Dexcom has recently acknowledged that the COVID-19 pandemic will likely delay the launch of the G7, their latest continuous glucose monitoring (CGM) sensor.
“We remain confident in our ability to deliver G7, but acknowledge that the timing of the pivotal trial will be delayed due to the pausing of new trials at most clinical sites,” said Kevin Sayer, Dexcom CEO, in the company’s first-quarter earnings call. This statement was derived from SeekingAlpha transcripts.
Due to coronavirus-related setbacks, Sayer predicts that the G7 trial will be delayed for at least six months. This is a significant setback from the originally planned launch in 2021, with a limited launch planned for the end of this year if approved by the FDA.
Dexcom G7 Trial Delayed Due to COVID-19
Although a delay in the G7 trial was expected by most due to COVID-19, Matthew O’Brien, an analyst at Piper Jaffray, notes that six months exceeds these expectations. Part of the reason for this seemingly prolonged setback is that O’Brien thought the trial was set to only last 14-days. Sayer emphasized that this is not the case.
“If we could run a 14-day study and put several hundred people on it for 14 days that would be relatively simple,” he explained. “These trials are not that simplistic. There’s going to be at least four in-clinic days where blood is drawn for 12 hours and we can only handle two to three patients at a time, at a clinic per day. So, these trials are very well orchestrated and scheduled from a logistics perspective. We do not know when clinics who run these trials are going to open back up and allow patients to run these kinds of studies.”
Sayer noted that it will take quite some time before large clinics where these studies are conducted will even resume seeing patients and that letting these patients partake in these trials is a step past that. This, in addition to the challenge presented by receiving FDA approval, makes the marketing of the G7 something that will be difficult to achieve for some time. Sayer added that getting the G7 approved for interoperable continuous glucose monitoring (iCGM) is another hurdle they must overcome. This designation allows the device to be used interoperably with automated insulin dosing systems. Though this is difficult, Dexcom accomplished this previously with their G6 CGM.
“We’re not shooting for just anything. We’re shooting for high iCGM standards and that is a high bar, that is not an arbitrary bar set by the FDA,” Sayer said. “That’s a high bar we’ve met with G6 and we executed a perfect study to get that done. We’ve got to execute perfection again. So, we’ve given ourselves this timeframe to make sure all our plans are locked down, that we can get the centers open, they can go and do this, and we’ll be methodical and thoughtful about it.”
Adapting to the COVID-19 Market
In addressing this setback to Dexcom’s operations, Sayer highlights the capabilities that his company already has.
“While we wait, and sometimes we forget, we have a fantastic product of what we have in G6, and we will continue to refine and make that better,” he said.
CGM sales are also down due to fewer patients being seen in doctors’ offices, limiting the number of new CGM patients that will become established. Telemedicine has helped combat this, however, with digital consultations leading to some new CGM sales.
Dexcom also withdrew its revenue guidance for 2020 due to the pandemic, previously expecting a 17% to 20% revenue increase this year.
“To be clear, this decision does not necessarily imply upside or downside to our prior guidance,” explained Quentin Blackford, Dexcom’s COO and CFO. “Our first quarter performance was above our expectations and, apart from the uncertainty created by COVID-19, we would be in a position to raise our guidance today. Ultimately, we believe the underlying demand for CGM has not changed despite the situation with COVID-19.”
Blackford noted that Dexcom is studying the macroeconomic environment to assess employment levels that will affect the company’s new COVID-19 financial assistance program. The company plans to provide financial aid to current customers who have lost their health insurance due to the pandemic. This program is set to launch in the next coming weeks, providing customers with up to two 90-day shipments of CGMs for $45 each.
Despite the company’s optimism, Blackford indicates that there is less predictability in this current situation.
“Predicting all of these future variables has been difficult, and we found it prudent to temporarily suspend our guidance until visibility improves,” he said.
@dexcom patients will have longer Wait for G7 as #COVID19 disrupts pivotal trial. —->https://t.co/k0kRf7dut6
— MD+DI (@MDDIonline) April 30, 2020
Source: MD+DI