Insulet Corporation (PODD) Earnings Call Transcript & Summary

Good morning. I think we're going to get started. My name is Jayson Bedford. I cover medical devices here at Raymond James. Thank you, certainly, everyone who's joining here. Kicking off the med devices track here at the 42nd Annual Raymond James Institutional Investors Conference is Insulet. They've been coming to this conference for 10-plus years now. And hopefully, next year, we'll be back down in sunny Orlando. So we've been fans of this business, and the management team has done a great job of executing on the differentiated features of the product and the business model. I think they're entering a new phase of the business with the launch of an exciting new product in 2021 here. So here to tell us more about the business, the company's CEO and President, Shacey Petrovic. Over to you, Shacey.

Thanks, Jayson. It's great to be here with you. We wish we were in sunny Florida because we are based in Massachusetts, but thrilled to be with you virtually and to be able to share Insulet's growth story. For those on the call today that are not familiar with Insulet, we are a company focused on a simple and powerful mission to improve the lives of people living with diabetes. You can see how we do that is through our Omnipod, which is a 3-day wearable disposable patch, waterproof pod that delivers nonstop insulin for people living with insulin-dependent diabetes. You can see the Omnipod pictured here on Michelle's arm and her daughter Emma, and they both live with type 1 diabetes, both use Omnipod. We're very fortunate to have now more than 250,000 people relying on Omnipod across the globe, many who want to share their images and their stories. And so you will see that throughout this presentation. You can move forward. Today, I'll be talking about forward-looking statements. You can find a list of our risks and uncertainties included in our 10-K, which is on our website, recently filed. You can move forward. So we have an important mission. We have a mission focused in one of the largest and fastest growing disease states across the globe and a differentiated technology. And today, I will talk about this large and underserved market that we are capturing with our technology. I will talk about how we are providing really disruptive, easy, affordable access for more customers across the globe, particularly in the U.S., through the pharmacy channel. I'll talk a bit about our consumer-focused innovation and a very exciting next-generation technology that we'll be launching in the coming months and then our plans to continue to deliver strong revenue growth and expanding margins over the future. You can move forward. Last week on our earnings call, somebody described our performance as pretty extraordinary even without a pandemic, and that is certainly true. 2020 for Insulet was an incredible year. It marked the company's fifth consecutive year of more than 20% revenue growth. In 2020, we were able to double the number of teams and people working on our next-generation technologies that will drive many future waves of growth over the coming years, and we made significant progress in terms of international expansion and manufacturing and supply chain capabilities. And we sit here pretty thrilled with where we landed in 2020 and the momentum but even more excited because 2021 and the coming years are positioned to be even more impactful and deliver even more growth as we saw in 2020. So if we can move forward to the next slide. Behind the performance metrics in 2020, you can see that we made significant advancements in our strategic imperatives, so the areas that we're focused on to really drive long-term growth. And that is, one, driving more affordable and broad access. We see insulin pump therapy as a therapy that has traditionally been very complex, very costly and really limited to a small group of tech-savvy well-resourced users, and we are developing and deploying strategies to bring our technology to more people across the globe. Access is one piece of that. The other is our innovation pipeline and our efforts to really deliver the most valuable and easiest-to-use technologies to people living with diabetes. And then, of course, international expansion, which I'll talk a bit about, is a significant growth driver for us. We really are in a small part of the world and plan to be in a much larger part of the world in the coming years. And then we are investing significantly in manufacturing and operational world-class excellence to be able to support the scale and this growth over the coming years. All of this investment is really positioning Insulet to deliver a long-term sustainable growth over the coming years. Next slide, please. So today, Omnipod is available really in a small part of the world, in about 20 countries across North America, Europe and the Middle East. And in those countries, we estimate there are approximately 11 million to 12 million people who require basal and bolus insulin and can benefit from Omnipod's discrete, simple, effective insulin delivery. The type 1 market is much more penetrated than the type 2 market. In fact, we're seeing both markets grow but the type 1 being a bit more mature. And our growth in these markets has been driven significantly by our innovations that we've brought to market in the last couple of years and ones