Masimo Patient SafetyNet in France

Masimo Corporation (MASI - Analyst Report), a leader in non-invasive monitoring know-how for patient care, recently reported that patients at the Centre Hospitalier (CH) de Chaumont in France will benefit from its latest technological advancement. Patients are being monitored by Masimo Patient SafetyNet, the latest cutting-edge remote monitoring and wireless notification system designed for doctors. The system is intended to assist hospitals to prevent injuries and deaths related with failure to rescue events, a frequent medical error.     

Patient SafetyNet aids in keeping inmates secure by continuously and non-invasively monitoring their basic physiological condition. The system can monitor as many as 80 patients to timely detect abnormalities and variances that indicate deteriorating health.

The moment an inmate’s health starts deteriorating, the system automatically transmits wireless messages to the smart phone or pager of the concerned technician. This elicits a prompt and possibly life sustaining response from the caregiver. It has been established that Patient SafetyNet cuts down traumatic critical occurrences by 65% and expensive transfers to the Intensive Care Unit (“ICU”) by 48%.

A spokesperson for the hospital stated that the facility has observed a major decline in false alarms as the know-how is more sophisticated. Furthermore, the system’s capability to timely identify changes in an inmate’s condition enables the hospital to intervene rapidly so that the patients can recover faster. Overall, the system helps to prevent inmates from slipping to the point of critical danger.      

Patient SafetyNet system consists of a bedside patient monitor and a non-invasive patient sensor, which continuously reports vital physiological statistics, such as total hemoglobin (SpHb), carboxyhemoglobin (SpCO), oxygen content (SpOC) and pulse rate, among others.

Masimo SET and Masimo Rainbow SET know-how can be found in more than 100 multi-parameter patient monitors from more than 50 medical device producers around the globe. Masimo’s SET offering may help it to become a dominant global player in the pulse oximetry market.

The addition of non-invasive parameters is expected to act as a long-term barrier to entry and drive substantial growth. The expanded pulse oximetry utilization into non-critical care areas of hospital represents another growth driver. Shipments have been growing at a steady rate fueled by new contracts. Moreover, recurring revenues from sale of consumables are increasing.

On the negative side, a weak macro environment raises concern and competition remains intense. Moreover, Masimo partly depends upon its Original Equipment Manufacturers (“OEM”) partners for a part of its sales. In conclusion, its valuation, which already factors in its robust growth prospects, offers limited upside potential at this time.

The renewal of the royalty agreement with Covidien (COV - Analyst Report) provides impetus albeit at lower rates. Our Neutral rating on Masimo is backed by a short-term Zacks #3 Rank (Hold).

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