This appeared last week:
How ResMed’s Mick Farrell turned a $7b company into a
$62b giant
Family
business successions are often a disaster. At ResMed, the global sleep device
manufacturer, it has proven to be a winning formula.
Michael Smith Health
editor
Aug 8, 2025 –
8.02am
When Mick
Farrell’s dad, Peter, first invited him to come and work at ResMed, which makes
breathing devices for sleep apnoea, he scoffed at the idea. Farrell, an
ambitious 26-year-old consultant, was being courted by two US multi-billion
dollar companies – med-tech giant Boston Scientific and biotech Genzyme – and
he wasn’t interested in working for his father’s start-up, which was worth
about $50 million at the time.
“He asked me
to come out to San Diego and interview with his company,” recalls Farrell. “I
said, ‘No offence, Dad, but your little $50 million start-up … ResMed is it?
... in the seaside hamlet of San Diego?’”
Farrell’s
youthful arrogance was met with an expletive-ridden tirade from his father down
the phone line. He still won’t repeat it to this day. “I am not going to quote
the exact words he said back then, but it was along the lines of: ‘Listen, you
arrogant little so-and-so. This is a huge opportunity for you … expletive …
expletive.’ ”
But Farrell
could be as stubborn as his father, so it was up to his girlfriend, Lisette, to
convince him to get on the plane to San Diego and spend Thanksgiving with his
dad, and while there meet with a ResMed interviewing committee. His dad wasn’t
on the panel.
On the flight
over, Farrell was crunching the numbers on ResMed and its potential. “I was
sitting on the plane with Lisette and I said to her: ‘This company, this
market, this opportunity is huge! My crazy dad is right!’”
Twenty-five
years later, and Farrell, now 53, is ResMed’s chief executive. He married
Lisette and they have two kids. And as for that little start-up? Well, it’s
now a global company worth $63 billion, with customers in 140 countries.
Farrell is
telling the ResMed origin story on a recent return visit from San Diego, where
he’s lived for the past three decades, to Australia. He is speaking to me from
his mum’s house in the northern beachside Sydney suburb of Manly, where he
slept the night before on a fold-out bed, along with his portable ResMed CPAP
device and mask. The device and mask are used to treat sleep apnoea, which is
estimated to afflict almost 1 billion people worldwide.
“In the
morning I wake up fired and ready to go,” says Farrell, who’s never one to miss
a marketing opportunity. He also refers to some of the company’s 10,000
employees as “ResMedians”.
Farrell,
who’s stocky, with a thinning hairline, talks in rapid-fire sentences,
and has largely retained his Australian accent. He was born in Seattle but grew
up in Sydney, before returning to live in the US.
He’s in
Australia this month to see family and meet with investors after delivering a
stellar full-year result for the medical device manufacturer. ResMed’s
earnings were up almost 40 per cent. He has also been in Sydney to catch
some footy, with ResMed a sponsor of the recent British and Irish Lions tour
against the Wallabies. “I love Sydney even when it is rainy and cold. At the
rugby, the rain was coming in sideways!”
Farrell,
whose early career included a stint working for BHP designing water cooling
systems for steel production, will have been ResMed’s chief executive for 17
years at the end of this decade. It’s a long time, according to corporate
governance experts, but Farrell brushes it off.
“Despite my
beautiful hairline I am only 53,” he laughs. “I have a good innings [ahead] to
finish this 2030 strategy. I am looking at long-term [succession] plans and
working with my fellow board of directors to think about that,” he says. “It is
a big question always at public companies.”
“I fell in
love with that overlap of science and altruism and the profit motive. I have
never looked back.”
— Mick
Farrell
The market is
happy for the Farrell-lineage to continue for some time yet.
“He’s not
that old. We would be pleased to see him stay for at least another five years,”
says Andrew Dale, a portfolio manager at ECP Asset Management.
Bell Direct
analyst Grady Wulff agrees. “I don’t think he is going anywhere,” says “He’s
the person you want at the helm really. He is very hands-on in every division.
The ResMed brand is in his DNA. ”
ResMed was
started in 1989 by Peter Farrell, a chemical and bioengineer turned
entrepreneur. He saw the potential of a new technology then under development
by Colin Sullivan at the University of Sydney, which ResMed would acquire and
commercialise, to treat sleep-related breathing disorders. He moved the
headquarters to California in 1994 after the company outgrew Sydney, but at one
stage considered relocating to Texas because the state was “too
Democratic” and high-taxing. He never followed through on that threat.
Farrell
junior would follow in his father’s footsteps. A
first-class honours student at school in Sydney, he too studied to be a
chemical engineer at the prestigious Massachusetts Institute of Technology,
where he had gained a scholarship, before later earning an MBA.
