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Dexcom CEO Kevin Sayer, appearing on CNBC

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There's no doubt that continuous glucose monitors have become today's de facto standard of care for people with type 1 diabetes, who need to continuously make insulin dosing decisions. Advocates are also working hard to gain insurance coverage of CGM for people with type 2 diabetes. Smaller, cheaper, streamlined CGM devices coming soon will open up the floodgates to thousands of people with prediabetes and, eventually, health-conscious consumers.

At the recent JP Morgan Healthcare conference in San Francisco, we talked with Dexcom CEO Kevin Sayer about how the San Diego-based CGM market leader is approaching these advances and planning to handle "the next big wave of CGM."

Sayer says their first order of business is to focus on building the economic case for widespread CGM use: "What is the annual spend for type 2s for meters and test strips? How does CGM fit in?" he asks rhetorically.

He points to data from a recent pilot study by Intermountain Healthcare in which 50 people with T2 diabetes used traditional fingerstick meters and another 50 used CGM over the course of a year. The annual cost savings with CGM clocked in at $5,000 a year per patient, based on hospitalizations, lab tests, drug costs, doctor visits, and follow up calls — a huge cost reduction across the board!

Making CGM a true standard of care would mean that every person newly diagnosed with any sort of diabetes would be mandated by both their doctor and insurance company to use CGM.

Sayer notes that the latest emphasis on Time-in-Range (TIR) means that CGM becomes a diagnostic tool, that can help many specific groups stay healthy.

"Will (Dexcom) go after the hospital market?… We don't currently know the outcomes in hospital settings. We would need a baseline first to gauge improvement," Sayer says.

"And the pregnancy market? That totally makes sense, and it's happening — pregnant women with T1D are being put on CGM routinely — but there's no official FDA labeling for that yet."

"We're focused now on the consumer market," he says.

"Our core customer base is intensive insulin users. We need to create an interface/platform that supports others," Sayer says.

Dexcom is of course working with Verily to codevelop its next-generation G7 sensor, a miniaturized, low-cost CGM that will be ideal for a broader market — from type 2s, to prediabetes and beyond. Pivotal clinical trials are set to start on that soon.

The Sanofi-backed Onduo entity will add a coaching platform for users, as will Dexcom's latest partner, Livongo.

In developing the CGM device itself, Sayer says: "Over time, there will be different experiences for different needs." For example:

  • An improved receiver-based platform as opposed to the phone app — "because some just want the receiver as a medical device"
  • An option for hyperglycemia (high blood sugar) alerts only — "because hypo (low) alerts are not meaningful for some users"
  • Maybe a target range of 70-150 mg/dL only, for those whom it would suit better

Importantly, Dexcom is shooting for extended wear in their next-generation CGM sensors — ideally 14 days or longer. That will be at least a 4-day improvement over the current G6 sensors that are FDA-approved for 10-day wear.

We had to ask about how the skin adhesive might hold up to longer wear, considering that many users struggle with that already. Many use "overpatch" products sold by third parties just to get a full week of wear (a huge array is now available for purchase online.)

"We're spending lot of money doing tape research right now. G7 will have stickier tape made of different materials. And we're considering adding overpatches right in the product packaging," Sayer says.

This is critical because with a smaller platform, the tape does move around more, he notes. "If the sensor were big and wide, the tape would stay put. That's a challenge we're dealing with."

Meanwhile, in an increasingly interconnected world in which CGM acts as the linchpin to new automated insulin delivery (AID) systems, assuring interoperability is key.

In 2018, Dexcom's G6 sensor was the first to receive FDA's new "iCGM" label, which indicates that the product is interoperability-ready. The company will need to reapply for the iCGM designation with any future product generations.

Achieving this requires high reliability standards and lots of data on patient experience, which can slow down the approval process, and can also require some difficult trade-offs.

Sayer notes that before iCGM, accuracy measured against traditional fingerstick meters could be off by up to 30 percent. But the new, tighter performance standards must be 99.1 percent on point — allowing for error in just 10 out of every 1,000 data points.

"That's why the G6 sensor shuts off frequently — it does so by design ­when that standard is not met, meaning the readings are not accurate enough per FDA requirements," Sayer says.

Clearly, frequent shut-offs are not something they want to carry over into their new G7 product.

If thousands of new CGM users do come on board as hoped, how will Dexcom handle the incredible load on customer service, we wondered? Not to mention the increased workload on their data servers, which famously crashed twice in the last year.

"In 2019, Dexcom created a full Customer Service Department — instead of just our original 'Customer Care' unit — that's led by VP of Global Marketing Chad Patterson," Sayer says.

"We now have a war room where we hash out every single step a patient has to take to get on a Dexcom and use it… We think about: How can we make this simpler? What steps can we eliminate?"

"We've explored every single thing imaginable to try to make this easy for people."

In response to the outages, Dexcom plans to introduce a Server Status website/app where users can check the status, and get push warnings of any data sharing issues. Ideally, they'd also like to create a "Sensor Status Detector" that could be built right into the sensor hardware, that could alert users immediately to any troubles with their device. Although falling off would not be detected, Sayer notes.

They were looking at doing away with the code that users have to enter when inserting a new sensor. But they found that with that omission, the system would lose one half-point of accuracy, which is not OK for iCGM requirements.

Another way they're looking a simplifying the user experience is by reducing the warmup time. While the Dexcom G6 currently has a 2-hour warmup, they're aiming for just 1 hour with the G7. "Or could we even get it down to 30 minutes? We're looking at potential impact of that," Sayer says.

They're also aware that PWDs (people with diabetes) considering using connected AID systems may be concerned about customer service going forward. If the system consists of a CGM, an insulin pump, and a controlling algorithm, which manufacturer will take responsibility for troubleshooting? Might customers get caught bouncing between call centers?

Sayer says they've worked that out well in their early integrations with the OmiPod and Tandem insulin pumps by clearly defining roles. "OmniPod owns the system running on their hardware, so they only call us if they can't resolve an issue… And we've trained the Tandem people to handle most issues in calls," he says.

One of Dexcom's big goals to simplify the CGM market going forward would be a different payment model. In an ideal world, that would be a subscription model in which customers pay flat fees to have a certain amount of supplies sent to them per month, depending on their needs.

"We've observed that 80 percent of people don't call for more than 6 extra (replacement) sensors per year, so a certain amount of extras could be included up front," he says.

While the idea is appealing to industry and patients, there are some major roadblocks. For one thing, U.S. pharmacies and drugstores are currently not set up to handle a pay-as-you-go model. Customers have to pay for each transaction (medication or supply) separately. There's also the concern that some users would over-order their CGM supplies and then turn around and sell them on eBay or elsewhere. That would be difficult to police.

In citing the advantages of a subscription model, Sayer laments the "crazy setup" of our American healthcare system. It's the only industry that has to somehow:

  • Market to doctors
  • Ship to customers
  • Charge insurance companies

Their incentives are not aligned, which makes for a lot of contention and inefficiency.

Finally, we asked Sayer for his thoughts on the many competing CGM products on the horizon, including several dozen companies developing non-invasive glucose monitoring.

Dexcom is currently not exploring non-invasive technology, he tells us. Overall, Dexcom's philosophy is "the more the merrier" to build out this market.

His final, ultra-practical note is that to succeed, any new CGM will have to:

  • Be more convenient
  • Cost less
  • Perform well, in relation to existing systems