Release Date: May 02, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Tandem Diabetes Care Inc (TNDM, Financial) reported a strong start to 2024 with a 12% year-over-year growth in worldwide sales, reaching $193 million in the first quarter.
- The company successfully launched multiple new products worldwide, including the Mobi pump, which has been well-received in the market, particularly for its wearability and the option to disconnect.
- Tandem Diabetes Care Inc (TNDM) has demonstrated a competitive advantage in speed to market with CGM integrations, enhancing the adoption of sensor technology and expanding the market for their AID systems.
- The company has made significant progress in clinical trials, including those for fully closed-loop technology and extended-wear infusion set technology, which are expected to improve clinical outcomes and expand indications.
- Tandem Diabetes Care Inc (TNDM) has increased its 2024 sales guidance to approximately $868 million, indicating confidence in continued growth and market expansion.
Negative Points
- Despite positive feedback, it is still too early to draw definitive conclusions on market trends from the Mobi pump's initial launch.
- The company faces increasing competition, particularly in international markets, as other players like Omnipod and Ypsomed expand their presence.
- There are complexities in accounting for the Tandem Choice program, which could affect financial reporting and transparency.
- While the company is making strides in entering the pharmacy channel, the transition involves negotiations and contracts that could take time to finalize and implement.
- Tandem Diabetes Care Inc (TNDM) is cautious about adjusting their financial outlook further until sustainable trends are observed following new product launches.
Q & A Highlights
Q: Congratulations on the quarter. A number of places to start here. But I guess, first of all, in terms of the initial feedback you're seeing from Mobi and also, in terms of what the split is -- I know it's early days between Mobi and t:slim. Just trying to get a sense of how this is starting to sort of apportion out in the field.
A: Steve, I will say that what we're hearing is that Mobi is redefining wearability. It's small and versatile and its size makes it so that it's light and people forget they actually have it on. And you can also disconnect. The HCPs, they like it because of the unpump bolus button and the performance of CIQ, and they also appreciate the fact that the wireless data uploads automatically to source.
Q: And Leigh, you talked about pricing and coverage. So the implied price that we saw this quarter, which obviously did come in higher, is that a good price to use in the U.S. for the remainder of the year? And any color you can provide on your sort of initial discussions on pharmacy with Mobi would be helpful.
A: Sure. Yes. To the first part of the question on the average selling prices, that is a good baseline to use for the remainder of the year. We're very proud of what our team has accomplished in terms of getting price increases when they're talking to the payers on the DME side of it. But to your question on the pharmacy side, we also have active conversations underway. So the whole team is extremely busy right now, and Mobi is being well received.
Q: I just -- I want to be sure, Leigh, that I understand your comments about the impact of Tandem Choice. And in particular, was there any or what, if any, revenue was recognized in Q1 that was essentially a deferral from Q4?
A: Thanks for the question, Brooks. So understanding that this is pretty convoluted and how this works. But the way you can think about it is from a non-GAAP basis, you won't see any impact from Tandem choice, whether it's deferral of revenue or recognition of revenue associated with it. But on the GAAP side, what happened was when Mobi became available, eligibility ceased for people who were buying t:slim pumps. And so at that point, they're able to go ahead and pick Mobi or t:slim when they purchase their pump.
Q: So a couple of months into the Mobi launch, can you just help us quantify what portion of the news starts? And once you overall came from Mobi and how that aligned maybe more anecdotally just with your own expectations? And then as you've gotten into 2Q, again, maybe just qualitatively how that's kind of track early on?
A: Sure. Thanks for the question. So when it comes to Mobi and its share, first of all, I'll start by saying it was available to a limited population. In the first quarter, we didn't launch it until middle of February, and we also started with just our direct customers. And so it was scaling up across the quarter and on into the second quarter.
Q: I'm just going to ask more directly here. Just -- hoping you could give some indication of 1Q new patient growth? And if not precision, simply -- I mean, it does seem like there was new patient growth, but you also did have a price lift. Just any indication you can give us on at least the first quarter, whether you saw a new patient growth? And if you want to give us magnitude wouldn't mind that either.
A: Sure. I'll go back to the first question, which was new patient growth. And I'm going to speak to it in context of all pump shipments in the first quarter in the U.S. The information that we're able to share is that we did see new pump starts continue to exceed renewal pumps. And so when you look at the split of new versus renewal, new pumps were slightly above renewals.
Q: Leigh, I wanted to follow up on the pricing commentary specifically OUS. I think you had talked about a $2,300 being the right place for the year there. It was higher in the first quarter closer to what we saw in '23. So I just wanted to double check, is '23 still where you think things shake out?
A: Sure. So 2023 in the first quarter, in particular, was unusually high from a pump perspective, that was back when we were undergoing the transition to our new European distribution center. So we didn't have a natural mix of all of our distributor customers ordering in that quarter. This quarter, it was, I would say, a little more normalized. And we expected that ASPs could look something like they did prior to the transition, which was more like the $2,300 mark.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
