Sleep apnea is a condition associated with the sustained disruption of breathing during sleep. Over 22 million people are estimated to suffer the condition in the United States alone ; global rates are rising along with an increasingly obese population, and improved diagnosis.

Obstructive sleep apnea (OSA) is a form of sleep apnea that occurs when the airway is blocked by the collapse of soft tissue and muscle. OSA is the most common form of sleep apnea; central sleep apnea – a condition where a lack of nervous activity during sleep prevents normal breathing – affects far fewer patients and requires a different method of treatment. Patients suffering a combination are said to suffer mixed sleep apnea. OSA is estimated to affect around 4-5% of the population, with a higher incidence in men than women. Other risk factors include age, with the condition most commonly affecting men in their late 50s and women in their early 60s; alcohol consumption; and the use of sedative drugs. Obesity, however, remains the strongest risk factor, and underpins the growth of the patient population.

In recent years, there has been a better understanding of the potential complications and comorbidities associated with OSA. It is hoped to prevent the development of comorbidities such as hypertension, atrial fibrillation, stroke and depression in the OSA patient population. Recent studies have even shown links between poor sleep quality and Alzheimer’s disease, with a higher deposition of β-Amyloid, a protein associated with the onset of the disease, seen in patients experiencing insufficient or poor quality sleep. This highlights the impact of poor sleep on both physical and mental health, both of which are already costly to healthcare providers. In a 1999 study published in Sleep, undiagnosed middle-aged adult patients with moderate-severe apnea were estimated to cost the U.S. healthcare system $3.4 billion a year in the extra medical services used by those patients; a value that will have only increased with greater disease prevalence. Spiraling healthcare costs and the burden of an increasing number of patients presenting with co-morbidities dictates the need to understand disease progression and provide effective treatment to prevent the onset of more complex conditions.

Currently, therapy for OSA is well developed and the market for devices to treat it is relatively mature. However, with an increasing number of patients, many of whom are unable to use conventional OSA therapy, there is interest in solutions designed to offer an alternative to the therapy used as a first-line solution. This article explores the current main-line OSA therapies, and assesses some of the alternative therapies available.

Current OSA Treatment

OSA is a well understood condition in the mature markets of North America and western Europe. Traditionally, patients testing positive for OSA after diagnostic testing are prescribed a therapy using positive airway pressure (PAP). PAP therapy uses air that is blown into the airway to force it to remain open, ensuring the patient receives sufficient oxygen during sleep. Therapy devices include:

  • Continuous positive airway pressure (CPAP) devices – provides air at a constant pressure
  • Automatic positive airway pressure (APAP) devices – pressure is adjusted automatically by the device, based on the patient’s changing needs
  • Bi-level devices – used in more complex cases, this device has two pressure settings. A higher pressure is set to open the airway during inspiration, while a lower pressure is set for exhalation, reducing the pressure against which the body needs to work to exhale.

PAP-based Therapy as the Main-Line Therapy

PAP-based therapy has been the most commonly used therapy for OSA patients, and is widely accepted as the first-line treatment for OSA. In 2013, an estimated 3.2 million PAP devices were sold worldwide . The historical dominance of PAP devices in the therapy market has arisen from their relatively low unit cost, and their ability to be used in the home, reducing the burden of the patient on the healthcare system. Furthermore, PAP-based therapy is lucrative for suppliers, with purchase and replacement of the devices supplemented by the purchase of masks and accessories required for their use. This maximizes the opportunities for revenue generation for suppliers. The devices are easy to use, with little required of the patient other than compliance with the stipulation to use the therapy regularly. The use of a non-invasive therapy is also favorable, as it helps avoid the risks, such as infection, of invasive procedures.

However, there are challenges with the use of PAP-based therapy. Compliance with CPAP therapy is notoriously low, believed to be as little in the United States as 50% after one year. Causes of non-compliance include patient discomfort, with a high incidence of pressure sores from the use of masks. As a result, patients must often rotate through different mask types, to relieve the pressure on the face, resulting in further cost to the healthcare system. In addition, the treatment of pressure sores costs healthcare providers thousands of dollars per patient. Patients also become complacent, reducing the frequency of use of the therapy, which reduces the quality of sleep and can lead to a decline in their condition. In other cases, the disruption caused by the therapy to the bed-partner can also lead to a decline in its use. While manufacturers have attempted to combat this by making devices quieter and interfaces smaller, patient non-compliance remains a huge financial and clinical burden to healthcare providers.

