Does Accuracy Really Matter?
Several years ago Diabetic Investor
attended an FDA panel meeting for the GlucoWatch. For those with short
memories, the GlucoWatch was the first non-invasive glucose monitor approved by
the FDA. While the GlucoWatch failed miserably once on the market, one thing
that stood out from that meeting was the comments made by the panel’s chairman.
Since the chairman was retiring he felt he could speak freely and basically
stated that he hoped one day the standards for approving glucose monitors would
be tightened, simply put he felt that glucose monitors should deliver more
Fast forward to today and the chairman’s
hope may become a reality. As Diabetic Investor has previously reported
LifeScan, a unit of Johnson and Johnson (NYSE:JNJ), is making accuracy the
center of their new marketing campaign. Piggy-backing on the concerns raised
over the PQQ enzyme issue, LifeScan is now stressing the accuracy of their test
strips which according to one ad “have DoubleSure® technology that
automatically checks every sample twice to confirm accuracy.”
Understanding that technological
improvements have done nothing to increase sales and that market conditions
continue to deteriorate LifeScan is doing what any market leader should do,
force the competition to play by their rules. LifeScan realizes that the
competition cannot come against a more accurate reading. They also realize that
by being the first major player to tout the accuracy of their monitors and test
strips that it creates the impression that somehow the competitions products are
inferior. Finally this push for accuracy plays into the company’s overall
strategy of targeting insulin using patients. This is perhaps the one and only
group of patients where accuracy actually does matter.
As Diabetic Investor has been saying for
years one of the major reasons more patients do not monitor their glucose
levels on a regular basis is that the information provided by a glucose test is
not actionable. This is not so with insulin using patients who need this
information so they know how much insulin to dose. Too much insulin and they
risk hypoglycemia, too little and they risk hyperglycemia.
The real question however is will an
improvement in accuracy actually be of any real benefit. Does it really matter
if the reading is 100 mg/dl or 120 mg/dl? The answer isn’t as simple or as
straight forward as one might think. The reason is glucose readings are only
one number used to calculate how much insulin to dose. Besides glucose readings
the patient must look at carb intake, insulin on board, duration of insulin action
and physical activity. Should any one of these factors be miscalculated the
patient remains at risk of delivering an incorrect dose.
In a perfect world insulin patients wouldn’t
be using a conventional glucose monitor at all as a continuous glucose monitor provides
much more valuable information to the insulin using patient. Conventional
monitors only provide one reading while a cgm provides patients with trend data
which for insulin using patients is actually more valuable. While it’s great to
know that reading of 100 mg/dl is accurate, it’s even better to know if glucose
levels are trending upwards or downwards.
Diabetic Investor also sees this as a
somewhat risky strategy as accuracy is measurable and anything that measurable
can be matched or beat by the competition. This is exactly what happened with
other “advancements” in glucose monitoring such as sample size and test times.
Today nearly ever monitor offers small sample sizes and fast test results, in
affect this feature has become standard throughout the industry. It’s just a
matter of time before one of LifeScan’s competitors comes out with a study that
shows their test strip is actually more accurate than the LifeScan test strip.
And this cycle of all monitors and test strips becoming the same will continue
and only push the market further into becoming just another commodity.
The fact is the glucose monitoring cannot
survive as it is today by solely concentrating on insulin using patients. This
is a finite group of patients which will see slower growth in the future as
more physicians move their poorly controlled type 2 patients from orals to
GLP-1 therapy instead of insulin therapy. GLP-1 offers several advantages over
insulin therapy not the least of which being it does not require the patient to
regularly monitor their glucose levels.
The fact is while the number of patients
with diabetes continues to grow at epidemic rates one fact hasn’t changed 90%
to 95% of patients have type 2 diabetes. According to the National Institute of
Health (NIH) 27% of patients are on insulin therapy, 14% on insulin only and
13% on insulin plus orals. Simply put the 73% not on insulin stand a greater
chance of moving to GLP-1 therapy than insulin therapy.
The reality is while Diabetic Investor is
not against more accurate glucose readings; it will do nothing to change the
dynamics of the BGM market. Market forces combined with changes to therapy
regimens add up to one big world of hurt for BGM companies. It’s only a matter
of time before the Big Four – LifeScan, Abbott (NYSE:ABT), Roche and Bayer –
become the Three Amigo’s or the Terrible Two’s. The wheels for this
consolidation were set in motion long ago and there is little these companies
can do now to prevent it from happening. The real question is who will cry uncle