DexCom Inc at JPMorgan Healthcare Conference (Virtual) Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Robert Justin Marcus - JPMorgan Chase & Co, Research Division - Analyst : All right. Well, great. Thanks, Kevin, and I think -- there we go. We've got Quentin joining as well. I think everybody is -- as much as there is to talk about the future, the opportunity, the total addressable market expansion, I think everybody today is much more interested in your fourth quarter results and your 2020 guidance, so maybe we could start there. You put up in the $15 million to $20 million range beat. It doesn't look like you have the full numbers locked and set in stone yet, but it looks to be -- during the pandemic, honestly, a good quarter here. Growth of at least 23% with international sales of 33%, in the U.S., up 20%. Quentin, you and I were talking about this a bit offline before, but I think it'd be great if you could just start off giving us some color on the U.S. experience in the quarter and some of the puts and takes that ended up driving these results.

Question: Robert Justin Marcus - JPMorgan Chase & Co, Research Division - Analyst : So Quentin, in the third quarter call, you actually gave us a number on volume approaching 40%, if I remember off the top of my head. What was it in fourth quarter here, if you could tell us?

Question: Robert Justin Marcus - JPMorgan Chase & Co, Research Division - Analyst : Wow. So if we take a step back and we look to 2021, at the Analyst Day in early December, you said you were approaching 50% in the pharmacy. It probably sounds like maybe you're on the other side of that metric now given your comments. But if your target is 75% in the pharmacy based on where you think contracting can go, if this was next year, we probably would be exiting 2021 with closer to a 30% revenue rate, right, all things considered in this quarter given that you'll probably be done with most of the conversion to pharmacy at that point?

Question: Robert Justin Marcus - JPMorgan Chase & Co, Research Division - Analyst : Got it. So maybe I'll take it a year out further. You shouldn't have much more in 2022. Is that the year we should see volume more closely aligned with sales growth?

Question: Robert Justin Marcus - JPMorgan Chase & Co, Research Division - Analyst : Great. A couple of questions here from the audience. The price headwind, or I guess, we're calling it the channel mix shift, I think, is a much more appropriate...

Question: Robert Justin Marcus - JPMorgan Chase & Co, Research Division - Analyst : What?

Question: Robert Justin Marcus - JPMorgan Chase & Co, Research Division - Analyst : Yes. Because it's not price. It's not like-for-like price it sounds like, it's mix. What was that number if you look back on 2020 here?

Question: Robert Justin Marcus - JPMorgan Chase & Co, Research Division - Analyst : Great. And the international number, getting some questions on that. It was a good step-up from what we'd seen recently. Any comments around the strength there?

Question: Robert Justin Marcus - JPMorgan Chase & Co, Research Division - Analyst : Got it. And last fourth quarter question here. Quentin, can you talk about what you -- or Kevin, if you want to take it, what did new patient growth look like? That's obviously -- sales is great, but new patient growth is the metric of the future growth. So how should we think about new patient growth in the fourth quarter here?

Question: Robert Justin Marcus - JPMorgan Chase & Co, Research Division - Analyst : Got it. Before we jump to guidance, Kevin, there was one question I wanted to pose to you. I think it was asked at the Analyst day, and to me, it's one of the key fundamental ideas of DexCom that investors really need to pay attention to and buy into for the longer term, and that's really where is all the R&D dollars going that you spend? We see it on G7, but you guys dropped little hints and bits here and there. I think Quentin last year at some point mentioned something about sepsis detection at a conference somewhere. What are all -- how do we think about where all the R&D REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JANUARY 11, 2021 / 4:40PM, DXCM.OQ - DexCom Inc at JPMorgan Healthcare Conference (Virtual) dollars are going? And I'd love to get your thoughts on data because DexCom has so much data that a lot of your competitors don't have, particularly Abbott, with all the sensor data going through Bluetooth that you've collected over the years. So what's really out there that investors don't know about yet?

Question: Robert Justin Marcus - JPMorgan Chase & Co, Research Division - Analyst : Great, great. And I look forward to hearing all of those exciting new products coming from DexCom over time. Maybe just to redirect back to the 2020 (sic) [2021] guidance here. And I'm sure you'll give us a lot more on the earnings call, but I just want to make sure you have the opportunity to lay out for investors. And some Street models do this well, some maybe don't do the best job, but it's a pretty simple issue of lower new patient growth in 2020 leads to a little less new sales growth in 2021. So you've had some pretty great growth numbers given the pandemic, but maybe, Kevin or Quentin, you can just walk us through how that rolls through the model? And anything you want people to be aware of as they set expectations here?

Question: Robert Justin Marcus - JPMorgan Chase & Co, Research Division - Analyst : Understood. Well, unfortunately, I could go on for a lot longer, but we're out of time here. Kevin and Quentin, thank you so much for joining. Appreciate it. And I'm really excited for what's on tap here at DexCom for 2021. Appreciate it.

Question: Robert Justin Marcus - JPMorgan Chase & Co, Research Division - Analyst : All right. Thanks everyone. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JANUARY 11, 2021 / 4:40PM, DXCM.OQ - DexCom Inc at JPMorgan Healthcare Conference (Virtual)