A conversation on CGM, part 1
How continuous monitoring of blood sugar will impact industries like health, food, insurance and others over the next decade
This is part 1 of a conversation between Henrik Berggren founder and CEO of Steady Health, a digital diabetes clinic and Eric Antonow, formerly at Metabolic.
Eric: Henrik, good to see you. There have been a bunch of announcements in the CGM space, and you wrote a Medium post about them. I think they’re a pretty big deal, so let’s go through them one-by-one.
Henrik: Sounds good. Let’s start with Abbott. They’re one of the biggest companies and seemingly on the trajectory to be the most innovative. First, their announcement of the third generation of Freestyle LIBRE or LIBRE 3. It was announced in Europe, and we actually don’t know how long it will take before it comes to the US.
There were three major announcements. First is a 70% size reduction compared to the LIBRE 2. The LIBRE 2 was the size of two stacked quarters; this will be only two pennies!
Eric: It’s miniscule.
Henrik: How it looks on your arm or your body is important. It can cause people to hesitate when buying a CGM device for the first time. So, that’s definitely a meaningful improvement. The other change is the LIBRE 3 is now using Bluetooth. That’s been the weakness of the LIBRE compared to some of these other manufacturers, like Dexcom or Medtronic. Previous LIBRE versions used NFC, and you had to tap it and scan it manually to get the data. This version now comes with full Bluetooth capability, making it true CGM. The update rate is now every minute compared to the previous standard of every five.
The third announcement is that the price will be the same as the current version. That begs the question of how pricing changes on existing devices and what that will do to the market as a whole.
Eric: Bluetooth is huge. It’s what separated LIBRE from the Dexcom devices. Now, you can wear this passively and have the data to show up on your phone or your watch. This competitive usability changes quite a bit. Also, NFC limited its connectivity to a smaller set of phone and watch devices, so this really opens things up, especially for Apple devices.
The market for the layer of services built on top of CGM devices gets much much bigger. Apple and Google have historically been more connected to Dexcom devices just because of Bluetooth. But with this, they have another hardware option, and because it’s significantly cheaper, it will attract an entirely new set of customers.
Henrik: These are the two biggest CGM manufacturers, and now they are at the top of their game. The delta between the two solutions is now almost zero except for price. So, it’s going to be very interesting to see how Dexcom responds, particularly when the G7 comes out.
The second big Abbott announcement was the LIBRE Sense, the first CGM device for the non-medical market. This opens up so many possible applications for blood sugar monitoring. There are athletes interested in performance optimization and people looking to lose weight.
The LIBRE Sense is specifically nonclinical. It’s a LIBRE 2, but they’ve put on guardrails to segment the regulatory market. The range of measurement is limited to 70 to 200 mg/dl. That’s totally sufficient for someone without diabetes. By doing this, they can potentially become an over-the-counter product in the United States because they aren’t serving an at-risk patient.
Again, this product announcement was for Europe, but I suspect it will quickly come to the US and be the first CGM approved for non-diabetics. That’s a landmark.
Eric: I’ve had many people ask me about getting CGM, primarily for diet purposes, and they’re absolutely willing to pay. The only issue has been access to a device. They or their doctor doesn’t want to go through the hurdles of a prescription. Outside the United States, you can buy this over-the-counter, but here, it’s a huge point of friction: you have to go through a physician, explain why you want this, and get a prescription.
I’ve had many people ask me about getting CGM, primarily for diet purposes, and they’re absolutely willing to pay.
I think this device is a great path to over-the-counter CGM in the US.
Meanwhile, there is an emergence of other consumer CGM services that are also trying to solve the access problem. And so far, they’re doing well.
Henrik: One other area that’s shifting is around access to the data on the devices. Abbott announced that they’re also launching a developer platform, and traditionally they’ve been more closed. Dexcom has performed well because they’ve been more open, allowing them to do things like power loop systems, automated insulin delivery, and a wide range of other apps. As we start to see these new consumer services get built, Abbott as a platform becomes very important.
