Medtronic plc (MDT) Earnings Call Transcript & Summary

Okay. Good afternoon, everyone. I'm Ryan Weispfenning, Vice President, Head of Medtronic Investor Relations, and thank you for joining us for our Diabetes Analyst and Investor Briefing here live from the American Diabetes Association 83rd Scientific Sessions. It's great to see all of you in the room and be here in person with all of you. And then I also want to welcome those joining us around the world on the webcast today. Get to the next slide. There we go. During today's program, many of the statements we make may be considered forward-looking statements, and actual results might differ materially from those projected in any forward-looking statement. Additional information concerning factors that could cause actual results to differ is contained in our periodic reports and other filings that we make with the SEC, and we do not undertake to update any forward-looking statement. I encourage you to go back and read this slide. The slides we're presenting today will be made available on our website at investorrelations.medtronic.com shortly after the conclusion of today's event. And I did want to point out that at the end of the presentation that we're posting to the website, there will be a clinical citation slide with sources for the information that we're using in today's presentation. Also, a replay of today's event will be available for viewing later today on our website at investorrelations.medtronic.com. So we have a full program planned for you today. Joining me are Geoff Martha, Medtronic Chairman and CEO; Que Dallara, EVP and President of Diabetes; and Ali Dianaty, VP of R&D for Diabetes. Geoff will make some introductory remarks, and then Que and Ali will cover specific topics related to our Diabetes business, including our strategic focus on the important high-growth Smart Dosing segment, an update on the early success that we're having with the U.S. launch for our MiniMed 780G system, an in-depth look at our differentiated meal detection technology algorithm that's in the 780G, and a look at the products in our near and mid-term diabetes pipeline. Following the presentation, I'll moderate a Q&A session where Geoff, Que and Ali will answer questions from the sell-side analysts and institutional investors that are here today in the room with us in San Diego. And with that, I'll turn it over to Geoff to make some opening remarks. Geoff?

All right. Thanks, Ryan, and thanks, everybody, for tuning in and especially for those that are here live. It's great to be here at ADA in San Diego. It's beautiful. But more importantly, really excited to talk about our Diabetes business, where it is today, which is really exciting, and where we're going, which is also really exciting. And before I turn it over to Que and Ali, who I'm guessing will be answering, fielding most of the questions here, I do have just some opening comments here. We're going to talk about what we believe differentiates us here today. And first, it's our ecosystem of products that work together. But really, as we sit here today, powered by our unique algorithm that we believe is really differentiated. And this is a line where you're going to hear us. This is a line where we believe the market is going here with this, Smart Dosing among insulin-dependent type 2s as well as type 1s. And then you're also going to see a lot of excitement around 780G and then the Guardian Sensor 4, but that's not all we got in the tank. We've got a steady cadence of new product releases coming over the next couple of years, and it's a couple of hockey references, not a hockey stick. It's a steady flow. And so we're really excited about that. We really want to position the business to have the best of the med tech world with data and science, but also with the consumer world, user experience, including physician experience, but patient experience, and a steady flow of new product launches. And I'm sure Que and Ali will talk about that. And we are, I mentioned the Smart Dosing market. We are really excited about this segment of the market that we think is -- we're confident is really going to grow and outperform. It's a multibillion dollar like we had to call secular growth segment. CGM, where you can hear a lot of Smart Dosing CGM alone, it's still important, but CGM alone is not enough to get the outcomes that patients want. And that will be even more apparent as 780G gets launched in the U.S., and you see the results. And like I said, we last talk you referenced, we do believe we're going. We're skating where the puck is going here and are really well positioned. We also -- we've also made some quite a bit of few changes to the organization and brought in new talent, starting here with Que, who joined us a little over a year ago. She's got the software and hardware background involving complex systems and a very strong operator that's having impacted the Diabetes business, but also just across Medtronic the way she ran on our business is something we're all learning for, with a really high, like we'd like to call it a say/do ratio and really delivering. And you're seeing the impact that she and the team that she's brought in is having the warning letter has been lifted, 780G is out there. We've got this pipeline going, and we delivered stronger than -- stronger results, not where we want them to be, but stronger results than we had anticipated over the last year in this business. So -- and at the same time, so we brought in some new people to plug some holes, capability gaps we have and also shift the culture. But at the same time, we've kept some continuity in critical areas like in our R&D here because we've had the technology for a while and the vision around what we could be here and the strategy. And we've had the continuity there. Ali is probably the best case in point there. And it was really, when I first came in as CEO, there's a lot of questions and still hit around the Diabetes business. Among some of you, I hope those questions are getting answered here as we speak. But Ali and at the time, Sean Salmon really got me comfortable in our Board that we had the underpinnings from a technology perspective to be a leader, to be the leader, not just of size but growth, and providing these outcomes and experiences for patients that we always -- that we've sought. And we've doubled down on this business. We've doubled down in a big way. One, just what you might underestimate as a lot of management bandwidth on this, but also investments in R&D, organic R&D. You've heard about the partnership with Blackstone. Now you've seen acquisitions, the latest being this EOFlow acquisition. So we're double down on the business, very excited about it, and it is at a real positive inflection point. And just taking a step back to the broader Medtronic, and we're here to talk about diabetes, but this is kind of the approach we're taking is being decisive on our capital allocation to these big secular growth opportunities. This is one of the 5 that we've outlined. Don't blink, be decisive. And then we're putting the people in place and the focus to execute. And where we need turning around, we're going to turn it around. This is one of those areas. And where we need continued strength like cardiac rhythm or something like that, we're going to continue that strength and make sure no businesses take a step back. And you're starting to see that play out with the last couple of quarters, our growth are coming back. And going forward, we feel really positive. But I want to get back to diabetes because this is just a really a special time, like I said, a real positive inflection point, and I'll turn it over to Que and Ali at this point.

