Category Growth and Pricing Environment
Q: Matt Turner with Jefferies asked about the debate around category growth and competitor pricing headwinds.
A: Jake Leach and Jereme Sylvain responded that management has not seen a degradation in pricing globally and remains very confident in their long-term plan, noting that active base growth is in the upper teens and new patient starts are tracking toward a record year.
Q: Robbie Marcus with JPMorgan asked about volume growth and pricing outside the U.S.
A: Jereme Sylvain stated that international pricing has been stable and tiered based on acuity, and Dexcom is priced appropriately to take share in those markets.
PBM Contract Impact and Dexcom Direct
Q: Travis Steed with Bank of America asked about the potential financial impact from a recent CVS contract loss and how it affects 2027 guidance.
A: Jacob Leach explained that the PBM access affected represents a specific formulary portion, while Jereme Sylvain added that the affected PBM represents less than 4% of U.S. revenue and is not expected to significantly impact next year's financial results due to expected price tier adjustments.
Q: Jeffrey Johnson with Baird asked about patient pricing increases and the mechanics of moving patients from pharmacy to medical benefits.
A: Jereme Sylvain explained that out-of-pocket prices for nonpreferred access would be significantly higher and outlined the process of writing scripts to DME providers, highlighting the upcoming Dexcom Direct service to assist patients.
Q: Ravi Misra with Truist asked how to size the risk of other payers moving to exclusive platforms and the economic impact of Dexcom Direct.
A: Jacob Leach noted that most formularies remain co-preferred for patient and prescriber choice, while Jereme Sylvain stated that incremental costs for Dexcom Direct are manageable within the existing growth algorithm and long-term plan.
2027 Financial Outlook and Puts and Takes
Q: Lei with Wells Fargo asked for puts and takes for 2027 and expectations for U.S. growth given coverage expectations.
A: Jereme Sylvain reviewed the progress on gross margins, the upcoming launch of the Ireland facility, and the broader rollout of the 15-day product as key drivers for next year, noting that official guidance will be provided at the appropriate time.
Connect Data and Type 2 Non-Insulin Adoption
Q: Anna Runci with Piper Sandler asked about the contribution of type 2 non-insulin patients to new starts following the Connect study publication.
A: Jacob Leach stated that non-insulin users are not far behind insulin users in new patient numbers per quarter and highlighted that the Connect data is helping raise awareness and prime the market for broader coverage expansion.
CMS Timing and GA Platform Progress
Q: Joanne Wuensch with Citi asked for an update on the timing for non-intensive type 2 Medicare coverage and the next-generation GA platform.
A: Jacob Leach stated that Dexcom still anticipates hearing back from Medicare on a coverage decision this year with implementation in the middle of next year, and targeted launching the GA platform either late next year or early 2028 depending on regulatory review timelines.
International Distribution Deal
Q: Jayson Bedford with Raymond James asked for more details on the newly announced international distributor deal in Europe.
A: Jereme Sylvain stated that the deal has been signed but not yet closed, will have no impact in Q3 or Q4, and represents Dexcom's largest remaining distributor market in Europe as a growth lever for next year.
ADA Standards of Care and Clinical Evidence
Q: Steve Lichtman with William Blair asked about expectations for the upcoming ADA standards of care update and its impact on CMS coverage.
A: Jacob Leach expressed confidence that the Level A evidence from the Connect study will significantly influence the standards of care and support broader coverage decisions by payers worldwide.
G7 15-Day Rollout and Ireland Facility Impact
Q: Bill Plovanic with Canaccord Genuity asked about the G7 15-day exit rate and the financial impact of the Ireland facility.
A: Jereme Sylvain confirmed that tracking toward nearly 50% G7 15-day adoption by year-end remains on track and explained that the Ireland facility will cause a temporary margin drag as it ramps up over the next few quarters before normalizing.
Retention, Utilization, and Customer Support
Q: Mike Kratky with Leerink Partners asked about the impact of utility and retention metrics on U.S. growth.
A: Jereme Sylvain stated that retention and utilization remain very stable across a growing base of type 2 and non-insulin users, supported by customer experience enhancements like the My Dexcom account.
Smart Basal Insulin Opportunity
Q: Daniel Markowitz with Evercore ISI asked about the contribution and timeline of the Smart Basal technology rollout.
A: Jacob Leach reported strong results from the basal pilot showing patients reaching optimal doses in about three weeks without hypoglycemia, and noted ongoing expansion of insulin compatibility and EHR integration before a broader launch.
Primary Care Physician Sales Force and Productivity
Q: Kieran Ryan with Deutsche Bank asked about PCP sales force coverage, penetration, and learnings in the non-insulin market.
A: Jereme Sylvain described the sales force as stable and efficient, noting that the team is continuously refining its approach to maximize physician office touch points and utilizing coverage calculators to drive efficiency.
Operating Expenses and Margin Targets
Q: Marie Thibault with BTIG asked about expectations for operating expenses, G8 investments, and leverage heading into 2027.
A: Jereme Sylvain stated that Dexcom will continue to invest in G8 clinical work and Dexcom Direct while gaining leverage due to the absence of Ireland facility startup costs next year, remaining aligned with the long-range plan.
