Dexcom Reports

Dexcom Reports

It was just a matter of time before Dexcom (NASDAQ:DXCM), who reported earnings this afternoon, joined the growing list of companies looking to provide an integrated diabetes management. So it was hardly surprising that along with earnings the company announced they have acquired SweetSpot Diabetes Care, Inc. According to a company issued press release:

“DexCom, Inc. (Nasdaq:DXCM) announced today that it has entered into a definitive agreement to acquire SweetSpot Diabetes Care, Inc., a healthcare-focused information technology company, in an all stock transaction, with initial consideration of up to $4.5 million and performance milestone-based earnout consideration of up to an additional $4 million. SweetSpot has an advanced cloud-based platform for uploading and processing data and specializes in turning raw output from patient devices into powerful information for healthcare providers, patients and researchers.”

Given the vast amounts of data gathered by a continuous monitor and the type of patient who uses a CGM, Dexcom with this acquisition actually stands a better chance of developing a useful integrated diabetes management system as their CGM system provides the critical data stream that makes integrated diabetes management possible. While there are other systems now available which do not require the patient to manually enter their glucose information, the systems are still dependent on the patient actually performing the glucose test; Dexcom won’t have this issue as their system gathers this information continuously.

It’s no secret that the future of diabetes management is gravitating towards integrated systems, systems which collect data from all the various devices a patient uses and then provides patients with suggestions as to how they could better manage their diabetes. These systems will not just collect data from the patient’s devices but will also a patient and/or the patients’ healthcare team to view this data on multiple platforms.

Besides the SweetSpot deal the company also announced yet another insulin pump partner with their agreement with Tandem Diabetes who recently received FDA approval for their t:slim insulin pump.

Looking at the base business the company continues to execute and is well positioned to capture the majority of the growing number of patients using a CGM system. About the only area which seems to be an issue is the hospital based system as this is something that seems to have been pushed to the back burner. Other than that one small item, Dexcom remains on track and continues to become more valuable.