US launch expected in mid-2019 – July 17, 2018

In a major positive for CeQur, the European insulin delivery start-up has acquired Calibra Finesse (One Touch Via) from J&J, the highly-anticipated three-day-wear, bolus-only (2-unit), 510(k)-cleared, super slim disposable insulin patch device. A US launch is expected in mid-2019 via pharmacy distribution (a big positive) and CeQur’s own US sales force. It will launch under a new name.

The Calibra device is already FDA-cleared with a very broad label: subcutaneous bolus insulin delivery in adults requiring insulin – both type 1 and 2. CeQur will immediately begin transferring manufacturing equipment from the existing OneTouch Via plant in Puerto Rico to a “world-class” undisclosed contract manufacturer. No new FDA submission is needed, and J&J has already done some legwork with payers.

We believe Calibra’s unparalleled , slim on-body profile and simplicity has strong potential to make mealtime insulin more convenient, both for MDIs (subtracting three mealtime injections per day) and for transitioning basal-only users to easily add mealtime insulin. This news follows largely positive ADA results in a 44-week RCT vs. pens (1.6% A1c reduction, strong HCP & patient preferences). At its 2016 Medical Device business review, OneTouch Via was pegged as a ~$1 billion global opportunity! We believe that was actually an underestimate and we perceive the opportunity for better insulin delivery for patients as even larger, given the enormous number of people that would benefit from bolus insulin but do not currently take it. Indeed, we see Calibra as market-expanding rather than taking business away from other insulin delivery companies or even from BD – it is a far larger population that would benefit from bolus insulin than currently takes it and we believe the market is ready for this expansion (and that it will not get it from just pens and/or syringes though that market is in growth mode also, particularly with Sanofi’s new mealtime biosimilar Admelog).

This acquisition of Calibra gives CeQur a widely-praised, FDA-cleared, simple mealtime insulin delivery patch to complement its basal-bolus PAQ device. PAQ’s FDA submission is now expected in 4Q18, with a US launch expected in ~2020-2021 (~12-18 months post-Calibra’s launch). PAQ is running ~three to foru years behind schedule, as CeQur has had to work on its manufacturability for high volume/low cost. CeQur is not the acquirer we initially expected, but we think Calibra is an outstanding fit in the company’s portfolio.

With this news, J&J is officially out of the diabetes device business, following Animas’ shutdown last October and the completed ~$2.1 billion sale of LifeScan to Platinum Equity in June. J&J originally acquired the Calibra device in 2012 (price not disclosed) – boy has this device been a long-time coming!
There is no information on acquisition price/deal terms but we are assuming CeQur got a beyond-great deal given J&J’s decision not to serve patients who need diabetes devices. We assume J&J management is very disappointed it did not move into CGM as advised over the last decade by various managers. We ultimately see the CGM business growing larger than the traditional blood glucose monitoring business. Our team is speculating that CeQur paid between $5 million and $20 million for Calibra – of course, this is pure speculation.

– by Adam Brown, Maeve Serino, and Kelly Close
For further details please visit www.closeconcerns.com