In today’s briefing:
- Insulet Accuses EOFlow Of Stealing Trade Secrets
- Summary of the Situation Regarding Insulet’s Lawsuit in the US Against Eoflow
- Insulet’s Lawsuit Against Eoflow, Medtronic’s Tender Offer, and Eoflow’s “Special Sauce”
- DexCom Inc.: New Innovations Driving The Way Forward! – Key Drivers
- Hygeia Healthcare Group (6078.HK) – The Crack in the Egg
Insulet Accuses EOFlow Of Stealing Trade Secrets
- From the outset, EOFlow (294090 KS) has traded wide (~7% of average) to Medtronic Plc (MDT US)‘s Offer. An apparent delay in filing with Korean regulators formed one argument.
- Now there’s a compelling reason. Key insulin pump competitor Insulet (PODD US) has filed a lawsuit accusing EOFlow of the misappropriation of trade secrets, patent infringement, and trademark dilution.
- Singapore-Based Flex (FLEX US) and three ex-employees of Insulet are also defendants. This does not bode well for the transaction.
Summary of the Situation Regarding Insulet’s Lawsuit in the US Against Eoflow
- This signifies the official commencement of a lawsuit against Eoflow in the United States, which has been considered one of the most significant risks for Eoflow.
- Eoflow is externally saying that the aspect of patents claimed by Insulet is actually based on previously expired patents. Hence, Eoflow believes they can win this patent lawsuit.
- This lawsuit emerged before the acquisition decision by Medtronic suggesting a need to consider trading the current spread based on the inference that the tender offer is still valid.
Insulet’s Lawsuit Against Eoflow, Medtronic’s Tender Offer, and Eoflow’s “Special Sauce”
- Insulet Corp (PODD US)’s lawsuit against Eoflow (294090 KS) caused a sharp decline in Eoflow’s share price today (down 10.7% to 24,950 won).
- Insulet is accusing Eoflow of hiring several senior personnel that have helped Eoflow to develop a product that could take away market share from Insulet.
- The most important factor may be Eoflow’s “special sauce” which is some kind of technology/mechanism that allows this 17% greater efficiency/convenience for the wearable EOPatch insulin device.
DexCom Inc.: New Innovations Driving The Way Forward! – Key Drivers
- DexCom delivered an all-around beat in the previous quarter.
- The company generated another fantastic quarter, with organic revenue growing by 26% in the second quarter compared to the second quarter of 2022.
- As the availability of their products expands more quickly than at any other point in the company’s history, demand for DexCom CGM keeps rising.
Hygeia Healthcare Group (6078.HK) – The Crack in the Egg
- Based on endogenous development and external M&A, the outlook of Hygeia is full of imagination. Hygeia also start to expand business in northwest region of China by acquiring Chang’an Hospital.
- If public hospitals have a role in “guiding patients” to Hygeia, anti-corruption campaign would affect Hygeia’s future performance, which is a significant uncertainty that could also shake its investment logic.
- There may be short-term chaos. It remains to be seen whether performance can sustain growth of around 30%. The 23H2 revenue growth would be an important guidance for Hygeia’s outlook.