Closing the Loop: An Overview of Three Business Models in Diabetes Disease Management Devices
Diabetes is a growing problem that affected ~63.8M people in the US, UK, and EU4 alone in 2022; the number is projected to increase to ~80.1M by 2028, as documented in our report, Diabetes Management Devices Market Trends 2023.
These huge numbers drive the continuing growth in the diabetes devices market, with an emphasis on making it easier for patients to manage their disease. The three major components of diabetes management are insulin delivery, blood glucose monitoring, and digital platforms. These components are all necessary to optimally treat a diabetes patient. Ideally, the components are integrated in a closed-loop system which requires little to no intervention by patients.
This article focuses on the three business models deployed by companies in the diabetes management device space: non-integrated, partially integrated, and fully integrated. All three models are focused on how to create a closed-loop system and are applied by the companies regardless of their geography. More information on the market dynamics can be found in our report, Diabetes Management Devices Market Trends 2023.
The business models deployed in the diabetes disease management space include non-integrated, partially integrated, and fully integrated. To become fully integrated, a company must own all components of the diabetes management loop.
These companies focus on one component of the closed-loop system: insulin delivery, continuous glucose monitoring, or a digital platform. These smaller specialists can sell their standalone product but given the evolution of the market towards closed-loop systems, they generally partner with other MedTech companies to optimize their technology, provide greater value to more patients, and bring in greater revenue.
Partially Integrated Companies
This group of companies offers two components of a closed-loop system: typically, a digital platform with either a CGM or an insulin delivery device. To fill the gap left by the missing component, they often partner with non-integrated specialists. These companies are generally bigger players because they have greater capabilities.
Fully Integrated Companies
Among the leading companies analyzed in this report, one company stands out for its fully integrated diabetes management business model because it offers all three components of a closed-loop system.
For the first two models, partnerships with other medtech companies are key to success – and much more effective than attempting to build out a new capability. To add the digital component, if the company does not already have a technology focus, partnering with a small digital company may be the best strategy.
To learn more about the diabetes management devices market and access other key learnings, including the challenges device manufacturers are facing and an assessment of the market trends and dynamics, read our report, Diabetes Management Devices Market Trends 2023.