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What Are Tandem Diabetes Care’s Key Growth Drivers in 2019?


Jun. 10 2019, Updated 3:34 p.m. ET

First automated insulin delivery pump

Tandem Diabetes Care’s (TNDM) automated insulin delivery system, t: slim X2 Insulin Pump with Basal-IQ technology, predicts a patient’s glucose levels in advance and suspends insulin dosage if there is a chance of a hypoglycemic event. DexCom’s (DXCM) G6 continuous glucose monitoring is used to provide continuous glucose data to the t: slim X2 Insulin Pump. This technological advancement has been the key factor driving the company’s exponential growth in insulin pump shipments in the US market in fiscal 2018 and fiscal 2019 YTD.

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International market expansion

In March 2019, Tandem Diabetes Care was registered as an approved vendor under the ADP (Assistive Devices Program) in Ontario, Canada. According to the first-quarter earnings conference call, this registration has provided access to around 40% of Type 1 Diabetes patients in Canada who reside in Ontario. The company plans to expand coverage for its insulin pump in other Canadian provinces in 2019.

According to the first-quarter earnings conference call, by the end of the second quarter, Tandem Diabetes Care expects to fully resolve the raw material supply issue that had affected its manufacturing capability in the fourth quarter. The company expects to meet all international market demand by the end of the second quarter.

Manufacturing capacity expansion

According to the first-quarter earnings conference call, Tandem Diabetes Care is focused on expanding its pump manufacturing capacity and supply chain capabilities in fiscal 2019. The company is also buying or leasing warehouse space for transitioning equipment currently at its Barnes Canyon facility. Tandem Diabetes Care has leased warehouse space to expand manufacturing capability of its facility at San Diego.

According to the first-quarter earnings conference call, to further expand its cartridge manufacturing capacity, the company is also working on introducing improvements in the cartridge automation process. The company is working to add three cartridge lines for the t: slim X2™ Insulin Pump. While the existing cartridge lines at Barnes Canyon facility manufacture 3 million units annually, the new lines are expected to manufacture 5 million units annually. The incremental capacity is expected to fulfill the demand from the additional 125,000 patients.

According to the first-quarter earnings conference call, Tandem Diabetes Care is also focused on entering partnerships with third-party manufacturers as a solution to rapidly build up manufacturing capacity in fiscal 2019.


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