Trap doors, secret passageways, moats

While we can’t speak for all Game of Throne fans one of the cooler things about the kingdoms and their respective castles are all the trap doors, secret passageways and of course fire breathing dragons controlled by a beautiful yet slightly off kilter queen. Kings and queens use these pathways and weapons to their advantage when fighting for control of the iron throne. The same can be said for what is becoming one of the most competitive markets in diabetes, insulin pumps.

Yesterday was a perfect example of just how fierce this battle has become with Medtronic, Tandem and Insulet all releasing data and updates. Now before we get into our analysis of what was and wasn’t said it’s important to note that at conferences such as this lots of attention is paid to the data but little paid to the practical real world aspects of the insulin pump business. This is understandable for two reasons as the audience consists of data geeks and analysts who are impressed by way cool whiz bang.

A perfect example of this comes with TIR data, as we expected TIR is the new metric in diabetes. A metric which means everything to the toy companies but a metric only a minority of patients even understand or care about. More important a metric which means absolutely nothing to payors, more on that in a moment.

Looking at the data presented yesterday everyone is making a big deal about who’s better at TIR and HbA1C and even if you assume the data is accurate, more on that in a moment, the differences between results are not that dramatic. One reason we aren’t all that impressed with the Medtronic data is it’s basically self reported. Check out this footnote from a Medtronic side

“1. US MiniMed 670G system users from CareLinkTM Personal data is from March 17, 2017 to May 9, 2019 and CareLinkTM System data is from March 17, 2017 to March 1, 2019. U 20 ADA 2019 | San Francisco, CA”

Now we aren’t saying Medtronic cherry picked the time range to make themselves look good or that this data tells us nothing about how many sensors failed or that this being Medtronic owned data that is was not manipulated but given their history nothing would surprise us. As Momma Kliff said and she has been quoted often liars figure and figures can lie. And not to digress or get off point here but when will people realize that sensor accuracy and reliability should be tracked as well as this is the straw that stirs that closed loop drink.

What really matters is here is not which toy has the best data but which toy company has patient access. Here is where Medtronic does have a huge edge over Tandem as Medtronic owns the most important piece of real estate, formulary position. Payors care about one thing and one thing only and it is NOT TIR. Medtronic owns the formulary and is forcing Tandem to play on their turf. Insulet in a stroke of genius isn’t playing the formulary game moving from a DME benefit to a pharmacy benefit. Therefore either Tandem follows Insulet’s lead or out maneuvers Medtronic at the payor level.

We saw nothing from any of the pump companies yesterday that changes our outlook for the space. Medtronic can talk all they want about the future but these morons still haven’t gotten the memo that calibrating a CGM sensor is a non-starter. Nor have they demonstrated they can actually follow through on any plan. Keep in mind Bevis an Butthead once had initatives in Type 2, a patch pump, a Tyler all of which are gone. All they have proven to be very good at is killing the goose that lays the golden eggs. Oh and we forget to mention they missed a two-foot putt when Animas handed them almost 100,000 new patients. Believing that Medtronic will actually execute on anything these idiots say is like believing it snows in Hawaii.

As it stands today Medtronic thanks to their payor relationships does have an advantage and it is up to Tandem to change this. Insulet has chosen a different path and plays in a different arena. This is not about who has the best toy in the toy chest, this is not about TIR or even the integrity of the data this is all about the business of insulin pumps. This is all about patient access putting that toy into the hands of as many patients as possible. This is about the ability to run a commercially successful insulin pump company.

There is no question the current heavyweight champion is on the ropes and vulnerable. But it’s up to Tandem to deliver the knockout blow as they aren’t going to win this fight on a judges decision. To become the champion the challenger must defeat the champ with no room for dispute. Just as the Raptors look in a good position to dethrone the Warriors its not over yet. They must deliver the knockout blow and not give the reining champions a chance to recover.