that are coming, our efforts to drive broad affordable access. And the growth is really also driven by external trends like CGM adoption. As CGM is adopted really very broadly among people living with type 1 today and just beginning to be adopted more broadly by people living with type 2 today, that trend is very favorable for getting people more information and looking for better tools like Omnipod to help deliver their insulin and manage their diabetes. So over the coming years, we expect that our penetration within this enormous market will grow, and our total addressable market will also grow as we expand into new countries and bring Omnipod to more people across the globe. Next slide, please. Omnipod today is really growing primarily among people who use multiple daily injections. So you can see Alecia in the center of the slide, she's wearing the Omnipod on her upper arm. Before adopting Omnipod, Alecia, like the vast majority of people across the globe, relied on multiple daily injections. That's pictured on the left hand of the slide. You can see for people like Alecia, people who were using multiple daily injections, one pod replaces up to 14 or 15 injections because that pod is worn over 3 days and on average, people are injecting themselves 4 to 5 times a day. So pretty significant improvement in quality of life, ease of use and outcomes, and you can imagine how Omnipod helps Alecia get more freedom, less burden to be able to do the things she loves like cooking. Alecia also considered conventional tube pump therapy, which is pictured on the right-hand side. A conventional tube pump is a relatively complex device. You can see all of the components pictured on the right hand of the screen. It is not very discrete and can be somewhat cumbersome because it is attached via 3 to 4 feet of tubing to a user's abdomen. And the challenge with conventional pump therapy that really was a problem for Alecia and for many others like her is the cost of the system. The system pictured here on the right will cost a patient or a payer around $5,000 upfront and then will lock a user into 4 years of commitment. And so these things have been -- these factors, its complexity, its cost and its not being discrete, have really niched the technology. And so we're helping to grow the overall category and bring pod therapy to more people who can benefit from it, like Alecia. Next slide, please. Our technology has been particularly appealing for the multiple daily injection user. This is great because it is the largest opportunity out there for both people living with type 1 and type 2 diabetes. Today, about 80% of our new customers previously used multiple daily injections, and the majority of those users tell us that they would not have come to pump therapy if not for Omnipod and all of the benefits that we've talked about. One thing we haven't talked about that has also been particularly important in 2020 is the ability to really leverage the simplicity of the technology. Omnipod is so easy to learn and to ramp up on that, that could be done in the comfort of your own home just through virtual training. And so that has been particularly important in the last year as the pandemic hit the United States and other parts of the world. And all of this has led to industry-leading retention and customer loyalty. And I think one piece that's not listed here that is really important to double-click on is the unique access and business model for Omnipod. So we'll talk about that in this next slide. About 2 years ago, we launched into the pharmacy with Omnipod DASH, which is our current generation system shown here on the screen. Today -- prior to Omnipod DASH, virtually all of insulin pump therapy was accessed through the durable medical equipment channel. And it was this model where a payer or a patient pays thousands of dollars upfront and then is locked into a 4-year contract and paying for disposables over that time. This caused patients and physicians to be reluctant to adopt the therapy, particularly for new segments like -- or for newer segments like the type 2 segment, and it caused payers to put a bunch of burden and restrictions in place for who could access the technology because they had to worry about compliance because they were shelling out thousands of dollars upfront. With Omnipod DASH, we really disrupted that model, and we brought our therapy to market through the pharmacy channel, which enabled us to provide therapy with no upfront cost and for most patients to access the therapy with a very reasonable monthly co-pay, to the tune of about $50 a month, so very cost-effective and very broad access for people living with both type 1 and type 2 diabetes. And so that has made a big impact in the marketplace and has really driven a lot of our growth. You can see here that now this technology is covered for 75% of U.S. covered lives, that's for both type 1 and type 2; and that, in fact, 35% to 40% of our new users live with type 2 diabetes, a segment of the market that traditionally was not prescribed and did not adopt pump or pod therapy. So it's great to see this model and the simplicity of this technology be -- driving new people and be able to bring our technology to more people in need. We will also launch our next-generation technology, Omnipod 5, which will be here in a matter of months through the pharmacy channel and