Insulet Losses a key player

Insulet Losses a key player

Diabetic Investor has learned that Dr. Howard Zisser has left Insulet (NASDAQ: PODD) for greener pastures at Google. Although there has been no official announcement from the company several sources have confirmed this move. Back in October of 2103 Dr. Zisser was appointed as Insulet’s first medical director.

Now we’re not sure what impact this move will have at Insulet but we do see this as a plus for Google. It’s well known that Insulet has been attempting to transform themselves from an insulin delivery company to a drug delivery company. It’s also known that CEO Pat Sullivan has revamped management basically replacing anyone who was associated with the previous CEO. It’s also no secret the company has been struggling to with its core insulin delivery unit, the basic issue being it just can’t make a consistent profit.

Although we have no idea why Dr. Zisser left Insulet our gut tells us there is more to this than just Google having a promising future in diabetes. Given that Insulet wants out of the insulin delivery space Dr. Zisser more than likely saw the handwriting on the wall and wanted to be associated with a winner.

This move also shows Google continued dive into this wacky world, remember besides the much hyped contact lenses that measure glucose, the company is partnered with Dexcom (NASDAQ: DXCM) and unfortunately Sanofi (NYSE: SNY).  We suspect Google will make even more moves and dive even deeper into the wacky world. News that should send a chill up and down the spine of every diabetes device company.

For years we have noted that when it comes to diabetes devices this is no longer a story about who has the “best” hardware. The story moving forward will be about who has the best diabetes management system. A system that will combine cloud enabled hardware with advanced analytical software that will transform all this data going to the cloud into patient relevant patient actionable information. And who’s better than Google to do this.

Given their other investments we further suspect Google could well be the first company to sell health insurance where premiums are based on patient data. Yes, the day is coming when patients with diabetes will share data with their health insurance provider in exchange for lower premiums. Just as drivers are now sharing data with their auto insurance provider. This my friends is the future and it’s getting closer each day.

This move also is just further confirmation that when it comes to the future of diabetes devices, the old guard is on the way out. Listen Google isn’t the only high tech deep pocketed company moving aggressively into this space. Apple, Qualcomm, Samsung and others are also diving into the deep end of the pool. Plus, there are plethora of smaller nimbler companies which are slowly gaining traction in the space.  This is likely why as we noted this morning Livongo has been able to raise even more money.

The simple fact is the old guard is playing catch up and finding their size to be a minus not a plus. It also doesn’t help any that they are trapped in the old diabetes vortex as the market transitions to the new vortex. These companies cannot simply abandon their legacy franchises, blow it up and start over no matter how necessary that may be. As we noted yesterday about Roche, there just aren’t too many optimistic options. Diabetic Investor is aware of some who are trying to break from the past but just can’t let go. The truth is they just are not built to move quickly and tend to be unwilling to think out of the box.

The old guard talks a good game but when it comes time to actually move and break from the past, what do they do? Yep, let’s throw another shrimp on the Barbie and have yet another meeting which of course will lead to even more meetings. In the meantime, while these companies worry about what color the toilet paper should be in the executive washroom, companies like Google are taking action. Action which will hasten the demise of the old guard and push them further into obscurity.

Yesterday we noted that at one time almost everyone had a VCR yet today no one does. Now we’re pretty sure during the VCR heyday no one could imagine a world without a VCR. VCR makers were fat and happy as it seemed money was falling from the sky and the good times would last forever. The smart ones enjoyed the good times but knew that the good times wouldn’t last forever. They looked towards the future, planned for it and most importantly took action. They didn’t sit around waiting for this to happen, they made it happen.

This exact same scenario is playing out in the diabetes device world right this very moment. Should the old guard continue to become experts at meetings and not change agents the party is going to be over and they are going to have one hell of a hangover.