Good afternoon. It looks like a much better ADA than it was last year. What we wanted to cover today with you are these topics, and we'll go into details, a little bit of detail on them. But one of the -- it's been a great ADA. And one of the key themes that we've had through the last few days is how important we're making is in diabetes management? And how good the 780G does with that from an outcome standpoint, but also in terms of earning reduction. Now the 780G looks the same on the outside, but I can tell you that it is completely different and revolutionary on the inside. And the data that we presented in terms of outcomes as well burden simplification is really unmatched. You've seen the success that we've had in Europe in prior earnings discussions. And the early indication that we're seeing from the U.S. is very positive, really positive, actually exceeding our own internal expectations. And we'll go into a little bit of detail on what we're seeing, just to give you a bit more color commentary on the progress there. Importantly, it's worth noting that the reason why the outcomes are so good is because of our unique meal detection algorithm. And because we are the only player that has both the CGM as well as the pump, we have more data than anyone else, and that allows us to develop algorithms particularly well and quick. And Ali will go into a little bit of detail about how we think about algorithmic development and the impact that has on outcomes. Everyone knows we have great outcomes. The outcomes are a result of how we develop algorithms in the total system and our ability to deliver the entire system. At the end of the day, our goal is to have -- is to really get automated insulin delivery or smart MDI into the hands of the insulin-dependent type 1 and type 2 population. That's a very large segment of the market. They deserve better outcomes. And our business model is one where by having both the CGM and the pump, we have a razor and a razor blade model. And so the business enjoys very high recurring revenues. And we believe that, that system will generate long-term very positive growth. So 780G is a very important step in the turnaround of the U.S. business. It's going to take us time to rebuild the installed base. We have had efficient in prior years, of course. Europe outside the U.S. is doing really well, but it's going to take time for us to make patients and HCPs aware of the system, what it does, the benefits, and then we rebuild our installed base. But we're going to follow it up, as Geoff says, very quickly with our Simplera CGM, which has a completely new form factor, and we'll share with you how we're thinking about the pipeline. We are upgrading our hardware platforms as well as our software platforms in order to take advantage of the Smart Dosing market that we see is with -- as Geoff mentioned, where the puck is going. So we'll cover those details with you. But first, I thought we'd start with -- for those of you who were in our product theater yesterday, when we were talking about this theme of CGM. CGM is a net positive. It's good. It's better to have CGM than not have CGM. But in our view, it's not enough to just have a diagnostic. You have to be able to drive action, and have those actions drive a benefit and outcome for patients. So the product theater were standing room only. It was -- the crowd was flowing outside the room capacity. And the reason is, is that we covered a lot of data about the benefits of 780G across all sorts of cohorts, whether you're in control or not in good control, all sorts of demographics. And the data is very compelling. But what's interesting is in these 3 studies here, covering almost 36,000 patients despite the fact that CGM penetration is around 70%, so extremely high, the percentage of the -- of these patients that achieve the ADA guidelines or the A1C target of less than 7% is less than 30%. And given how much health care systems spend on CGM and in diabetes in general, you would expect to have better outcomes, but we don't. And so in our view, having CGM alone with MDI is not sufficient to drive the outcomes that honestly we should expect. And when we look at our own data, so this is a study that was published last year in diabetes, obesity and metabolism, we looked at our real-world data of 12,000 patients. The ones that used our recommended settings of 100 milligrams per deciliter and an active insulin time of 2 hours achieved the A1C target of less than 7% as well as time in range above the ADA guidelines. And 90% of that cohort reached that. And so we really believe that where the market is going is in the area of Smart Dosing because it delivers both benefits, outcomes without sacrificing simplification of diabetes management. Now why does it matter? We don't believe all AID systems are created equal. And the reason the way it matters at an individual level is that the difference between someone experiencing 80% time in range versus someone experiencing 60% time in range, say, is 73 fewer days where they feel good. They could feel dizzy, have trouble concentrating, feel dehydrated. And so it makes a big difference from a patient standpoint. They can feel it. And a lot of our early U.S. customers that are on the system, even after 24, 48 hours, say, I can feel the difference that the system is making on their physiology. So it makes a big difference from an individual standpoint. And we know that better glycemic control early on reduces complications later. Eye disease, heart disease, kidney disease and of course, hospitalizations and emergencies. And so there's downstream cost impacts and health impacts if you don't have good glycemic control. One of the things that we talked about in yesterday's product theater was how hypo -- a lot of people spend time on hypoglycemia and fear of lows, and managing that. I think there's been a lot of progress from AID systems in that regard. But we don't have enough conversation around the impacts of hypoglycemia. And we know the impacts of that on the growing brain of children, as well as adults that have type 1 diabetes. And so we're very pleased at what the data shows and the study shows how well 780G does in managing hypoglycemia and being able to bring someone who are experiencing highs down to the target glucose levels as fast as possible without creating higher risk of hypoglycemia. So what does this mean in terms of the market? And this is a little bit of a complicated slide. So just bear with me a little bit while I just maybe break it down for you. The way we think about the market is we just took the top 25 countries in the world, and our focus is on type 1 and type 2 insulin intensive population. And we took 25 top countries mainly because they have reimbursement systems. We're obviously in over 100 countries. So we're being conservative for a reason. It does cost money. And if the health care system is entirely out of pocket, it's going to take time before those markets grow at the same rate as these top 25. And the way to think about this is there's 4 segments. There's a self-managed BGM market, if you like, with MDI with needles; there's CGM with MDI, which is the largest segment today; and then this category that we're calling Smart Dosing, which is Smart MDI, so it's something like InPen with a CGM, as well as having a CGM with a connected pump and a total system like the 780G system. And then lastly, dumb pumps that are not connected to any CGM, and so it's a stand-alone pump system. And our view is that this market will move. This Smart Dosing market will grow substantially because what 780G has demonstrated is that AID systems and Smart MDI delivers really outstanding outcomes while simplifying diabetes management. So we have study after study. We have never launched a product like this with so much data in the market. And why wouldn't physicians and patients want better outcomes from the technology that they're spending money on? And what we've also shown in this stage at ADA is that it doesn't matter whether you're technology naive or whether you're really savvy, you're young or older, you're good at carb counting or not good at carb counting. What is amazing about the 780G system is how democratizing it is. Anyone can use it. And in fact, it simplifies the clinician's time and allows them very busy endocrinologists to spend time with patients and other issues without having to explain to them some of the fundamentals that they spend time on today. So it does free up time, not just for patients, but also on the clinician side. Now we talked a lot about some energy and the outcomes that it produces. That's not at the sacrifice of having to do more work. I think people have long memories of 670 and how much work that required. It was the first AID of its kind. And so it had a lot of bells and whistles from an engagement standpoint, and a safety standpoint. But 780G is completely different. And while the list of things that you got to do if you have diabetes, is extremely long and endless, you quote just for the sake of simplification. You could bucketize them into these 3 things. There's physical burdens, there's mental burden and there's administrative burdens. When you look at the 780G system, it reduces physical burdens because we've removed fingersticks. Fingersticks are no longer required in Smart Guard. And not only that, you have fewer set changes because we have the only 7-day wear infusion set in the marketplace. And so that's a huge benefit for customers physiologically. Now on the mental side, this is where the auto corrections and meal detection technology are important. I don't know about you, but I'm pretty sure pancreases don't bolus. And the way that we think about order correction is we want the algorithm to mimic as close to how a pancreas would work through these 5-minute order corrections as the body needs insulin. That's how it works. In addition to that, we have this low detection technology, which the benefit of which is it allows users that sometimes forget that they forget to bolus or they undercount carbs. The system is extremely forgiving to be able to accommodate life when things like that happen. And then lastly, because we are the only player that has CGM and the pump, there's 1 phone number to call. So from a support standpoint, the feedback that we get from our customers as well as the HCPs is that our support and service is second to none. And that's really important when you have to manage a complex chronic disease like diabetes. So let's look at our European experience. Now let me caveat this by saying that we've had 780G in Europe for 2.5 years. So please don't accuse me of saying this is going to be the U.S. number. It's going to take us time to rebuild the U.S. installed base, and it's early days. We just launched it. So -- but I wanted to give you a little bit of a picture of how we're doing in Europe. What we did was this data is from the second half of calendar year '22. It's dQ&A data. And we looked at 6 countries where we compete head to head with Tandem and Insulet. And our share of the new pump starts is 40%, which I believe is the leading share position in those competitive markets. Now we are competing head to head with one or other competitors in other countries, but these 6 countries represent 76% of the European market. And you can see how well 780 has done. We're also up 8% versus prior year according to the dQ&A data. You've also seen this in terms of our revenue performance. We're posting mid-teens organic growth driven by 780G. So that's the experience that we've seen from the European side of the house. Now on the U.S. side. So again, early days. We're very encouraged. We are really happy with the reaction that we're seeing from accounts we haven't visited in a long time from customers, early customers who are using the system. The feedback's been really good. And so a few data points to maybe share with you. We have approximately 10,000 unique HCPs already prescribing 780G in the first 30 days. Our CGM attachment, which historically in the U.S., has been very low because we've had fingersticks requirements in our sensor is very high. That's what we've seen so far. And we're winning new patients. We're winning new patients not just from MDI, but also from competition. And some of those quotes there you can see, these are the reactions of the early adopters that are coming on to the system. People are pretty happy. It's doing what it's advertised to do. People have seen the data. They actually do test runs with it. They try it out and you're actually being pretty great. And I think there's been a lot of openness by many accounts that have been maybe unwilling to spend time with us as much to really have many conversations, particularly deep diving on the algorithm, how it works and why it is differentiating the market. So with that, I'm going to turn it over to Ali to maybe go into a bit more of our secret sauce and why we're so excited by the, really, is a competitive advantage, our data position and then how we've turned it into outcomes through our algorithm.

