Sleep Market Growth Slowing, Short-Term Rebound Unlikely
Wachovia Capital Markets says that growth in the global sleep market has slowed, and that while home sleep testing should eventually drive faster growth it still faces some obstacles.
Wachovia estimates that the global sleep market grew by 13 percent constant currency (cc) in the December quarter, down from 14.5 percent cc in the September quarter. Over the next 12 months, respondents to Wachovia’s Q1 2008 Sleep Center Survey say they plan to expand their bed capacity by 13 percent and expect 10 percent patient volume growth.
Based on these data points, Wachovia has lowered its forecast for global sleep market growth in 2008 to 14 to 16 percent cc from its prior forecast of 16 to 18 percent cc.
Where home sleep testing is concerned, Wachovia says it expects home sleep testing to drive faster U.S. sleep market growth and push the U.S. market closer to 20 percent by mid-2009 assuming that Medicare's final decision is not too restrictive. Wachovia says some of its contacts have suggested that CMS might attempt to limit home testing to sleep physicians or accredited sleep labs in its final decision, due on March 14.
Such a restriction could limit the positive impact of home testing. And even in the best case, Wachovia says it would take 12 months or longer after the final decision before the industry would see a significant impact from home testing on U.S. growth.