equipment for the diagnosis and treatment of sleep-disordered breathing, selling a comprehensive range of products in over 60 countries.
The ResMed Story
When ResMed was formed in 1989, its primary purpose was to commercialize a device for treating obstructive sleep apnea (OSA), a major subset of SDB. Developed in 1981 by Professor Colin Sullivan and colleagues at the University of Sydney, nasal continuous positive airway pressure (CPAP) provided the first successful noninvasive treatment of OSA. Since 1989, ResMed has maintained its focus on SDB, which is gaining greater public and physician awareness. Operations have grown dramatically through the introduction of a number of highly innovative product lines.
Into the Future
OSA affects millions of people worldwide (approximately 20 million in the United States alone), its prevalence being comparable to that of asthma or diabetes. However, awareness is low with only around 5% of sufferers being diagnosed and treated. Along with an increasing understanding of the morbidity and mortality caused by SDB, this discrepancy has created one of the fastest growing segments of the respiratory industry. There is also now a recognized association between SDB and common diseases such as chronic obstructive pulmonary disease, stroke, and cardiac disease. ResMed is moving quickly to seize these exciting opportunities by applying its leadership in algorithm-based software as well as to related hardware to treat SDB.
Delivering Results
In its commitment to technological innovation, ResMed spends approximately 7 - 8% of net revenues on research and product development. Together with a clear focus on growing market opportunities, this dedication has enabled ResMed to create and maintain shareholder value. Since its public listing in June 1995, ResMed has met or exceeded First Call earnings per share estimates for 17 consecutive quarters. As of June 1999, its compound annual growth rate was well in excess of market growth rates: 39% for sales and 55% for net income, using fiscal 1995 as a base. ResMed is cashflow positive with no long or short term debt. Revenues and profits have increased steadily during the past eight years, making ResMed a robust and rapidly growing player within the SDB marketplace.
In September 1999, ResMed listed on the New York Stock Exchange (symbol: RMD). The ResMed Board of Directors anticipate that this move will provide greater visibility within the financial community for both ResMed and the market opportunities for sleep-disordered breathing (SDB) products.
Business Strategy
Think global; act local
ResMed was born global. From day one the company operated in more than one country. Today, products are marketed and distributed in over 40 countries by direct employees as well as distributors with extensive knowledge and experience of local markets. This ensures that ResMed supplies the right products to the right markets - a key factor in the Company's business strategy.
Products
Innovation has played a major role in ResMed's success. Since the company's founding in 1989, a large number of product advancements and improvements designed to increase patient comfort and encourage compliance with therapy have been developed. Feedback from patients and specialists around the world is used to produce products that meet the different market needs. At the end of June 1999, the Company had a total of 186 patents issued and pending for a range of technologies.
ResMed produces nasal CPAP, VPAP
, and AutoSet systems for the home treatment of SDB; the VPAP range includes Ventilatory Support Systems for the treatment of adult patients with respiratory insufficiency or respiratory failure.
In addition, ResMed manufactures air delivery systems that include nasal masks, headgear and tubing to connect the system to the patient; plus humidifiers and other accessories aimed at improving patient comfort, convenience and compliance with therapy.
The Company also markets a growing range of sleep laboratory products. Strategic alliances with other market leaders such as Flaga hf., whose multi-channel sleep recording equipment complements ResMed's innovative range of diagnostic devices, enable ResMed to offer a comprehensive product suite.
Product Development
ResMed is committed to an ongoing program of product advancement and development. Currently, product development efforts are focused on AutoSet technology, improved CPAP, VPAP and mask systems, and manufacturing cost-reduction programs. ResMed consults with physicians at major medical centers throughout the world to identify technological trends in the treatment of SDB. Some of these physicians currently serve on ResMed's Medical Advisory Board. The Company's marketing staff, direct sales force, manufacturers' representatives, patients and network of distributors also identify new product ideas. Typically, ResMed's internal development staff then perform new product development.
Manufacturing
ResMed's principal manufacturing facilities are located in Sydney, Australia. The manufacturing operations consist primarily of assembly and testing of devices, masks and accessories. Of the numerous raw materials, parts and components purchased for assembly of therapeutic and diagnostic sleep disorder products, most are off-the-shelf items available from multiple vendors. ResMed generally manufactures to its internal sales forecasts and fills orders as received. As a result, the Company generally has no significant backlog of orders for its products. A quality control group performs tests at various steps in the manufacturing cycle to ensure compliance with the Company's specifications.
Awards Received
In 1999, 2000 and 2001, ResMed was listed as one of Business Week's Hundred Hot Growth Companies. In 2001, ResMed was ranked #31 up from #67 in 1999. ResMed was also named by FORTUNE magazine as one of America's One Hundred Fastest Growing Companies in both 1999 and 2000. In 2001 ResMed was ranked #30 among Fortune Small Business' 100 Fastest Growing Small Businesses. ResMed has made the Forbes' list of 200 Best Small Companies in America for five consecutive years, most recently at #24 up from #172 in 1997.
updated 16th July, 2002
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