All right. Thank you, Que. And so as noted, hopefully, you're hearing a lot of business about the algorithm specifically. And so I have the privilege of sharing with you exactly what the secret sauce is. And so starting with where Que initiated the conversation as it related to a healthy pancreas. A healthy pancreas just works off of seeing a demand and providing a supply. It doesn't have this notion of basal insulin and bolus insulin. It just sees what's happening within the body and tries to regulate it so that we see a consistent, as-flat-as-possible glucose curve. And so what we've had to do as a result of just the technology that was available to us is emulate that in the most, I would say, user-friendly way with injections. And of course, people don't like taking injections every 5 minutes, nor do they like taking these boluses as often as they potentially need to. And so with that, we worked through a combination, a series of things to make sure that, first and foremost, people stay safe. So we knocked down boluses in a lot of times, depending upon the food they eat so that they don't go low later within an hour or 2 as a result of that. And then more importantly, with the advent of now auto basal insulin, that obviously most of the manufacturers now have, we've been able to at least modulate some of that insulin dosing to a point of where we felt it was safe with the exception for what is there for meals. And so a typical patient with diabetes would then have a meal, give themselves some insulin, that's that bolus that you see in dark gray, with the estimation of how many carbs are in the meal that they're having, usually knocking that number down so that they don't go low later and then hoping for the best to come back and correct for it later. So in that middle section there is probably the majority of folks that are out there, either on basal insulin with bolus insulin as well, or on a existing hybrid closed loop system, like our 670, 770 or even with an Omnipod 5. Now with the advent of corrections, auto corrections, what happens here is that we look at the CGM curve, and based off of that, try to get people back down into a range with a certain amount of insulin that hopefully later in time won't drop them lower. And our competition has this in an hour-to-hour basis. The problem with the hour-to-hour is in case you are wrong, that mistake could be very costly. And so you have to knock down the insulin again in order to provide a safety net for them to be able to manage their diabetes. And so though it's nice that there's a correction in there, it's still inadequate in order to emulate what we see in that healthy pancreas. And so that's where the secret sauce of the 780G comes from. We had a ton of data as a result of the 670 and the 770, hundreds of thousands of patients, and each one of those equated to a 5-minute to 5-minute interval of not only their CGM graph but how much insulin that they were dosing and their meals and then what happened thereafter. And what that allowed us to do is create predictions of what could happen if we actually dose insulin sooner. And as a result of that, where they would land in terms of their sensor glucose and their effective time and range. And so really, what we're trying to do with this 5-minute-to-5-minute interval is essentially match the demand to the supply. And it's the easiest way to do that is by increasing the increment, and then making how much we are providing smaller. And that's effectively what the 780 does. It's able to provide the total amount of insulin, but it won't do that in 1 shot. It will do it over a period of time, and it's an add into that as it sees the sensor glucose and then modulate it accordingly so that we can actually bring down that glucose level faster because we can add insulin sooner with less of it and then continue to add it as we see the curve come back down into our target. And with it now, we can essentially avoid these hypoglycemic events. And then more importantly, when meals come, we can look even further out because we have the data to do it and predict even beyond that and manage that even more accordingly. So what we have done with the system is be able to detect meals even when a patient doesn't give us that data or that information, meaning that they forget to carb count, forget to announce a meal. We now know when that's happening. And as a result, we can get even more aggressive with the insulin dosing and bring them back down to that target. And so I'm happy to say that now with the launch in the U.S. and it's -- it was my hard to say that our friends and family and the broader population in the United States has access to this because of the great results that we saw in Europe and the rest of the world. And this is an example, and I get these kinds of examples on the daily. Bill, who's on vacation, was sitting poolside had a snack and forgot to bolus for it. And what you see in these green lines are the auto corrections kicking in to take care of his diabetes for him. And so he was completely unaware that he forgot to bolus for it. And as a result, the system took good care of them and maintained a very high time and range. And this is not a special case. I get these all the time, and we see them quite frankly often mainly because dealing with diabetes on a day-for-day basis is hard, remembering to do all this work is hard. Carb counting is hard. And by virtue of making sure that we can take care of this for people, we're really changing their lives and making that impact. So then I'm sure you are interested more in not only what we have today, but what's coming in the future. And bottom line is we're planning on differentiating on all vectors within the product portfolio. Many of you have asked about the Simplera sensor. And I think we previously have mentioned that we have already submitted it. Our intent with that product is, of course, to merge with our InPen and then have an open loop system, as Que had mentioned before, to help people dose for insulin properly and get even more benefit not only out of the CGM but as a system so that they can get better outcomes and actually deliver therapy to themselves in a good way. So that Smart MDI system as well is very far along. It's obviously in front of the regulatory agencies, and we're moving forward, of course, with that. The follow-on, once that sensor, as you see there, is our Simplera sensor with the new form factor, that only takes a couple of steps to get on the body. The intention is for it to not have any calibrations just like our Guardian 4 sensor on the 780. That will get integrated into our 780 system. And of course that combination, what we're hearing not only from our clinical sites, but the early use of it, bottom line is that people are very, very happy with the form factor and actually would definitely like to see it come to the market as soon as possible. Last but not least, we have a number of pumps coming forward. And part of the reason why we're making some changes here is the feedback from folks with type 1 is that they want to keep things as discrete as possible with their diabetes and take more time living their own life. And as a result of that, what you see on both of these pumps, they no longer have screens on them for that exact reason. The first one is our durable pump that we're working on right now. The durable pump is essentially a little less than half the size of our existing 7 Series pump. Again, it does not have a user interface on it. And the intention here is for it to use our existing consumables. So our reservoir and our infusion sets that we already have fit into it directly, so patients don't have to get a whole new set of consumables to deal with. They can use what they already have. And then beyond that, I'm sure we're going to get questions on this as well. We're intending to integrate into the EOFlow patch pump as well. Intent there is to bring all of these algorithm advancements and sensor advancements into a system and have a patch pump for folks in the marketplace in the not-so-distant future. I think with that, I'll hand it over to Que very quickly, and we can talk about the software and the ecosystem.

