The Music Plays On – Diabetic Investor

The Music Plays On

In a typical game of musical chairs, chairs are removed from the game after the music stops and a player finds an empty chair. Well as we should know by now this isn’t how the game works when it comes to the wacky world of diabetes. Whether its CGM and the numerous Dexcom wannabes or connected pens with all the Companion wannabes or diabetes coaching platforms and the all the Livongo wannabes there seems to be no shortage of chairs.

It really doesn’t seem to matter that these market are becoming overcrowded nor does it matter much that these markets are overlapping. As always this isn’t about innovation this is about …. Wait for it … money. Yep Teladoc pays $18.5 Billion for Livongo, Medtronic $400 million for Companion while the CGM market continues to grow like a weed. About the only thing all these wannabes have in common is their goal; to find a greater fool.

At the same time the big boys Apple and Google are entering the space. Google/Verily has Onduo and Fitbit while Apple continues to transform the Apple Watch into an essential patient monitor that also tells time. Amazon is also sniffing around this space not to mention payors like UnitedHealthcare.

Frankly we’re not exactly sure how this all plays out but our gut/gray hairs and years of watching the wacky world tell us that we are moving ever closer to Austin. Just as a refresher Austin is Tyler’s younger brother and unlike his older brother Austin isn’t focused on insulin delivery rather total patient care. Years ago we predicted that one day physicians would no longer prescribe individual pieces of the patient’s diabetes management system, rather they would prescribe a comprehensive system from one company that would include everything the patient needs to manage their diabetes.

Tyler was the first iteration of this focused specifically on insulin using patients. As we noted when Medtronic acquired Companion it is quite possible even likely they will become the first true Tyler supplying patients with a CGM/Connected Pen/Insulin plus coaching. Lilly and Novo Nordisk also have dreams of a Tyler but have yet to pull the trigger. Now that insulin has become a commodity almost anyone with a CGM/Connected Pen/coaching app can have a Tyler.

Austin on the flip side is designed for non-insulin using patients. Like his older brother the centerpiece of his system is a CGM/Coaching app. An app which will collect more than just glucose data. Given the plethora of connected devices we see Austin collecting exercise and weight data. Tyler can and likely will do this but with Austin these additional data points take on greater significance given that the patient is not taking insulin. Austin will also include medication reminders and automatic prescription refills.

As Tyler and Austin grow up expect some additional enhancements such as virtual physician consults.

The fact is we have all the elements for Tyler and Austin but so far no one company has put them all under one roof or platform. Teladoc/Livongo has coaching and telemedicine – Medtronic/Companion has CGM/Connected pens and soon insulin – Lilly/Novo have insulin/connected pens – while Onduo – UnitedHealthcare – Apple have platforms, relationships with Dexcom and of course financial resources.

The critical element is not getting everything under one roof, that quite frankly is the easy part. The critical element here is changing mindsets convincing physicians/patients that these systems are better then the current build your own approach. Perhaps the best way to think of this is to use Microsoft Office as an example. While not each program may be the best Office does have several advantages. Yes there are people who prefer to pick and choose which programs they use; this will always be the case. However as we have seen with Office the majority likes everything under one roof.

The emergence of Tyler and his younger brother Austin has taken longer than we anticipated but as Momma Kliff always said change as necessary as it may be comes slowly. There is no question this change is coming and who knows maybe one day in the not so distant future Tyler and Austin will have a little sister to play with.

Author: wpadmin

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