“I fell in
love with that overlap of science and altruism and the profit motive. I have
never looked back,” says Farrell.
After working
for BHP, and a stint as a consultant, Farrell rang his father for career
advice, which is when the job offer was made to come into what was then a
family business. It was 2000, and despite the tense phone call, Farrell junior
eventually joined ResMed, initially in business development and marketing
roles, before eventually climbing the ladder to become head of the Americas
division.
In 2013, he
succeeded his father as the company’s chief executive and is credited with
continuing to build the company’s market share and develop the technology in
breathing machines, masks and other sleep devices. He has cemented ResMed’s
place as one of Australia’s corporate healthcare success stories alongside CSL
and Cochlear.
“When I took
over ResMed in 2013, it was already a strong company,” says Farrell, but adds
that there are distinctions between him and his father in how they operate.
“There are very big differences. He was a founder and entrepreneur. I am
chairman and chief executive.”
He knows the
succession to become ResMed’s chief executive could be painted as blatant
nepotism – he is the youngest of three children – but denies this was the case.
“In the early days I had to work harder and work longer. I learnt a lot from my
dad about what to do in business and ambition.
“He was big
about getting as educated as you can, work as hard as you can and take your
god-given talents to the world and double them. He saw some talent in me, and
he didn’t want it to be wasted.
“From my
mother, who was a nurse, I learnt how to make sure that while you are doing all
that, you take care of people, your friends, your family, yourself. That
balance of intellectual ambition and care and love.”
Resmed
founder Peter Farrell saw the potential of the technology under development at
the University of Sydney to treat sleep-related breathing disorders, which he
acquired and commercialised. Peter Rae
Peter
Farrell, who
stepped down as ResMed’s chairman in 2023, declined to comment on his son.
A company spokeswoman said he no longer does media interviews and is enjoying
his time on the golf course.
For a man who
makes his living out of those who suffer from insomnia and poor sleep, there’s
not much that keeps Farrell junior awake at night. And understandably, because
right now he is riding high.
ResMed’s
dual-listed shares hit a record $45 on the Australian Securities Exchange last
week. During Farrell junior’s tenure, ResMed’s market value has grown from $7
billion to $62 billion.
“ResMed’s
market cap growth over his tenure says it all,” says Anna Milne, a deputy
portfolio manager at Wilson Asset Management. “He has transformed the company
in a number of respects. ResMed has shifted from being a primarily
hardware-focused CPAP device manufacturer, to a sleep and respiratory care
global leader. His focus on technology and data has been ahead of its time.”
If there is
something that worries Farrell, it’s technology and cybersecurity threats for
ResMed, which has 23 billion nights’ worth of patient medical data in the
cloud.
“In
California, people fail all the time and get back up again, and people say you
are learning.”
— Mick
Farrell
He shares an
anecdote about a recent meeting he had with technology leader Jensen Huang, Nvidia’s
chief executive, who is personally worth $US150 billion from the success of
his semiconductor company.
“I was at
this small event with 20 CEOs and Jensen arrives with his cool leather jacket,
and he is worth a couple of billion dollars more just that morning. You know
me, I’m talkative, so I made the mistake of being the one in the group to ask
him a question.”
Farrell’s
question was about how to engage your board in strategy, but Huang said the
premise of his question was wrong. He said it was impossible to have a
five-year fixed strategy in a world where artificial intelligence was changing
things daily.
What does
the future hold for ResMed?
“I realised
ResMed isn’t going to be the world leader in machine learning and AI, but we
will be the world leader in applying Generative AI in the field of sleep
health.”
Technology is
where Farrell is focused for ResMed’s future. He’s less concerned about
government regulation or the Trump administration’s whipsawing on global
tariffs, which has caused headaches for so many multinationals.
He says the
regulatory and political upheaval occurring under the Trump presidency is not a
problem for ResMed, which he argues is
tariff-proof. He says ResMed, which manufactures sleep devices and masks in
Australia and Singapore, is protected under an international agreement called
the Nairobi Protocol, which guarantees duty-free treatment for products that
help people with disabilities.
Still, Trump
administration observers would argue that it is remaking the world order in
ways that were once unthinkable.
Farrell, a
Republican, cites Ronald Reagan as the US president he most admires. He has not
met Trump yet, but expects to in his new role as chairman of the Advanced
Medical Technology Association, a global trade association.
“I haven’t
met Donald himself, but I think it is quite possible over the two years as
chairman, I will be shaking hands with the head of the ministries of health in
Europe and maybe the president as well.”
Farrell’s
sanguine approach to government is a marked difference to his father, who was
very outspoken in criticising governments, both in Australia and the United
States, over high taxes, excessive regulation and overspending.