So just to piggyback on what Ali said, I mean he showed you a lot of the hardware platforms that we're upgrading. But underneath all of it, of course, is what's inside. And what's inside is also an upgrade of our software. It's our algorithm, it's our apps, it's CareLink. We are doing a complete upgrade of our portfolio. We're pretty excited by that because we think we can push the envelope from an outcome standpoint, as well as performance and also the user experience. We've heard all the feedback on the form factor, and we're taking it to another level. Let me wrap up, and then we can move to Q&A. I think we're really excited about the Diabetes business. There's a tremendous runway. The trend that's driving Smart Dosing is very exciting for us because it really does fit where our product road map is going. And it remains one of the fastest-growing sectors in med tech. That's why we're -- and we are, in my view, very well positioned. As we mentioned previously, we're going to be below the company average from a growth standpoint. We'll accelerate through FY '24. And then long term, we fully anticipate to be growing in double-digit territory. Our business model is pretty sticky. There's something special about the system that play into pieces from 2 different companies just doesn't provide. And what 780G has proven is that a broader set of patients should have access to AID. They don't have to be good at carb counting, which is the sort of traditional barriers that on how diabetes or pump therapies treated and its expanding access. In fact, the pyramid is upside down now. There's no ideal patient. You can come from all walks of life or socioeconomic, it doesn't matter what race, sex, any part of the world. 780 and all the data we've accumulated shown that it generates a benefit to all comers. Our business model, as I said, is razor/razor blade. So what's very important, of course, is CGM attachment to the system. And we're really pleased with how 780 is performing in that regard as well. And it's a very highly recurring revenue business. And then lastly, we expect to be accretive to Medtronic's growth rate overall. And I'd like to also think that will contribute to Medtronic's capabilities from a consumer experience and connected product standpoint. So with that, I'm going to hand it over to Ryan.

Okay. Thanks, Que. We are going to move to Q&A now, and we're going to take questions for those of you that are online. We're taking questions only from the analysts and investors that are here in the room. [Operator Instructions] And finally, for the benefit of those listening, we've got microphones. We're going to come around. [Operator Instructions] So we'll get started. First question. There.

Matt Miksic from Barclays. So I'm sure we're going to get a lot of questions on Simplera, and congrats on all the great progress getting the pump out, getting those trials running in step. But I wanted to ask about two things that incurred to me listening to the presentation and also talking to other folks in the field. The experience you have with CareLink and remote monitoring and sort of what we're starting to see is kind of like an early response curve from endocrinologists who are starting to build that into their practice. So how -- to what degree do you feel you'll be able to lever your experience helping other disease categories like cardio and so on with your experience in that kind of remote monitoring software? Is that finally at a point with reimbursement where that's getting interesting? I know it's not the first thing we're looking at in returning to growth, but it's certainly a competitive advantage, we think, of Medtronic. So I'd love to hear your thoughts on that. And then just one quick follow-up, if I may.

I can start and then maybe -- look, I mean, we, in some ways, invented CareLink and made clinicians look at the data. It's a chronic disease, and so the trends are important. And I think it sets the standard, and it's integral today in practices that treat diabetes. It's sort of -- you can't really do your job without looking at CareLink report. We do have CareLink in our cardiovascular business as well, absolutely. I do think that it's a logical step that across Medtronic's portfolio of therapies that this data could be useful. It's not been a focus in diabetes. We have a lot on our plate, but I wouldn't rule it out.

Look, I do think the remote monitoring is going to become a bigger deal. And there's a couple of reasons. It's just, it's better now. right? I mean, the cardiology example, I know we're here to talk about diabetes, but this is kind of a leading indicator. What we're seeing in cardiology with the intersection of what we do with tech, you're seeing, like, take our Link monitor, right? We put -- you want it to last. It's an insertable cardiac monitor. We want it to last. Ours is 4.5, 5 years, so you can't have an algorithm that's chewing up too much battery. We tune the device to be super sensitive so it catches everything, but you don't want to give the docs too many false positives. So now that goes into the cloud, we can have another algorithm that weeds out all the false positives, and we're providing docs with no false positives basically with through that new algorithm. And AI is helping this. So you got the cloud computing, AI, you're going to, in that example, too many false positives to none or virtually very few. I think the data is like 99% or some of the high -- very few false positives. And now it's having an uptick, and-- it really works. And we're seeing this in other areas as well. And I do think because it's getting better like that, and you're going to see it go on to emergency response. So we're automatically calling 911 and things like that down the road. So it's -- I think wearables that are not sensitive and specific enough or too sensitive and not specific, that's a problem. People we have too much data in the world. We need insights that are actionable. And I think with what we do being under the skin or in the epidermal space with AI and the way cloud computing and everything, it's an exciting time overall for med tech monitoring. It's going to take some time for this to play out, but you're seeing leading indicators of this.