Eric: Well, this new segment of people without diabetes also drives that. There’s less risk in giving data access here. These patients don’t have an acute health condition and they’re not dosing insulin. There’s no medical risk argument for keeping this segment closed.
Henrik: One of the core hypotheses I have around CGM is that it will parallel GPS and maps. The device itself generates data, but the next layer of services is even more powerful — similar to what we saw in GPS development. First, there were Google Maps, and then you have Lyft, Uber, DoorDash, and so many more. You start thinking about applications that will come from CGM and the glucose data that exists in our bodies.
The device itself generates data, but the next layer of services is even more powerful
Eric: That’s absolutely right. Those services are coming.
Henrik: Let’s shift to Dexcom. In terms of functionality available today, they are the top, top player — solid platform, data access, and the highest accuracy. That’s kept them ahead. The next model, the G7, is coming out soon. They’ve been developing it with Google’s Verily spin-off, and it’s going to be much smaller. It’s still going to be 10-day wear, so that’s three sensors a month versus two for the LIBRE. The biggest delta was already the costs, with Dexcom’s monthly costs being roughly $500 to LIBRE’s $75. That’s big.
Eric: Segmentation and price pressure will be interesting. The minute you have these within the general CGM consumer market, you also have segmentation around precision. Accuracy matters much less for people with diabetes, so you don’t have to win there, just place. At the same time, Dexcom can continue to point to higher accuracy and precision. For some people, that will be worth it, but the price difference will be harder to maintain.
It’s also worth noting the Dexcom devices have become much less intimidating to apply. The G5 looked like sticking a syringe into your abdomen. The G6 was a significant improvement, and I expect the G7 to be even easier for people to handle.
Irrespective of the device, this is probably the second major friction point for trying a CGM solution. People are intimidated by the idea of attaching one of these to their bodies.
It’s interesting that one of the consumer companies, Levels, made a good-looking patch that covers the actual CGM. It makes it look cool, like a tattoo or badge. It’s almost something that you’d be proud to be seen with at a gym, the way people wear Kinesio tape.
Henrik: The Dexcom G5 was basically like a gun with a needle that you had to stick into your stomach. I got sweaty palms when I looked at it. The G6 has this cute, Star Wars-looking applicator with a button, and you press and you’re done. It makes a huge difference.
Eric: Making it entertaining is great and removes some of the fear and intimidation. Let’s shift to talk about the newer consumer services.
Henrik: When I wrote the blog post, I mentioned a few of them, but more have popped up, like January.AI. Two of them, Levels and Supersapies, are capturing a lot of attention and worth discussing. At their core, they both serve healthy people. They ship them two CGM devices a month and give them access to an app and program to interpret their data. These services help them see how they’re reacting to food and exercise as well as other things like stress.
The customer targets feel slightly different. Supersapiens is focused very much on performance. It was started by a pro cyclist who happens to be diabetic. They’re one of the first companies building on this new developer platform that Abbott is launching.
Eric: To me, the future of this market is how these services differ. The interpretation layer on top of the CGM is early but the next important problem. Once they’ve given you access to a CGM, which they do solve well, the next question becomes: “How do I interpret this data?” From what I can see from Levels, they’ve done a great first version
For people with diabetes, you can find good endocrinologists or books on how to use a CGM device, but for the general population, there is almost nothing. So, the application and service layer that Levels is building is a big deal. It contains a thesis about what to pay attention to, what’s good and bad. The science is still pretty early, so it’s critical to get that guidance.
This is where the markets will segment again. You’re going to see one brand focus on elite performance, like Supersapiens is doing. It will be about optimal conditioning or preparing for a race. Then, another brand will be more focused on diet and nutrition and will target the larger market. We’ll see if that’s where Levels ends up going or if they choose something like general fitness. They can both be positioned as premium and go after very different non-diabetes problems.
This is part 1 of a conversation between Henrik Berggren founder and CEO of Steady Health, a digital diabetes clinic and Eric Antonow, formerly at Metabolic. Part two will be released shortly.