through this disruptive business model where we don't charge upfront and we don't lock people into 4-year contracts. Omnipod 5 is pictured here with Max. He's holding his Omnipod 5 system. This is in partnership with Dexcom, our automated insulin delivery system. And Omnipod 5 will deliver a number of very exciting firsts to the market. It really is designed to be the simplest, best AID system on the market. In fact, what this is, is the Dexcom G6 sensor and the Omnipod directly integrated so that insulin dosing is automated and there is dramatically improved outcomes and reduced burden for users. Max is actually wearing an Omnipod and a Dexcom. You just can't see it because both devices are so discrete, and he's holding the handheld controller. Omnipod 5 will be the very first entirely wearable AID system with the algorithm on the disposable pod. It brings a number of features designed to drive dramatically improved outcomes and ease of use and flexibility. And probably the #1 feature that is incredibly exciting for our users is full smartphone control. So for our Omnipod users like Max, a user will put on a pod, put on a sensor, download a secure app on their Android mobile phone and be off to the races managing their diabetes. And we do plan to follow with iOS control as well. So pretty exciting and we are very excited to be able to bring this technology through the pharmacy channel and offer it to users with a really low, reasonable out-of-pocket cost, make it more affordable and more accessible for our users. We are on track to launch Omnipod 5 in just a matter of months in the first half of this year, and we know it's one of the most anticipated innovations in the diabetes pipeline. Next slide, please. Omnipod 5 is really just the beginning. Behind Omnipod 5, we have a very exciting pipeline full of innovations to bring value to people living with diabetes. At a high level, we're focused from an innovation perspective on simplicity. We really see insulin pump therapy as overly complex and part of what has been niching it. And so our goal has been to provide the easiest-to-use technology for young children, for people living with multiple daily -- or relying on multiple daily injections and for people living even with type 2 diabetes. And so the simplicity starts with our easy-to-use pod, but we are working on driving incredible simplicity throughout every aspect of how the user interacts with our systems. Omnipod 5 -- we'll go back one slide, please. Omnipod 5 does also launch our ability to really dramatically improve outcomes because of the integration and automated dosing, but that's just the beginning. We are working on advancing our algorithms to continue to provide improved outcomes. And then, we also view data as potentially incredibly empowering for patients. And with Omnipod 5, we now get access to troves of data: continuous glucose monitoring data, how the user is interacting with their system as well as insulin delivery data. And because we are now on the user's phone, over time, we will have access to other sources of data like calendars and Fitbits and all sorts of things. We believe that we can leverage this data and especially our position on a user's phone to provide valuable insights and to empower our users, their clinicians and even payers. And then finally on the choice side, we are very excited about our current generation, which is in partnership with Dexcom's G6 sensor. But we do plan to bring our technology to integrate it with other sensors like Abbott's Libre as well as Dexcom's G7 and also to follow our Android phone control with iOS phone control, so looking to bring our technology to users with their choice of sensor and their choice of phone platform. You can move forward. Thank you. Great. So all of this investment in broader access, in consumer-friendly innovation and in global expansion has been driving a pretty terrific trajectory of growth. You can see here for this year, in 2021, we've guided to just over $1 billion and continuing a 20-plus percent CAGR. We will also see significant gross margin expansion in 2021, and that is driven primarily by a significant investment in highly automated manufacturing in the United States, which gives us leverage and also supports, in a cost-effective way, our scale. And then finally, we will see a significant expansion in our operating margin this year as well. So we are in the unique position of serving one of the fastest growing markets in med tech, and that is really enabling us, with our differentiated technology and our access strategies, to expand significantly on both the top line and the bottom line. And in closing, on the last slide, I'll just share here that what we see over the coming years is our ability to really unlock this large and underpenetrated market opportunity, and we're doing that by driving broad, affordable access for technologies that typically were too expensive and really focused on consumer-focused innovation that brings simplicity and reduce burden in a new way to users in all sorts of segments. And we believe that these advantages are durable and will allow us to continue to drive strong revenue and expanding margins over the long term so that we can make good on our mission to improve the lives of people with diabetes like Myrthe here, who's one of our Omnipod users from The Netherlands. So thank you very much.

