HEALTH

Reimbursement pressures, product innovation threatens blood-glucose meter market

BY Michael Johnsen

MOUNTAIN VIEW, Calif. — The market for self-monitoring blood glucose meters continues to be promising in the short term, Frost & Sullivan announced Tuesday, with $4.2 billion in revenue projected for 2016 from a 2014 base of $4 billion. However, several challenges limit the revenue potential for this market, including changes in reimbursement and the potential for developing technology to eliminate the need for blood glucose meters. In addition, availability of inexpensive generic test strips has intensified competition and strained participants' profit margins.
 
"Generic test strip market coupled with slash in Medicare reimbursement and national mail order program will affect the market until 2016," said Frost & Sullivan Life Sciences senior industry analyst Divyaa Ravishankar. "Other threats to the market include innovations in continuous monitoring and noninvasive methods of testing being pursued by IT companies like Google."
 
Together, the reimbursement cut and continuous monitoring will have many consequences, including the exit of independent retail pharmacy communities from the program, Ravishankar suggested. Medicare's national mail-order program inhibits retail pharmacies from delivering test supplies to homebound patients on the same day. Additionally Medicare patients will not have access to diabetes supplies from independent pharmacies. The overall result is a reduced accessibility for patients and a drop in the sales of bloo glucose meters.
 
Given the reimbursement reductions and sequestration cuts in the United States, non-invasive methods might replace the SMBG market in the long-run. As alternative markers at the point of care — glycated albumin tests, for example — can ease reimbursement issues associated with the market and provide meaningful care in type 2 diabetic patients, these products could also eat into SMBG's market share, Ravishankar said.
 
Spot monitoring provides a snapshot of blood glucose activity, research has shown that trend data is more useful in determining the long-term treatment regimen for diabetes. Several large companies are investing in continuous monitoring technologies that are proving more useful in determining long-term treatment regimens for diabetes.
 
"Finger-stick tests currently complement continuous devices and these invasive meters losing share to continuous devices is a long term possibility," said Ravishankar. "Non-invasive methods are becoming popular and may replace the SMBG market in the long run, given the reimbursement reductions and sequestration cuts in the United States. Alternative markers at the point of care for instance the glycated albumin tests can ease the reimbursement issues associated with the market and also provide a meaningful care in Type 2 diabetic patients."
 
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Living Essentials relaunches 5-Hour Energy ecommerce site

BY Michael Johnsen

FARMINGTON HILLS, Mich. — Living Essentials on Friday announced the relaunch of the 5-hour Energy web store, Shop5hourenergy.com, which is fully stocked with gear and all varieties of the energy shot. The site also gives fans of the brand the opportunity to sign up for auto ship so they never have to look too far for their next 5-hour Energy shot.
 
"The updated version of the web store offers a number of benefits to our customers," said Melissa Skabich, Living Essentials' communications director. "Now they have easy access to every flavor and variety, including our limited edition shots, an expanded selection of high quality apparel and gear, and the option to have 5-hour Energy shots auto shipped right to their doorsteps."
 
To celebrate the launch, the company will gave away free t-shirts to the first 100 customers with orders totaling more than $25 as a thank you for visiting the web store. In addition, there will be new promotions every month.
 
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Reuters: Alibaba Group Holding preparing online pharmacy powerhouse in China

BY Michael Johnsen

SHANGHAI — Shares of Alibaba Health Information Technology nearly doubled last week after Chinese e-commerce firm Alibaba Group Holding consolidated its online pharmacy operations into the company in a deal valued at $2.5 billion, according to a Reuters report
 
According to the report, Alibaba Health will buy 100% of the online pharmacy operations from a wholly-owned subsidiary of Alibaba Group and another investor.
 
"We expect that this integration will enable Alibaba Group to build a healthcare ecosystem that can utilize e-commerce, big data and other technologies to improve the healthcare supply chain," said Daniel Zhang, Alibaba Group COO.
 
Reuters reported that while online pharmacies in China are currently restricted to the sale of OTC medicines, China is preparing to open its $161 billion prescription market to online pharmacy operators including Alibaba Health, JD.com and Walmart Stores. 
 
The deal is expected to be completed in the third quarter this year, Reuters reported.
 
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