Memorandum
As noted briefly in yesterday’s Closer Look, Bigfoot and Ypsomed have jointly announced a supply agreement – a modified version of Ypsomed’s Orbit 360-degree infusion set will be used in Bigfoot’s planned 2018 automated insulin delivery pivotal trial (also including Abbott’s next-gen, factory calibrated FreeStyle Libre).
In Bigfoot’s own press release today, we learned that the modification concerns the “proprietary connector cap,” just as Asante had when its pump was on the market. This is not a commercial agreement, but it is a very critical partnership for Bigfoot, given the need for a custom infusion set. (As a reminder, the Asante pump never had a Luer Lock connector, though this move is in line with custom, proprietary connectors offered by Medtronic (p-cap) and now Tandem (t:lock).)
At first, we assumed Ypsomed may have offered better terms/flexibility than Unomedical (who supplies Medtronic, Tandem, and Roche), but Bigfoot CEO Jeffrey Brewer shared a different perspective with us: “We are only using best-in-class components that support our vision for easy to use, simple to train, high-quality user experiences.” Bigfoot’s press release this morning noted a few convenience advantages with Ypsomed’s Orbit set – 360-degree rotation for the tubing, a novel patch adhesive, and easy insertion. In a Q&A with us, Mr. Brewer also highlighted Ypsomed’s patient-centered design process, unique features in Bigfoot’s pump (auto-priming, sensitive in-line occlusion detector) that Ypsomed is designing for, and Orbit’s common design for steel and teflon versions. Will the deal move to a commercial agreement next year?
Bigfoot’s “2018” US pivotal timing is on track (in line with the Abbott announcement in July), and as noted in our Abbott 3Q17 report, Bigfoot CEO Jeffrey Brewer believes a “2020” launch of the pump-based system is possible. Moving ahead, Bigfoot will need strong clinical trial execution (it has done fewer studies than Insulet), strong product integration (particularly with next-gen Libre), and excellent regulatory progress (given the smartphone interface).
Q&A with Bigfoot CEO Jeffrey Brewer
Q: Why go with Ypsomed’s Orbit vs. another infusion supplier?
Mr. Brewer: The thinking behind why we chose the Ypsomed Orbit set is the same we are applying to any other supplier. We are only using best-in-class components that support our vision for easy to use, simple to train, high-quality user experiences. Additionally, Ypsomed Orbit infusion set utilizes a common design for both teflon and steel versions. Ypsomed, like Bigfoot, employs patient-centric design to develop products that make life easier.
The infusion set Ypsomed has developed for our pivotal trial uses the industry's only auto-priming infusion site, as well as the world's most sensitive in-line occlusion detector, something that precisely measures insulin delivered and is a highly differentiated integrated component of Bigfoot's insulin automation system.
Q: Does this deal have business advantages for Bigfoot’s monthly service model – e.g., more attractive margins for going exclusive?
Mr. Brewer: Infusion sets don't drive our economics, so pricing isn't the driver here. We aren't utilizing the same razor and razor blade model as everyone else. We don't need an integrated infusion set to drive margins. We need an integrated infusion set to drive the simplest customer experience. For Bigfoot, all the system components come bundled together: durable hardware, consumables, software, remote monitoring, etc. and all for a simple fixed monthly service fee.
Q: What would you say to skeptics who might quip, “Bigfoot has not done nearly enough feasibility studies to push into a pivotal trial next year”?
Mr. Brewer: We've done fewer trials than some others because our algorithms have been hardened through the most robust and extensive in silico metabolic simulation engine ever utilized in medical device development. You are about to see results published demonstrating the power of this approach. Effectively, we don't need to do more feasibility trials to test algorithms. We are ready to go to a pivotal trial.
-- by Adam Brown and Kelly Close