The ResMed Inc. (ASX: RMD) share price is having a very disappointing start to the week.
In morning trade, the sleep disorder treatment company's shares are down 13% to $27.88.
Why is the ResMed share price sinking?
Investors have been rushing to the exits this morning in response to the release of sleep apnoea trial results in the United States.
On Friday, global pharmaceutical giant Eli Lilly And Co (NYSE: LLY) released detailed results from the SURMOUNT-OSA phase 3 clinical trials. These are evaluating tirzepatide injection (10 mg or 15 mg) for the treatment of moderate-to-severe obstructive sleep apnoea (OSA) in adults with obesity, with and without positive airway pressure (PAP) therapy.
Tirzepatide, sold under the brand names Mounjaro and Zepbound, is an antidiabetic medication used for the treatment of type 2 diabetes and for weight loss.
According to the release, in both studies, tirzepatide achieved all primary and key secondary endpoints for both the efficacy and treatment-regimen estimands and demonstrated a mean reduction of up to 62.8% on the apnoea-hypopnea index (AHI), or about 30 fewer events restricting or blocking a person's airflow per hour of sleep, compared to placebo.
It also notes that in a key secondary endpoint, the efficacy estimand showed that 43% (Study 1) and 51.5% (Study 2) of participants treated with tirzepatide at the highest dose met the criteria for disease resolution.
Management highlights that this means achieving an AHI of fewer than 5 events per hour, or an AHI of 5-14 events per hour and an Epworth Sleepiness Scale (ESS) score of ≤10. It notes that ESS is a standard questionnaire designed to assess excessive daytime sleepiness.
'A complex disease'
Commenting on the results, Dr Atul Malhotra said:
In the trials, patients with moderate-to-severe obstructive sleep apnea and obesity treated with tirzepatide experienced about 30 fewer disruptive events every hour of sleep and nearly half achieved disease resolution.
Senior vice president, product development, Jeff Emmick, MD, Ph.D, added:
There are currently no pharmaceutical treatment options to address the underlying cause of OSA, a complex disease that disrupts the daily lives of 80 million people in the U.S. alone and is linked to serious health complications. The SURMOUNT-OSA results showed a significant proportion of patients with moderate-to-severe OSA and obesity treated with tirzepatide achieved disease resolution based on predetermined AHI and ESS measures, at which point PAP therapy may not be recommended.
Based on the ResMed share price weakness today, it appears that some investors are concerned that tirzepatide could weigh on the company's growth in the coming years by reducing its addressable market.
Time will tell if that is the case and whether today's selling has been yet another overreaction.
