New developments are moving fast right now at Dexcom, the California continuous glucose monitor (CGM) company dominating the market, and that's good news for all of us in the diabetes community.
During an earnings call last week, Dexcom leaders reviewed their five new product and mobile health launches in 2014, and predicted another 5 to 10 coming this year - wow! Just this past Monday, the new Dexcom SHARE Receiver with low-energy Bluetooth (allowing data sharing on mobile devices) became available to order. And during the week of Feb. 23, the huge news hit that Dexcom has filed its next-gen G5 sensor with FDA in hopes of seeing that approved soon, maybe even before 2015 comes to a close. Exciting times, no doubt!
We had a chance to connect by phone recently with longtime leader Terry Gregg, who's transitioned to chairman from the CEO role he'd held since 2007, and with his successorKevin Sayer, who served as chief operating officer before taking over as CEO in January.
The two have a long history in the industry, as both began two decades ago at Minimed (before it was Medtronic) and before CGM was a glint in anyone's eye. Over the past decade, Dexcom has risen to become the predominant CGM company, achieving superior sensor accuracy and device convenience.
Here's what Terry and Kevin had to say about the evolution of Dexcom...
DM) Terry, you particularly must be pretty darn proud of all that Dexcom's accomplished since you joined the board in 2005... What has this ride been like for you?
TG) Obviously, it's been a long haul. We've never lost the vision that CGM was, and is, an extremely important tool allowing people to live with more freedom and have fuller lives. We needed the tech to get better, and it has. We are now on our fourth sensor, and as mentioned by Kevin, there will be a 6th.
It's such a different world now for diabetes devices than it was a decade ago...
KS) Yes, we started in '94 when no one even paid for insulin pumps. This whole industry didn't even exist 20 years ago. In some ways, things have changed very rapidly with pumps, CGM, smartphones and apps. In other ways, they haven't -- there are still two only CGM products on the market. Some ships haven't come as fast as we've seen in other markets, or with consumer products. But the (number of) ships we're going to see coming in during the next 5 years will be greater than they have in the past 20, with data analysis and mobile health. This is going to be a boon for people with diabetes.
Really, the G4 delivered on that promise that Terry and I committed to in the very beginning -- that CGM could become a fabric of life, being reliable and safe and accurate. It's truly changed the dynamic, and has lifted everything up.
Give us a quick rundown of the business growth and changes you've seen at Dexcom?
TG) When we started, we had less than 100 people -- I'd say 75 employees when I started as CEO in 2007. Since then, we've grown exponentially and now have 900 to 1,000 employees. Now that I've transitioned to chairman, it's interesting to look at the ecosystem you take care of within our population. We have a large number of employees who have both type 1 and type 2, and then when you expand to all of the suppliers that we utilize in this ecosystem we call Dexcom, it populates dramatically. The real estate (in San Diego) continues to grow, with us adding another 90 square feet to accommodate growth. It's truly rewarding to see all of this, although I'm looking at this now from more of a grandfather-ish perspective than a fatherly perspective.
KS) I've been here since June 2007 on the board, and yes, the employee base doubled in just the past three years. We now have a second building, and a lot of innovative stock gaps as we add infrastructure. It's been fabulous!
Are you as far along as you'd thought you would be by now?
TG) No, but that's not because of the technology. I really thought there'd be more players to drive this technology. As it turns out, there have only been two real players in the U.S. making this commitment to CGM. I would've expected it to go faster, and I didn't think that Dexcom would have to be leading the charge. I thought Abbott (with its now-discontinued Navigator CGM) and Medtronic would do more of the heavy-lifting, and we would just carve out our niche within that. It's taken longer and more money, and it goes to show how hard this all is. There's no other way to describe it. I now have a better understanding of why there aren't more players, even though there are many who want to play and get to commercialization.
That said, where we're headed is going to take less time than I originally thought -- and again, it's not because of the technology. Going on in parallel to all of this CGM development has been the role of the smartphone. No one could have predicted that seven years ago, and it's all converging together and will drive CGM adoption to an even higher level. So it's the connectivity that will drive all of this... and (development) will become faster than we thought.
Getting to a real mobile health solution was a long road, but we're finally seeing it now with Dexcom's new SHARE. Can you shed some light on the regulatory path you've helped forge?
