Does it matter?

Does it matter?

This morning Abbott (NYSE: ABT) received approval for the Libre Pro system. According to a company issued press release;

“Abbott (NYSE: ABT) today announced that the U.S. Food and Drug Administration (FDA) has approved the company’s FreeStyle Libre Pro system, a revolutionary continuous glucose monitoring (CGM) system for healthcare professionals to use with their patients with diabetes.

FreeStyle Libre Pro system is designed to empower healthcare professionals to provide better diabetes management for diabetes patients. The system provides healthcare professionals with a visual snapshot of glucose data, known as the Ambulatory Glucose Profile (AGP), giving a more simplified and clear overview of not only glucose levels, but also patterns and trends within those levels. This valuable information helps healthcare professionals make better, customized treatment decisions for their patients – and for a significantly lower cost than other professional CGM products available.”

While this is a positive step forward for Abbott the question is does it change anything, does it matter?

As we have been stating for some time continuous glucose monitoring is the hottest thing going in diabetes devices. Within 5 years CGM will become the standard for glucose measurement. Yet, the battle isn’t over which system is the most accurate or which system works with which insulin pump. No the battle in CGM is what the battle always is; turning this data into patient relevant patient actionable information which then leads to better patient outcomes.

Put more simply this is battle over systems NOT hardware. Yes, it is true that the Dexcom (NASDAQ: DXCM) is the most accurate of the systems on the market. It is also true that the folks at Medtronic (NYSE: MDT) are working to improve the accuracy of their system, as is Abbott. Data accuracy is not where this battle will be fought.

With Dexcom aligned with Google and Medtronic with IBM Watson, data analytics, predictive analytics combined with artificial intelligence will be the weapons used to determine the winner.

We see Abbott well behind in this race as even if the consumer version of the Libre is approved here in the US, the system has limitations but more importantly it’s coming to the race a day late and dollar short. Especially when you consider what Dexcom and Medtronic have in their respective CGM pipelines. It won’t be long before disposable CGM systems are here, systems which will be competitively priced with conventional finger stick point to point monitors. Systems which will come with way cool whiz bang apps which will attempt to transform this data into patient relevant patient actionable information.

Most importantly of all these way cool whiz bang apps will dumb down diabetes management for the patient, and this is not a bad thing it is a very good thing. The dumber the better, especially when you consider that real money will be made by getting non-intensively managed patients to use these new disposable systems. This is by far the largest market opportunity.

By our way of thinking Abbott is using the Libre as bait. They see that Apple and others in the Valley are jumping into the diabetes pool. These cash rich companies can easily afford to acquire the Abbott diabetes unit. They also can use their vast resources to improve the Libre turning it into the cornerstone of the diabetes management systems they are building. Abbott just doesn’t have the vision or resources to do this.

The central fact is there is room for multiple players in the CGM market. Again the key is not intensively managed patients, this is the low hanging fruit. The key is non-intensively managed patients, patients who need the information just as much as intensively managed patients. What everyone fails to understand is that while non-intensively managed patients may not be able to take immediate action based on data, this data when analyzed and presented in the correct fashion can and will positively impact outcomes. The results may not be as immediate as with intensively managed patients but the results will come.

This is why these companies must develop different platforms for each set of patients. The fact is an intensively managed patient wants to see one thing, while a non-intensively managed patient wants to see something totally different. Years ago we noted that BGM companies should take the systems they had and reconfigure them to target different patient populations. While an intensively managed patient wants to see an actual number, non-intensively managed would be more comfortable seeing which zone they are in, green for good, yellow for caution and red for bad.

The same is true with CGM data given who will be using this data.

Yes, we know this getting redundant but this is not a battle over who has the best hardware. This is battle over who has the best SYSTEM. As it stands today Dexcom and Medtronic are well ahead in this race with Abbott a distant third. This does not mean they cannot catch up, they can BUT not as part of Abbott. It’s time for Miles to let go of his baby, to let this child become an adult. The Libre in the right hands has potential however given Abbott’s dismal track record in CGM it’s time to cut the umbilical cord.

As Momma Kliff said long ago; “There comes a point when you realize that your kids aren’t kids anymore. They are adults and at some point you have to let them be adults. Let them make their own mistakes, let them take ownership of their actions. They may not live the life you want but its not your life to live. It’s theirs.”