This Company Is Solving Major Problems for Diabetics

Apr 02, 2022

Some of my favorite companies were born by solving a simple consumer problem.

For example, I hate emails.

Sometimes I just want to be able to go straight to the source. Chat through something casually. Keep it rolling!

I am a product of the ’90s, when AOL Instant Messenger was king, so this tracks.

When I discovered Slack, it changed my life.

We use the messaging service at LikeFolio in lieu of old-school emails. We communicate directly and efficiently, and at the end of the day, it makes my life easier.

No wonder Salesforce (CRM) acquired the company last year; this is just one example of how good companies solve problems for consumers.

So this brings us to the first question to ask when analyzing a company for future growth: Is this company solving problems?

For the case of the company that caught our eye this week, the answer is a resounding “yes!”

The Case for Insulet

Insulet (PODD) is a medical device company working primarily on diabetes insulin delivery devices. These devices differ from straightforward insulin injections (needles) and traditional pumps with tubing.

Since I do not have any form of diabetes, it only felt right to speak with someone who does.

Sam, who works with us at LikeFolio, was gracious enough to Slack me some of his experience. And major pain points.

“I’ve had diabetes for about 26 years, and essentially, when it comes to getting insulin into my system, I have only really been aware of two main options: Injections or a pump.

“While having T1 [type 1] is by no means the worst thing in the world, there are frustrations and annoyances.

“I have never had the pump, and my choice to not have it is based on the fact it looks a little clunky, and I will have what I can only describe as a wire hanging out of me at all times.

“As someone who is reasonably active, that sounds annoying.

“When it comes to injections, it is sometimes a little difficult to judge the amount of insulin I need to take. Therefore, I run a slightly more increased chance of having high or low blood sugar.

“In addition, I need to carry the pen around with me the majority of the time.

“These are not big problems, but they are frustrations.”

This is a really powerful perspective because it demonstrates where Insulet can step in.

Insulet’s Omnipod product is a tubeless, wireless insulin management system that is small and attaches directly to the body without the need for any wires or tubes.

It is designed for the user to wear discreetly, addressing some of the problems Sam mentioned above, which is the first reason we have our eyes on PODD.

First: It Solves Consumer Problems

As Sam mentioned above, there are a few issues with the pump and injection methods — issues that the Omnipod helps to solve.

The device is small. The recently released Omnipod 5 is 3.9 cm x 5.2 cm x 1.45 cm, or about half the width of a credit card.

The pod also comes with a “Personal Diabetes Manager,” or PDM, a separate device about the size of an iPhone that is used to manage and view Omnipod data.

However, with the latest Omnipod 5, which is yet to be broadly available, users who have Android smartphones will be able to access data and control insulin delivery via the Omnipod 5 app.

The iPhone app has not yet been developed or cleared by the FDA, but you can see where the company’s head is at.

In addition, Insulet’s product solves the problem of real-time insulin calibration by combining glucose monitoring and a smart system to automatically adjust insulin delivery via the pod.

As a result, it better controls blood glucose levels while reducing the need to carry around a separate blood glucose testing device.

With the Omnipod 5 eagerly anticipated and Insulet also gamifying its marketing, it is no wonder the buzz surrounding the company has seen a boom, with overall Mentions increasing by +75% QoQ and +57% YoY.

Second: Insulet Users Are Happy

To put it bluntly, solving problems for consumers tends to make them very happy.

As Sam said to me previously:

“For me personally, the Omnipod 5 seems like it will help to ease the mental stress of keeping a steady blood glucose level at all times.”

It’s no wonder the company has a very strong Happiness Score of just over 80% after a significant rise in positive mentions since the start of February. The Omnipod 5 was cleared by the FDA for T1 diabetics ages 6 and older on Jan. 28.

Third: Consumer Demand Is Booming

While Consumer Purchase Intent Mentions were quietly creeping higher ahead of the FDA’s Omnipod 5 approval, they have rocketed since.

Mentions from consumers currently using or planning to use an Insulet product have increased by +89% QoQ and +79% YoY.

And, unfortunately, the market for products like the one Insulet provides is forecast to grow. According to Beyondtype1.org, approximately 1.84 million Americans have type 1 diabetes, and by 2050, 5 million people are expected to be diagnosed with the organ-specific autoimmune disease, with around 64,000 people diagnosed each year.

Summary: Omnipod Eases Consumer Pain Points

At the end of the day, a company poised for growth is one that solves consumer problems.

And based on LikeFolio’s real-time consumer data, Insulet is stepping up to the plate to alleviate major pain points for diabetics.

Meanwhile, Insulet stock has dipped about 4% in 2022 and has not been able to sustain a move higher since the start of 2021. Budding competition and FDA hurdles to clear (like distractions from the pandemic) have weighed on investors’ minds.

But right now, LikeFolio data suggests the company is gaining steam. We’ll be keeping an eye on this name, and when we spot an opportunity, our members will be the first to know.

Megan Brantley
Head of Research, LikeFolio