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Dexcom, Abbott applaud Medicare expansion for CGMs

April 19, 2023 By Sean Whooley

Dexcom G7 Abbott FreeStyle Libre 2 CGM
Left, the Dexcom G7 CGM. Right, the Abbott FreeStyle Libre 2. [Images from Dexcom and Abbott]
Dexcom (Nasdaq:DXCM) and Abbott (NYSE:ABT) both commended a change to Medicare policies that benefits continuous glucose monitor (CGM) users.

Last month, the Centers for Medicare & Medicaid Services (CMS) published a final local coverage determination (LCD) expanding coverage for CGMs. The ruling has now gone into effect.

CMS first published the LCD modifying coverage criteria for CGMs in October. The modification includes people with diabetes who receive insulin treatment or have a history of problematic hypoglycemia. The proposal eliminates the requirement for frequent adjustments of the patient’s insulin treatment regimen. This falls on the basis of glucose measurement testing.

The finalized version changed some language on the criteria. It amended the line saying “the beneficiary is insulin-treated with at least one daily administration of insulin” to, simply, “the beneficiary is insulin-treated.”

BTIG analyst Marie Thibualt singled out Abbott and Dexcom as the two companies most likely to benefit. The companies both develop market-leading CGMs.

In February, the Dexcom G7 launched in the U.S. and shortly after received positive Medicare news. The FDA cleared Abbott’s next-generation FreeStyle Libre 3 last year. Chair and CEO Robert Ford said on Abbott’s fourth-quarter earnings call that the company expects growth for the platform this year. Today, the company reported 50% growth in U.S. FreeStyle Libre sales.

“In our view, this is a significant catalyst that will increase CGM adoption in this patient population, benefiting both Abbott and [Dexcom],” Thibault wrote.

Abbott and Dexcom have their say

According to Dexcom, the updated Medicare policy marks the biggest single expansion of CGM coverage in the U.S. to date.

“This landmark CMS decision has the potential to bring Dexcom CGM to millions more Medicare patients living with diabetes,” said Teri Lawver, EVP and chief commercial officer at Dexcom. “Our MOBILE study, which helped lead to this decision, is part of Dexcom’s ongoing efforts to help increase access to the most accurate, easy-to-use CGM technology that offers people a better way to manage diabetes and improve their quality of life.”

In addition to the sales uptick, Abbott’s diabetes business last week reported multiple positive updates. First, the FDA cleared a reader for its FreeStyle Libre 3 system. Then, the company broke ground on a $450 million manufacturing plant for the CGMs in Ireland on Friday.

“FreeStyle Libre technology was designed from the start to be affordable and accessible,” said Jared Watkin, SVP for Abbott’s diabetes care business. “We’ve been focused on highlighting the tremendous benefits of continuous glucose monitoring to help people living with diabetes manage their care easily and pain-free. Increasing access is a monumental step by Medicare to allow more people to have access to FreeStyle Libre so they can spend less time worrying and more time living healthier, better lives.”

A long-awaited decision

Both Abbott and Dexcom expressed excitement as the process of the CMS decision unfolded. They initially expected the change to come in the second half of this year. Ford said in January that the decision could benefit millions. Thibault had said the decision increases access for approximately 1.5 million people using basal-only treatment in the U.S. covered by Medicare. That could expand to between 3 million and 4 million, she said, as U.S. commercial payors follow suit.

“You’ve got about 4 million type 2 basal patients in the U.S.,” Ford said. “About a third of them are Medicare. … I think this is a great growth opportunity.”

Dexcom CTO Jake Leach told Drug Delivery Business News that Dexcom is “really excited” by the potential expanded coverage.

“We see that as just another validation of how CGM can really benefit people with diabetes,” Leach said. “This is a whole new group of folks that haven’t had access to it before. I think we’re going to really see some great outcomes as that population starts to use CGM more regularly. We’re really excited about G7 servicing that population when it becomes available.”

Dexcom CEO Kevin Sayer also said on the company’s fourth-quarter earnings call that the population could nearly double Dexcom’s addressable reimbursement market in the U.S.

Filed Under: Business/Financial News, Diabetes, Drug-Device Combinations, Featured, Patient Monitoring, Regulatory/Compliance Tagged With: abbott, Centers for Medicare and Medicaid Services (CMS), Dexcom

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About Sean Whooley

Sean Whooley is an associate editor who mainly produces work for MassDevice, Medical Design & Outsourcing and Drug Delivery Business News. He received a bachelor's degree in multiplatform journalism from the University of Maryland, College Park. You can connect with him on LinkedIn or email him at swhooley@wtwhmedia.com.

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