Diabetic patient monitoring glucose level

What can we learn from the continuous glucose monitoring device market?

Authors

7 minute read 07 Mar 2024

The continuous glucose monitoring (CGM) device market offers important lessons to diabetes medical device manufacturers on how to capture untapped market potential.

In brief

  • Continuous glucose monitoring (CGM) device players have taken different approaches to penetrate the market.
  • What are the key considerations for CGM device manufacturers when devising their go-to-market approach?
  • What future challenges lie in the CGM market? 

The continuous glucose monitoring device or CGM market is booming, as illustrated by the J.P. Morgan Healthcare conference earlier this year, where market leaders reported record expected growth, exciting product launches, as well as a commitment to reach sales of USD 20B by 2028.1

The technology has revolutionized the treatment and management of diabetes in combination with hybrid closed-loop systems, even enabling diabetes type 1 patients to participate and successfully finish in such strenuous activities as the 250 km ultramarathon Marathon des Sables in the Sahara Desert,2 a feat unimaginable with traditional diabetes management methods even a decade ago.

In this article, we will look into the current state of the CGM market, key lessons on the go-to-market (GTM) approach of CGM device manufacturers, and future challenges for developing a successful GTM approach for a CGM device supporting diabetes management.

Doctor checking the patient in hospital
1

Chapter

Key lessons on developing a strong GTM strategy for CGM manufacturers

How considering differences between diabetes type 1 and diabetes type 2 patient needs and other patient groups has shaped the CGM manufacturer GTM.

Medtronic was an early entrant in the CGM market with its GuardianTM sensor system in 2017. However, system complexity, mandatory fingerstick calibration and frequent alarms motivated patients to shift to more user-friendly alternatives which have now captured the majority of the CGM market in the US3 - Abbott Laboratories, which has reported CGM sales of USD 5.3B (within its Diabetes Care business) in 2023,4 and Dexcom Inc, with a reported USD 3.6B revenue in 2023.5

The major players in the diabetes device market have had distinct GTM approaches, targeting different patient profiles. Dexcom has been more popular among diabetes type 1 patients, who value user-friendliness, safety, and discreet alarms,6,7 with their G6 and G7 CGM products, due to their customizable and predictive safety alarm systems that can detect hypoglycemia. Meanwhile, Abbott has had more success with diabetes type 2 patients with its more affordable Freestyle LibreTM system, suited to patients more concerned with adapting and managing their lifestyle after diagnosis.8

While there have not been price wars among prominent MedTech companies, they have strategically lowered prices of CGM devices to expand their market presence. Abbott reportedly ramped down pricing through scaling production in 2019,9 other giants such as Medtronic have trodden a similar path by reducing CGM cost by as much as 66% in 2021.10 A noteworthy focus for the players is on tapping into the type 2 diabetes patient market, traditionally not the primary consumer base for CGM devices. 11

Learning from the large CGM players, diabetes device manufacturers should focus on developing unique GTM strategies to cater to the specific needs of their different customers. For instance, for diabetes type 1 patients, continuous monitoring and hybrid closed loop technologies are worth investing in due to the severity of the disease and risk of complications. Meanwhile, many diabetes type 2 patients would not be willing to invest in advanced and high-priced technologies and instead would prefer a more affordable option.

Similarly, geographical differences play a key role in GTM strategy. While the US and Europe have been well penetrated by most manufacturers, low- and middle-income countries present a large untapped market with unique challenges such as cost constraints, misinformation, and poor health education. When targeting these markets, CGM device manufacturers must leverage different types of outreach channels and strategies to fight misinformation and stigmatization. For example, collaborating with educational institutions, NGOs, and governmental institutions can help educate both younger and older patient populations. Beyond these, there are additional key areas that need to be analyzed and considered by manufacturers for developing GTM strategies (see Figure 1).

A women looking at the notice
2

Chapter

Future challenges for diabetes device manufacturers

What are the next key challenges for CGM device manufacturers and how can they be addressed?

