Dexcom's (DXCM), stock, closed on a break-out Monday after Medicare officials revealed the largest expansion of coverage for continuous glucose monitors ever in the U.S.
Centers for Medicare & Medicaid Services (CMMS) will reimburse the cost for continuous glucose monitors or CGMs for all Medicare patients that require insulin for diabetes management. The coverage will be extended to patients with a past of glucose-related problems.
Dexcom announced in a press release that the new coverage will allow 1.5 million additional Americans to access Dexcom’s latest CGM, called G7.
Dexcom's stock closed at 118.65, a 2.6% increase on the stock market today. Dexcom's shares have an impressive Composite Rating of 97, out of the maximum 99. According to IBD Digital, this puts Dexcom in the top 3% when it comes fundamental and technical measures.
Stocks of Abbott Laboratories, Inc. (ABT), also rose 0.5% and closed at 104,52. Medtronic shares (MDT), a CGM manufacturer, also rose by 1.8% to close at 82.12.
Teri Lawver is Dexcom's Chief Commercial Officer. She called the CMS decision "a landmark" for diabetics. CGMs track blood sugar levels in real-time. They can then time their insulin treatment appropriately.
She said that the study was part of Dexcom’s efforts to increase access to CGM technology, which is accurate and easy to use, to improve people’s quality of life.
Dexcom's Mobile test found that patients with type-2 diabetes who used basal insulin achieved better results than those who prick their fingers or use a device called a "glucometer". Dexcom's stock price could continue to rise due to increased demand from type 2 diabetics for its devices.
Jared Watkin is the senior vice president for Abbott's Diabetes Care business. He noted that the growing prevalence of diabetes in the U.S. requires greater access to CGM. Abbott estimates that almost 11 million Americans over 65 years of age have diabetes. Abbott produces a body-worn glucose monitor called Freestyle Libre.
Watkin, in a statement, said that "the increase of access by Medicare is a major step to ensure more people have access to Freestyle Libre and can live healthier lives."
Patients with type 1 diabetes genetically prone to the disease are more likely to use CGMs. This type of diabetes is caused by the body not producing insulin. The patients rely on daily insulin injections or insulin pumps.
Type 2 diabetes is progressive. Patients can develop type 2 diabetes to the point where they need insulin injections.
In a written statement, Dr. Thomas Martens said: "This is an important win for the diabetes communities and another validation that CGMs can benefit people with diabetes." Martens, an internal medicine doctor who led Dexcom Mobile's study, is a diabetes expert.
The news has pushed Dexcom's stock towards a breakout. According to MarketSmith.com, shares are consolidating around a buying point of 125.65. On Monday, Abbott closed above the 50-day line for a second consecutive trading day.
Follow Allison Gatlin at URL.
You may also like:
Merck Acquires Prometheus for $10.8 Billion as Keytruda's Patent Expiration Date Approaches
Moderna Crumbles as Cancer Vaccine Results Show a 'Long and Complex' Road
IBD Long Term Leaders - Find the Best long-term investments
IBD's ETF Market Strategy - Learn how to time the market
IBD experts provide stock ideas each morning before the open
Investor's Business Daily published the article Dexcom, a Top 3% Stock, Nears a Breakout on a 'Landmark Medicare Win'.