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  "docId": "019dd923-622c-750b-8b98-916758668d1f",
  "docSlug": "34401c2968d1",
  "documentTitle": "Dexcom, Inc. (DXCM)",
  "authorId": "54_Spruce_Point_Capital",
  "authorName": "Ben Axler",
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  "sourceTypeSlug": "short_seller",
  "sourceTypeLabel": "Short seller",
  "presentationDate": "2019-03-21 00:00:00",
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  "pageNumber": 40,
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  "notes": "The slide uses survey data to undermine the narrative of Dexcom's technological moat.",
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      "kind": "callout",
      "text": "The next generation of Abbott's CGM, the FreeStyle Libre 2 system, is currently available in parts of Europe. This version currently offers: Optional glucose alarms for high / low levels, No finger pricks, 14 day sensor wear period, Smart device capability. When this version is approved in the U.S., would you consider using it?",
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      "text": "Of the 93 respondents who currently use a Dexcom CGM, 81% said that they would consider the Libre 2 when informed of its key features.",
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      "text": "customer switching intent: 81%",
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      "kind": "paragraph",
      "text": "The vast majority of surveyed Dexcom users with Type 1 diabetes do not feel strongly about remaining with Dexcom - even G6 users, who must have adopted their current CGM within just the last several months.",
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      "kind": "paragraph",
      "text": "The extent to which Dexcom is forced to slash prices to maintain market share will ultimately hinge on (1) its technological superiority, (2) the customer's price sensitivity, and (3) customer inertia. We have already established that the G6 will have at best a narrow technological edge over the Libre 2 - but just how sensitive are diabetic patients to CGM prices, and how willing are they to entertain new and unfamiliar CGMs?",
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      "kind": "paragraph",
      "text": "Note that Type 2 diabetes patients - generally considered to be more price-sensitive and interested in user friendliness over technological superiority and dependability - would likely be even less wedded to Dexcom, and that the population of Type 2 diabetes patients represents the vast majority of the untapped CGM market.",
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      "kind": "paragraph",
      "text": "Our research reveals that customer loyalty is surprisingly limited in the CGM space. Spruce Point surveyed 170 CGM users with Type 1 diabetes - patients who are believed to put a relatively high premium on technology and dependability over price. Of the 93 respondents who currently use a Dexcom CGM, 81% said that they would consider the Libre 2 when informed of its key features.",
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      "kind": "table",
      "text": "Survey results table showing Yes/No responses for G4, G5, G6 users and Total.",
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      "kind": "title",
      "text": "CGMs Trending Towards Commoditization, And Dexcom Customers Are Willing To Switch",
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