A year after receiving FDA clearance for their smartphone-connected glucometer, Israel-based DarioHealth is in good shape, reporting record revenues, an increasing user base and big plans to expand with payers, new markets and partnerships to monetize big data.
On an earnings call, DarioHealth CEO Erez Raphael told investors the fourth quarter of 2016 “seriously advanced” the company in the United States. After receiving the CE Mark in 2013 for the DarioHealth system – which consists of a pocket-sized device that includes a glucose meter, disposable test strip cartridge, a lancing device and a companion smartphone app – the company moved onto Canada in 2015 and then the United States in 2016, and is now eyeing a global presence.
“We truly believe that the mobile solution is the future, which is why we are improving our high engagement software and are very focused on innovation that allows us to do more with our big data management,” Raphael said on the call. “In the last quarter, we managed to increase our user base in a way we believe our big data will contribute to in a way to monetize on that.”
The company, which offers a direct-to-consumer model in the United States, Canada and Australia, ended 2016 with revenues of $2.8 million, representing a 241 percent increase from the previous year. While subscriptions to theDariohHealth’s full diabetes management platform continue to increase, most of the revenue comes from sales of the devices. The company sold 8,500 devices in the United states in the fourth quarter, up 55 percent from the previous quarter. To date, the company has about 19,000 customers, and they want more. What will help DarioHealth continue to grow, Raphael said, is getting FDA clearance for the Android version of the system.
“We have clearance for Android everywhere but the US. The file is submitted to the FDA and the process has started, but we still currently have it available by iOS in the states,” Raphael said. “Once we are able to do that, we think we can increases our access to the market, along with reimbursement from insurers.”
Raphael couldn’t disclose names, but said DarioHealth is very close to inking a deal with two clients who work with insurance companies. Overall, they want to bring as many payers on as possible and develop a more aggressive business-to- business strategy in the next six to nine months.
“We want to do this in a gradual way. As of today, we have access of around 20 to 25 percent of the market, and a lot of that is because we are only iOS and out of pocket. Once we start getting reimbursed and cleared for Android, we think we can get up to 60 to 70 percent of the market,” Raphael said. “We see this happening in the very near future.”
In addition to growing the US market, Raphael mentioned the company's desire to have a global presence, which they are working towards thanks in part to a recent $3 million investment from crowdfunding equity platform OurCrowdQure. That means selling more devices through channels that include reimbursement, and seeking out strategic partnerships to leverage revenue opportunities from big data.
"Because we want to monetize on all the data – and because we are mobile-native and have 100 percent data capture – it's very important to have global coverage," Raphael said.