January 2012 – Sleep-apnea solutions drive small but growing Export firm

Tuesday, January 31, 2012

David Groll spent years working on the development of new versions of masks used to treat sleep apnea for Philips Respironics, the Murrysville company that invented the first sleep apnea mask more than a quarter century ago.

But for the past five years, Groll, 51, has been running his own company, which is challenging Philips Respironics basic design. After years trying to improve on sleep apnea masks made from plastic, Groll founded Circadiance® LLC in 2007 to bring an all-cloth mask to market.

“I realized there was no way to make a breakthrough using plastic,” Groll said recently in Circadiance’s modest offices in Export, about 10 miles southeast of his former employer’s headquarters in Murrysville. Respironics Inc. was acquired by Royal Philips Electronics in 2008 for $4.9 billion.

Groll left Respironics in the late 1990s and consulted for other companies working on similar products that blow air to keep a patient’s throat open during sleep — known as continuous positive airway pressure, or CPAP. But by 2003, Groll said, no one had solved what he saw as a fundamental problem of CPAP masks — some people who need the treatment don’t comply with it because they can’t tolerate wearing hard plastic masks during sleep.

Groll said he got the idea of using cloth that year and by 2007 Circadiance® was making a one-size-fits-all cloth CPAP mask called the SleepWeaver®. The cloth is a synthetic material that’s both waterproof and breathable, similar to the Gore-Tex found in high-end ski jackets, Groll said.

Circadiance® has applied for a broad range of patents that Groll said should keep another company from introducing a cloth material CPAP mask.

The privately held company doesn’t release sales figures, but Groll said Circadiance® has had annual growth of at least 25 percent a year since its founding.

“We’re still only a small fraction of the market,” he said. “But we continue to grow and take market share.”

The CPAP market in the United States was estimated at $1.5 billion in 2010, according to GlobalData, a United Kingdom-based market research company. By 2017, GlobalData predicted the market will reach $2.5 billion.

The U.S. market is growing quickly because of increasing awareness that obstructive sleep apnea has serious health implications, such as heart disease and stroke, and that many people with the condition haven’t been diagnosed. There also may be a link between rising obesity rates in America and an increasing prevalence of sleep apnea.

“Up to 80 percent of people with sleep apnea aren’t yet diagnosed,” said Dr. Robert Basner, a Columbia University sleep doctor and representative for the American Academy of Sleep Medicine.

The cost of untreated sleep apnea — from heart attacks to driving accidents — is estimated at $3 billion a year, Basner said. “The numbers are very high.”

Obstructive sleep apnea occurs when soft tissue in the throat collapses during sleep, blocking the airway and stopping breathing repeatedly. That lack of oxygen and repeated interruptions of sleep lead to a variety of problems, said Dr. Ryan Soose, director of UPMC’s Division of Sleep Surgery.

Soose said there aren’t good data to establish whether any one type of CPAP mask is more effective than another and that many patients do just fine with traditional hard plastic masks that fit over the nose and mouth.

“But a subset of patients that are struggling to get optimum results because of the plastic mask … those (people) could benefit from a cloth mask,” Soose said. “There’s a small percentage — maybe 10 percent or so — who really have specific concerns about the plastic and skin irritation.”

One of those people is David Hopwood, a 55-year-old sleep apnea patient from Indianapolis. Hopwood was diagnosed with the condition in September and went through several types of plastic masks before finding Circadiance’s SleepWeaver®.

The cloth mask allows him to sleep on his side in comfort, he said. “It’s great and I wouldn’t trade it for anything.”

Circadiance’s 14 employees perform product design, marketing, sales and administration out of its Export offices. It contracts for manufacturing with an outside company, Groll said.

The growing CPAP market and plans for new products are expected to help Circadiance® continue its growth, Groll said. Last year, the company introduced an ultra-lightweight tube to connect the SleepWeaver® to the air blowers. And several other products, which Groll declined to discuss, are in Circadiance’s development pipeline.

“We’re building off the concept of soft and light,” he said.