Another FDA Meeting – This time it’s BGM
It looks like March is going to be a busy month for the people in the diabetes device sector. On March 5th the FDA will be conducting a panel looking at issues surrounding insulin pumps and today Diabetic Investor has learned that on March 15 and 16th the agency will be conducting another meeting on blood glucose monitors.
Before we move on to the BGM meeting, the insulin pump meeting appears to have caught the all the players by surprise. Although Johnson and Johnson (NYSE:JNJ), who owns Animas, was not presenting at JP Morgan Diabetic Investor did meet with Animas during the meeting who knew nothing about what was going on. Neither Medtronic (NYSE:MDT) or Insulet (NASDAQ:PODD), both presented at JP Morgan, seemed to be aware of just what the heck is going on. Sources tell Diabetic Investor that Medtronic is the target of this meeting although the other players could be asked to present as well. Until the agenda officially comes out there is no way to know for sure but as always Diabetic Investor is looking for more information.
Turning to the two-day BGM meeting it appears LifeScan has succeed in getting the FDA to question the accuracy of blood glucose monitors. The genesis of this meeting actually started long ago when the whole PQQ issue became public. As Diabetic Investor previously reported LifeScan quickly jumped all over this controversy and even changed their marketing efforts stressing the accuracy of their monitors. Bayer also jumped on the bandwagon and Abbott quickly followed agreeing to change the enzyme they use with their monitors. About the only major to ignore the problem was Roche, who seemed oblivious to what was going on around them. The company semi-changed strategy when they indicated during a conference call they would be changing some of their enzymes for monitors sold in Europe.
This lack of action by Roche is turning into a business disaster. Besides further damaging their already tainted reputation in the market, the company is about to lose a major source of revenue. Some may recall when Diabetic Investor reported that the Veterans Administration circulated a memo to all their hospitals telling them not to use any hospital based BGM system that used the PQQ enzyme. Diabetic Investor has learned that FDA will soon issue a directive banning any PQQ system from hospitals. Given that Roche has yet to respond to this issue and was a major player in the hospital market this will be a serious blow to their already hurting BGM unit.
While Diabetic Investor applauds the FDA for looking into this issue, the fact they are holding two days of meetings on this subject should send a message to anyone who thinks the recently announced artificial pancreas project will ever come close to achieving their goal. Someone will need to explain to Diabetic Investor how the agency will develop a regulatory path for the artificial pancreas when companies can’t even make a simple glucose monitor that delivers an accurate reading.
From a business perspective the mere fact the FDA is conducting this meeting plays right into the hands of LifeScan, Bayer and Abbott. LifeScan is already marketing the fact that their test strips are more accurate as is Bayer and soon Abbott. Roche, whose market share appears to be in a free fall, remains the only major who has not publicly stated they will be switching enzymes. Frankly even if they made this move immediately the damage is already done. Given the way Roche has turned gold into sand one just might think this was done by design. It’s hard to find an example of another company so inept and poorly managed.
Obviously Diabetic Investor will watch both meetings closely as well the coming PUDFA date for Byetta LAR which is also scheduled for early March. Given that March is known for the college basketball tournament and is called March Madness, the diabetes industry might just have their own version of March Madness this year. While it’s way too early to start filling out your brackets one thing is for certain Roche won’t even make the tourney and is the biggest loser of all.