FDA approves Dexcom’s G5 mobile for Android; US launch this month on popular Android devices (Samsung, Motorola, LG) & Android Wear watches – June 7, 2017

Executive Highlights

  • Dexcom announced long-awaited FDA approval of the G5 mobile app for Android today. A US launch will commence this month on the most popular Android smartphones currently on the market, including “several” from Samsung, Motorola, and LG. The G5 app will also be compatible with Android Wear watches.
  • The approval is on the early side of expectations for “mid-year” and follows a fairly long FDA review after a 3Q16 submission. Putting a class III CGM app on Android is no small task, and the burden of developing/maintaining world-class apps for iOS and Android grows by the day.
  • Android holds a majority of the US market, meaning this approval could significantly expand adoption of G5 mobile. Android G5 is also the first mobile app in the US to communicate directly with a CGM transmitter, a notable advantage over Medtronic.
  • This news is also a major win for the Verily partnership, giving Dexcom an approved Android app to build on for the first-gen Verily sensor (launch by end of 2018).

This morning, Dexcom announced long-awaited FDA approval of the G5 mobile app for Android devices. A US launch will commence this month on the most popular Android phones currently on the market, including “several” from Samsung (Galaxy, Note), Motorola (Nexus), and LG (G4, G5). Notably, Dexcom’s G5 app will also display data on Android Wear watches – nice! Today’s approval is on the early side of 1Q17 expectations for “mid-year” and just in time for ADA.

For Dexcom, this FDA review was fairly lengthy following the 3Q16 submission, which underscores how big of a deal it is to put a class III CGM app on Android – testing so many phone models is a big effort. FDA is also highly under-resourced, and Android is definitely less familiar territory for CGM. Unquestionably, it is a lot of work to develop, maintain, and build out CGM apps for one platform, let alone both iOS and Android and their ever-changing operating systems and growing list of devices. For context, G5 Mobile originally launched for Apple’s iOS in late 2015, meaning Android is coming to market ~1.5 years later.

This approval could significantly expand G5 mobile adoption: according to the oft-cited Kantar World Panel, Android accounted for 59% of smartphone sales in the US in 1Q17 vs. 39% for Apple’s iOS (see the cool data visualization here, which trends over time). This dominant market share is actually on the lower side over the past few years, as Android’s quarterly share of sales is regularly in the mid-60% range.

For Dexcom, we assume Android G5 is baked into 2017 revenue guidance expectations – sales of $710-$740 million, reflecting 25%-30% YOY growth – though it will be fascinating to see if this launch accelerates new patient growth. Have some users been waiting for Android G5 to start on CGM? Of course, it will also serve as a convenience win (and passive data upload victory) for current G5 receiver users that have Android phones.

Today’s news is also a regulatory milestone, as it makes G5 Mobile the first class III Android app in the US to display CGM data and communicate directly with a CGM transmitter. Android G5 launched outside the US earlier this year, and our first demo at ATTD showed a pretty identical user experience to the Apple iOS version. See the picture below from Dexcom’s UK website.

Finally, this is a clear win for Dexcom’s Verily partnership, giving it an approved Android app to drive passive data upload, analytics, and behavior change with real-time CGM. The first-gen Dexcom/Verily sensor is expected to launch by the end of 2018 and talk directly to smartphones via Bluetooth (14-day wear, factory calibrated, real-time, fully disposable, lower cost). Today’s approval de-risks some of that regulatory process, as we assume it will most certainly launch on Android. Obviously, Verily is the perfect partner for building outstanding Android apps to expand CGM adoption! We also wonder if Dexcom’s transmitter will be able to talk directly to Android Watches in the future (no smartphone nearby necessary), just as Apple announced this week will be possible on WatchOS4.

  • In the mobile app and wearable area, Dexcom is definitely ahead of its biggest competitors with G5 now on iOS, Android, and watches.
    • Abbott’s FreeStyle LibreLink app has been available on Android across Europe since last November, but we’re not sure if it is part of the US submission (we assume it’s not). Abbott has used partners Airstrip and Newyu to build the LibreLink and LibreLinkUp (remote monitoring) apps, rather than build this in house. Abbott has also not shared firm timing on an iOS version of LibreLink, though we know it is under development. (We’re not sure if this will add Bluetooth to the sensor, or require a separate dongle on the phone to read data.)
    • Medtronic’s MiniMed Connect has been available on Android in the US since October, but it requires a keychain uploader device that talks directly to the pump and relays data (a hassle). Medtronic’s standalone Guardian Connect system remains under FDA review, though we believe it’s only for iOS. Guardian Connect is currently available outside the US only on iOS. Medtronic does have a partnership with Samsung, which will be an asset once it moves Guardian Connect over to Android.
  • Dexcom’s US device compatibility page has not been updated with this news, but based on the international page, we assume G5 mobile will come to Samsung Galaxy and Note, LG G4 and G5, Nexus, and Android Wear watches. Presumably it will download to other Android devices, though these are the “tested” operating systems that have been vetted to use the app.
  • A picture of Android and iOS G5 from Dexcom’s UK website:

Close Concerns Questions

Q: To what extent will G5 Android expand adoption of Dexcom CGM? How many potential Dexcom CGM users will now get on G5 with this approval?

Q: Will G5 Android protect Dexcom against competition from Medtronic and Abbott?

Q: How long will it take Medtronic to catch up and launch an Android version of Guardian Connect? How long will it take Abbott to launch an iOS version of LibreLink? Where are both companies on the Watch front?

Q: How will Verily and Dexcom build on this app with their first-gen sensor?

-- by Adam Brown and Kelly Close