Helpful. And then just one maybe thematic question and to get your response in your first year here is a big theme here over and over again is like there's no one-size-fits-all in diabetes, it's becoming kind of like an increasing realization. We all have heard the criticism when we talk to endocrinologists about disappointed they might have been that you were out of the market and what are they coming back? And so there's plenty of sort of like criticisms. But what in your experience in the past year working with endocrinologists, like what are some of the things that they're looking, they really look to you as being like this is something that you do better, this is a reason why we'd be more interested in working with Medtronic around pumps and sensors going forward? What do you think some of the strengths and the pull are for Medtronic?

I think the obvious one is at the end of the day, endocrinologists are treating patients and they want their patients to do better. And so they want choice, and they want technology that works, that drives better outcomes, but at the same time, reduces burden. And the 780G does that. So it's important. I think we have a reputation for being very good with clinical outcomes. And historically with the 670, it's been at the expense of patients having to do a lot, and that's completely different now with 780. And all the feedback that we've heard over the years is incorporated into how we built M&A. So while it looks very similar, it is a completely different system, which is why all our data, all the feedback has been, honestly, is super compelling.

Let's go to Robbie.

Robbie Marcus, JPMorgan. I appreciate you hosting us today. Two quick questions from me. One on the fiscal '24 and '25 commentary on diabetes sales growth. Given all the positive commentary on the 780G launch and the very easy comps the past several years, especially fiscal '23 in the U.S., why wouldn't it be better than corporate average this year and materially better in future years? And then second question, I didn't see any mention of a stand-alone CGM on the pipeline slide. Maybe just give us the update on where you stand at Simplera, a stand-alone CGM eligible? And what's your thoughts there in the stand-alone CGM market?

Thanks, Robbie. So to answer your question, look, it's early days in the U.S. The U.S. market is different in dynamics from Europe. So for example, on F5 has not been available in Europe. And so we need to take that into account. There's a lot of wood to chop when it comes to going out to all the endo offices and primary care and helping people understand what the product does. And so that's going to take a cycle. There's going to be customers that are in warranty, that will come out of warranty. So it's going to take a cycle before we can work through the system. And it's too early for us to forecast anything than what we have planned. And we'd rather let the results speak for themselves once they happen. So it's just too early at the moment to sort of, say that. Obviously, we're working very hard to make sure that we're getting the knowledge and education of 780 out there as fast as possible.

Stand-alone CGM.

Simplera is a stand-alone CGM. So it's been submitted for CE Mark as a stand-alone system. And there will be a number of different commercial options for us. One, it would be available as a stand-alone, but also in combination with InPen because we do believe that having Smart Dosing together drives better outcomes and is a better value proposition than stand-alone with MDI.

In U.S.

In U.S., it's submitted as a stand-alone.

And just to be clear on Que's first answer, I mean, we feel confident against the competition, our outcomes, our patient experience versus them. But as you mentioned, in Europe, we didn't miss a cycle. Here we kind of did in the U.S. And so we've got a we've got to win back physicians. We've got introduced to patients, but I don't want people to misinterpret the comment vis-a-vis the slide she showed that in Europe, when we're competing, we're winning 40% new patient starts. So there's a difference there. Here, we've got to win back some physicians and introduce this technology to patients.

Let's go to Larry.

Larry Biegelsen, Wells Fargo. Just to follow up on Robbie's question. And Que, I appreciate what you said about taking time in the U.S. to replicate what you've seen in Europe. And we've heard that you have one of the best, if not the best algorithms. But on the CGM side, Simplera should be a nice upgrade from Guardian 4. So I guess my question is, Simplera plus 780G, can you put just a little more precision around the U.S. and international time lines of when those -- when you'll be filing for example in the U.S., or the study will be completed and the international time line there. And then on Simplera versus Guardian 4, you need fingerstick tests outside of SmartGuard. What are the differences between Simplera and Guardian 4? Tying in all interaction, MARD, we saw data last year at 88, 10% MARD. Are you going to improve upon that? And I didn't see an CGM, we haven't heard anything from you on that. And just lastly, sorry, we didn't see anything on the CGM pipeline, I don't think beyond Simplera today. Basically, all the CGM and Simplera empire question.

So 7 questions. At the end of the day, Simplera plus 780G U.S. time line and then just Simplera versus Guardian 4.

Yes. So on time lines, what I can say is we have submitted the stand-alone CGM Simplera both in Europe last summer and then in the U.S. in January to the FDA. So it's just very hard, as you know, to comment specifically on time lines. We obviously want it to be as fast as possible. But I'd be lying if I know exactly when these things will drop. So hopefully, it's not in the too-distant future, but that's a bit of the process. On the integrated system, we are doing the ID at the moment with 780 and Simplera. So that we've just, I think, finished enrollment of adults, I think, under a month, which is pretty fast. So there's a huge interest there. And then we're starting on the pediatric enrollment. So that's where that is at. I think you had a question on MARD.

Just the international 780G plus Simplera, what do you need for that to get integrated?

That's submitted too. So that's -- maybe you can explain that a little more.

So with the MDR, the new regulation, the way the chain of events goes and typical for everybody in the marketplace, you do a stand-alone first. That stand-alone sets it up. It's like a platform and then as a result of that, you can integrate it the way that you need it integrated. And so because of that, they are staged and they would be -- one would be a follow-on or the other.

I think you had a question on MARD, Larry.

This is Simplera versus G4. I mean there isn't an improvement more than just form factor in Simplera, clearly form factor improvement, but is the CGM technology and improve it as well.

Maybe you can...

Yes. So the performance is better. The data that we presented was at 10.2% MARD. But I think the key thing to note is when you do look at the iCGM metrics on it, our hypo performance is quite good. It's better than the Libre. And then on the hyper side, we're all about the same. And so our intent is not only to make sure that this is a good stand-alone product, but of course, with insulin dosing gain an advantage as a result of how we've designed the sensor. So it is an improvement in that way.

And maybe I can just add something on MARD. I know a lot of people asked that question. But this is how we think about MARD in the context of Smart Dosing. If we're in a MARD of, say, 10 and Dexcom's at a MARD of 7, you're at 110 or 108 against the target. You're still going to make the same decision. It makes 0 difference. At the end of the day, you have to look at the performance of the system in totality and what it does to outcomes. A MARD of 10 or 8 is meaningless. It's an example of a bar that's set, and it's important. We certainly want to reach something less than 10, but we've tuned our algorithm to be extremely accurate on the hypo side and the hyper side, which is where you make the decisions around dosing.

