Inspire Medical Systems Prepares For Market Debut

Investors suffering some sleep apnea have plenty of reasons to look forward to the future, not least among them the fact that Inspire Medical Systems, which focuses on sleep apnea therapy and treatment solutions, has announced it will be debuting on the market with an IPO soon. The company will be offering millions of shares in a scheme that it hopes will generate some $75 million, but investors will want the intimate details of the Inspire’s financial dealings before they decide to back the medical pioneer.

Here are the fundamentals that will be in play during Inspire Medical Systems’ IPO, and the key facts concerning its industry and the diseases it’s combatting.

A NYSE debut is right around the corner

Inspire Medical Systems (NYSE: INSP) is aiming to offer investors on the open market some 5 million shares of the company’s stock, which could reap it in as much as $75 million if financial backers hit the top of their expected range of $14 to $16 per share. The company will also be granting underwriters the privileged opportunity to score an additional 750,000 shares of its common stock, according to the announcement Inspire’s executives released to the public. Such tremendous amounts of funding could prove vital towards the company’s future; its sleep apnea therapy solutions are already fairly popular on the market, but an influx of capital could be just what Inspire Medical Systems needs to ratchet its operations up to the next level.

According to the prospectus the company filed with the SEC as it announced its forthcoming market debut, Inspire Medical Systems has been incurring serious losses for some time now, which could prove to be distasteful to a great many investors who are currently interested in the company. Such losses are relatively normal for tech, biotech, and medical companies like Inspire that aim to pioneer complex treatment solutions using MRI imaging to debilitating diseases and ailments which aren’t always easy to tackle. Provided the company’s sleep apnea therapy solutions continue to garner an audience in the marketplace, it’s not unreasonable to say that the money gleamed from its IPO could prove instrumental towards Inspire’s ability to expand its existing pool of customers to start churning out a profit.

Such changes to convert its present losses into a net profit may be necessary; Inspire lost $17.5 million in 2017 alone, for instance, though those losses were significantly down from the $21.3 million in losses Inspire posted in 2015. Thus, investors have some reason to believe that the company’s financial performance is evidently trending away from it hemorrhaging and towards it getting back into the black. Since its 2007 inception, however, the company has accrued a total deficit of more than $125 million, which could serve as an albatross around its neck that deters investors with their eyes on the long-term financial wellbeing of a company.

Inspire’s prospectus also makes it clear that the company’s commercial activities are relatively young, as it’s only been operating commercially in the United States since 2014. Thus, many investors may feel that the company is still in a fledgling stage where it’s yet to prove its long-term viability. Still, it would be ludicrous to say that Inspire hasn’t found at least some success in its market since it began; an estimated 22 million Americans alone suffer from sleap apnea troubles, meaning the company has a huge audience to market its treatment solutions to.

 More marketing is needed

For Inspire Medical Systems to compete with the big fish in its industry and endure as a company on the open market for long, it needs to seriously ramp up its existing marketing operations. Luckily for the company, it intends to use at least $8 million of the capital it raises from its IPO to beef up its marketing efforts and to fund future product development initiatives, meaning investors have plenty of reasons to believe Inspire’s executives have their eyes on the long haul.

Many Americans and Europeans who suffer from sleep apnea may find Inspire Medical Systems to be a lifesaver, provided they actually hear about the company; Inspire produces implantable devices that help patients get through long nights when they’re struggling to get any shut eye. But if Inspire’s audience doesn’t know about its revolutionary sleep apnea treatments, the company can’t hope to turn a profit, and its marketing efforts thus far have been relatively lackluster. That’s why the way that the company utilizes the cash from its IPO as it pertains to boosting its marketing efforts is a crucial indicator of its future health. The company’s treatment solutions are already garnering positive press, meaning consumers are evidently happy. With the capital from its IPO, Inspire Medical Systems could thus pivot to the world stage, and start marketing its products with gusto. If that happens, expect Inspire’s shareholders to sleep soundly, confident that their money is in the good hands of competent executives.