INSP Stock Price Increases Over 10% Pre-Market: Why It Happened

By Amit Chowdhry ● Aug 4, 2021
  • The stock price of Inspire Medical Systems Inc (NYSE: INSP) increased by over 10% pre-market. This is why it happened.

The stock price of Inspire Medical Systems Inc (NYSE: INSP) – a medical technology company focused on the development and commercialization of innovative and minimally invasive solutions for patients with obstructive sleep apnea – increased by over 10% pre-market. Investors are responding positively to Inspire Medical Systems reporting its financial results for the quarter ended June 30, 2021.

These are the company’s recent business highlights:

— Generated revenue of $53.0 million in the second quarter of 2021, a 335% increase over the same quarter last year

— Reported gross margin of 85.8% in the second quarter of 2021, an increase over the 84.0% reported in the same quarter last year

— Activated 63 new centers in the U.S. in the second quarter of 2021, bringing the total to 535 U.S. medical centers implanting Inspire therapy

— Created 13 new U.S. sales territories in the second quarter of 2021, bringing the total to 130 U.S. sales territories

— Announced positive coverage policy issued by Anthem for Inspire therapy

Full Year 2021 Guidance

Due to the positive trends during the second quarter, Inspire is increasing its full year 2021 revenue guidance to between $210 million to $213 million — which would represent growth of 82% to 85% over full year 2020 revenue of $115.4 million. And this compares to the prior revenue guidance of $192 million to $196 million. The company is also raising its full-year 2021 gross margin guidance to 85% to 86% as compared to the prior gross margin guidance of 84% to 85%.

And Inspire is increasing its guidance relating to the opening of new U.S. medical centers to a range of 48 to 52 per quarter for the remainder of the year, as compared to the prior guidance of 36 to 40 centers. The Company is also increasing its guidance on the addition of new territories to adding 10 to 11 new territories per quarter in 2021. This compares to the prior guidance of eight to nine territories.

KEY QUOTES:

“Our significant commercial momentum continued throughout the second quarter. We remain focused on our commercial execution driven by increasing our capacity at existing implanting centers, opening new centers and improving the education process with patients. Based on our strong performance in the second quarter and the anticipated continuation of positive implant growth trends in 2021, we are raising our full-year 2021 revenue guidance to between $210 million to $213 million, an increase from our prior guidance of $192 million to $196 million. We continue to closely track the on-going challenges presented by COVID-19 and the latest resurgence and, despite the associated uncertainty, we intend to continue our robust investment in the further growth in adoption of Inspire therapy.”

“The 63 new U.S. implanting centers we added in the second quarter was well above our guidance of 36 to 40 new centers per quarter in 2021, and represents the significant demand by physicians and centers for access to Inspire therapy. To further support this demand, we created 13 new sales territories in the second quarter in the U.S., also well above our guidance of eight to nine new territories. We are dedicated to scaling our sales management and training teams to optimize our on-going expansion and focus on positive patient outcomes and center productivity. On the commercial reimbursement front, we are pleased that Anthem, which, through its affiliated companies, serves 42 million individuals within its family of health plans, is now providing coverage of Inspire therapy. Finally, we are pleased with the proposed national average physician payment, which is in-line with the results of the RUC physician survey and provides physicians with strong reimbursement for performing the Inspire procedure; as well as the increase in proposed Medicare reimbursement in hospitals, and we will continue to work with CMS with the goal of assuring that the final reimbursement levels for Inspire therapy procedures in Ambulatory Surgical Centers is appropriately established.”

— Tim Herbert, President and Chief Executive Officer of Inspire Medical Systems

Disclaimer: This content is intended for informational purposes. Before making any investment, you should do your own analysis.