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Biocontrol Technology, Inc., of Pittsburgh, Pa., has recently received negative media coverage that forced the company to respond in a point-by-point press release distributed in December 1995.
According to the document, "Because of the size of the market we are infiltrating and the large companies involved now and hoping to beat us to market, and because of general lack of knowledge about diabetes and those who suffer from it, some of this negative and erroneous information is to be expected and therefore ignored. However, it has reached a level that demands addressing, both for Biocontrol stockholders and diabetics. As we draw nearer to market entry, not only has the amount of negative information increased but it has also been timed so closely to events crucial to the company that it is very difficult to believe that the timing is simply a matter of coincidence."
In November 1995, Biocontrol met with the FDA about the Diasensor 1000 but failed to receive market approval for the device. The Diasensor 1000 is a non-invasive sensor that directs infrared light through the wrist to measure blood glucose levels. No blood is necessary.
In a November 1995 article in the Pittsburgh Post-Gazette, FDA spokesperson Sharon Snider said, "[Approval of the device] was not the purpose of the meeting. It was just a routine meeting to discuss their particular product."
Biocontrol stated in its press release that, "This was most certainly not (Biocontrol's) perception. Had it been, the company's top management, as well as eight of the world's leading endocrinologists, would not have attended."
Biocontrol says that the endocrinologists who reviewed the Diasensor 1000 "supported the data, then stated during the FDA meeting that they would indeed prescribe the device for their patients, and urged the FDA to approve it."
When DIABETES HEALTH requested a name of one of the endocrinologists who said they would prescribe the device, or a patient who has used it, Susan Taylor of Biocontrol said, "All of this information is, at this time, confidential."
The Diasensor 1000 has also been met with skepticism regarding its efficiency. Some critics have asked if the device works. To this, Biocontrol answers, "If the device does not work, why struggle so hard to get it to the market? Why struggle so long and hard through the FDA approval process and why would eight of the world's leading endocrinologists have gone to the FDA to support the Diasensor 1000 and urge its approval? The company will not survive if a product that doesn't work is supplied. Biocontrol will maintain strictest standards with the Diasensor 1000 non-invasive glucose sensor and will certainly stand behind the product. The welfare of the diabetic is of the utmost importance."
Various critics claim that the Diasensor 1000 is too large and expensive for the average consumer to purchase. Biocontrol responded, "Whoever says this most certainly has not been on the other end of conversations with diabetics where they plead with Biocontrol to get the product to market because they themselves or someone they care about suffers the constant pain and complications of pricking their fingers four to six times a day."
The company says the device will enter the market at about $8,000 but insists that the demand for it will be strong. Biocontrol compares the high cost to the price of early computers, which were expensive because the technology behind them was new. The company is working with "various financial institutions to set up plans whereby the sensor may be able to be purchased on a monthly payment cost close to what a diabetic spends monthly on disposables necessary with the finger prick blood glucose meters that are now on the market."
"Biocontrol will, of course, continue to research ways to bring down the costs."
Biocontrol originally manufactured pacemakers but phased out the operation in the mid-1980s in favor of pursuing a non-invasive blood glucose sensor. It was originally hoped that the device would be market-ready by late 1990. Although the Diasensor 1000 is roughly the size of a personal computer, Biocontrol Marketing director Gary Keeling says that the company "won't be able to keep up" with the demand, and estimates that sales will exceed $3 billion.
Biocontrol's press release refutes the theory that the sensor's large size will discourage purchasers."To have the sensor and not have to prick one's fingers two, five, seven or more times a day is what matters. Once, a computer filled an entire, very large room. Now you can take one wherever you go." Currently, the device is designed for home use, plugs into a wall, and is not portable. It would not replace meters that require blood, since people with diabetes must test their blood sugar throughout the day, not just when they're at home. Because the device must be calibrated for just one person, in a process that takes about five hours, it cannot be used in a clinic or a hospital setting.
According to the Pittsburgh Post-Gazette, Biocontrol has not had a product to sell for some time and lost $12 million in 1994. The company has funded its work through stock offerings. It received $12 million from offshore investors to finance a manufacturing facility for the Diasensor 1000.
Germany-based IMACO will have exclusive distribution rights to the Diasensor 1000 in Germany with the understanding that IMACO will purchase 5,100 of the devices in 1996. On October 25, 1995, the day before the announcement of the IMACO contract, Biocontrol's stock opened at 3 31/32, and closed at 4. After the information about the contract was released, Biocontrol's stock sold for $6 per share, and for $4 per share after its meeting with the FDA.
0 comments - Jan 1, 1996
Diabetes Health is the essential resource for people living with diabetes- both newly diagnosed and experienced as well as the professionals who care for them. We provide balanced expert news and information on living healthfully with diabetes. Each issue includes cutting-edge editorial coverage of new products, research, treatment options, and meaningful lifestyle issues.