Updated to include more information, commentary from Organogenesis.
Medicare administrative contractor National Government Services has retired previous coverage policies on cellular and tissue-based products, effective September 1st.
The change will allow new coverages and reimbursement through Medicare for such products based on FDA labeling and packaging.
Derma Sciences (NSDQ:DSCI and Organogenesis have said the changes will allow for their products to receive coverage and reimbursement for individuals covered under NGS.
Approximately 24 million Medicare Part B beneficiaries are covered by NGS, and with the change its Amnioexcel will be eligible for Medicare reimbursement in 47 states and up to 93% of all Medicare beneficiaries.
Derma Sciences’ Amnioexcel will now be considered, with appropriate documentation of medical necessity, as a second-line therapy, following standard wound care treatment.
“We are very pleased with NGS’ decision to retire its LCD for CTPs. NGS’ jurisdiction includes several major metropolitan areas – such as New York, Boston and Chicago, which not only increases our market for Amnioexcel, but permits much more efficient sales rep coverage. While we now have coverage over the bulk of the country, we continue to pursue an LCD from the remaining MAC for Amnioexcel in order to ensure complete nationwide access to those who suffer from diabetic ulcers and other chronic wounds. Of note, Amnioexcel is one of the only amniotic allografts with level I Randomized Control Trial evidence in diabetic foot ulcers, and we expect this data to continue to support our sales efforts,” interim principal exec Stephen Wills said in a press release.
Organogenesis said its PuraPly and PuraPly antimicrobial wound managements will also be up for coverage through NGS. The company said both products have already been approved for pass-through reimbursement in a hospital outpatient setting for Medicare & Medicaid Services.
The PuraPly and PuraPly AM both have FDA 510(k) clearances with indications for acute and chronic wound management across a variety of wound types, including full and partial-thickness wounds, pressure ulcers, surgical wounds, trauma wounds and venous and diabetic ulcers.
“We applaud the NGS for retiring its local coverage determination and making it easier for millions of Medicare patients to access clinically appropriate, advanced wound management products. We’re excited that many more clinicians will now be able to use our versatile PuraPly product offerings to help Medicare patients more effectively manage a wide variety of acute and chronic wounds,” CEO Gary Gillheeney, Sr., said in a prepared release.
Earlier this month, Derma Sciences said it closed its acquisition of regenerative allograft maker BioD in a deal worth up to $78 million, including milestones and earn-outs.
Princeton, N.J.-based Derma Sciences said it paid $21.3 million up front in a mix of cash and stock; meeting regulatory milestones could mean another $30 million, and the transaction included $26.5 million in earn-outs pegged to net sales growth. The deal, announced July 28, closed August 5, the company said in a regulatory filing.
BioD makes a line of allograft products derived from human placental tissue, including treatments designed for chronic wounds, soft tissue repair, resorbable adhesion prevention, scar tissue formation and ocular tissue repair. The company is based in Cordova, Tenn.