The expense associated with unused therapy is leading to payers requiring proof of use of therapy before reimbursement. This practice is increasingly seen in Western Europe, as well as in North America; however, the difficulties associated with protection and use of data are limiting widespread use of this as a method to enforce compliance.

Furthermore, non-compliant patients are a source of additional cost to the healthcare provider because patients using PAP-based therapy require regular interaction with the sleep therapist. This allows them to be regularly assessed, to ensure they are receiving adequate care; placing further strain on the already over-stretched healthcare providers.

CPAP and APAP devices are used to combat OSA in those patients suffering mild apnea. However, in more severe cases, patients will be prescribed a bi-level device. The market for bi-level devices is much smaller than the market for CPAP or APAP, and is forecast to grow at a steady rate. However, faster growth could be driven by an increasing number of patients with severe OSA, or with complex co-morbidities, for which CPAP and APAP are simply insufficient.

Headquarter locations of the key suppliers of PAP-based OSA therapyHeadquarter locations of the key suppliers of PAP-based OSA therapyWhile there are a number of well-understood problems with PAP-based therapy, the devices are commonly used in the treatment of OSA; prescription of these devices for OSA is widely accepted as the only option for many healthcare providers. Demand for CPAP will be sustained in cost-sensitive emerging markets, where OSA is poorly understood, and awareness of the condition remains low. However, in the mature markets, a better understanding of sleep therapy is already driving a shift towards the increasing use of APAP and bi-level devices. The use of alternative OSA therapies to address some of the issues posed by PAP-based therapies may occur sooner.

Alternative OSA Therapies

While PAP-based therapy has historically been the mainstay of OSA therapy, it is largely targeted at patients with mild apnea. For those with moderate or severe OSA, where CPAP or APAP is insufficient, the options are often more complex. Furthermore, there are a number of patients suffering mild apnea for whom PAP-based therapy simply doesn’t work, mainly because of the patient fails to comply with the therapy. There is growing interest in the development of alternative devices and procedures that allow the treatment of OSA to address some of the issues faced by PAP therapy users, particularly in the growing patient population. Some of the alternatives available to non-compliant PAP therapy patients include:

Neurostimulators

The use of neural stimulation to activate the hypoglossal nerve, which is responsible for the movement of muscles in the tongue, has been trialed as an alternative therapy for OSA sufferers. The aim of the therapy is to induce activity in the muscles of the tongue to ensure that the airway remains unblocked. This requires implantation of a neurostimulator device, usually in the neck. In recent years, developments of this technique have led to numerous studies exploring the capabilities of such devices. To date, one device – the InSpire system – has received Food and Drug Administration (FDA) approval.

Intra-Oral Devices

Often used primarily for those suffering mild OSA, these devices are designed to displace tongue, oral tissue and/or the jaw, allowing the maintenance of an open airway. The device may be in the form of a soft palate implant, which is placed under the soft palate to prevent obstruction, or a mandibular advancement device (MAD), which acts like a gum shield to force protrusion of the tongue and jaw, opening the airway. Other solutions achieve displacement of the soft palate and uvula using negative airway pressure, or by increasing expiratory airway pressure to encourage the opening of the airway. However, despite some devices already having received approval for OSA therapy, the efficacy of these devices in treatment has not yet been sufficiently proven; the National Institute for Health and Care Excellence (NICE) in the United Kingdom advises against the use of soft palate implants in the treatment of OSA . Trials assessing the efficacy of these treatments are frequently small-scale and subjective, and long-term assessment will be required to understand if they can provide an effective first-line solution for those non-compliant with CPAP.

Surgery

There are a number of surgical procedures that have been used in the attempt to treat sleep apnea patients, with varying levels of success. Procedures such as uvulopalatopharyngoplasty, where tissue is taken from the airway, or the airway is remodeled; mandibular advancement, which forces protrusion of the lower jaw; and tonsillectomy, where there is enlargement of the tonsils blocking the airway, are all common surgeries suggested for sleep apnea patients. However, none of the procedures has been conclusively or sufficiently proven to treat OSA effectively, because of discrepancies in the surgical method between cases.

Other therapies that use a surgical procedure include somnoplasty and the Pillar Procedure. Somnoplasty uses heat to reduce tissue mass, and usually specifically targets the soft palate. There is continued debate over the application of somnoplasty, with some arguing that it merely cures the patients’ snoring, rather than OSA. The Pillar Procedure uses surgery to implant small, woven fibres into the soft palate, stabilizing the tissue to maintain an open airway.

