Insulin management devices maker Insulet (NSDQ:PODD) is highly optimistic about the future, foreseeing "record sales" in upcoming quarters as the company boosts its manufacturing, extends distribution agreements and fortifies its market against the competition.
"Insulet pioneered what is now called the patch pump segment of the insulin pump market, a market that no one else has yet been able to enter," company CFO Brian Roberts told MassDevice.com. "The next generation OmniPod with its reduced size raises the barrier of entry even higher for any potential competitors as the comfort of a smaller device is a significant driver of the patient’s willingness to use."
Insulet hit a record number of OmniPod insulin management units sold during the quarter, reflecting the growing number of patients and the company’s new manufacturing capability for its slimmer next-generation device, which is more than 30% smaller and 25% lighter.
"The fact that we were able to produce a record 1.4 million OmniPods in a quarter, each effectively a small insulin pump, is a tremendous accomplishment," Roberts said. "We produce more OmniPod insulin pumps in a week than the competition does in the form of conventional pumps over an entire year."
The company sent its 1st shipment of its next-generation OmniPod tubeless insulin pumps to Europe through its its international partner, Ypsomed, and doubled the European distribution agreement agreement to include 22 countries, including new regions in the Middle East and Asia.
"We’ve been very pleased with the growth as we see rapid adoption in markets such as Germany and the Netherlands," Roberts told us. "We have shipped Ypsomed the next generation OmniPod and we anticipate a further acceleration as it is launched."
"The relationship with Ypsomed has been very positive to date," he added. "We’re working together now to understand when Ypsomed can obtain reimbursement in order to launch in these new markets such as Austria, Italy and Russia."
The Bedford, Mass.-based company’s losses widened during the 3 months ended March 31. Insulet reported losses of $14.8 million, or 31¢ per diluted share, a 50% increase from losses of $9.8 million, or 22¢ per share, during the same period last year. Analysts had predicted a loss of 28¢ for the quarter.
The dip was partially driven by a $3.8 million interest expense, a significant increase from an interest expense of $2.6 million for Q1 2011.
Sales soared 70% to $47.8 million for the quarter, compared with $28.3 million for Q1 2011, as Insulet produced 1.4 million pods, a record for the company.
Insulet is also looking forward to a previously announced deal to combine OmniPod system with Johnson & Johnson’s (NYSE:JNJ) LifeScan blood glucose monitoring technology. The companies are aiming for a mid-2013 commercial release.
"Insulet is off to a strong start in 2012, with solid revenue growth, continued margin expansion and strategic execution across our business," president & CEO Duane DeSisto said in prepared remarks. "We are excited for customers to start using the new OmniPod in Europe and expect this launch will drive increased demand as customers experience the benefits of the smaller and lighter OmniPod firsthand. We are eager to introduce the new OmniPod in the U.S. as well and are working diligently with the U.S. Food & Drug Administration to obtain 510(k) clearance in the coming months."
PODD shares were up 6.5% to $18.43 as of about 1:15 p.m. today. Wall Street analysts at Cannacord Genuity reiterated a "buy" rating and $27 price target for the insulin devices maker.
