This NEEDS to happen!!
The only way to make this interesting would be to exclude all the gore/SOINSANE horror and include a genuine, medically-researched view of sleep deprivation. Sleep deprivation in extremes is by itself horrifying. We don't need dudes smearing shit on walls or leaping around like Xenomorphs and biting dude's nuts off.
A skilled director with driven, talented actors could do wonders with almost no budget on the concept alone.
Is the only other way. If you have to make something exaggerated and fantastic, you may as well just go full Cronenberg and create something deeply unsettling and emotionally exhausting to watch. This is generally aided by great practical effect work though, which is expensive, so I don't see an indie film being successful going this route.