- Medtronic acquired insulin pen startup Companion Medical to broaden its diabetes management tech.
- And competitors like Abbott will likely try to keep pace with moves toward creating an artificial pancreas.
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Medtronic announced its plans to acquire Companion Medical — which is best known for its connected insulin pen, InPen, that enables diabetic patients to track and share data like insulin doses, active insulin, and meal time recommendations. Companion Medical’s app will also be compatible with Medtronic’s continuous glucose monitor (CGM).
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This marks the latest acquisition that will help Medtronic broaden its diabetes management tech and better appeal to users aiming to cut costs. Medtronic is using acquisitions to get it closer to its goal of releasing an advanced closed-loop system, or artificial pancreas, that uses a CGM and insulin pump to control insulin levels with minimal action from the patient.
Last year, it bought Klue, which uses motion-tracking software embedded into wearables to track users’ movement. And in 2018, it purchased nutrition platform Nutrino for use of its predictive glycemic response algorithm. Companion Medical’s connected insulin pen will help the medtech behemoth expand its footprint in the digital diabetes management space — this marks the first smart insulin pen in Medtronic’s diabetes portfolio.
And considering that 69% of diabetic patients who use daily insulin injections exhibit interest in switching over to smart pens — likely because they’re cheaper and more convenient that insulin pumps — the acquisition should help it pry open a new revenue stream: Analysts at Jefferies predict that the move could add $200 million in incremental revenue.
We expect other medtech giants like Abbott to use acquisitions as a means to create their own artificial pancreas tech — which would boost their value in the eyes of payers. Medtech companies Abbott and Dexcom both scored tie ups with insulin pump maker Insulet earlier this year — and Abbott recently backed $45 million in funding for Bigfoot Biomedical, which plans on using the cash infusion on clinical trials of its diabetic closed-loop tech.
These moves could likely signal that Abbott and Dexcom are ready to build out their tech to create a viable artificial pancreas system — a bold move that would retain the attention of payers: An artificial pancreas system would substantially reduce the whopping $237 billion the US spends on diabetes management annually.
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