Shares of Senseonics (NYSEMKT:SENS) are up nearly 20% today after the biotech company announced that it expects a review of its glucose monitoring system to be completed by the U.S. Food and Drug Administration (FDA) within the next few weeks.
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Germantown, Maryland-based Senseonics is developing an implantable continuous glucose monitoring system for people with diabetes. The company says that it expects the FDA to issue a decision on whether to approve its glucose monitoring system in coming weeks, noting that it has answered all the questions raised by regulators.
Today’s move higher represents a recovery for SENS stock, which has slumped 20% over the past six months. However, Senseonics stock is up 182% over the last year.
What Happened With SENS Stock
Investors clearly like that Senseonics appears to be in the final stages of approval with the FDA and that a decision on its glucose monitoring system is coming. In anticipation of approval, Senseonics said that it is ramping up its marketing efforts in order to “increase overall patient awareness” of its product.
The company has also reaffirmed its full year 2021 financial guidance, saying it continues to expect revenue of $12 million to $15 million. “We are excited to advance long-term solutions for people with diabetes,” said Tim Goodnow, president and CEO of Senseonics, in a news release.
Why It Matters
Senseonics is focused exclusively on the development and manufacturing of glucose monitoring products for people with diabetes. Its implantable glucose monitoring system includes a small sensor inserted under the skin that communicates with a smart transmitter worn over the sensor. Information about a person’s glucose is sent every five minutes to a mobile app on the user’s smartphone.
Senseonics says that its system works for three months at a time, distinguishing it from other similar systems. News of a pending decision by the FDA is positive for SENS stock, which was trading at 87 cents a year ago but has since risen sharply to its current level of $2.68 a share.
What’s Next for Senseonics
Investors appear to be betting that the company’s implantable glucose monitoring system will be cleared by the FDA and become commercially available. However, while a decision is pending, Senseonics’ diabetes treatment has not yet won approval. As such, investors should be careful with SENS stock.
Should the FDA reject or delay approval, the company’s share price will likely fall precipitously. As such, investors may want to keep any position in SENS stock small until the company achieves full approval from the FDA and its glucose monitoring system becomes widely available to diabetes patients.
On the date of publication, Joel Baglole did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
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