F&P Health eyes 15pc growth

Listed healthcare devices innovator Fisher & Paykel Healthcare says with at least 50 million people in the developed world still to be diagnosed and treated for obstructive sleep apnoea, its latest home treatment device range has a lot of potential headroom for earnings.

The company has announced a launch into New Zealand and Australia of a new continuous positive airway pressure device range called Icon, which combines FPH's leading technologies in a stylish and intelligent bedside table device to deliver a better night's sleep for OSA patients.

The Icon device, which looks like and functions as a modern digital bedside clock with alarm and music playing ability, has been three years in development. The company is awaiting official clearance to launch the three-model range in its key United States market.

Chief executive Michael Daniell said the new device combines all FPH's innovative technologies into one package, including ThermoSmart to ensure a high level of humidification so the patient's nose and upper airways do not dry out.

"In our existing product range we had various things in various products that we couldn't put together into one. Here we can. That's important from a technical perspective and for patient comfort," Mr Daniell said.

"Our SmartStick capability is [now] across all models. Again, that's been limited in the past. That's a USB drive like the ones people use all the time – it plugs into the side and records usage data, which is important for doctors to be able to monitor patient usage. In the US it's particularly important because federal insurers like Medicare and Medicaid won't pay for a treatment device unless the home provider can prove the patient has been using it and complying with treatment."

But the device's looks are what FPH is most excited about, Mr Daniell said.

"It looks wonderful. With medical devices this is not normally important, but this is at home, by the bedside. It looks like it belongs."

A "big chunk" of FPH's OSA research and development budget went into the new device range, Mr Daniell said. "We typically spend around 6 per cent of revenue on R&D and our revenue for the OSA business is more than US$150 million (NZ$214m) a year, so each year we are spending around US$10m on development of OSA. A big chunk of that in the last three years has gone on this."

On the new device's earnings prospects, Mr Daniell said the company hoped it would increase market share in an OSA treatment market growing at up to 15 per cent a year. "We started out with our first range ... about eight years ago and had no market share.

"Now we have 7 per cent around the world and we hope to grow that market share. The market itself is growing at 10 to 15 per cent a year, so if we grow faster than the market, we should be able to grow faster than 15 per cent."

The Icon range includes FPH's InfoSmart technologies, which provide a full range of communication and compliance reporting options.

- © Fairfax NZ News