Alternative Therapy Advantages

These alternative devices offer a number of advantages over traditional PAP-based therapy. As previously stated, primary causes of non-compliance with CPAP are the discomfort associated with the interface, including pressure sores, dry and broken skin, and the impact on the patient’s bed partner. By lacking an interface, both oral appliances and neurostimulators eradicate these problems. Furthermore, thousands of dollars per patient could be saved on the treatment of the resulting pressure sores, further reducing the cost of the patient to the healthcare system.

The alternative therapies are attractive to patients because they are small and discrete, they do not emit noise, and they are more easily integrated into the patient’s normal life. They are more easily portable than a PAP-based therapy, enabling more flexibility for the patient, and the therapy is reversible. Patients can be perturbed by the nature of an interface, which may encourage the use of these smaller, simpler devices.

Limitations of Alternative Therapies

A primary consideration with any new device or therapy in healthcare must be the cost, both the initial outlay for the device or therapy, along with any additional costs after purchase. Cost of production and potential reimbursement are also important considerations; and the relative cost of a new device and that of a currently available therapy will affect its uptake.

With spiraling healthcare costs, reimbursement has continued to fall, particularly for providers of durable medical equipment, where competitive bidding in the United States is driving prices down. The cost of any alternative therapy device would have to be competitive to the existing therapy for it to be considered. While this is the case for many intra-oral appliances, with low production costs due to their simple design and functionality, neurostimulators remain a far more expensive alternative; with the upfront cost of the device often over ten times the price of CPAP or intra-oral appliances.

Reimbursement will be a major consideration for healthcare providers considering alternative options to PAP-based therapies for the wider OSA patient population. This will be of particular focus in the United States, where the healthcare system has historically been funded primarily by private payers, and where reimbursement rates have a significant influence on the uptake of a device. As an established therapy, PAP devices have full and structured reimbursement. The rates of reimbursement have declined over time; but in recent years have been stable. The alternative therapies and procedures will need to be proved effective, efficient and cost-effective to the healthcare provider before reimbursement will be considered. For some of the available alternatives that have received approval, insurance cover is currently assessed on a case-by-case basis, instead of widespread cover and set reimbursement rates being implemented. Until reimbursement rates have been agreed and implemented, the use of the alternative therapies will remain limited.

Despite the lack of full reimbursement for the alternative devices, there are some positive signs indicating that the use of these devices will become more common. First, the approval of the InSpire neurostimulator by the FDA in 2014, and approval of the ImThera neurostimulator for use in Europe in 2012 shows that they are considered as sufficiently effective and safe for OSA treatment. Further, intra-oral devices have been classified as Class II medical devices by the FDA. The implementation of stringent regulation of the production and features of these devices indicates that they are considered an effective alternative to PAP-based therapy, making market penetration in the future much easier. These initial steps indicate that full reimbursement for the alternative therapy devices is possible, providing these devices can provide sufficient cost savings compared with the current PAP-based therapies.

In anticipation of difficulties securing reimbursement, some manufacturers are already exploring the potential of monitoring compliance. An example of this is the DentiTrac oral compliance monitor from Braebon Medical. This may accelerate the reimbursement approval process, by ensuring that the alternative devices are cost effective.

Furthermore, the neurostimulator solutions require surgery to implant the device, and for any subsequent maintenance, such as battery replacement, or removal. This is costly in terms of money and time, and can also lead to complications, such as infection. Despite the problems associated with PAP-based therapy, patients can easily stop the therapy should a problem arise. The use of neurostimulators is not only more expensive initially; it will also be more difficult to reverse.

The alternative therapies discussed have both advantages and disadvantages, and while they address many of the problems of PAP-based therapy, they have limitations of their own, which could limit their uptake and adoption as a new first-line OSA therapy.

Potential Impact of Alternative OSA Therapy

When assessing any alternative to a widely used therapy, there are a number of factors that need to be assessed to really understand the impact that they will have on the market.

Before an assessment can be made of the impact of the alternative therapies on PAP-based therapy, an understanding of the target markets of the alternative devices is required.

In the PAP device market, CPAP and APAP are used by patients suffering a mild apnea, while bi-levels tend to be used in more complex cases. For the alternative therapies, the application is often less clear-cut. Typically, intra-oral devices are designed to address mild to moderate patients, while neurostimulators are normally used for patients suffering severe OSA. This indicates that intra-oral devices will be the most competitive to PAP-based therapy, as they target the patient population currently addressed by the largest PAP therapy markets, namely CPAP and APAP therapy. Similarly, neurostimulators are often used to target patients suffering a severe apnea; as these devices require surgical implantation, the patient’s need must be considered great enough to warrant the costs and potential risks associated with surgery. Therefore, neurostimulators will have more of an impact on the bi-level market in the short-term, as they both target patients with more complex apnea.

