), a player in the glucose monitoring market, recently reported
that it received a CE Mark for its 4
generation continuous glucose monitoring system. This recognition
for the DexCom G4 system permits its launch in EU as well as
certain Latin American and Asian nations, where the CE Mark is
Diabetes is a chronic condition, and a major cause of fatality
and disability, which affects over 350 million individuals across
the globe, as per the International Diabetes Federation. It can
lead to serious negative outcomes such as end-stage renal failure,
blindness and amputation of limbs. The DexCom G4 is intended to aid
diabetics to better monitor their glucose levels.
The company stated that the DexCom G4 system's strong
performance is duly evident in the information recently submitted
by it to the American Diabetes Association's 72nd Scientific
Sessions. DexCom is developing a plan for a phased product
commercialization in overseas markets.
The diabetes market is large and growing. An important component
of effective diabetes management is frequent monitoring of blood
glucose levels. DexCom's ambulatory product has a comparative
advantage in terms of both patient convenience and quality of data
generated vis-à-vis traditional diagnostic tests.
We believe DexCom is poised to gain a share of the glucose
monitoring market driven by sustained product development
initiatives, collaborations, favorable reimbursement and increased
need for continuous glucose monitoring. Increased awareness and
acceptance of the need for continuous glucose monitoring and more
favorable reimbursement coverage should help drive sales for
In addition to upgrading and enhancing the functions of existing
products, DexCom has also been active on the collaboration front,
through which it is looking to leverage its technology with its
collaborator's product offerings.
We believe that the company's move to buy healthcare IT company
SweetSpot Diabetes may allow it to compete more effectively with
) through better data management systems.
However, competition in the glucose monitoring market is fierce.
Moreover, DexCom has incurred losses since inception and its
efforts are made more difficult by a stringent regulatory
environment. We are currently Neutral on the stock, supported by a
short-term Zacks #3 Rank (Hold).
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