That's great. Thanks, Shacey. It's a nice story to tell. So I guess let's -- remaining 20 minutes or so, let's kind of dig into some questions here.

Great.

Let's start maybe just with the current environment. You reported last week. I thought fourth quarter was quite strong for the entire pump market, up mid-teens by our math. So I guess I'm just wondering is there any more detail you can give us about the fourth quarter inflection in the market? Is there pent-up demand? Do you think endos are seeing more patients in this virtual world? Anything that would kind of give us a little bit more flavor on the strength of the fourth quarter. And certainly, the guidance for all of the pump companies really pertains to continued teens growth.

Yes. It's a great question. I think we have seen in our performance in the fourth quarter a terrific performance. We saw obviously record quarters in terms of revenue growth. We saw a record global new customer start quarter driven by real strength in the United States in terms of new Omnipod adoption. So that was very encouraging for us because we had seen through 2020 some challenging quarters really in Europe in Q1 through Q3 and in the United States in particular in Q2 and Q3. So the fourth quarter for us was the first time that we saw both regions, our international and our U.S. region, deliver more growth in terms of new customer starts year-over-year. And so that was terrific to see. I think we are seeing the world and certainly clinicians and patients adapt and find a way to continue to bring new technology to patients in this environment, and so that has been helpful. And then, of course, we have been investing in continuing to drive increased access and also increased awareness, and those things, I believe, contributed to the strong Q4 and sets us up for really exciting momentum in 2021. Because, as we think about moving into 2021, we see coming off of Q4, a record quarter. We see continuing investment in DTC, and of course, we see our launch of Omnipod 5 into the market in the first half of this year. We'll be in limited market release, but you've seen we've been growing really nicely even without an AID or integrated system. And so we are very excited to see the continued momentum with type 2 and MDI users in type 1 and then see the impact that will come with what we think is going to be an incredibly differentiated technology in Omnipod 5. So we're certainly at a technology inflection point with CGM adoption and AID adoption and with at least Omnipod being able to penetrate also into the type 2 segment.

Okay. A few topics I'd like to hit on. But I guess just -- you mentioned in your presentation unlocking this market. I think on the 2Q call, you mentioned that you expect the type 1 pump market in the U.S. to double in the coming years. Just wondering, based on your models, where are we today in terms of penetration? And over what time frame do you think the market can double?

Sure. So it's -- we're in this very large and underserved market. In the type 1 segment, we believe there are 1.5 million to 2 million people living with type 1 diabetes in the U.S. and over 2 million people living with insulin-dependent type 2 in the U.S. We think that the type 1 market is just over 1/3 penetrated and that the type 2 market, we are just very -- at the very beginning of penetration, so less than 5%. And we believe in both segments, Omnipod is extremely differentiated. In the type 1 segment, we think that differentiation grows with the launch of Omnipod 5. In the type 2 segment, based on the simplicity of our technology and the business model, we believe that we have a very strong competitive position in that segment. So we do see that both of those will grow in terms of penetration over the coming years. We think that the other dynamic that's driving growth there is CGM adoption. So in the U.S. in the type 1 segment, we've seen pretty rapid displacement of blood glucose monitoring for CGM. And that trend has been very helpful to drive then adoption of pump and pod therapy, and that CGM adoption is really starting to ramp up now in the type 2 segment and will be helpful for pod adoption over the coming years. We think that the type 1 market can easily get to over 50% penetration in the coming years. And we haven't really put a target out there for type 2 because it's just so new. We're sort of standing at the beginning of what we think is going to be rapid market adoption. But it's so early in the adoption curve it's a little difficult to predict at this point. But we certainly see that with the launch of new technologies like Omnipod 5 for both type 1 and type 2, we can drive significant growth in this marketplace.

