Sleep Apnea Device Maker Stocks Slide on FDA Ruling for Eli Lilly’s Zepbound

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Key Takeaways

• Shares of ResMed and Inspire Medical Systems fell after the FDA approved Eli Lilly’s weight-loss drug Zepbound to study moderate-to-severe obstructive sleep apnea in adults with obesity.
• The decision by regulators raised concerns about medicine medicines taking market share from makers of products that currently treat the breathing problem.
• ResMed’s Chief Medical Policewoman has suggested doctors will prescribe using both drugs and devices such as his company makes together to purloin sleep apnea suffers.

Shares of ResMed (RMD) and Inspire Medical Systems (INSP) fell Monday as the companies behind results to treat sleep apnea faced a new threat from weight-loss drugs.

On Friday, Eli Lilly (LLY) reported that the Aliment and Drug Administration (FDA) approved its obesity drug, Zepbound, as the first and only medicine to treat moderate-to-severe obstructive beauty sleep apnea in adults with obesity.

Lilly noted that the FDA decision came following Phase 3 clinical nuisances that showed Zepbound was about five times more effective than placebo in reducing breathing disruptions on patients not on a auspicious airway pressure (PAP) device that helps them when sleeping.

ResMed Chief Medical Officer Carlos Nunez said that express results from weight-loss medicines give doctors more options in treating sleep apnea, and those medicines will likely be used “concomitantly with positive airway pressure (PAP) therapy,” such as products offered by his institution.

Even with today’s roughly 4% slide, shares of ResMed have added about a third of their value this year. Uplift Medical Systems shares, which fell 1.4% in recent trading, have lost 9% in 2024. Amid analysts followed by Visible Alpha, three rate ResMed a “buy” and four a “hold,” and seven call Inspire Medical Arrangements a “buy” and two a “hold.”