People have been riding the wave of GLP-1 to achieve fast, dramatic weight loss. But given the drug's role in controlling type 2 diabetes, it's no surprise that DexCom CEO Jake Leach wants to ride the wave. DexCom manufactures continuous glucose monitoring devices (CGM) that patients wear 24/7. They were originally used in type 1 people who needed them to know when to take insulin and manage the disease, but as evidence of their efficacy continues to grow, CGMs are now also used in people with type 2 diabetes.
“So we've been working on how to use CGM to optimize drug therapy, and insulin was the first one, [but] There are opportunities with GLP-1,” Leach said in a recent interview. “We have all kinds of opportunities to guide treatments for physicians and patients, working together to get better outcomes faster. “
CGM estimates blood sugar levels in people with diabetes by measuring glucose in the tissue fluid surrounding cells. A blood test will give an A1c result, which is considered a better indicator, but the constant pricking and drawing of blood is cumbersome, to say the least. It’s also impossible to constantly perform fingertip pricks to get real-time data. CGM, which must be prescribed by a healthcare provider, has a tiny sensor inserted under the skin that accurately senses blood sugar levels throughout the day.
Like obesity, type 2 diabetes is a metabolic disease in which GLP-1 effectively suppresses appetite, thereby affecting metabolism and insulin levels.
“GLP-1 gives great results. But I feel, and I see in all the data we look at, that when you use CGM and GLP-1 together, you get better results [mainly because] “CGM is about understanding different nutrients, different dietary choices, activity levels and all of those factors and how it actually affects your blood sugar,” Leach said. If you are taking GLP-1, CGM will show you how well it performs while you are taking it. “
Leach points out that if you take GLP-1 alone and don't monitor your blood sugar levels, “the only real feedback you have on your performance is your weight,” and by the time you measure A1c, the effects can take up to 90 days.
CGM can also help with dietary modification.
“I think some of the very important knowledge about proper nutrition comes not from GLP-1 but from CGM,” he declared, although he couldn't say how broad the range of patients with type 2 diabetes who use GLP-1 is.
Leach also points out that combining CGM and GLP-1 in patients fighting type 2 diabetes may also be economically feasible.
“I think CGM is a cost-effective solution,” he said. “When you think about the cost of CGM, for someone using CGM for a year, we're talking about $1,000, right? When you think about the health care savings, that's a very compelling financial argument.”
In fact, a study designed to determine whether CGM use in GLP-1 patients would be cost-effective for payers appears to echo Leach's sentiments. The study was conducted by a physician consultant to Abbott Laboratories and two of its employees. Abbott is a competitor of DexCom and has its own CGM product, FreeStyle Libre. Although Abbott's technology is different from DexCom's — former DexCom CEO Kevin Sayer once described FreeStyle Libre as not being a true CGM — the product has been gaining market share.
To address this issue and solidify Dexcom's position as a leading innovator in CGM, the San Diego-based company plans to launch the DexCom G8 sensor, the latest DexCom wearable CGM device expected to be the world's smallest CGM.
“This will be the most advanced wearable system we have ever produced,” Leach said, according to a Jan. 12 webcast at J.P. Morgan's annual conference. “Design changes will ensure improved sensing and error detection. The sensor will also be 50 percent smaller than the G7 sensor, meaning the wearable will be the smallest CGM on the market when it launches.”
No launch date has been specified.
Whatever the driver – international sales expansion, jumping on the GLP-1 bandwagon, or launching an advanced, smallest CGM – DexCom and its stock price desperately need a success story. The stock peaked in November 2021, when it was trading above $160. The market has since fallen to less than half its value due to various missteps, including a sales restructuring that didn't go as planned and a warning letter from the U.S. Food and Drug Administration over conditions at two manufacturing plants.
The stock is currently trading near $70. The market will be affected again on February 12 when the company reports fourth quarter and fiscal 2025 earnings.
