Shares of Australian medical technology firm Polynovo Ltd (ASX:PNV) surged on Tuesday after the company said it could benefit from a proposed overhaul of U.S. Medicare reimbursement rules for outpatient wound care.
The Centers for Medicare & Medicaid Services (CMS) has proposed a flat reimbursement rate of $806 per square inch for skin substitutes, replacing the current model that rewards physicians with a percentage of product costs.
The change, aimed at cutting government spending that topped $10 billion in 2024, is expected to reduce incentives for high-cost products and promote clinically proven, cost-effective options.
PolyNovo said its NovoSorb wound-healing products would remain profitable under the new system, with margins intact and competitiveness enhanced.
Sydney-listed shares of the company advanced as much as 26.6% to A$1.665, but later pared gains to trade 6.8% higher at A$1.405 as of 04:15 GMT.
“Outpatient product application … is a significant potential growth area for PolyNovo’s products,” Acting CEO Robyn Elliott said.
"We are currently assessing the optimal commercial model for accessing this market opportunity," he added.
A final decision on the proposal is expected in November, with implementation slated for January 2026.
Source :
https://www.investing.com/news/stock-market-news/polynovo-shares-surge-on-growth-potential-from-us-medicare-overhaul-4218376
