Another step closer

Another step closer

Yesterday Dexcom (NASDAQ: DXCM) received FDA approval for a non-adjunctive claim. Per a company issued press release;

“Dexcom, Inc. (NASDAQ: DXCM), the leader in continuous glucose monitoring (CGM) for patients with diabetes, announced today that the U.S. Food and Drug Administration (FDA) has approved its G5 Mobile CGM system as the first and only continuous glucose monitoring system that can be used to make daily diabetes treatment decisions without finger pricking. The new “non-adjunctive” indication expands use of the Dexcom G5 Mobile CGM system as a replacement to finger stick glucose testing for diabetes treatment decisions, positioning the device as the new standard of care in glucose monitoring for diabetes management. With the new label indication, the Dexcom G5 CGM System only requires two finger pricks per day for calibration.”

This news really should not come as a shock as Dexcom has continually improved the performance of their system. Nor should it come as a shock that this news moves the conventional glucose monitoring market one step closer to extinction. As we have been reporting the performance gap between Dexcom and everyone else in CGM is closing and it’s only a matter of time before others have this claim as well. Not to be redundant but the CGM market is moving from performance based to price based.

Still this news should not be dismissed and is yet another example of why Dexcom is the CGM market leader and an example of how a diabetes device company should be run. The key for Dexcom moving forward is the same as was before this news, continue to execute. Continue to move their Band-Aid disposable sensor forward. Continue to expand CGM adoption beyond just intensively managed patients to all patients.

Now this won’t be easy given that Medtronic (NYSE: MDT) is getting set to do battle and will use price as a weapon. It also doesn’t help that the partners Dexcom has, excluding Google, are having tough times of their own. Nor does it make it any easier that the Libre continues to gain traction overseas and will soon hit the US market. Even with these challenges Diabetic Investor is confident that Dexcom will do quite well as they have perhaps the best management team in diabetes and as we have said often talent is in short supply today.

Having watched the CGM market evolve from day one going all the way back to the approval of the now dead GlucoWatch Diabetic Investor cannot help but think of where this market will be 5 years from today. Congruently we also cannot help but wonder how much further the BGM market will shrink over that same time frame. The fact is CGM is quickly becoming the standard for glucose measurement while BGM is just as quickly fading away.

So, congratulations to good people at Dexcom for a job well done. Enjoy the limelight but not for too long as bigger battles lie ahead.