ProSomnus (OSA) Shoots Up on Validating Study Results
Like many de-SPACs working their way through commercialization, ProSomnus (NASDAQ:OSA) has spent the first year of its public company life dealing with the turnover of shareholders coming out of the de-SPAC process and waiting for a patch of good news to generate some upward momentum.
That news has finally landed as the Cureus Journal of Medical Science released a study validating the effectiveness of ProSomnus’ products in treating sleep apnea and it has spiked +87% on the day as a result.
The study involved 91 patients and 98.5% of those were successfully treated with ProSomnus’ devices. Sleep apnea severity is generally measured by a patient’s apnea-hypopnea index (AHI), which is an average of the number of events that may constrict breathing and disrupt sleep per hour.
An AHI of 5-15 is considered mild, 15-30 moderate and anything above 30 severe with some patients suffering from an AHI of 50 or above. The Cureus study included patients of all severity levels that together had a mean AHI of 21.8 before treatment.
Treatment brought that mean down to 8.2 by the end of the study, with at least one patient seeing their AHI drop below 2, effectively knocking nearly all patients down a severity level or two and nearly eliminating issues for some.
Patients in the study that had better compliance in wearing the ProSomnus mouth guard devices regularly throughout the night also saw better results than the trial population.
Compliance is a major issue in treating sleep apnea because the default treatment has previously been for suffers to attach themselves to CPAP machines as they sleep, requiring them to wear ventilator masks attached to an oxygen cart, which would frequently bring discomforts outweighing those of sleep apnea on its own.
As such, ProSomnus’ solutions, which are similar to orthodontic mouth guards have been found to get far higher compliance rates with similar effectiveness as a CPAP machine.
That latter point was asserted by a 2021 Cureus study, which found that the devices had “excellent compliance rates “for all severity levels” similar to or better than CPAP, and an equal or better MDA of 56.7% compared to literature values of 50% for CPAP.”
This was a much smaller study, however, and ProSomnus had only sold a limited number of devices through their existing distribution partners when it closed its combination with Lakeshore I in December 2022.
Though its revenues have been consistently growing quarter-on-quarter since, it had not pulled itself significantly past breakeven with its FDA-approved devices. It logged a net loss of -$17 million through the first nine months of the year, which led to harsh trading in the macro conditions of 2023.
This latest study could give the company new life alongside the improving investment climate, but it still has much ground to make up. Before the study dropped today, the company last closed at $0.62, in the danger zone of compliance actions by Nasdaq.
By afternoon however, ProSomnus is trading at $1.17 in what could be the first step in getting the company back on the right trajectory.