How EY can help

CGM devices have been shown to enhance patient experience and quality of life, but the technology is still developing and facing both technological and market challenges. A key challenge is posed by the recent success of Glucagon-like peptide 1 (GLP-1) in diabetes intervention, the impact of which on the CGM device market is also yet to be understood.

 

While CGM manufacturers argue that patients on GLP-1 medication exhibit increased usage of their glucose monitors,12, 13 consumer anxiety over the new medication led to a 20% decline in three months in the MedTech stocks index, as reported in October 2023.14 Analysts’ projections align with those of MedTech companies, foreseeing heightened CGM adoption and improved outcomes following GLP-1 initiation for type 2 diabetes patients. However, there is a potential 20%-25% reduction in the portion of patients using insulin over the next five years due to the impact of GLP-1.1 Cultivating a thorough understanding of the effects of GLP-1 on patient demographics, treatment paradigms, and clinician communication can empower MedTech companies to make sound strategic decisions in the future.

 

Another challenge for CGM manufacturers has laid in device distribution channels. Traditionally, CGM supplies in the US could be bought only from the manufacturer or third-party vendors. From the mid-2010s, CGM device manufacturers started collaborating with insurance providers to provide CGMs directly to patients via prescription in pharmacies. This has reaped great benefits for players, significantly contributing to the growth of sales observed in the last years. To further strengthen their outreach to patients, CGM device manufacturers should invest in e-commerce capabilities, offering their supplies, apps supporting disease management, as well as healthcare management advice online. To enable this, the players should foster and strengthen ties with healthcare professionals (HCPs), payors and manufacturers of other devices used in diabetes care (i.e., insulin pumps, pens and medical software developers).

 

Finally, to be able to better understand and leverage the unique preferences of different patient groups, segregated by disease type, demographics (i.e., age, gender, healthcare expenditure) or established channels (government, HCPs, pharmacies, community health), companies must invest in and develop significant data and analytics capabilities. This can be done through collaboration with tech companies, allowing them to generate insights for each patient group and enabling more informed market and treatment decisions.

Doctor giving suggestions on video call
3

Chapter

Outlook for diabetes device manufacturers

How CGM device manufacturers can expand to cover the entire care continuum and leverage data to set CGM as the new diabetes standard of care

CGM Manufacturers that want to go one step ahead should invest in further technologies or partnerships, offering a broad range of solutions to support a patient throughout their journey from screening and diagnosis to monitoring and management. In addition to the above-mentioned strategic opportunities, a more distant strategy that manufacturers can explore includes expanding their overall business horizon to include diabetic comorbidities such as diabetic neuropathy, chronic kidney disease, diabetic foot and eye complications, among others (see Figure 2). 

human resource

Manufacturers can make use of CGM and other existing technologies to monitor more blood-based parameters, as well as patient adherence to prescribed lifestyle changes (i.e., diet and exercise) via wearables and dedicated fitness and diet apps. In combination with predictive analytics and AI technology, it can create a one-stop solution for diabetes and its associated disorders, further reducing patient burden and resulting in overall enhancement in patient experience. The collected data can also be used to generate novel insights for doctors, HCPs and MedTech and Pharmaceutical companies, to inform better ways how to treat the individual patient, as well as effective policies for diabetes treatment and management overall (see Figure 3).

EY details

Leveraging our extensive experience in the MedTech sector, EY is uniquely positioned to propel MedTech companies forward in the CGM devices segment. With a dedicated Digital Healthcare Excellence Center, we offer unparalleled expertise in design innovation, data and analytics optimization, and streamlined product launches. Our strategic guidance extends to developing impactful go-to-market approaches, ensuring clients capitalize on market opportunities and navigating regulatory landscapes effectively. Partnering with EY equips MedTech enterprises with the tools and insights necessary to achieve sustained success in a dynamic and competitive industry.

Summary

The continuous glucose monitoring (CGM) device market has experienced exceptional growth recently. In this article, we try to understand key approaches that have shaped the success of major CGM players, discuss challenges CGM manufacturers face and outline the future of the CGM market.

Acknowledgement

We thank Liga Skarda, Aman Bhatnagar and Hebri Nandita Mallya for their valuable contribution to this article. 


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