Release Date: February 26, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Tandem Diabetes Care Inc (TNDM, Financial) achieved an 18% increase in worldwide sales in 2024, setting new sales records both in the US and internationally.
- The introduction of the Tandem Mobi pump platform was a highlight, experiencing continued growth and expanding the company's product portfolio.
- The company implemented operational efficiencies that set the stage for sustained profitability in 2025 and beyond.
- Tandem's Control-IQ Plus algorithm, now FDA cleared for people with type 2 diabetes, more than doubles the addressable market in the United States.
- The company has made significant progress in expanding its pharmacy channel, with approximately 20% of US lives covered under pharmacy agreements, improving access and affordability for patients.
Negative Points
- The fourth quarter in the US did not meet expectations due to muted seasonality and shipping delays, impacting revenue reporting.
- The transition to direct sales in select European countries may cause some disruption, potentially affecting sales in 2025.
- The sales force expansion and realignment in the US could create short-term disruption, impacting sales performance.
- Despite the positive outlook, the company faces a highly competitive market with more competitors and larger sales forces.
- The pharmacy channel and type 2 diabetes market initiatives are still in early stages, with only modest contributions expected in 2025.
Q & A Highlights
Q: Can you quantify the impact of 4Q shipping delays and December trends on both pumps and supply? Also, is Type 2 and Libre included in the guidance?
A: The majority of the shortfall came from a muted seasonal curve in December, particularly in the last few weeks. Shipping delays were a contributor but not the most significant factor. These considerations were factored into the 2025 guidance. Type 2 and Libre are not significantly baked into the guidance, leaving potential upside. - Leigh Vosseller, CFO
Q: What are the next steps for the pharmacy initiative, and what are the 2025 goals for coverage?
A: We are focused on pharmacy to address out-of-pocket costs. This year, we offer multi-channel DME and pharmacy benefit plan coverage, with patients now receiving products through the pharmacy. We have signed multiple contracts with leading PBMs, covering roughly 20% of lives. Driving scale and efficiency in pharmacy is a top priority. - John Sheridan, CEO
Q: Can we expect meaningful margin improvement from Mobi pump conversions this year?
A: Mobi pump manufacturing costs are expected to become accretive in 2025, contributing to margin improvement. However, Mobi cartridges will take longer to scale and show benefits, likely starting in 2026. This is a multi-year margin expansion opportunity. - Leigh Vosseller, CFO
Q: What are the new product innovations included in the 2025 guidance, and what is the pathway for Sigi?
A: We are launching Control IQ Plus, integrating FreeStyle Libre 3 with t:slim and Mobi, and introducing an Android app for Mobi. Sigi will be an ACE pump, interoperable with our algorithms, and is still in development. Enhancements to Control IQ will be available on Sigi once it comes to market. - John Sheridan, CEO
Q: How does the Type 2 launch impact the mid-single-digit growth in new starts, and what is the timeline for the pilot?
A: The Type 2 market is large and underpenetrated, doubling our addressable market. We plan to start pilot launch activities in March, targeting high insulin prescribers and expanding the pharmacy channel. The pilot will scale based on performance indicators. - John Sheridan, CEO and Unidentified Corporate Representative
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