Okay. I don't want to be a bad guy and pin you down, but coming years, is that next 3 years over 50% penetration in the next...

I'd say in the next 5 years, we can get to over 50% penetration.

Okay. Omnipod 5, you mentioned in the presentation that it will improve outcomes. You've got data coming up in late March. What should we look for in terms of key metrics? What kind of -- what level of time-in-range is acceptably competitive? And what should we prepare for?

Yes. Great. So we are publishing our data or presenting our data at ENDO just in a few weeks here. And what I'll point to is the pre-pivotal data because that's what we have available to talk about today. And if you look at Omnipod 5's pre-pivotal data, it delivered best-in-class time-in-range for actually all segments, including children, which is a pretty hard segment and which we chose to tackle with our pivotal right from the beginning. We will launch the technology with an indication down to age 6 and then follow pretty rapidly down to age 2. So if I were looking at the data, I would look at number one, time-in-range. The pre-pivotal data would indicate that will be very strong and competitive, but that's just part of the story. I would also look at improvement from baseline, how -- depending on where the patient population started, how much they move in terms of time-in-range percentages. And I always point to hypoglycemia as a really important metric. This was an area where in Omnipod 5's pre-pivotal, the system was very differentiated. There are AID systems on the market today where a user really has to trade off hypoglycemia and time-in-range and that there's an increasing risk of hypoglycemia as you get into tighter control. We did not see that with Omnipod 5, and I think that's because of a feature we call HYPOPROTECT, which is a very easy, touch-of-a-button mode that the user can go into for overnights or for exercise, moments where there is increased risk for hypoglycemia. And so we saw best-in-class time-in-range and best-in-class, by a significant margin, hypoglycemia. And if that advantage holds in the pivotal, I think that's significant because hypoglycemia is the #1 cause of hospitalizations and diabetes distress, and so pretty significant if we can remove that stress from the patient. And then the last thing I would say is all of these systems are going to improve time-in-range. The algorithms do a nice job. How well they perform in the real world and whether or not MDI users will adopt them will really come down to usability. And that's an area where we believe we've got a significant advantage and one that I think we'll see demonstrated in the data.

Okay. Okay. In terms of the limited launch, is it limited just because you need to iron out access? Or what is the limiting factor?

Yes. The primary objective for the limited market release is access. We are committed to bringing Omnipod through the pharmacy channel, but we do have work to do to get established access. The other thing we'll be doing in the very early part of the limited market release is just ensuring that we've tested all of the customer journeys for different segments. Today, 80% of our new users come from multiple daily injections. That's been the case for a long time, and so we really understand how to train, ramp up, support those users. As we move into Omnipod 5, we've added the Dexcom sensor, and we expect that more users -- more of our current users will adopt Omnipod 5. We will still have users coming from multiple daily injections. And we're likely to have users coming from tube pumps because they can access the technology without any upfront cost, and so they can move anytime. And we want to test the customer journeys, the training and support for each of those segments. But I think that's going to happen pretty rapidly, and then the real test and the real driver of the length of limited market release will be how quickly we can establish broad access through the pharmacy.

The 80% of users coming from MDI historically, do you expect that mix to change with Omnipod 5?

I think it's a good question. I mean certainly, we know from our market research that Omnipod 5 is going to be very appealing for the multiple daily injection user, particularly the user that is wearing a Dexcom sensor today. And we also know through our clinical data that the system performs very well in that segment. That said, we have been competing very well without an AID system. And the market research would indicate that when a person chooses a tube pump, they're typically not choosing a tube pump. They're choosing a -- they're basically sacrificing the form factor for automated insulin delivery and CGM integration. And so with our business model because we can offer this technology without any barriers, people can try it really for free, that we think we'll probably have a more competitive system for tube pump users, and that could change then just the optics of where the customers are coming from.

