CG MEDTECH, DIAGNOSTICS AND DIGITAL HEALTH & SERVICES FORUM - SENSEONICS HOLDINGS INC

Explicit Guidance:

• FY2026 revenue guidance raised to a range of $68–70 million, reflecting 140% year-over-year growth trajectory.
• FY2026 gross margin guidance raised to at least 60%; target gross margin of 70% anticipated with future scale and "Freedom" product launch.
• Anticipated EBITDA break-even and profitability scheduled for the 2028 timeframe.
• FY2027 revenue projected to approach a 100% growth rate (doubling) relative to FY2026.
• IDE submission for the "Freedom" (full implant) product targeted for the first half of 2027; anticipated market launch for this product in mid-2028 following a 90-day FDA review period.

Business-Segment Outlook:

• Commercial Growth: Projected to approach 100% revenue growth in FY2027, driven by a "razor blade" business model with high patient retention (75% first-to-second sensor, 85% second-to-third, >90% thereafter).
• Product Pipeline: Launch of "Freedom" product (fully internalized battery and Bluetooth, no external transmitter) aimed at Type 2 (Gemini) and Type 1 (Freedom) markets; expects this to be the first fully invisible, year-long sensor on the market.
• Geographic Expansion: US currently represents 85% of revenue; Europe represents 15%. Europe focuses on tender markets (four markets), with Germany being a key DTC-enabled market.
• Channel Mix: DTC channel expected to drive approximately 60% of new patient acquisition; HCP channel drives 40%.
• Economic Model: Transition to a $100M+ revenue scale anticipated in the near term; product economics expected to improve via CPT code reimbursements and removal of DME distributor margins.

Market and Competitive Outlook:

• Market Size: Total continuous glucose monitoring (CGM) market valued at approximately $15 billion for the current year.
• Competition Dynamics: Positioned as the only third entrant in the standalone CGM space; competitors (Dexcom, Abbott) are focusing on size reduction while Senseonics is leapfrogging with full implant technology.
• Customer Migration: 90% of current new patients are switching from competitors (even split between Dexcom G7 and Abbott Libre 3) primarily due to "sensor survivability" issues (15–20% failure rate before 15 days with competitors).
• Retention Advantage: High retention rates driven by the elimination of skin adhesions and compression lows, contrasting with weekly transcutaneous replacement cycles.

Macro / Industry Outlook:

• Regulatory (CMS): Anticipates CMS decision pending on reimbursement for non-insulin Type 2 diabetes patients; expects timing to coincide with competitive bidding decisions.
• Reimbursement Structure: Expectation that Medicare will favor the product under the medical benefit (40–50% higher reimbursement) rather than the DME channel due to bundled payment options (procedure + product).
• Type 2 Diabetes Market: Anticipates a significant market expansion if reimbursement criteria are lifted for non-insulin-dependent Type 2 patients, potentially allowing 100% DTC qualification efficiency.
• Automated Insulin Delivery (AID): Trend toward higher integration with pumps expected; Senseonics' full-year sensor stability offers superior Time in Range (76% combined with pump) compared to current integrated systems.

Strategic Initiatives:

• AID Partnerships: Current partnerships with Tandem (Control-IQ) and Beta Bionics (iLet) launched/active; target to have at least two additional pump partnerships in place by 2028.
• R&D and Trials: Initiated first-in-man trial for the "Freedom" product one month ago; data collection will support IDE submission in H1 2027 for a pivotal trial enrolling ~100 patients.
• EON Network Expansion: Currently operating with 100 insertion nurses; planned expansion to 120 nurses within the next few months, with long-term goal of hundreds of nurses covering US zip codes to facilitate primary care and aesthetic clinic insertions.
• Capital Allocation: $127 million in cash and restricted cash available (as of recent reporting); growth capital raised earlier in 2026 to fund DTC marketing and R&D investments.
• Manufacturing/Supply: Focus on scaling production to support the transition to a 70% gross margin structure once economies of scale are realized with the new product.

Risks and Headwinds to Outlook:

• Regulatory Timing: The "Freedom" product path relies on FDA 510(k) approval; delays in the review process or data collection could postpone the 2028 launch.
• Reimbursement Uncertainty: The potential for expanded Type 2 market access hinges on CMS decisions, which may be timed with competitive bidding, introducing uncertainty to the DTC qualification timeline.
• Integration Complexity: New pump partnerships require integration work on the pump side (not just sensor), which may delay time-to-market for new alliances compared to sensor-only updates.
• Patient Qualification: Current DTC efficiency is capped by the inability to qualify patients not yet on insulin; lifting this restriction is contingent on regulatory changes.
• Competitive Response: Competitors may accelerate their own miniaturization efforts, though the transcript notes Senseonics is not competing on size but on the "full implant" differentiator.

Management Tone on the Future:

• High Confidence: Management expresses strong optimism, citing "encouraging results," "strong commercial momentum," and the "revolutionary" nature of the upcoming full-implant product.
• Growth Trajectory: Emphasizes a linear path to profitability and scale, with specific milestones set for 2027 (IDE submission, additional partnerships) and 2028 (profitability, Freedom launch).
• Strategic Clarity: Tone is decisive regarding the pivot to a standalone business model and the elimination of the Essentia partnership (transitioned Jan 1, 2026).
• Innovation Focus: Highlights the "Freedom" product as a primary growth engine, noting it addresses the #1 patient request for invisibility.

Miscellaneous:

• Clinical Data: Real-world data indicates Time in Range increases from 66% (EverSense alone) to 76% when combined with the Tandem pump (highest published results for combined systems).
• Retention History: Product stability validated by patients on the 90-day version, 180-day version, and now 365-day version, with some European patients flying to the US for the one-year insertion prior to EU availability.