Headquarter locations of the key suppliers of alternative OSA therapies.Headquarter locations of the key suppliers of alternative OSA therapies.However, some intra-oral devices, such as the Provent Sleep Apnea Therapy, have been shown effective in, and are used for, patients suffering severe OSA. Consequently, the use of a single alternative therapy in a range of apnea severities may lead to the uptake of these devices because of their broader coverage of the market. While the short-term impact of each of the alternative devices may be on one specific PAP-based therapy, the long-term impact may be on the total market for PAP devices.

Understanding the addressable market is particularly important when it is considered that, of those patients diagnosed with sleep apnea, an estimated 1 in 15 patients is classified as severe . This limits the application of the most common PAP-based therapies available, and currently restricts the patients’ therapy options before a therapy has been prescribed. With the additional population of patients non-compliant with PAP therapy, there is a large proportion of the market for which alternative therapy will be the only option available. Therefore there will be limited competition between the alternative therapies and PAP-based therapy among this patient population. In this case, there would not be encroachment on the market, but instead the use of the alternative devices would be addressing the unmet needs of this patient population.

The potential market for the alternative therapy devices will be much easier to penetrate as a result. Therefore, the use of the alternative therapies as a main-line solution may occur first in the non-compliant patient population, allowing manufacturers to establish their place in the market before encroaching upon the PAP therapy market directly.

However, much like PAP-based therapy, some of the available alternative therapies have limitations in terms of the patients that can use the therapy. For example, some of the available therapies cannot be used in patients who suffer comorbidities such as chronic obstructive pulmonary disease (COPD), while the use of neurostimulators is limited by the patient’s weight. For some patients, their weight will prevent them undergoing the surgery required to implant the neurostimulator device. As obesity is the major risk factor for OSA, this could limit the application of neurostimulators as a therapy. The problem here is that, for many patients, OSA is part of a more complex condition, and in some cases co-morbidities may develop as a result of untreated OSA.

Cost

As discussed, the cost of any therapy will have an impact on its uptake. This includes not only the initial cost of the device, but of any associated costs for implementation, maintenance and replacement. PAP-based therapy is considered relatively low-cost in terms of the up-front costs, although there is considerable cost in replacing interfaces and accessories. For any new therapy to be competitive, it will need to show improved cost-effectiveness over current therapies. For example, the improved efficiency of APAP over CPAP, and the associated cost savings this brings, continues to drive growth in the APAP devices market.

Given the acceptance of the current main-line therapy, the price of an alternative device will have to be competitive before it is considered by healthcare providers. This is particularly important in markets where budgets are limited, either because of spending cuts or a fundamental lack of financial resource. The increase in the initial cost of the device must be outweighed by the financial benefits and improvements in efficiency that the devices provide, before they will be considered as an alternative main-line therapy; care provision is primarily driven by cost, and this will remain the case. The potential benefit of the alternative therapies is that, with improved compliance, patients are less likely to deteriorate, and the therapy will be maintained, rather than being unused.

Although the initial cost of some of the alternative therapies is higher than that for PAP-based therapy, the ongoing cost of the patient to the healthcare provider is much lower since the patient does not need to be supplied with interfaces and accessories. Instead, the only subsequent cost to the provider is replacement of the device, and the battery for the neurostimulators. This reduces the overall cost of the patient to the healthcare system, and may encourage the use of alternative therapies. For PAP devices, much of the revenues is derived from the replacement of interfaces and accessories; and may lead to manufacturers of PAP devices to encourage the use of PAP-based therapy, for which they continue to receive revenues, from both the existing and the new patient population.

Adoption of Alternative Therapies

The uptake of alternative therapies requires the devices and procedures to be approved by governing healthcare bodies, such as the Food and Drug Administration (FDA) in the United States, and to be accepted by the medical and patient community. Complex and lengthy approval processes in both the mature and emerging markets can delay market entry for some devices, particularly where proof-of-concept other than clinical trials is required for approval. In addition, demand for approved devices will rely on proved cost-effectiveness and return on investment. Currently, some neurostimulator devices, including Inspire’s Upper Airway Simulation device in the United States, and the ImThera aura6000 in Europe, have been approved; also some intra-oral devices, including SomnoMed’s range of intra-oral devices in the United States, have been approved.