Okay. Getting back to the access dynamic, what's the anticipated payer pushback here? If price is the same, what's the pushback?

Yes. I don't think there's necessarily pushback, but we are the only automated insulin delivery system available in the pharmacy channel. So there's just education to do there. And we don't have our data public yet and we don't have FDA clearance, so most of that work -- the conversations are underway about what's coming, about educating the channel on what automated insulin delivery is and what the potential benefits are for patients. But the real kind of start to establish broad access will start with clearance. And so we've just got the work to do to get in touch with hundreds of payers, maybe 1,000 payers, and establish coverage for the system. I think that will happen more rapidly than it did for DASH but still is a tremendous undertaking and one that we can't really make significant progress on until the product is cleared.

And do you have to sign new contracts with all of these payers?

We do, yes. It's not a new -- in some cases, it's an amendment to the contract or in addition to the contract. That's the work that we did with Omnipod DASH that is leverageable for Omnipod 5, is we -- in the last 2 years, we have established wholesaler relationships. We’ve established pharmacy benefits manager relationships, coverage, et cetera. So a lot of that will help us to be more efficient in how we set up access for Omnipod 5. But we still do need to get to all of them, and we need to get the product on to the contracts for all of our payers.

Okay. And remind me, DASH, roughly 70% access right now and you expect to be a bit faster ramp here from an access perspective for Omnipod 5, correct?

That's right. So we have 75% of covered lives now for DASH. The majority of that is in the pharmacy, not all of it, but the majority of it. And with Omnipod 5, -- so that took us about 2.5 years to establish 75% coverage. With Omnipod 5, we would expect that to happen more quickly. So we haven't given a target out there in terms of number of lives by X date. Certainly, we have internal targets, and the teams understand that this is the most important thing that we're doing in 2021. The most important metric for Omnipod 5 is going to be covered lives because we know there's great demand. We know people can switch to the technology as soon as it becomes available, and there's going to be many people who want to do that. And so we've got to establish broad access.

And why make the choice to go through solely the pharmacy with Omnipod 5?

Well, it's a -- we have been developing the go-to-market strategy for about 3 years now with Omnipod 5. And in that time, we've sort of learned a lot about the pharmacy channel as well as we've ramped -- as we've entered into the pharmacy and ramped up our volume there. Today, with Omnipod DASH, an Omnipod user can access the technology through the pharmacy with very little constraint, very little barriers and with the average -- on average of $50 per month co-pay. So it is very affordable. That's in line actually with multiple daily injection costs for the user. And when we look at the pharmacy, we saw that the customer experience is much better because you have this predictable, very reasonable out-of-pocket co-pay. It's a much more efficient channel because a physician simply has to write a prescription, and in 2 to 3 days, the user can go pick up Omnipod 5 -- or Omnipod out their pharmacy. And it's where the patient goes already to get their insulin and their CGM or BGM supplies. So there's a lot of benefits for the user and for the clinician and actually for the payer because it's this risk-free model for the payer and the pharmacy where they don't have to pay a bunch upfront and then hope for compliance. So all of those benefits said to us -- we want the vast majority of our users getting those benefits. And we can leverage Omnipod 5 to bring more people into the pharmacy and get them experiencing the benefit, and it's obviously a bit of a competitive moat for us as well. And so all of those things make it a great channel for all of the stakeholders.

Fair. When you get approval, do your marketing efforts intensify? Any anticipated change or -- in the sales force in terms of increasing the size of the team?