It’s not to
say that Farrell doesn’t have views. He’s just not as outspoken as his old man.
For example, he believes that in Australia, more could be done by politicians
to support interactions between industry and universities.
He says
ResMed does its best to capitalise on Australia’s innovative talent. “We have
our advanced engineering next to our advanced manufacturing here, and we can
teach and learn from [our offices in] Singapore and San Diego.
He would also
like Australian state and federal governments to be more pro-business. “Support
more Peter Farrells! Don’t put artificial caps on research and development or
amortisation incentives,” he says. “Other governments aren’t thinking that way
and so want to partner, support small companies and entrepreneurial companies.
“In
California, people fail all the time and get back up again, and people say you
are learning.”
Farrell’s
tenure at the top of ResMed hasn’t been without its hitches or challenges.
There was a
clinical trial failure in 2015 when US regulators ruled that a new form of
sleep therapy the company was testing endangered patient lives, sending ResMed
plummeting 18 per cent.
In 2020, the
COVID-19 pandemic disrupted international global supply chains, making it a
challenge for ResMed to manufacture and supply customers. Then, governments
spanning the US, Singapore, Germany and Australia demanded it supply
ventilators to them as it had manufacturing operations in those countries.
There has
also been the arrival of new technology, such as wearables and AI, to which the
company has had to adapt and capitalise on to keep driving sales.
More
recently, the challenge has been the explosion in demand for miracle weight
loss drugs such as Ozempic and Mounjaro, often simply known as GLP-1s, which
caused a sell-off in the shares of companies such as ResMed. There was some
early evidence that those weight loss drugs could also reduce or cure sleep
disorders, but this is not proving to be entirely the case.
Farrell has
data showing patients going to doctors for weight-loss drugs but also deciding
they would address their sleep problems by buying ResMed devices. ResMed’s
shares, which are listed on the ASX and the Nasdaq, are now double the price
they plunged to in late 2023 on the back of concerns about those weight-loss
drugs.
“It might be
premature to say they have shrugged off the threat of GLP-1s,” says Wilson
Asset Management’s Milne. “This threat remains. But we have come a long way in
the last two years, where the hype was at its peak. I believe we are at the
very start of the next phase for ResMed, one of customer centricity.”
Getting
lucky and staying lucky
Still,
unexpected competition and changes in technology are what concern analysts
about ResMed’s future, and they, like Milne, are still watching and waiting to
see what the full impact of the mass takeup of GLP-1 drugs will be.
In response
to those concerns, Farrell likes to quote American business author Jim Collins.
“Good luck and bad luck happen to all companies equally, but the successful
ones have return on luck,” he says.
A lucky time
was when ResMed was able to capitalise on a disastrous product recall by its
main rival, Philips, in 2021 due to safety concerns about foam used in one of
its products. ResMed swiped Philips’ lost market share as hundreds of millions
of devices were recalled, and the gains have been permanent because it has
taken Philips years to make the replacement or repair kits.
“We would
never have guessed COVID, the supply chain crisis, or GLP-1s,” says Farrell.
“We never expected Philips to drop the ball so badly. They have been sent off
the field for four years now.”
Farrell is
focused on his 2030 strategy, which is to drive high-single digit revenue
growth annually, invest 7 per cent of revenue into research and development,
and expand ResMed’s sleep offerings by using data to help people battling
insomnia. It is also expanding into the fast-growing ventilation and oxygen
therapy market.
Farrell’s
strategy includes some ambitious targets, which sound like marketing slogans,
such as the plan to help 500 million people sleep better. ResMed says 144
million people now use its products, and it has 27 million cloud-connected
devices in the market.
ResMed’s
investors are backing Farrell and his strategy. “The real strength of a CEO is
to take a high-quality business and continue to drive it and improve returns,”
says ECP Asset Management’s Dale. “Mick’s been a very good custodian of
high-quality assets.”
Bell Direct’s
analyst Wulff agrees and sums it up another way. “He has taken what was just a
sleep apnoea company into this new monster, which has so many different revenue
streams.”
Here is the link:
https://www.afr.com/companies/healthcare-and-fitness/resmed-mick-farrell-cpap-devices-20250724-p5mhm2
A great story of a huge Australian
success!
I can remember when Resmed was just
an experimental idea being pushed by some friends in the laboratory next to me
while I was doing my BSc(Med) in 1970-71.
Rather a pity I did not go and work with
them but I had my experiments to do (in my BSc(Med)) and a medical degree to
get! Certainly a commercial path not followed – but always watched with interest!
I suspect Resmed has to be the
biggest thing ever to come out of Sydney University, as it heads for a market
cap. of US 50 Billion
And I was there when it started <grin>!!!
David.
