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Recently, ResMed (RMD - Analyst Report) filed parallel lawsuits in the International Trade Commission (ITC) and U.S. federal court to protect its patent landscape from its international competitor APEX Medical.

This provider of medical equipment to treat and diagnose sleep-disordered breathing (SDB) filed a patent infringement lawsuit against Taiwan-based APEX Medical. The lawsuit claims, among other things, that several APEX Medical products violate numerous ResMed patents.

Many APEX products such as the APEX WiZARD 210 and WiZARD 220 masks and APEX iCH and XT Fit flow generators among others infringe ResMed’s intellectual property. Thus, ResMed seeks to recover the damages against the defendant.

We note that ResMed also filed action against Medical Depot (doing business as Drive Medical Design and Manufacturing), the distributor of APEX products in the U.S. As per the lawsuit, ResMed wants to stop any further importation and sales of APEX products into the U.S.

ResMed currently holds a major position in the worldwide market for generators, masks, and related accessories for the treatment of SDB, especially obstructive sleep apnea (OSA). The company enjoys a competitive edge over other players in the market it serves.  ResMed’s ability to compete effectively relies on its ability to protect its patent landscape.

Considering the SDB market overview, there is massive growth opportunity driven by lifestyle trends, further penetration and increasing awareness. Evidently, the company’s new generation products are major growth catalysts. ResMed has had to turn to litigation to protect its intellectual property. The move is seen as a coherent decision to spur innovation and new product development.

With a nominal revision in Zacks Consensus Estimate for the ongoing fiscal over the last 30 days, the stock carries a Zacks Rank #3 (Hold). While we remain on the sidelines for ResMed, other medical stocks such as Cepheid (CPHD - Analyst Report), Cyberonics (CYBX - Analyst Report) and Given Imaging warrant a look. These stocks carry a Zacks Rank #1 (Strong Buy).

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