We are growing our sales force. We've grown our sales force virtually every year to keep up with demand. In terms of DTC efforts, I think it's a good question. We started investing in broader DTC in September of 2020 with direct-to-consumer advertising on television. We've always been very active in digital and learned a lot there and gotten very sophisticated, but it was more about conversion than awareness. And we started to drive broader awareness with television starting in the last quarter really in earnest, and we've learned a lot there. I think we have to be careful with Omnipod 5 because we will be in limited market release. And so we want to be thoughtful about the timing where we really drive more awareness and more demand. But we are committed to continuing to create additional demand around Omnipod in general and just its simplicity and its advantages. And that has definitely driven favorability in Q4. The efforts have been, I think, very successful. But we want to be thoughtful both in access, full market release and awareness with Omnipod 5 because we don't want to open the floodgates and then have -- really have limited ability to get the technology in the hands of people that we know are waiting for it.

When should folks in Europe expect Omnipod 5?

We haven't given a time line. That work is underway. And in fact, another program that is making great progress is our integration with Libre, which is particularly important for our -- some of our European markets where Libre is the dominant shareholder. So both of those systems will be very important. And we are committed to bringing Omnipod 5 to our OUS markets. It's just going to take us a little bit as we work through the regulatory and clinical work.

You mentioned great progress with Abbott and Libre. What's left to take that through to the finish line?

Well, there's a few things left. I mean one is Abbott needs to address the limitation in their label for integration with AID systems. So that -- they're obviously undergoing that work. We have a lot of great work done on technical feasibility, but still working through the regulatory and clinical requirements for our OUS markets and finalizing all of the technical work. So a lot of great progress. We haven't given a time line out there, but very exciting to be able to bring that technology to more people, particularly outside of the U.S.

Okay. Do you envision that more as an international launch before a U.S. launch?

We really haven't made that decision yet. The regulatory pathway actually in the U.S. could be more straightforward because of the AID -- because of ACE pump and the way that AID systems are regulated in the U.S. And so we're evaluating that as well, and that will determine then the kind of the launch strategy.

Okay. Okay. Wanted to ask you about pharmacy. Over 35% of your volume going through the pharmacy now, where does that go over time? I'm guessing there's certainly a nice lift with Omnipod 5.

Yes. We haven't given a target out there, but I would say more. We would want -- the benefits are such that we really want everybody to be able to experience them. And so to the extent that we can drive more business through the pharmacy, we want to do that. For the user, it is just a much, much better experience. It's much more cost effective. It makes much more sense for the payer, and it's a much better experience in the clinic. And then for us, it's an efficient channel. And so all of those things mean that we are investing in broader pharmacy access, and we will continue to drive more volume into the pharmacy. And you should expect us to use future technologies like Omnipod 5 to help us to that end.

Okay. And in the last minute here, I do have one additional question. Type 2, certainly a more differentiated opportunity for Insulet. You've seen a step up in adoption into this patient population. How broad is access right now, meaning is access to the insulin-intensive type 2 similar to type 1 right now?

Yes. In fact, it is precisely the same. It's actually a common misconception out there because of the way that reimbursement is structured in the DME channel. But in the pharmacy channel, there is no distinct -- so in 2 areas, there is no distinction between type 1 and type 2. And one is in Omnipod DASH's label. The product is labeled for all people requiring insulin, doesn't actually even distinguish between intensively managed and non-intensively managed. And then in the pharmacy channel, when we say 75% of covered lives, we mean 75% of covered lives, whether you have type 1 or type 2 insulin-dependent diabetes. So this is why -- part of why we're seeing such great access and uptake is because of this affordable access because people can just try the technology. I mean physicians previously really did not have a good tool for these patients who were not well controlled on MDI, living with type 2 because they viewed pump therapy as too expensive and too much of a commitment. With Omnipod, there really is no reason not to just try and see if the technology works for you because you can try it for free and there's no long-term commitment.

Okay. I think we're bumping up against our time. Shacey, thank you so much.

It was a pleasure.

Look forward to 2021 here for you.

Terrific. Thank you. You too, Jayson.

Bye now.