And just on the form factor question, can you guys get into beyond the size like the other form factor improves like the tape and...

Yes. So we've, obviously, try to make sure that given the feedback that we have gotten not only for ourselves, but the competition as well, we spent a lot of time on things like the tape, the sorting itself, the form factor thinness, the edges of it even so it doesn't get dragged on to clothing. I mean you name it, we try to make sure that we put into the device. And I think we'll see that we especially hear this from the clinical trial patients who are using Libres and G7s historically, that they're very, very, very comfortable and actually appreciate the form factor is quite good. So we're bullish on the fact that it's going to do well.

And so Larry, you had two more questions. One was on fingersticks. You need to fingerstick to get into SmartGuard. That's mostly a safety feature. And then once you're in SmartGuard, which our data would say, our users are in SmartGuard 95% of the time. You don't exit SmartGuard even through a sensor change. You don't really fingerstick, it's only to get into SmartGuard. Or if you -- if a person with diabetes feels like their blood glucose is different from the sensor glucose, they may take a calibration. But that's the only reason why you would need one. And then you had another question around the road map. On iCGM, I would say, look, we're giving you a bit of a peak into the road map we have. It is not the only thing we're working on and it's not exhaustive.

Let's go to Steve.

Steve Lichtman, Oppenheimer. Que, I was struck by your -- the chart where you showed 55% potential penetration of AID out in FY '30. Can you talk to sort of what you see are some of the drivers or hurdles you need to get over in order to significantly increase penetration?

I think there's probably 2 primary things. One is it's a bit of, I would say, education of how diabetes has been traditionally -- or how pump therapy has been traditionally rolled out. You look for an ideal patient. Are they good at carb counting? Are they kind of in control? And we think we should turn that paradigm on its head,-- but that takes time and education, updates of guidelines. There's work we've got to do to improve the standard of care across towards AID. But that shift is beginning to happen. We rarely see pump sales as a stand-alone. It's always part of a system because the system works better. So it's a bit of a notion that standpoint that we're going to have to work through. The second one is probably cost. There's -- these are more expensive than, say, doing MDI alone. And so we've got to work the reimbursement angle, make the systems more affordable. And I think that's why InPen with CGM is such a great option because it introduces automation at an affordable cost. If you segment the market in terms of affordability, there's always going to be a segment of the market that can afford for AID and then InPen is a very good option there. And I guess the third one is probably, I don't know, I can think of other barriers, but those are 2 probably big things that we'll work through. But the benefits are just so amazing that we think that's what will push it.

And then just secondly, on your international business, you said -- you talked about 780 being your 100th country. With some increased competition 05 coming to the U.S. what are -- what's your outlook for the international business and drivers, particularly outside of the U.S.?

We think the value proposition of 780G with Guardian 4 Sensor and fingersticks, the outcomes it delivers, the simplification that we went through is an extremely differentiating compelling value proposition. And so we think it's very competitive. Now because we're able to deliver outcomes without increasing burden, actually, we're reducing it, you don't have a conversation whether it's tube or tubeless. It's not really why people buy. Maybe some people do, some segment of the market cares more about the form factor. But I think if you went to your cardiologist, they're not saying, hey, do you want what blood pressure of this kind or this kind? I mean they're going to treat the disease. And you want to feel better. And those things are meaningful.

Let's go to Joanne.

Joanne Wuensch from Citibank. Two questions sort of related. Could you give us a little bit more color on the initial response to 780G in the United States? You're changing some patients up from 770G and you're getting new patients. Just any incremental color you can give? And then bigger picture, I've been sitting in meetings all weekend, everyone has fabulous new technology. At what stage does this not become -- if someone should use a CGMR pump or everyone should use a CGMR pump, are we getting towards that?

Yes. To answer your question, your second question first, I do think we don't really see stand-alone pump sales because it's still too much work for patients. It's sold as part of the system. And I think that's really the way to go. It should be AID for all because as we've shown in our data, everyone benefits. Everyone benefits. And so why wouldn't everyone do that? And the sooner you can treat, particularly high glucose, longer term, that's a net benefit to the individual, their families, but also the health system. Because you're not dealing with comorbidities later on, cardiovascular disease and so forth. So that's definitely where we think the trend is going. In terms of color on 780G, I mean I would break the segments into we have a core base of 770 users, whether they're in warranty out of warranty. We upgrade them for free in the next 12 months. And so there's certainly demand there. And what we're excited about is we see very high CGM attachment to that cohort. So while it's a free upgrade, it is generating. It's also generating revenue because we didn't have CGM attachment for a number of those customers before. We're also seeing other Medtronic pumps, the older generation, 670 users also upgrade. That would be incremental revenue. So there's an existing non-770 base, if you like, that also will upgrade. And then there's new patients coming from MDI and competitive pumps. We have excellent offerings for customers. We have a $499 trade-in offer, if you're on a competitive pump and in warranty. And we have -- if you're in warranty on an old Medtronic pump, it's a $399 offer and we can switch people. We want to get as many people on 780G as possible because we think they're going to have a great experience, and it's an extremely sticky product.

Let's go to Chris.

Chris Pasquale, Nephron. Que, a lot of the data you guys cite was 770G's the 100 milligrams per deciliter 2-hour AIT setting, but if I remember from the pivotal trial, that was only a slice of the patients in the study. Curious in the real world what percentage of users manage to those settings? And if not, like what are some of the challenges around that?

Maybe you can...

Yes. So in the real world right now, the way that we're looking at it is a little strict, maybe too strict. We're looking at 95% of the patients that essentially meet that threshold of 102 hours, and that might be a little strict, so that we can show the outcomes accordingly. But the reason why that was the case in the trial is because the agency wanted us to test the extent of the system. And so we had 120 and 100 as the target and then the variations in between. And so that's why it looked like a small cohort. Generally speaking, the numbers you're going to see from us because of that are going to look small but in reality, many people are at that number. It's because they decide, let's say, overnight to switch it up or switch it down or they're going to have exercise and they change it because of that. So we don't want to muddy the water as a result of that. We wanted to show what it actually is. And from the patient's responses as a result of that, many of them are actually getting better performance than what we're showing as a result. But as time progresses, we'll make sure to make that very clear to you. And so I think in our last cohort and I'm doing the software memory, which is always dangerous. I think we had about 1,400 people out of the 12,000 that were using the recommended settings, and they were hitting 80% time in range with very good hypoglycemic numbers.

