Goodbye iBGStar and we hardly knew ya
Yesterday with the great fanfare Apple introduced their latest version of the popular and way cool iPhone. While technology pundits picked apart the many new features of the iPhone 5, one new feature could spell the end of the line for the iBGStar, the new glucose monitor from Sanofi (NYSE:SNY). Just in case anyone missed the introduction of the iBGStar, and it’s quite possible to have missed it, the biggest selling point for this new device was that it attached to the way cool iPhone and results would be seamlessly transmitted to the iBGStar app. Well that was its biggest selling point until Apple decided to change the connector for the iPhone 5, instead of keeping the 30 pin connector the new iPhone uses a smaller connector which in essence means the iBGStar will no longer attach to the device it was designed to work with.
Now Sanofi isn’t the only company lamenting this change but it is probably the only company whose entire device strategy has now been flushed down the toilet because of this change. While makers of other iPhone accessories can easily adapt to this change, the iBGStar is an FDA approved device and it seems likely that the company would have to go through another FDA review should they decide to change the connector on the iBGStar. That is assuming Sanofi wants to throw even more money at this product which now carries another risk; what happens if Apple decides to change the connector on the next version of the iPhone.
Think of anyone who went out and bought the iBGStar who must now decide whether to keep using the device, which would likely mean dishing out a few more bucks to buy an adaptor which would allow the iBGStar to connect to the newest iPhone. Besides the additional expense, think of what it means from a practical standpoint as the adaptor is not just one more thing to carry around but would make the size of the entire system, phone, adaptor and iBGStar, bigger than the Titanic. Overnight the IBGStar went from a slick, easy to use device to one big pain in the rear.
The question now becomes will this change by Apple force the company to buy Bayer’s diabetes device unit. As Diabetic Investor has been reporting Sanofi is the leading candidate to buy this unit but in typical Sanofi fashion has been dragging their feet on getting the deal done. Rumors recently surface that due to Sanofi moving at glacial speed, Bayer had found another buyer and Sanofi would once again lose out as they did when they could have bought Amylin. Now that Apple has basically killed the future prospects for the iBGStar will Sanofi now go back to Bayer and finish what should have been finished months ago.
As Diabetic Investor has been reporting Sanofi has embarked on an aggressive diabetes strategy to help offset the coming patent cliff for their blockbuster drug, Lantus. Rather than sell the individual pieces used by a patient, the company was moving towards a system based approach where physicians would prescribe a Sanofi diabetes management system. This system would not just contain the drugs and devices a patient uses but would include health coaching services, which in theory would help the patient better manage their diabetes and ultimately produce better patient outcomes. All along Diabetic Investor has felt this strategy fit nicely into the future of diabetes management provided the company could execute.
Yet it seems the only thing the company has been able to execute well at is selling Lantus. Their once-daily GLP-1 is a Victoza copycat, Apidra their short acting insulin is going nowhere in a hurry and now the iBGStar their first foray into glucose monitoring is basically dead before it had a chance to live. The question is will they compound their mistakes and go through with the Bayer deal or will they regroup? Given this is the wacky world of diabetes, Diabetic Investor is betting on the former not the later. As has been said many times before the best way to accumulate a small fortune is to start with a big one. RIBIT!!!!!
