DexCom profitable for the first time, completes FDA submission for smartphone glucose monitor

Continuous glucose monitor company DexCom ($DXCM) turned a profit for the first time during the fourth quarter of last year. It also said it completed its FDA submission for its first direct-access smartphone CGM, the G5, which transmits data directly to a smartphone and from the phone to a secure system.

Investors took the opportunity to sell this high-flyer on solid, largely expected earnings news. DexCom was down as much as 5% in early trading on Feb. 26 but remains up about 10% so far in 2015 and 34% over the last year. For the fourth quarter, DexCom reported product revenues of $84.3 million and an operating income of $1.6 million.

The new G5 system is expected to gain FDA sign-off this year. It's another step in streamlining the process of acquiring, transmitting, analyzing and sharing continuous glucose monitor data to aid in better management of diabetic patients.

Kevin Sayer

"The G5 mobile platform operates through a smart transmitter, meaning glucose values are computed on the transmitter, eliminating the need for a receiver. Glucose values will go directly from the transmitter to a patient's mobile device. Patients will still be able to use a receiver if they wish, because the G5 smart transmitter can communicate with two BLE-enabled devices simultaneously," summed up new DexCom President and CEO Kevin Sayer.

In January, Sayer was promoted from his prior position as president and COO, replacing Terry Gregg who remains as executive chairman.

Last year, DexCom launched 5 new products. That's up from only three global product launches during the prior two years combined. The company is planning 5 more product launches this year. That 2015 figure could be as many as 10 product launches, depending on execution and regulatory timelines, Sayer said.

In the near term, its Share Receiver is being used as part of artificial pancreas research supported by the Juvenile Diabetes Research Foundation.

Sayer made it clear that DexCom is working toward elucidating its long-term artificial pancreas strategy.

"As we sit here today and as we've said here for the past several years, our message has been CGM first and making the CGM systems more and more accurate and reliable and better suited to work with an artificial pancreas and we're very comfortable with our product pipeline. The question then becomes is how do we play in the sensor-augmented pump arena," he asked.

After mentioning Tandem Diabetes Care ($TNDM) and Johnson and Johnson ($JNJ) efforts in particular, he continued, "There are a lot of efforts going on. We won't sit and let somebody else control our fate forever. If nobody does this, we will get more involved if we see a project that is going very, very well. We haven't found anything that we wanted to commit to yet. We support all the artificial pancreas programs or sensors. We support our pump partners. But we're cognizant of this, so we're cognizant of this the fact that we need to play here. We've got the best sensor in the world."

Tandem has submitted a PMA application to FDA for its t:slim pump that integrates with DexCom's fourth generation CGM.

- here is the release

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