Why Insulet Stock Soared This Week

Manufacturer of specialized devices Island (PODD 0.36%) had some good news to share with the world earlier this week, and investors jumped on the stock as a result. As the market began gearing up for its weekend early Friday, Insulet’s share price is up nearly 11 percent year-to-date, according to data compiled by S&P Global Market Intelligence.

The new approval was granted

Insulet specializes in insulin pumps, and on Monday it officially announced that its latest offering in the category has received Food and Drug Administration (FDA) approval for a new indication. This product is the latest version of its Omnipod line, the Omnipod 5 Automated Insulin Delivery System (AID). The FDA has approved the Omnipod 5 for patients with type 2 diabetes 18 years of age and older.

The device had previously been approved for type 1 diabetes. Insulet said the latest regulatory agreement makes the Omnipod 5 the only AID to carry FDA approval for both types.

“Insulet is paving the way for these individuals to achieve better health outcomes while living with more confidence and freedom through the game-changing benefits of tubeless capsule therapy,” said the care device company’s CEO of Health, Jim Hollingshead.

Large patient population

There is certainly a significant addressable market in this country for the expansion of this label. According to Insulet, more than 30 million people currently have type 2 diabetes. Of that number, about 6 million need to take insulin treatments. Among this population are 2.5 million people who require multiple daily injections. This is the target market for Insulet as the Omnipod automatically delivers doses at regular intervals.