And maybe just to add to that, when we started in Europe, we didn't have the volume of data we have now. And so a lot of clinicians were a little bit more conservative about the 2-hour active insulin time, the lever that really says how aggressive the order correction is going to kick in. And so we started off more conservative. Now that we have more data, there's a lot more confidence to go to the recommended settings which work. It shows that you get better results. I will also say that even if you don't use the recommended settings, our clinical data in terms of outcomes is excellent. You're clear -- you get -- you certainly clear the ADA guidelines from a timing range and A1C standpoint.

And then just one quick question on the 8 Series pump. Is this something you see as a successor to 780G, or do you imagine this sitting in the marketplace alongside 780G maybe serving a little bit of a different patient population?

It is intended to be the successor. But it may still -- there still is probably a case to be made for 780 that may get maintained because there are certain people that may not want to be on the phone as well to the point of we got to feed everybody that wants to get fed and they want all kinds of different options. We may keep it alive for that reason alone for somebody that would actually prefer a user interface on the pump itself. But our intention is for it to be the successor.

Jayson?

Jayson Bedford from Raymond James. There was no mention of channel which has been a factor here, an adoption of these technologies. So is the intention to go through the pharmacy with Simplera? And just in general, can you let us know how the pharma channel factors into your thinking here?

Yes. I mean, yes, Simplera and InPen goes to the pharmacy channel today, so that's certainly the intention. And the durable pump, the 800 Series, 780, is going through the DME channel.

Okay. Fair enough. And then you mentioned CGM attachment a few times. Just curious what is the attachment rate of your installed base today, meaning the number of Medtronic pumpers using a Medtronic CGM, both U.S., OUS approximately?

Can't comment on those specifics at the moment.

We can assume it's higher internationally.

It's high internationally.

Matt?

Matt Taylor with Jefferies. So you talked about a couple of times the diabetes growth being accretive to the WAMGR, and then I think at 1 point you mentioned hope for some double-digit growth at some stage. I guess I was just hoping you could put a little bit more meat on the bone there, and maybe talk about when you think it could be accretive to the WAMGR and then when this double-digit growth goal could be achievable.

I think that's our long-term target. So hard to put a time line. We'll see how this year does and how 780 does. But we're very confident with where the market is going, how fit for purpose our road map is that we'll get to those targets.

Danielle.

Danielle Antalffy with UBS. Just a question for you on you made the comment it's going to take a while to sort of the installed base. Is it just a matter of it takes a while to train? Is there something more you guys have to do if something goes wrong here, like 670G underperformed expectations, ultimately? What would it be that could possibly go wrong?

I think there's a natural cycle of upgrades that we have to go through. So let's just take this conference. We're going -- we touched a lot of over -- we've had over 4,000 physician meetings with our field team. They get excited about 780G. They may not see a patient for 90 days or a number of months. They've got to then see the patient and then it goes through a natural cycle, and that's what we just need to work through. There's nothing I'm concerned about. It's just there's just work to be done to get out in the field and go through that natural cycle.

Yes. One big advantage we have this time around is it's been on the market outside the U.S. for quite some time. And so some of the issues that you might normally encounter with the new product, we've already worked through those.

We'll go to Matt, and then we'll go back to Travis after Matt.

Matt O'Brien, Piper Sandler. Maybe just, I think you were kind of addressing this with Joanne's question, but, Que, you said you've done better than expected in certain metrics here, early days with 780G. Can you talk a little bit more about what those -- what areas those are? Is it MDI? Is it the competitive conversions? Is it upgrading your existing 770 users? What is it specifically that you've really kind of outperformed what you're expecting?

Actually, all segments. We've done better in all segments than we thought we would do. The process has been extremely smooth. People have been really happy with the ordering process. And you have to think, we got approval on April 21st. We were taking orders on May 15th, less than 30 days after approval. We were shipping to early adopters late May, and we've opened the floodgates in terms of fulfilling orders already shipping. So extremely fast ramp into market. And the demand and the interest has been really excellent but across the board.

Okay. And this is not a related follow-up. So sorry, Ryan. But, on EOFlow, can you be a little more specific on timing of that product here in the States? I know it's available OUS, but what are you expecting as far as getting that product here into the U.S. and then integration with Simplera next-generation sensor?

We have to close the acquisition first. So we're going to go through that process. It's just unfortunately hard to comment on time lines. I will say, repeat what I said at our last earnings, which is we believe that the #1 EOFlow patch is already in the market in Europe, in a number of countries in Europe, and Korea. So it's already in the market that we believe that we'll have the second patch AID system in the market with Simplera, as well as our meal detection algorithm. We're second to market with, I think, a very differentiated offering.

And just to build on the first question, again, I don't know what, this is my personal expectations that have been surpassed. Have been talking to patients, again, this wasn't in clinical studies, just me talking to patients and physicians who are dealing with patients. The time and range of the system in the wild, and it's higher than I would have thought. I mean, it's very high. The anecdotes I'm hearing from patients and physicians that are telling me about the patients they're dealing with. And then we use these words like less burden. Okay, what does that mean? Well, you talk to patients and physicians, I mean they're just putting diabetes in the background, where even going from an existing advanced hybrid closed loop pump, whether it's ours or Tandems, or whomever, the difference is dramatic, not just in the time of range, but then what they have to do to get it. They're able to sleep better. They even say they open up their mental bandwidth on other things and not being a type 1 diabetic. It's hard to I think understand what they go through. And this changes that dramatically. And at these conferences, we look at all this data. It's hard to quantify that, but patients love it. And that's why I think this is, as Que said, it's incredibly sticky. That's one of the reasons. And those, again, these are anecdotes from a lot of people, and that's what's exceeded my expectations.

We go to Travis.

Travis Steed, Bank of America. Maybe give a little more color on the $399 thing that you were talking about for people switching from a competitive pump? Is that a co-pay that you're discounting, or is it the cost of the pump? Is it open to just people switching from competitive pumps? And is that something you plan to keep rolling out longer term, or is that just a near-term promotional thing?

We've always had halfway programs. It's $499 for a, basically, it's a trade in price, and they can trade in their in-warranty competitive pump and then we give them a 780G system. So that's the offer. We have a $399 similar trade in concept for our existing in-warranty non-770 Medtronic pump user.

And that's the co-pay, right? The patient out of pocket is $400?

Yes, it's an out-of-pocket expense for those in-warranty customers. If you're -- whether you're in-warranty or out of warranty for 770, you get a free upgrade. And then we have a number of offerings for if you are on Guardian 3. We want them to have a great 780G experience, no fingersticks. So we will exchange the Guardian 3 sensor unopened boxes for Guardian 4 sensors. So we do a bunch of those things. And we've had a lot of really good take-up on those offers.

