On December 3, ResMed announced that it was acquiring digital therapeutics manufacturer Propeller Health for $225 million. Part of ResMed’s goal in making this acquisition is to help establish itself as a leader in COPD management across all stages of the disease. ResMed is not only interested in augmenting its regular business with Propeller’s digital medication adherence products; it also wants an “in” with Propeller’s established partnerships with pharma, healthcare, and payer organizations.
In an article in HIT Consultant, writer Fred Pennic provides 10 market-based reasons why the Propeller Health acquisition makes sense for ResMed. They are as follows:
- An enormous addressable market: According to the World Health Organization, asthma and COPD affect more than 354 million and 250 million people worldwide correspondingly. The prevalence of both conditions is expected to increase.
- Big digital opportunity: Digital respiratory solutions could target more than 270 million patients by 2023.
- The high lifetime value of asthma and COPD patients: In the U.S., the lifetime value of a COPD patient is about $200,000, and the lifetime value of an asthma patient could be three times as high because asthma patients typically live longer than COPD patients.
- The revenue opportunity for pharmaceutical companies: Digital respiratory solutions can adhere patient medication adherence, a good thing for the already multi-billion-dollar market for asthma and COPD drugs.
- The impressive network of industry partnerships that Propeller Health has built: Propeller has established partnerships with several pharmaceutical companies and other stakeholders like pharmacy benefit managers and healthcare systems.
- The global presence: Propeller’s programs have reached several thousand patients across 16 countries.
- The extensive coverage of the available device-drug combinations: Propeller’s add-on inhaler sensors cover nearly 90% of the currently available types of inhalers.
- Substantial clinical evidence, proven patient outcomes, and FDA clearances: Propeller has received nine FDA clearances and has demonstrated clinical outcomes in 15 peer-reviewed studies.
- An outstanding position in the digital respiratory market: Propeller offers a unique width and quality of service offering among digital respiratory solutions. Its partnership ecosystem is also outstanding.
- Availability of SaaS services and the opportunity to roll out a full-fledged patient monitoring solution: In addition to its connected inhalers, Propeller Health offers a cloud-based patient management platform, which Propeller to decrease its dependency on device sales.
Ultimately, ResMed’s acquisition of Propeller Health is a vivid example of the untapped potential of the emerging digital respiratory market.
Read the full article here.