TheraSense's Sweet Spot
Executive Summary
TheraSense is making inroads in the $4 billion diabetes testing market. Its FreeStyle glucose meter system is a quality product--perhaps the best in its class. FreeStyle has gained 6% of the US meter market in less than two years, and that share still appears to be increasing. But in the six years since the company's founding, the market has changed; more than ever, glucose meters are viewed as a consumer item. And TheraSense is competing with much larger companies in the space. TheraSense has already seen the marketing of blood glucose meters change dramatically in the past three years. Should the FreeStyle line wither in the face of big-company competition, it would have little left to drive its stock price.
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Brief summaries of recent medtech market and industry developments. This month we cover results from the EVEREST II trial on the MitraClip percutaneous mitral valve repair system, CareFusion's acquisition of Medegen, Sanofi and Agamatrix's glucose monitoring deal and Myriad Genetics' unfavorable patent ruling.
Sanofi-AgaMatrix Deal a Harbinger
Sanofi-Aventis is allying with AgaMatrix around the latter's blood glucose monitoring technology. The deal gets Sanofi a BGM product line and access to a technology around which it can begin to build an integrated diabetes management system. Importantly, it signals to other companies that it is moving in that direction. That could help Sanofi in partnering or M&A discussions around other aspects of diabetes device development, including continuous glucose monitoring, and also stimulate competitors to pick up the deal-making pace.
Sanofi-AgaMatrix Deal a Harbinger
Sanofi-Aventis is allying with AgaMatrix around the latter's blood glucose monitoring technology. The deal gets Sanofi a BGM product line and access to a technology around which it can begin to build an integrated diabetes management system. Importantly, it signals to other companies that it is moving in that direction. That could help Sanofi in partnering or M&A discussions around other aspects of diabetes device development, including continuous glucose monitoring, and also stimulate competitors to pick up the deal-making pace.