In response to signing a reimbursement contract with one of the largest insurers in the U.S., shares of Senseonics Holdings (NYSEMKT:SENS), a medical device company focused on blood sugar monitoring, rose 11% as of 10:30 a.m. EDT on Tuesday.
Senseonics announced today that Aetna (NYSE:AET) is now offering reimbursement for the company's recently approved Eversense Continuous Glucose Monitoring System (CGM). This is a big deal for Senseonics because Aetna is the third-largest health insurer in the U.S. with more than 22 million lives covered.
Tim Goodnow, Senseonics' CEO, offered investors the following commentary on the news:
We are pleased that one of the largest national payers in the U.S. is now covering Eversense, and that Aetna recognizes the value of CGM and the value Eversense can bring to the market in terms of patient adherence. We believe this coverage decision represents a major milestone and has the potential to facilitate broad patient and physician access to Eversense in the U.S.
Traders cheered in response to the favorable reimbursement update.
Senseonics is having a banner 2018.
Here's a quick reminder of what the company has accomplished so far this year:
- Raised $50 million through a convertible note offering in January.
- Won FDA approval in June.
- Raised $150 million through a common stock offering in June.
- Secured insurance coverage and shipped its first units to clinics in August.
Add today's update to the list, and it isn't hard to figure out why shares are up 40% so far this year.
But can the rally continue? That's a tougher call as now the company has to go through the hard work of actually selling the device to patients and providers. Given that the company faces a healthy amount of competition from the likes of Medtronic, Abbott Laboratories, and Dexcom, it's hard to know if the Eversense CGM will be able to stand out.
For that reason, my plan is to approach this stock with a wait-and-see mindset.