Refreshingly Predictable

Given the unpredictable world COVID has created it’s nice to see that some predictability has returned. Per the earnings release from Tandem;

“We are reinstating the sales guidance we set at the beginning of 2020 based on the continued strong worldwide demand for our t:slim X2 insulin pump,” said Leigh Vosseller, executive vice president and chief financial officer. “While being mindful of the unpredictable nature of the current pandemic, our confidence in the remainder of this year is supported by the positive feedback from users of our Control-IQ technology and its scaling international launch, as well as UnitedHealthcare’s recent decision to include Tandem as a network provider.”

Tandem has joined Dexcom and others who after suspending guidance due to COVID have reinstated guidance. None of these companies will ever know the true impact of COVID just as they really have no clue what the post-COVID world will look like when it eventually comes. Simply put they like everyone else are adjusting to the continuing COVID crisis doing the best they can under very difficult circumstances.

The good news for Tandem continues to be the increasing adoption of Control IQ. Pump shipments continue to accelerate and likely will only further accelerate with the recent decision by UnitedHealthcare to include Tandem as a network provider. Even better and largely unnoticed is the increased usage of virtual pump onboarding. While forced upon Tandem due to COVID this virtualization of the onboarding experience will also help accelerate pump adoption while at the same doing so more cost effectively than conventional pre-COVID face to face onboarding.

Just as everyone else is facing delays in their pipeline due to COVID Tandem is no different. However as we noted with Dexcom this delay with Tandem’s new system could be a blessing in disguise. The new Sport pump has the potential to expand pump adoption even further and could well come to market in the same time frame as Medtronic’s new system which will still be handicapped due to its reliance on the Medtronic CGM.

Tandem could get a real boost should Abbott solve their AID issue with Libre2. Yes the two companies have finalized their agreement yet as long as the AID issue remains the true value of this partnership is muted. Once solved the real benefit will be seen internationally a market where Abbott is strongly outpacing Dexcom.

All in all Tandem has responded well to the COVID crisis and seems well positioned to move forward. We know this is getting just a little redundant, but it bears repeating that the continuing COVID crisis has proved to be both a blessing and a curse. It’s difficult to say with any confidence that the worst is over however we can state companies are now better equipped to handle anything that’s thrown their way.

Looking at Tandem specifically we can say this with 100% confidence as they are clearly the market leader in terms of technology and long-term outlook. Their main competition is no longer Medtronic but Insulet which speaks volumes to how far Medtronic has fallen and the great job Insulet continues to do. Even better Tandem and Insulet can more peacefully exist together given their respective customer bases and distribution models.