Officials at Somnetics International plans to expand awareness of their product in 2012 while honing in on the cash/retail niche.
In a world where tiny iPods hold thousands of memory-intensive songs, should it be any surprise that a CPAP machine finally weighs less than a pound? Clarence Johnson, president and CEO of Somnetics International, observed the trends over the last decade, and decided to start a mini revolution of his own.
The result is the Transcend Sleep Apnea Therapy Portable CPAP System, a unit that company officials say is the smallest, lightest, and most portable CPAP on the market. “It also has the smallest, lightest, and most portable battery,” says Johnson, who relied on more than 25 years in the biotechnology industry prior to starting Somnetics 3 years ago. “These two things, in combination with the waterless humidification technology, will transform the way CPAP is delivered.”
Somnetics received FDA market clearance for the Transcend obstructive sleep apnea therapy device in July 2010. A little more than a year later, judges at the 2011 Medtrade show in Atlanta gave Transcend the Innovation Award for the product that best exemplifies high tech and state-of-the-art design.
Johnson knows that well-funded marketing departments at manufacturing juggernauts will try to overshadow the positive news, but he’s confident the message will spread. “To compete with the large companies head on would be folly,” says Johnson from his Minneapolis office. “Instead, we believe we have identified a route to market that is unique. Our product is unique, and we think our product strategy can succeed.”
With increased utilization of direct-to-patient marketing, the young company intends to partner with DME and sleep physicians to reach out to the installed base of existing CPAP users. “We also need to market to DMEs and sleep physicians,” adds Johnson. “We want them to know that we intend to partner with them to improve their retail sales with a small and innovative CPAP.”
In addition to the unit’s compact size, judges at Medtrade appreciated the fixed pressure CPAP’s automatic altitude adjustment, good for up to 8,000 feet, with AHI and leak detection reported to compliance software. Tight pressure control at the mask means consistent performance that Johnson maintains is more than suitable for everyday use.
Sleep Doctors who may be unaware of the Transcend, will notice change in 2012. “We should be in sleep labs, but just have not gotten there yet,” adds Johnson. “We exhibit at the sleep meetings, and many sleep docs who attend the meetings have seen the device, and many will soon have an opportunity to try it on patients. One of our great marketing challenges for 2012 is to expand the knowledge of our product within the sleep physician community.”
Cash is King
Officials at Somnetics believe their product is ideal for self dispensing sleep labs looking for a viable cash retail device. Accepting that the Transcend won’t likely be considered as a first-line therapy device any time soon, Johnson believes his product’s niche is currently the growing travel market. “There is a big market for people who buy second CPAPs for travel,” he says. “We believe we can help create a bigger market there with our battery powered unit. For those interested in selling CPAPs for cash, we are a perfect partner. We will help market to your base, and give our customers all the marketing materials they need for free.
“We don’t want DMEs and sleep labs to add our device as a third- or fourth-entry primary device, because it will just sit on the shelf,” continues Johnson. “We think our first and best route to market is through patients who already have and understand CPAPs, and know what features they are looking for. Ultimately, patients will know about the device, and ask for it.”
For DMEs and self-dispensing sleep labs looking for cash sales, Transcend can attract customers looking for secondary travel devices. “Certainly Transcend is reimbursed like other CPAPs, so physicians can send patients to DMEs, and those DMEs can provide this as a primary device,” says Johnson. “And of course, when patients want to travel, they can do it. No other device is that convenient. Every other device is heavier, bulkier, bigger, and creates problems.”
Transcend can be carried and used on a flight, and as a medical device it does not count as a carry-on item. Sleep lab directors and DME providers should advise users to never check a sleep apnea therapy device with baggage because the chances for damage are high. “A doctor can provide a letter stating the user’s diagnosis and the need to carry and use the device on the plane, if necessary,” says Johnson. “Users should call the airline in advance to clarify procedures and in-flight policies.”
For the Medicare and insurance market, the Transcend is reimbursed under the same codes as any other CPAP. The device is not an auto-pap, but instead a fixed pressure CPAP. “We stop recommending at 16 cm of water for pressure,” says Johnson. “For anything above that, we think expiratory relief or Bi-PAP is required. The only thing we don’t have is expiratory relief. Other than that, Transcend is fully featured, and even has more features than some units.”
One crucial feature of the modern CPAP is humidification, and Johnson reiterates that Transcend uses heat moisture exchange technology, which hospital-based respiratory therapists have long relied on for critical care ventilation patients. “We have a great deal of intellectual property developed around the concept of applying this technology to CPAP,” says Johnson, who holds a Master of Science degree in microbiology (biochemistry) from the University of Minnesota.
Somnetics is the first company to offer heat and moisture exchange humidification, a staple for patients on long term ventilation, but not used in CPAP until now. “An insert fits into the breathing circuit and captures exhaled moisture and warmth and returns that to the patient when they inhale with the next breath,” explains Johnson. “It is effective and satisfies humidification needs. When it becomes more widely understood, it will be an attractive option because it is small, easy, and portable. There is no hassle, no mess, and no water. It is a viable alternative to heated humidifiers.”
Somnetics sells its products through an established network of distributors and direct sales representatives serving markets across the U.S., and in key markets around the world. The unit is reimbursable under the standard CPAP HCPC code, and is accepted by most insurance companies.
As the Transcend launch continues, buyers can purchase with a standard 6-ft hose that will work with any mask or seal on the market. Two battery options are available, one with an overnight capacity of 7 to 10 hours at a pressure of 14 cm. “Another option is a multi-night battery that will last 14 to 16 hours minimum at 14 cm,” adds Johnson. “Both batteries work as uninterrupted power supplies for people living in hurricane zones or zones with frequent power outages. Ultimately, we listened to patients in putting this device together, and we feel we have incorporated what they want.”
For more information about the Transend, visit http://www.mytranscend.com/
At a Glance