DexCom hit after FDA expands approval of Abbott’s Libre

Shares of DexCom (DXCM) are falling after Piper Jaffray analyst JP McKim highlighted the FDA’s approval letter of Abbott’s (ABT) FreeStyle Libre for 14-day wear and a 1-hour warm-up. This compares to the initial approval at 10-day wear and 12-hour warm-up for the glucose monitoring system, McKim told investors last night in a research note. DexCom shares are down 8%, or $8.59, to $93.40 in morning trading. The analyst notes, however, that even with the 1-hour warm-up, it appears Libre still has a non-adjunctive claim. It is unclear at this time what Abbott will do on pricing as currently, patients get there sensors for around $75, McKim writes. If Abbott keeps the same per sensor price of $25 and drops the monthly price to $50, that would make the price gap even greater relative to DexCom, he adds. The analyst views the news as more of a negative headline for DexCom than an impact estimates. He points out that DexCom is working on 14-day indication and 1-hour warm-up as well.
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