SomnoMed Limited (ASX:SOM) has accomplished what no other company ever has - to receive FDA clearance to offer the advanced recording feature for oral devices for in the U.S.
This is expected to deliver a significant sharemarket re-rating of the company.
SomnoMed has received FDA approval to commercialize their wearable SomnoDent devices fitted with DentiTrac® Micro-Recorders.
Dr. Peter Neustadt, executive chairman, commented:
"We believe the use of the SomnoDent Compliance Control system is of great importance in our strategy to obtain a greater acceptance of (Continuous Open Airway Therapy) COAT from medical specialists and insurers in the US.
"It offers physicians ongoing control of patients by monitoring the progress of the treatment of their sleep apnea conditions."
This is expected to assist in the company's endeavours to change the prescribing behaviour of physicians and increase the use of COAT in the U.S.
The U.S. runs well behind a number of other countries around the world where SomnoMed operates.
SomnoMed is partnering with Braebon Medical Corp
SomnoMed is partnering with Braebon Medical Corp., maker of the DentiTrac, to introduce SomnoDent with DentiTrac, designed to capture and store compliance data in the cloud for patients undergoing Continuous Open Airway Therapy (COATTM).
Until now, compliance data for COAT was only available by way of patients self-reporting their use of the oral device.
SomnoDent with a DentiTrac micro-recorder objectively captures patients’ usage of the device on a minute by minute basis.
The recorded compliance data is uploaded to a HIPAA secure cloud and can be easily accessed by the physician treating the patient’s condition.
Additionally, clinicians can remotely create, view and keep records of patients’ historic compliance data taken in minute intervals during the time the device is worn.
The ability to objectively measure patient compliance is an important feature for COAT when compared to other treatment modalities.
This unique feature gives SomnoDent devices a competitive advantage, as physicians and payers require objective evidence that patients are wearing their SomnoDents and receiving treatment as prescribed.
Neustadt added: “Early compliance control tests conducted by SomnoMed in Australia during the last few months indicate that the SomnoDent device achieves an 84% objective compliance rate on an "all night/every night" basis.
"Further, it was shown that where SomnoDent was tested using the standard definition of compliance used for CPAP (based on only 21 nights in a month, for a minimum of only 4 hours per night) an objective compliance rate of 95% was achieved.
"This exceptional rate of compliance compares very favorably with that of CPAP, which is usually stated to be around 60-70%.”
Analysis
SomnoMed has achieved what no other company ever has - and that is to receive FDA clearance to offer the advanced compliance recording feature for their oral devices in the U.S.
SomnoMed has received FDA approval to commercialize their wearable SomnoDent devices fitted with DentiTrac® Micro-Recorders.
The company is partnering with Braebon Medical Corp., maker of the DentiTrac, to introduce SomnoDent with DentiTrac, designed to capture and store compliance data in the cloud for patients undergoing Continuous Open Airway Therapy (COATTM).
Shares in SomnoMed are expected to be re-rated.
Revenue ramp-up
Last month SomnoMed said that it was confident that the last quarter of the financial year 2014/15 will set a new historic record for sales in a quarter.
The company expects to sell over 14,000 SomnoDent® units worldwide, about 20% above the same quarter in the previous year and over 2,500 units more than the sales achieved in Q3 of this financial year.
Total volume in the financial year ending 30th June 2015 is expected to exceed 50,000 units despite lower Q3 sales while revenue will grow by over 25% to $32.5 million.
EBITDA for FY2015 is expected to be in line with previous year’s earnings (around $1 million versus previous guidance).
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