GLP-1s agonists – the class of medications that can help manage Type 2 diabetes and obesity – have put some in the home medical equipment (HME) market on edge.
Broadly, GLP-1s such as Ozempic, Trulicity and others stimulate insulin release and reduce glucagon secretion, leading to lower blood sugar levels. While GLP-1s can prove helpful for managing challenging conditions, they may also create headwinds for HME businesses.
If individuals are able to better manage their diabetes, there could be reduced need for monitoring devices, for example. GLP-1s can improve glycemic control without requiring frequent blood glucose monitoring, especially when compared to other diabetes medications.
Additionally, by reducing the need for insulin injections or insulin pump supplies, GLP-1s may indirectly impact the demand for these products within the HME market.
And those aren’t the only considerations. Beyond diabetes management, healthier consumers could mean decreased demand for respiratory devices. Weight loss can potentially alleviate symptoms of obesity-related obstructive sleep apnea (OSA), for instance, reducing the need for CPAP devices or other sleep apnea treatment equipment.
Earnings calls discussions
GLP-1 ripple effects reach beyond the HME market, and they’re now routinely brought up by analysts on quarterly earnings calls for all types of health-care companies, from ambulatory surgery center (ASC) operators to behavioral health providers.
At least two HME players – Viemed (Nasdaq: VMD) and AdaptHealth (Nasdaq: AHCO) – aren’t overly concerned about their impacts at this point. Leaders from both HME companies discussed GLP-1s during their respective Q4 earnings calls.
“There seems to be a consensus that GLP-1s will not have a negative effect on CGM (continuous glucose monitor) growth,” Richard Barasch, chairman and interim CEO of AdaptHealth, said in February.
“It’s logical to assume that patients on GLP-1s are actively engaged in their health and will be required to monitor their A1C levels through CGMs,” he continued.
The Plymouth Meeting, Pennsylvania-based AdaptHealth provides medical equipment and supplies to about 4.1 million patients annually, with a team of about 11,000 employees.
Casey Hoyt, the CEO of Viemed, echoed those sentiments – particularly on the respiratory side – during his company’s earnings call in March.
“As we gained clarity on the limited impact of GLP-1 drugs on the home medical equipment industry specifically regarding CPAP usage, the available evidence suggests that initial concerns were significantly overstated,” Hoyt said.
The industry overall, he noted, has “shown resilience” against possible GLP-1 headwinds. To support that point, Hoyt also referenced a survey from ResMed (NYSE: RMD) that found minimal disruption around GLP-1s and key HME market segments.
“Our sleep business is growing faster than previous years, with new patient starts indicating promising future resupply revenue growth,” Hoyt said.
AdaptHealth’s Barasch said that recent surveys from his company indicate that 16% of its current CPAP users are already using GLP-1s.
“We want our patients to be healthier, so this is good news,” Barasch said. “It’s also reasonable to assume that increased awareness of obesity will also increase awareness of related comorbidities like OSA. These trends are beneficial for everyone.”
Both leaders explained how it’s still relatively early, in terms of GLP-1s impact on the health-care sector.