KS) The first data meeting I had with FDA was in 2011. So yes, this has been in the works for a long time. The FDA has most recently made data more accessible, and that's big. We're working on a retrospective data platform with SweetSpot (acquired in 2012), and what the FDA's done makes it much easier for us.
The definition of 'retrospective data' is a big question right now, and we are working with the FDA to differentiate between this (past) data and live (real-time) data. It's new territory for the FDA, too.
Dexcom has really pioneered the rules for CGM data, and we have truly led this mobile revolution. We're the first company to get products and apps approved that use mobile platforms for secondary CGM display, and with our G5 platform, we're going to be the first (FDA-approved app) where live CGM data goes straight to your phone. The app on the phone basically becomes a primary medical device, and there's a lot of innovation and collaboration that's happened on this.
KS) Anything outside of the FDA's jurisdiction is always a little concerning for us. We just can't endorse something like that. But now, the FDA has created a regulatory pathway for secondary display of CGM data. If we could find an outside group that is addressing a need that we can't, and does it better, and has systems in place to comply with the FDAregulations, we would consider a licensing opportunity. We've done that in the past. Look at our track record with the FDA and in working with others -- there's no one who has been more cooperative in their efforts than us. I will agree that the Nightscout/open source community has increased awareness about data-sharing, and we appreciate that.
What about future data encryption or limitations on access for Nightscout users?
With our mobile platforms, you will not lose what you have in Nightscout. But we will implement security measures around CGM data as the FDA directs us. In today’s environment, with major data attacks at banks, insurance companies... the FDA is very concerned that our data remain secure. We will be compliant. In short, we haven't decided where these groups fit in or how it all works out together, but we are evaluating possibilities.
Many have wondered why Dexcom has Apple apps but not Android. Was that a strategic decision on your part?
You're absolutely right that it was strategic to pick a platform direction, get that developed and approved before moving on to something else. We have already launched apps for iPhone, like what we have now with the SHARE Receiver. With the FDA's January down-classification of secondary display of CGM data... we will be able to move much quicker. Once our app development is complete, including the appropriate FDA-required internal documentation and testing, we can now simply turn them on instead of having to go through a longer regulatory process like we did before. We expect to have Android secondary display apps by the end of the year.
It seems that by the end of 2015, users will likely have two different G4-integrated insulin pumps to choose from, the already-approved Animas Vibe and also the new Tandem t:slim G4. How big is that to you?
KS) We're optimistic there. We aren't looking at (Tandem) to drive the company, but it will be great. My first year on the board was in 2007, and that was when we signed the Animas deal... we thought that was the biggest thing then. The range of choices people have with their devices will keep opening up broader markets.
Let's talk about your pipeline. It's exciting to see your G6 plans, with improved accuracy. Can you tell us more?
KS) As far as accuracy measures, we've already acheieved a 9% MARD score with the G4 505, and that will be in the G5, so you're really getting into hair-splitting when talking about accuracy going forward. What that next-gen will address is blocking interferents, reducing calibrations, and possibly extended wear. There are a number of things to weigh as we move forward. We recently presented at the ATTD (Advanced Technologies and Treatments of Diabetes) conference in Paris, and showed an 11% MARD for early 10-day G6 studies with a single calibration at the beginning of the sensor session... and that's not quite good enough compared to what we have now.
We will be looking at accuracy, consistency, reliability, and convenience with the G6, and will run a number of studies to come to some decisions. Obviously, it will be a connected and mobile platform. But there are some questions we're still researching, and you have to balance all of that.
And you're going to have a new, better inserter (as seen in a conference slide captured by diaTribe)?
KS) It's very elegant. You can insert with one hand, peel tape of the bottom of the sensor, and push the button. It will be wonderful and much, much easier. We're starting to develop the pilot manufacturing for the insertion system, but have not announced a timeline for the inserter launch.
Changing the insertion system is the most disruptive thing we can do in our manufacturing process. It could be a fully automated assembly process, though not at first. We could drop the insertion system in either the G5 or G6, it's just a question of timing. I liken it to our past three launches -- the slimmer transmitter we didn't announce, just launched it; we decided to bring in the 505 software (improved algorithm) without a timeline attached; and the SHARE Receiver that we just wanted to get out there as quickly as possible. These are things that can come in the middle of bigger launches.