However, the use of these devices remains limited. Even with approval, these devices require both the physician and patient communities to be educated before significant demand will be seen. A thorough understanding of the benefits and risks associated with the alternative therapies will allow physicians and patients to choose the most suitable therapy. As care becomes more patient-centric, the additional options presented by the alternative therapies will likely be welcomed in a market where non-compliance to the main-line therapy remains so high. However, resistance from the medical community to new devices is common, as they prefer to stick to tried-and-tested therapies, unless the patient is truly non-compliant.

This is particularly important in markets where device purchasing is influenced by the physicians. In the mature markets, a shift towards centralized purchasing to manage budgets more effectively means that cost remains the primary factor in the purchasing decision, with the clinical benefits having less impact. This will require those making the purchasing decision to fully understand the cost benefits of the alternative devices, especially where the cost of non-compliance with PAP-based therapy is a burden on the healthcare provider.

Adoption of OSA therapies – both traditional and alternative - in the emerging markets will ultimately be limited by the lack of understanding and awareness of sleep apnea. Here, the market for therapy devices is primarily private, with patients paying for their own care. This results in price remaining the key factor influencing the purchasing decision. As awareness of OSA increases in these markets, there is potential for more competition between the traditional and alternative therapies; the emerging markets typically adopt newer technologies earlier, as the traditional technologies are less established.

Another key factor in penetrating emerging markets is to consider the possible distribution channels. Distributors are required in many of these markets for successful penetration, even for the most established manufacturers selling relatively mature products. Education of the medical and patient community may be required to drive demand for the product, but the correct sales channels will need to be identified and established before this demand can be met. This could pose a further hurdle to the suppliers of the alternative therapies. However, with the use of PAP-based therapy limited by the lack of awareness of OSA, suppliers may find market penetration here easier.

The factors discussed indicate that, in their current state, the markets for the alternative therapy devices pose a limited threat to PAP-based therapy. However, with time and development of these markets, including device approval, the introduction of full reimbursement, and demand from the patient and physician communities, these devices will become competitive to PAP-based therapy.

Will Alternative OSA Therapies Displace PAP-Based Therapy?

This article has discussed the merits of both traditional and alternative OSA therapies, and explored the challenges that each therapy faces. Despite the challenges of PAP-based therapy – namely the high rates of non-compliance, and the large proportion of the market that it does not address – the use of PAP-based therapy is so widespread and accepted, that the adoption of the alternatives will be neither quick, nor will they completely displace PAP-based therapy. This is particularly important when it is considered that many of the alternative therapies are either more expensive, as-yet unapproved, or even unproven in their efficacy as a therapy.

Instead, increasing penetration of the market by these alternative OSA devices will occur as the price of the devices falls, approval of their use is granted, reimbursement is introduced, and physicians and patients are educated as to their benefits. For patients who are non-compliant with PAP-based therapy, the alternative therapies enable them to manage their OSA more effectively; alternative therapies will most likely be used to address this market first. For those patients using a PAP-based therapy, its disadvantages must be compared with those of the alternative therapies, and a cost-benefit ratio be devised for each option, to understand which therapy is truly the best for each patient.

It must also be considered that, while there are problems with compliance to PAP-based therapy, the solution may not be to consider alternative therapies, which also have disadvantages, but to address the root causes of non-compliance better, by developing more comfortable interfaces, and convincing patients of the importance of maintaining the therapy. Perhaps the best way to manage the patient population is to find a way to encourage, or even incentivize, the patient population to use the existing therapy, rather than replacing it with a new alternative.

Therefore, rather than a sudden displacement of current OSA therapies for any one of these alternatives, the market will slowly shift to become more balanced, with each of the available therapies being considered equally, on a case-by-case basis, to assess which best meets a patient’s needs. Holistic, patient-centric care is driving this change, and will provide an opportunity for the use of alternative devices as more common therapy solutions. However, the balance of the cost of care versus patient need will remain the primary consideration for the care provider, and will act as a major barrier to the uptake of alternative therapy devices. While there will be encroachment on the market from the increased use of these alternative devices, it will not be fast, it will be not be dominating, and there will not be a distinct displacement of PAP-based therapy devices, which are forecast to see increased use for the next five years . Simply, the market will become more competitive.

Contact the author: Holly Ingram, Analyst, Medical Technology, IHS Technology, +44 1933 402255, holly.ingram@ihs.com.

References:

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[10] The IHS Technology 2014 ‘Sleep Diagnostics, Therapy and Interfaces’ report, published February 2015. The IHS report covers historical developments and future projections in the global sleep markets for 2013 to 2018