Nice theory

This morning Ypsomed and the JDRF announced a new partnership, per a press release;

“Burgdorf/New York – JDRF, the leading global organization funding type 1 diabetes (T1D) research, has announced a partnership with Ypsomed, a Switzerland-based developer and manufacturer of injection and infusion systems, as part of JDRF’s Open-Protocol Automated Insulin Delivery (AID) Systems Initiative. The objective of the project is the development and regulatory approval of the next-generation mylife™YpsoPump® insulin pump supporting incorporation into an automated insulin delivery (AID) system via open-protocol communication with third-party smartphone-based apps and/or other devices.”

While we have nothing against this effort it should be noted that this move towards open-protocol is not without its limitations. In theory it makes sense to allow a patient to mix and match which toys they play with. The theory of open-protocol is that a patient could chose any CGM sensor which would work seamlessly with any insulin pump and by extension any insulin dosing algorithm. A nice theory until one considers how things work in the real world.

Let’s say a Dexcom sensor worked with a Medtronic insulin pump. Which company takes ownership of customer service? Let’s also assume the patient wants the TypeZero insulin dosing algorithm, how does it get onto the Medtronic pump? Or what if the patient wants the OmniPod, the Libre and a different insulin dosing algorithm that’s not already preinstalled?

Now we know the JDRF does not think of such things but does having everything run through a patient’s smartphone really make things easier. We can see open-protocol benefiting a patient using a Tyler – a “smart” insulin pen – CGM – app system – but with an insulin pump we’re not so sure. Anyone who has seen the data from Tandem for their hybrid closed loop system which uses the Dexcom G6 sensor and TypeZero algorithm would say there is no need for any data to go through the patient’s smartphone.

When this data was released at ATTD many speculated one reason this system performed so well was due to fewer links in the chain. Yes, other systems did ok but noted connectivity issues impacted results when a smartphone was added into the mix. Simply put the fewer chances for connectivity issues the better.

Another issue ignored by the JDRF but of critical importance is intellectual property. A company like Ypsomed with no market presence does not care about this but you can take it to the court room that companies who have spent millions developing systems do. Does Dexcom really want to share IP with a company like Medtronic who is competing against them in the stand-alone CGM market? We don’t think Tandem wants to give away what will be a major advantage when their hybrid closed loop system comes out. Nor do we think Dexcom acquired TypeZero, so they could give away the insulin dosing algorithm for free.

Frankly we see this effort as a direct assault on Medtronic who the JDRF seems to believe has stifled innovation in the insulin pump market, something that hasn’t happened. The truth is the JDRF has never understood that like it or not diabetes is a business, a big and growing business. They like the West Coast Mafia complained loudly when Medtronic signed their deal with UnitedHealthCare. They also had another kumbaya moment when JNJ decided to shut down Animas who sent their patients to Medtronic.

Yep the JDRF and West Coast Mafia are joined at the hip, viewing any successful business as the evil empire. The problem is they are both clueless and worse still have been dead wrong. If this wasn’t sad it would be damn funny. As nothing they predicted has come close to happening. Innovation hasn’t been stifled at all – Bigfoot, Lilly, Roche, OnDuo, CellNovo – are just some of the companies who are developing new insulin pumps or have reentered the insulin pump market.

Nor has patient access been hurt either. As the results from Tandem and Insulet show Medtronic may have the inside route to Animas patients but this has not prevented Animas patients from choosing a Tandem or Insulet system as the replacement pump.

Let’s be clear here we have nothing against Ypsomed for doing this as with no market presence they have everything to gain and nothing to lose. However, we cannot say the same about the JDRF. This organization claims to be impartial, but the truth is that is one big fat lie. They may be clueless when it comes to how the business of diabetes operates in the real world and how this competition is good and not bad for the patient. Yet one thing they do understand is something Momma Kliff said often; “Money buys lots of things.”

Let’s be even clearer here as we are not claiming or insinuating that Ypsomed did anything nefarious here. However, we aren’t so sure about the JDRF. Living in Chicago we are no strangers to influence peddling or bribe taking. Frankly the JDRF should be above any suspicion and held to the highest standards. In the past they have taken undeserved credit, i.e. when Medicare decided to cover CGM. They are hypocritical as well at one time praising Medtronic when the 670G was approved and then talking out of the other side of their mouth bashing Medtronic over the UnitedHealthCare deal.

As we have stated on numerous occasions Medtronic is viewed as the evil empire. This reputation is somewhat deserved. However, Medtronic is also a publicly traded company which has a fiduciary responsibility to its stakeholders. This does not excuse bad behavior but on balance the company has done more good than harm in the insulin pump space. Although their competitors would never admit it publicly they are better off with the competition. Competition drives innovation it does not stifle it.

Will this stop the JDRF or the West Coast Mafia from believing that for-profit companies are evil, nope. Will it stop them from believing that somehow patients would be better off without the competition between companies, nope. Will it stop them from being hypocrites, unfortunately no. Will it stop them from being dead wrong on a wide variety of subjects, not at all.

We’ve said it before and we’ll say it again diabetes is a business. The companies that operate in this business have a responsibility to their stakeholders to make money. This is America where capitalism is alive and well, thank goodness. Bottom line here is if these people want a friend get a frickin dog. It’s time the JDRF and West Coast Mafia wake up and get with the program.