JP Morgan Tuesday Morning

JP Morgan Tuesday Morning

The biggest news coming out of this morning’s sessions here at JP Morgan is further confirmation of something Diabetic Investor reported previously, Sanofi-Aventis (NYSE:SNY) is moving deeper into the diabetes device business and this move is likely to go beyond insulin delivery systems. During the company’s presentation they noted that Lantus would be the cornerstone of one of the company’s core growth strategies. They went onto to state that this strategy will include device development and during the breakout sessions added this could include moving into glucose monitoring.

Previously Diabetic Investor speculated when the company announced their acquisition of Chattem that this move was the initial step towards moving into BGM. We further speculated that Sanofi could well be the first company to market a complete diabetes management system that would include insulin, an insulin delivery system and a glucose monitoring system. Finally we speculated the easiest path to entering BGM was via acquisition.

Based on their comments today and acquisition remains a possibility however the company also is keeping their options open. In a statement that will warm the hearts of the folks at privately held AgaMatrix the company mentioned glucose monitors that attached to an iPhone and then used an app to help patients manage their diabetes. While they didn’t mention AgaMatrix by name, they are one of the few, we believe, only company that has an existing iPhone app. Frankly adding a monitor that attaches to an iPhone or having a monitor that seamlessly communicates with an iPhone, say via Bluetooth technology (which AgaMatrix happens to have) is really no big deal.

We thought it was very interesting that company went as far to say they have even looking into glucose sensing technology, even systems that were implanted under the skin. This should be very good news for another company that presented this morning Dexcom (NASDAQ:DXCM), but more on them in a moment.

The real intriguing possibility here is developing an insulin pen that communicates with a monitor. As everyone knows insulin pens are becoming the insulin delivery system of choice and that it’s not a stretch to add a bolus calculator to a monitor. What’s truly intriguing here is who owns the IP for this type of technology. While Diabetic Investor did not attend the Becton Dickinson (NYSE:BDX) presentation yesterday we have seen several of the patents the company has regarding this type of technology. Things are getting very interesting indeed.

Turning our attention back to Dexcom, the company continues to execute and is on track to be the leader in continuous glucose monitoring technology. Dexcom CEO Terry Gregg outlined a strong case as to why Dexcom is not just well positioned today but equally prepared for the future. Given the troubles at Medtronic (NYSE:MDT) and the failure of the FreeStyle Navigator from Abbott (NYSE:ABT), Dexcom has an opportunity to own this space.

Finally this morning Diabetic Investor sat in to see if Bristol Myers Squibb (NYSE:BMY) had anything interesting to say about their new diabetes Onglyza. Yesterday during the Amylin (NASDAQ:AMLN) breakout session someone asked what impact drugs like Onglyza might have when Byetta LAR comes to market. The person asking the question correctly noted that Onglyza hasn’t exactly set the world on fire since coming to market. The reality is Onglyza is a me too drug and really no different than category leader Januvia from Merck (NYSE:MRK). It also well known throughout the diabetes community that there really is nothing special about any DPP-4 as none of these drugs are particularly effective at lowering glucose when used as a monotherapy. Perhaps for these reason the folks at Bristol barely touched on what’s going on with Onglyza.

Sticking with Type 2 drugs for a moment according to an Associated Press report Amylin has received a letter from the FDA over statements the company made during a conference last year in Washington D.C. According to the letter, several statements promoted the drug for unapproved uses and “overstate the efficacy of Byetta.” While not good news for Amylin, Diabetic Investor is not overly concerned with the letter given the hyper-regulatory environment at the FDA.

The real fireworks will come in the afternoon session when MannKind (NASDAQ:MNKD) presents at 1:30pm PST. Thankfully the markets will be closed by this time as conflicting reports are being thrown around as to exactly why the FDA delayed the approval for Afresa®. As sure as night follows day, Diabetic Investor can practically guarantee this issue will be addressed during the breakout session.

Also presenting this afternoon is Lilly (NYSE:LLY) who also received a letter from the FDA regarding a print advertisement used for Cymbalta. (Strange how Lilly and Amylin are getting closer and closer even when it comes to FDA letters. But that’s a story for another day.) Needless to say Diabetic Investor is on top of it all and will report again this evening.