Anything to say about the future pipeline, and your mysterious "Sleeping Beauty" implantable sensor?
TG) It's still inactive, but we do keep our intellectual property filings up to date. As we increase accuracy and technology, we continue talking about whether it's needed. We are hoping for a 14-day sensor, and if that's a scenario we can get to, we'd like to see it. We have seen that on some custom-sensors, but developing millions of them is a different question. We are hard-pressed to look at a surgical procedure for CGM, when it can already be done so easily with phone connectivity. I think the external ways we're going at it now are good enough. We monitor the space, but there's no active plan for this.
We know neither of you have diabetes, but how many sensors have you personally worn over the years?
TG) We're experimenters, definitely. I'd probably say hundreds of them.
KS) I wear sensors all the time. As my wife would say, though, I'm a bit of a sensor snob and always have to have something more experimental, and not the current gen. I love finding something wrong and going down to talk to the engineers about it. Of course that is getting more difficult to do. I wear them frequently, and I've learned a lot about what I eat and shouldn't eat.
Where is Dexcom on Artificial Pancreas development?
KS) On the earnings call, I talked about our meeting with various groups and how we need to play in this area. Our sensor is so accurate and reliable, and we want a pump partner to step up and go faster in terms of AP. We're trying to give everyone a kick in the pants to do this. We know patients want pumps to control insulin delivery and have everything connected. So let's get going here. We're in, and offering to help.
Dexcom has one of the best track records in working with FDA compared to anyone else in the diabetes space. What would you say about the agency and how patients often blame regulators for delaying products?
TG) People view any regulatory oversight as having too much control -- whether it's FDA, FCC, or you name the agency. You really have to go to the origins of the FDA to understand their role, and how there were adulterated products hurting people out there. With any bureaucracy, the immediate reaction is "it's their fault." I find that troubling because we've always tried to work effectively with them, and I don't view the FDA as anything other than serving the best interests of people in the U.S. Yes, it takes time.
I blame Ted Turner and the creation of 24-hour news for everything, as that changed the world and our expectations. When I hear background noise of people complaining about the FDA, I don't tend to spend much time on them. And I'm not a huge government supporter in general; I'm a stage-right guy, a leave-me-alone guy. But when we get calls from the FDA on something at 9 or 10pm their time, I can't think of better dedication. I'm a fan of waving the FDA banner.
KS) Let me just add: Who does the FDA have to compare us to, in guiding us? No one. In many of these things, no one has been here before. And so sometimes, we all have to be a little patient.
You've talked about Medicare coverage of CGM and pursuing a dosing claim with the FDA, so CGM would be able to replace fingersticks. How will that move forward?
KS) It's a huge issue. Every endo we talk to asks us: When will you get Medicare coverage? We are pursuing a legislative path with others (such as Medtronic, AACE, and JDRF) and will continue on that path. But we're spending a lot of time discussing the dosing claim, as Medicare has told us they won't cover CGM as a supplementary device. You have so much more information to dose with a CGM, and we wonder why this is even such a discussion. But it's important to getting that dosing designation and we're talking with the FDA about the structure for clinical trials. The legislation was introduced last year but died in Congress, and we expect it to be reintroduced soon.
It seems that Dexcom is focusing on raising awareness of the need CGM these days, like with the Dexcom Warriors program that highlights CGM power-users?
KS) We are focusing more on awareness. It took a lot of money and time to focus our dollars on product, and get it right. We've poured our money into research and products, but now it's time to turn our resources to start creating more awareness and access.
We're talking about some national consumer campaigns and even evaluating television options. The Apple Watch announcement created a whole bunch of awareness for us, and it's blown up our phone lines and the watch isn't even out yet. I think connectivity and mobility will create even more awareness, driven by these next-gen apps and products. Everything is pointing in the same direction and converging at the same time.
Anything else you'd like to tell the Diabetes Community?
TG) Dexcom was created with a patient-centricity, and it's a privilege to be a part of this Dexcom family and the diabetes community. That's never going away, regardless of our success. We'll always strive to do better.
KS) The pipeline we have coming is one that no one's ever seen. It will change the field, as data is shared and tech gets better and better. There are things coming that we never thought of doing before.
Thank you both for taking the time to share these exciting business developments, along with your personal insights! We just can't wait to see what comes next.