Seen this movie before
Lately it seems not a day goes by without seeing another Dexcom wannabe get funding. The twist this time around is these wannabes are moving beyond the traditional CGM model and into the CGM/diabetes coaching arena. Yep it’s no longer good enough to try and be Dexcom it’s now SOP to be Dexcom plus Livongo. The good news here is that people are beginning to realize that CGM is no longer a tool for patients with diabetes but all patients.
Keep in mind that so far anyway NONE of these wannabes have made it through the FDA. CGM remains the domain of Dexcom and Abbott. Yet as we say far too often this is the wacky world of diabetes where anything no matter how crazy it seems somehow finds investors who fail to perform their due diligence blinded by the toys in the toy chest. These blind mice see the CGM market exploding and figure a rising tide will lift all boats. Never mind that most of these wannabes will sink because they have no clue on how to run a commercially viable CGM company.
We’re also seeing the patient coaching market begin to reposition. The market is subdividing with each platform seeking a niche. Nope it’s no longer good enough to help patients with diabetes. Now these platforms want to prevent diabetes or focus on wait for it … metabolic health. Of course every one of these platforms has something that sounds way cool whiz bang. Something that combines way cool whiz bang with artificial intelligence. Something that at the end of the day is the same shit in different box.
Yet this is what happens when a company like Teladoc is stupid enough to value Livongo at $18.5 BILLION.
To fully appreciate just how off the wall things have become consider this rumor (which is not true and pure BS) that Ascensia is about to buy Abbott’s diabetes unit. Abbott might sell one day but that day is NOT today, and it won’t be to Ascensia if they do sell. Libre is doing great; the market continues to expand, and they have found a somewhat peaceful coexistence with Dexcom. These two companies while paying attention to possible competitors are going about their business, adding new patients and making it tougher and tougher on any wannabe should they make it to market.
And not to get off track but if anyone is going to get bought in this space it will be Dexcom and Apple would be the company making the play. Google/Verily would be a second option but they seem to running around like the Keystone Cops rather than acting like a company with any reasonable diabetes strategy. And no throwing it at the wall and seeing what sticks is NOT a sound strategy at least not in diabetes, toilet paper maybe.
We get that everyone is fascinated with way cool whiz bang, it is fun to dream. In that ivory tower it’s great to pontificate about all the wonderful possibilities. How we are on the cusp of a major advancement in diabetes care. How this time it will be different. Well we hate to break the news to everyone while improvements are happening we have seen this movie before and know how it ends.
As much as these companies think they have the magic potion Ilsa still gets on the plane and Rhett walks out on Scarlet.