Pacific Edge threatens to go legal over an unfavourable US ruling. Pic via Getty Images
Health & Biotech
Kiwi based, US-focused bladder cancer detection house Pacific Edge (ASX:PEB) has flagged a legal challenge to this month’s US decision that removes public reimbursement for its Cxbladder bladder cancer detection tool.
While acknowledging the “inherent uncertainties” of such a gambit, the company will pursue a preliminary injunction “if our efforts to negotiate a withdrawal [of] or revision to the finalised [determination] prove unsuccessful”.
On January 8 Pacific Edge shares tumbled 64% after the decision by Novitas, the Medicare gatekeeper with jurisdiction over the company’s US labs.
This one can’t be blamed on Trump, by the way – but we’re sure plenty more decisions in the medical milieu will be.
The dictate reverses a 2020 decision and is effective from February 23, 2025.
Pacific Edge maintains the decision is flawed and ignores clinical evidence supporting the use of Cxbladder to evaluate patients with blood in the urine, a possible sign of bladder cancer.
The company says it will seek a fair hearing before pursuing legal action and is after an “immediate dialogue” with Novitas and the ultimate arbiter, the Centers for Medicare and Medicaid Services.
“Our immediate focus is to seek a negotiated revision or withdrawal of the [decision], but we have resolved to escalate and seek immediate relief [via a preliminary US Federal District Court injunction] on the basis of the irreparable harm it will do to our business … if our concerns are not heard and acted upon.”
Put in context, in the September half Medicare accounted for 5300 commercial tests – just over half of the company’s total US assays – and NZ$6.5 million ($6.07 million) of operating revenue out of a total NZ$11 million.
In the meantime, the company has done well to maintain test volumes in the December quarter.
Today, the company reported ‘total laboratory throughput’ (TLT) in that stanza rose 0.7% to 7092 tests, from 7042 in the second (September) quarter.
In the US, TLT of 5808 tests was up 2.2% on the previous 5682.
“Novitas’ deliberations remained the overriding challenge to test volume growth, although the seasonal holiday slowdown also impacted volumes in the quarter,” the company says.
Management also cites the benefit of a full-time equivalent addition to the US sales team.
The company also reports “steady demand” from clients including managed-care intermediary Kaiser Permanente.
Tests per “unique US ordering clinician” – the company’s preferred measure – rose 9% in the quarter, to an average of seven.
But reflecting the Medicare uncertainty, the number of these clinicians – in effect the company’s real-world fan base – fell to 834 from 890 previously.
Pacific Edge’s Asia-Pacific volumes fell 5.6% to 1284 tests, largely reflecting the Kiwi holiday season.
With December-end cash of NZ$28.5 million and a current market cap of under NZ$50 million, the company appears priced on the assumption the ruling won’t be reversed.
The developer of a spray-based erectile dysfunction therapy called Spontan, LTR Pharma (ASX:LTP) has inked a distribution agreement to support local approval of the drug.
The compact is with Symbion, a wholesale supplier to 3900 pharmacies.
The non-exclusive agreement is effective from March 1 and includes “comprehensive quality assurance, inventory management systems and specialised handling processes tailored to pharmacy requirements.”
LTR intends to apply for approval under the Therapeutic Goods Administration’s early-access scheme, which allows a drug to be supplied on a compassionate-use basis.
The company hopes the Symbion tie-up will help its cause by enabling access to “established, scalable pharmaceutical infrastructure”.
Assuming approval, the company has targeted a local rollout of Spontan in the June quarter.
While Spontan contains the same active ingredient as the well-known Viagra or Cialis tablets, LTR Pharma claims that nasal delivery makes it much faster acting.
Blokes can be ready to go in as little as five minutes, compared with up to two and a half hours with the tablets.
LTR shares expanded 8% to 75.5 cents.
As it awaits US approval for its nerve repair product Remplir, Orthocell (ASX:OCC) says it will rev up its regulatory submissions in five other regions as well.
A collagen wrap, Remplir allows for less suturing and creates an “optimal healing microenvironment”. As a result, patients emerge with better nerve function.
Orthocell says its Canadian regulatory submission is “well advanced” and is expected to be lodged shortly, with an entreaty to Thailand’s medical gatekeepers expected this quarter.
The company plans UK and the European Union applications in the September quarter and a Brazil lodgment in the December quarter.
“The accelerated global expansion will significantly increase the revenue opportunity for the company, targeting a 20% share of the US$3.2 billion market,” Orthocell says.
The company is also interested in other markets including Taiwan, Vietnam, Indonesia, the Philippines and Latin American countries.
In December the company submitted a US marketing application under the 510(k) predicate-device route, with approval expected in March or April.
As with most devices the US market is the big daddy, in this case valued at US$1.6 billion a year.
To date, Remplir has been approved locally and in New Zealand and Singapore.
Orthocell also says that since Remplir initially was launched here in November 2022, around 160 orthopaedic and plastic surgeons are using Remplir across the three approved geographies.
A week ago, Orthocell reported December quarter revenue of $2.21 million, 9% higher than the September quarter and 46% better year-on-year.
Orthocell shares today surged 11.5% to $1.45.
At Stockhead, we tell it is as it is. While LTR Pharma and Orthocell are Stockhead clients, they did not sponsor this article.
Health & Biotech
Health & Biotech
Health & Biotech
