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A Look at the Competitive Landscape of Diabetes Devices

The diabetes devices market is more competitive than ever before. Here's what we expect to see this year from the leading players in the space.

Diabetes represents a huge market opportunity for medical device companies, but that also makes for a tough competitive landscape. Here we have reviewed the key players and what 2019 could have in store for them, based on recent news and earnings calls.

Abbott Is on a Tear 

Abbott's latest milestone in the diabetes space is a non-exclusive partnership that will integrate insulin dose data from Novo Nordisk's pre-filled and durable connected pens directly into the digital health tools compatible with the FreeStyle Libre system.

The companies said that integrating the two products will enable diabetes patients, caregivers, and clinicians to view glucose and insulin data together to help them make more informed treatment decisions and to have a more meaningful and productive conversation about health outcomes.

Abbott CEO Miles White says the company is adding 300,000 new Freestyle Libre patients per quarter and growing. More than 1.3 million diabetes patients are currently using the device for continuous glucose monitoring, he said during the company's earnings call in late January.

Abbott recently launched the Libre 2 system in Europe and White said the new iteration of the device should make it to the U.S. market shortly.

"And I’d say, a significant quantum of capacity will come online in the second half of this year. And from my perspective, that allows us to open the floodgate much wider," White said. "At this point, we’re having a tremendous amount of success with Libre without putting much push behind it. And at that point, we’re going to have an ability to turn on a lot of push."

He noted that there is a steady cadence of capacity additions to the platform after that.

"I think this is a very big, long-term, sustainable growth product for the company," White said. "I don’t have any other way to say it. This is a hell of a good product."

DexCom Will Double Its G6 Production Capacity This Year

The key word in Abbott's news about the Novo Nordisk agreement is "non-exclusive" meaning that companies like DexCom, which also has a relationship with Norvo, shouldn't have to worry.

"We announced our relationship with Norvo back in October, and I can tell you we've been working with Novo for far longer than that," DexCom CFO Quentin Blackford said in response to an analyst's question during the company's earnings call last week." "We continue to push forward to develop software tools, robust software tools to integrate our CGM together with their intelligent insulin pen technologies that will be coming to market. So, I don't think that announcement earlier this week has any impact."

CEO Kevin Sayer also talked about the competitive landscape of the space during the call, as transcribed by Seeking Alpha.

"With respect to competition, we take competition seriously all the time," he said. "While it hasn't slowed on our growth trajectory, I would say if anything our vision and our focus on the competitive environment is much greater than it has been before and as we design our products and our future pipeline, we want to take advantage of those things that we do well to continue to forward competition."

Blackford also pointed out that it's still very early in the continuous glucose monitoring (CGM) game. 

"We're so early in the opportunity of converting folks from traditional finger sticks to CGM that the opportunity in the way of volume growth from the adoption of CGM technology is so significant that while there is going to be revenue per patient headwinds over time, I think the volume opportunities significantly outweighs any of those headwinds."

Sayer said DexCom has big ambitions for 2019.

"In light of our meaningful uptick and demand, we have set the aggressive internal goal to double our G6 production capacity by year-end," he said. "We need to expand our footprint dedicated to manufacturing within the Arizona facility, both to meet our G6 goals and in anticipation of a late 2020 launch of G7."

In addition to scaling its manufacturing capacity, Sayer said DexCom has had to rethink how it builds its customer-facing infrastructure to better serve its rapidly growing patient base in order to build a sustainable infrastructure for the future.

We have therefore expanded and reorganized our customer support efforts, which includes an increase of resources on our new Philippines location, as well as outsourcing other functions through third parties," he said. "This move will provide the ability to serve our customers with the same high level of quality that they have become accustomed to and grow in a much more efficient manner."

Sayer said the expansion will result in organizational changes, including a workforce reduction its San Diego and Arizona facilities, despite an expected overall increase in employee numbers in these locations this year.

Medtronic's Is Taking Diabetes Personally

Medtronic continues to roll out its 670G insulin pump system throughout the world and in the coming fiscal year, the company expects to launch its hybrid closed-loop system with Bluetooth, which Medtronic has dubbed the MiniMed 780G.

The 780G will feature next-generation algorithms, designed to improve time in range to over 80% by automating insulin delivery following a snack or a meal. In addition, the system will reduce the burden of carb counting and enable remote monitoring and remote software downloads.

The company also plans to submit an application for a non-injunctive designation for the Guardian Sensor 3 CGM in the next few months.

FDA recently granted breakthrough device designation to Medtronic's personalized closed-loop system that will feature real-time personalized algorithms designed to automate insulin delivery on a personalized basis that continuously adapts to the user. The system will also provide insights and predictive diagnostics, unique to the individual, all of which will dramatically simplify diabetes management for the patient, Medtronic noted.

The company also said it is advancing its CGM sensor pipeline by reducing the need for calibration and making the sensors smaller and longer lasting, all while using cognitive computing to enhance personalized insights.

Tandem Is Blazing New Trails

FDA recently approved San Diego, CA-based Tandem Diabtes Care's t:slim X2 insulin pump. The approval created a new device category called alternate controller enabled infusion pumps (ACE Pumps). Along with this authorization, the FDA is establishing criteria, called special controls, which outline requirements for assuring the accuracy, reliability, cybersecurity and clinical relevance of ACE pumps, as well as describe the type of studies and data required to demonstrate acceptable pump performance.

The approved indication for the t:slim X2 pump states that the pump is able to reliably and securely communicate with compatible, digitally connected devices, including automated insulin dosing software, to receive, execute, and confirm commands from these devices.

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