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thebossmagazine.com

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July 2016

INNOVATION

Most companies won’t remember their

first customer, but for Inogen, she’d be

hard to forget. Mae, one of the founder’s

grandmothers, is the reason the innovative

oxygen concentrator provider was founded in

the first place.

After being diagnosed with COPD (chronic

obstructive pulmonary disease) in 2000, Mae

was given an oxygen tank. She hated wheeling

it around. It took away her freedom, and she

was always concerned about whether she

would have enough oxygen on hand or would

run out. Instead of taking her diagnosis lying

down, she shared her thoughts with the right

people and has been able to make a difference

for oxygen users in the United States.

Four years later, the founders of Inogen were

able to present her with their first portable

oxygen concentrator—the Inogen One.

“It was designed to our patient’s specifications.

It was a big departure from how things were

being done in the industry. What does Mae—

the patient—need, but more importantly,

what does she want?” said Scott Wilkinson,

President and COO.

The standard in the industry until this point

has been the big, clunky oxygen tanks that

Mae disliked so much. Oxygen tanks have a

finite amount of oxygen compressed within

them. It’s inhaled by the user until it runs out,

when it needs to either be refilled or replaced

with a new tank.

Oxygen concentrators, on the other hand, filter

and generate medical-grade oxygen. As long

as the battery that powers the machine has

life, the user has an infinite supply of oxygen.

Concentrators compress and purify the air,

removing nitrogen and other agents that could

complicate breathing. The air is delivered

through a nasal cannula, set to the desired

flow setting of the patient.

But this is only where the differences start

between Inogen and oxygen tank providers.

Another key difference between Inogen and

others on the market is that the company

designs its oxygen concentrators for the

customers, while its competitors design their

products for the home care company.

“If the home care company wants a lower

price, then our competitor designs a cheaper

model,” shared Wilkinson. “To them, it doesn’t

really matter if the patient wants something

that’s smaller, or lighter, or hands free, or quiet.

Home care companies also don’t really want

to see a new product inside of four years—

replacing the entirety of their inventory is

expensive.

“We design for the end user. Our competitors

design for the middle man. It’s a very different

dynamic. We’re competing on different

planes.”

Wilkinson shared an innumerable amount

of benefits from providing for the patient

instead of the middle man. By connecting

directly with the end user, Inogen is able to

garner direct, unfiltered feedback regarding

how the company’s product works, as well as

what else the customer is still looking for. This

drives the company’s product development

and innovation, and means that the innovation

cycle from idea to final product can be a lot

faster than other companies’.

Inogen is able to provide the market with a

brand new product every two to three years,

and significant product improvements and

upgrades to existing units every year to year

and a half because of this.

And because patients always want the latest

and greatest products—especially when

it comes to their health and products like

oxygen concentrators—Inogen is in a position

to command a premium price on their devices.