When you think to the gating factor on EOFlow, I don't know if you're planning on making changes to the form factor at all. Building up, is it manufacturing that's the gating factor or just regulatory?

Well, one of the reasons why we were very by EOFlow is their manufacturing and how much progress they have made on it. So we don't intend to change the form factor or the -- it's actually smaller than Omnipod. And the manufacturing is one of the biggest challenges with getting a patch up to market. You got to make a device that's super accurate to dose insulin but you're throwing away over 3 days. So they bring a lot of assets in that regard.

We go to Anthony.

Anthony, Mizuho. Maybe just a recap on type 1, type 2 mix 780G in Europe, how that's going to play out in the U.S. as it rolls out here. And then the follow-up would be on just the GIP, GLP-1 products here Mounjaro, Ozempic, Novo Nordisk. How does that influence just the timing of when patients go on insulin? Is there any expectation? Is it neutral for insulin utilization? Is it a headwind? Is it a tailwind? How does that play out over time?

Do you mind just repeating your first question? I didn't quite...

The mix of type 1 and type 2 insulin intensive patients on 780G in Europe. And then should that play out that mix similar in the United States as it rolls out?

I don't have the mix number, but in the United States, 780 is approved for type 1 today. We're in the midst of a type 2 trial. So that's where that's at. And then in terms of GLP-1, we do think it's complementary. It's early days, but maybe Ali, you can add a bit more color.

I think that's right. I think we think it's complementary. And given the fact that even with those drugs, they saw the titrate, they still need CGM. And so all of that adds to what we think will be a good outcome for us.

Jeff Johnson from Baird. Wanted to go back and just ask a question or reask a question on iCGM, I'm not sure I heard if you would expect to get iCGM approval for Simplera, number one. And number two, does it matter? As a closed system, I guess, I still am not clear. I can't imagine you guys ever opening up and wanting to jump one of your products interoperable with another product outside the Medtronic family. So just a little more clarity on iCGM, and then I have one more.

Yes, I think there has been a lot of hype about iCGM. It's great for Dexcom for obvious reasons. For us, it's not as important. A nonadjunctive label is what's important. And so being able to dose insulin is really the thing that we're most interested in. And clearly, that's what we're going to do with Simplera. So I'd say that, yes, if we wanted to do switching and the like, great, you would go after that label. But for right now, we're really more focused on making sure that it's not adjunctive.

And then just on the 8 Series, would that be a couple of years out? I don't know if you gave any timing, and maybe you won't, and that's fine. But also within half the size of a, I think you said a 780 at this point or a 7 Series pump, would you expect that to have a docking station, something you could actually wear it on body? Or would that still be a belt loop kind of tubed?

Yes, it has a holster basically, and we have a bunch of other concepts so that it's just more amenable to wear on the body, of course. And so as an example, females like to wear it in their bra and so making it much more comfortable for them to wear in the bra is one other example that we're working on. I don't think there was another question, but I just want to make sure I answered it.

Timing just, and again, I know you won't give it, but do we think of every 12 to 18 months as a normal product cadence for Medtronic from here in the diabetes space? Or just any ballparks you can give us?

Yes. I'd say the cadence was from left to right of what we expect. It's probably the easiest way to say it. And I think you can infer in between what that means, yes.

Marie.

Marie Thibault from BTIG. Just wanted to follow up on the competitive landscape in Europe. We're seeing Omnipod 5 just start to launch in the U.K., Germany later this year. Curious what your team is doing to sort of get in front of that competitive launch. You've taken very nice share over the last couple of years. So if your internal expectations, is that a slowing of share gains? What are your expectations are there? And then I wanted to also clarify on 780G. Will insurance pay for type 2 scripts? Just want to clarify on that.

So on the first question, we're very confident about 780G in Europe. Obviously, I'm sure noise that will come from Omnipod 5 coming in, it's coming in, in the U.K. It's a bit slow. We have a very strong commercial team in Europe. And 780G has been there for a while. People know what it does. They know the outcomes it generates. So we think it's going to be very competitive. So on insurance reimbursement, it's approved for type 1. So I would say no.

Rich.

Rich Newitter from Truist Securities. The first one, just on the meal detection, some of the feedback from -- or competitors will say that the auto correction feature is something that's not that new. I just want to make sure what you guys are doing with your meal detection algorithm is the existing auto corrections that are largely prevalent out there on other systems. And in addition to that, the 5 seconds intervals is what's new, and that's very specific to what you're launching. Is that correct?

Yes. So think of it as the basal is 1 algorithm, but we actually added 3 algorithms on top of it, one for correcting, one to make sure that we're detecting a meal and then another to make sure that both of those are safe. And so it is not, very clearly, I'll articulate that it is not the same algorithm by any sort of imagination. And the meal detection is definitely differentiated. We don't know of anybody else that's able to do that.

Okay. And just last on the guidance. Maybe this is obvious, but when you talked about fiscal '24 and fiscal '25 as it was, you were talking about the full fiscal years, right, being above the company growth rate and obviously double digits as longer term. You were less specific there, but that was a full year -- full fiscal year objective, not within it, right?

I didn't say we're going to be above the company guidance for the full fiscal year. I just said we're going to ramp up our growth rate. We're going to start below the company's average in FY '24. And I'm not making any further comments on the guide. Just. that's what we said.

Sorry, not guidance, you objective to be above the company average, corporate average growth rate in fiscal '25. That was a full year '25 objective.

Yes.

Any other questions? Okay. All right. Yes, we'll go to Larry.

I promise. Thank you for taking the follow-up. The 20% CAGR on that slide for the Smart Dosing, I know smart pens are in there, too. But is that how you see the pump, the AID market? That's a big number, a 20% CAGR. Is that how you see kind of the AID market growing? Just one question on that.

Yes, look, there's a lot of things that go into, say, a market size number, which is why we focus on patients. There's different ASPs. There's just different dynamics going on to -- it was very -- we would have made the slide much more complicated. So we just chose to start with patients, and that's got the chart refers to, which is the growth in patients that will be on an AID or a Smart MDI system.

Okay. Thank you for your questions. If anybody has any follow-up questions, please feel free to follow up with me or any member of my IR team. And a reminder, that the slides, including the clinical citations and a replay of this event, will be available later today on our website at investorrelations.medtronic.com. Thanks to everyone for your continued support and interest in Medtronic and our diabetes business. With that, let's conclude today's event.