Abbott (NYSE:ABT) plans to “go more aggressively” into the continuous glucose monitor (CGM) market with its FreeStyle Libre 3 this year.
Chair and CEO Robert Ford said on the company’s most recent earnings call that the company expects growth for the platform this year. FreeStyle Libre 3 received FDA clearance in May 2022.
Ford cited full-year growth for the Libre platform of 21% overall. Revenues grew by 42% in the U.S., too. Backorders and supply chain issues hampered growth internationally, he noted, but sales still grew in the mid-teens percentage-wise. However, Ford feels those issues are “mostly behind” Abbott.
As for the transition from FreeStyle Libre 2 to the next-generation system, the company has big plans. Ford explained that Abbott let the switch from Libre 1 to Libre 2 happen “naturally.” That took around two years to complete.
“For Libre 3, we wanted to go more aggressively in some of these markets,” Ford said. “I expect continued growth in the U.S. in terms of market expansion. … Can we see a path for 20% growth in 2023? Yeah, I can. I think there’s a lot of opportunities for growth.”
Basal-only population represents a growth driver for Abbott
Ford said the opportunity for basal-only insulin users is “great,” both in the U.S. and abroad. The company is one of a handful of CGM makers that should benefit from an expected Medicare reimbursement win for the basal population. That decision is anticipated to come mid-year.
“[Basal expansion will] start, I think, in the U.S., but I don’t think it will be a U.S.-only phenomenon,” Ford said. “You’ve got about 4 million type 2 basal patients in the U.S. About a third of them are Medicare. … I think this is a great growth opportunity.”
The Medicare decision represents a massive boost for companies like Abbott and Dexcom in particular. Both companies will see their CGMs go head-to-head to try and take hold of the basal market, especially after the reimbursement comes.
CMS’ proposal eliminates the requirement for frequent adjustments of the patient’s insulin treatment regimen. This is on the basis of glucose measurement testing. According to BTIG analyst Marie Thibault, the proposal doesn’t mark a blanket for all beneficiaries with type 2 diabetes not administering insulin. However, by eliminating the intensive insulin management requirement, it could be a “positive step.” This would potentially benefit those most at risk of hypoglycemic events.
There are potentially millions who could benefit from the decision, as Ford laid out. Dexcom CEO Kevin Sayer said on the company’s fourth-quarter earnings call that the population could nearly double Dexcom’s addressable reimbursement market in the U.S.
The reimbursement decision is something to keep an eye on this year. Here are a number of things to look out for in the diabetes tech space in 2023.
Automated insulin delivery and penetrating the international markets
Ford made it clear that Abbott’s aims go beyond domestic growth. While strong U.S. numbers bring encouragement, the company already has the wheels in motion to penetrate the international markets. Last year, Abbott announced a $450 million investment in FreeStyle Libre production in Ireland. That investment included a brand new manufacturing facility in addition to pouring more money into its existing site in the country.
At the end of 2022, Abbott announced compatibility between its FreeStyle Libre 3 sensor and the mylife Loop from Ypsomed and CamDiab. The technologies combine to offer a smart, automated process for insulin delivery based on real-time glucose data. This system launched in Germany, and the companies intend to offer it in additional European countries in 2023.
“We have already launched a connected [automated insulin delivery] system in Europe,” Ford said. “Initial results for that combined product in Europe has been very favorable. I think that’s another key growth driver for us in 2023.”
As for bringing a Libre-using pump to the U.S., Ford called insulin delivery an important segment “that benefits quite significantly from a combined system.”
“We’re focusing more aggressively on that,” he added.
Analysts sought to find out if Abbott is considering bringing pumps under one roof. However, Ford said the company currently just wants to provide its sensor capabilities to other insulin pump makers.
“[Pump users] want to be able to choose the best sensor-pump combination,” Ford said. “Right now, my view on that is that the consumers have spoken. The market has spoken. The regulator has spoken. They want that interchangeability. Our focus will be on providing the best sensor for the pump systems that are out there.”
Abbott eyes other uses for its CGM
Abbott has more in the works for its Libre platform beyond diabetes. Interestingly, Sayer recently told Drug Delivery Business News about Dexcom’s own plans for expanding its CGM for other uses.
“I’ve talked about expanding the Libre platform outside of diabetes and using it for a much more broad target,” Ford said. “I’ve talked about Libre being a $10 billion product by 2028. That implies a 15% annual growth rate. We’ll do better than that this year. I think the opportunities we have to be able to drive that kind of revenue for this product are very real. And I think we’ve been executing very strongly in all of these areas.”
Ford also said the company’s Lingo biowearable for continuously monitoring both glucose and ketone levels represents another growth driver.
Abbott is running a U.S. trial for the combination sensor, and it represents an area of focus, the executive added. The company has a separate team working on the Lingo development.
“We will be launching two Lingo products this year in Europe,” Ford declared. “I’d say the first one will probably be in the first half of this year and the second one in the second half.”