Diabetes tracker developer Dexcom is pushing back the timeline for a U.S. launch of the latest generation of its continuous glucose monitor, the G7, after the FDA raised questions about the device’s software during a review.
Though the wearable sensor was first submitted to the agency late last year, the company now plans to rework how the G7 and its smartphone apps deliver alarms to alert the user of significant changes in their blood sugar.
“We discussed several options that we had, we decided the best option at this time was to revise the software and file it differently and we have added a few other features to it as well based on our discussions with them,” CEO Kevin Sayer said on the company’s second-quarter earnings call with investors, according to a Seeking Alpha transcript.
“We are in the middle of revising the software for that, and have to run it through the complete validation and verification process and resubmit,” Sayer said. The company has narrowed expectations for the device’s initial, limited release in the U.S. to the fourth quarter, after previously planning for the FDA’s go-ahead to come at some point in the year’s second half, and has slated a full commercial rollout for early 2023.
Comparing the latest version to its mainstay G6, Sayer went on to describe how the G7’s development had already brought on a complete revamp of the company’s processes.
“We changed the algorithm. We changed the insertion techniques. We changed every manufacturing procedure that we have and completely rewrote the entire app and the software experience, which is a lot for [the FDA] to digest and a lot for us to submit,” he said.
“If I look at learnings for us over time, I think we will probably do things a little more incrementally going forward, rather as big as this one was, and we can get things through faster.”
The disposable G7 is about 60% smaller than its predecessor, which first debuted in 2018, and offers a 30-minute warmup period after application. It received a green light in Europe this past March and is finding its way to users in the U.K. with a wider continental release starting before the end of the year.
Dexcom’s stock dipped by about 17% in after-hours trading Thursday following the news, though the price began climbing again when the Nasdaq opened on Friday to around $80 per share or about 7% off its previous close.
The company reported $696.2 million in revenue for the second quarter of 2022, or about a 17% increase over the same period the year before, driven by 39% sales gains in international markets.
That includes income from the launch of its Dexcom One programs in the U.K. and Spain, built around a simpler, less-expensive system at a lower price point.
Representing the company’s first attempt at offering multiple products at different tiers, Dexcom One uses the same 10-day sensor hardware as the G6, though its software does not provide the same range of features, automated alerts and real-time data sharing that’s offered with the G6 and G7.
And despite posting $2.75 billion in cash and untapped credit, Sayer said in an interview last month that major acquisitions are not front of mind for the company—even as rumors swirled earlier this year of a potential merger with wearable insulin pump maker Insulet.
“We’ve been the organic growth story of the decade. No medical device company goes from $40 million to almost $3 billion organically—we’ve done that,” Sayer told Fierce Medtech in an interview during the American Diabetes Association’s annual meeting.
“Where we see opportunities to get technologies or capabilities that enhance what we do or possibly enable us to differentiate in the future, we will consider that,” he added, perhaps coming from small startups outside its main product line that the company has already invested in, as well as from the purchase of existing distribution partners to help increase its geographic footprints.