AVITA Medical, Inc.

ASX:AVH

AVITA Medical, Inc.

ASX:AVH
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$1.065 (+0.5%)
Last close price
#170
Rank
11
Held by
32
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Reports (5) My Report Forum Investors
Forum Topics AVH AVH ASX Announcements

Pinned straw:
mikebrisy
Added 2 months ago

Not marked as SP sensitive, the market clearly disagrees as the following announcement provides a nice revenue kicker for ReCell in the US in non-burn applications.

ASX Announcement

Basically, $AVH announced that from October 1, 2025 to September 30, 2026, U.S. hospitals will be eligible for New Technology Add-on Payment (NTAP) reimbursement of up to $4,875 per case when using RECELL to treat acute, non-burn trauma and surgical full-thickness wounds. The NTAP, granted under CMS’s alternative pathway for FDA Breakthrough Devices, highlights RECELL’s clinical value and innovation.

RECELL enables clinicians to create a Spray-On Skin™ cell suspension from a small patient skin sample, reducing donor skin needs compared with standard grafting. A 2024 randomized trial showed RECELL achieved equivalent wound closure outcomes while using 27% less donor skin, lowering donor site complications such as pain, delayed healing, infection risk, and scarring. The new reimbursement is expected to improve hospital access and expand patient use.

My Assessment

Perhaps because the market is awaiting news on the remediation of the CMS coding debacle for RECELL, the company has decided not to flag this as price sensitive. In any event, I didn't have this on my radar screen before today.

The top-up is significant, with the cost of the RECELL component of a 10-20% surface area wound being in the range $6,500-$13,000. However, it is hard to translate this into a potential revenue impact, partly because I don't know what proportion of the sales are eligible. So, afterall, perhaps it is not material at a group revenue level.

Maybe I am drawing too long a bow, but if CMS has granted this priority payment, you'd think they'd have applied themselves to working with their payment contractors to get the re-coding issue sort out. That's the news I am really waiting for, i.e., 1) is the coding issue sorted out and 2) have the hospitals and surgeons that stopped ordering in Q1 and Q2, started again.

I expect we'll have to wait another month or so for that update, when $AVH reports its quarterly.

Don't get me wrong - I'll take today's good news!

Disc: Held in RL and SM
jcmleng
Added 2 months ago

@mikebrisy , I suspect it is not marked price sensitive as it was previously flagged in the last round of earnings announcements/webinars. That good news was completely overshadowed by the CMS reimbursement drama's.

You would think that if the CMS can apply ADDITIONAL reimbursement for RCEL, then surely, surely, the BASE reimbursement would be sorted ... otherwise, the impact of this reimbursement kicker would be pretty much wasted as it only runs for 12M.

Management has had the tendency to make these sort of "something-but-nothing" announcements. Was looking for wording to provide any hint on CMS drama resolution, but none was forthcoming - perhaps the coded message was not so much in what was said vs what was not said!

Discl: Held IRL and in SM

7
mikebrisy
Added 2 months ago

@jcmleng you are right - the CMS coding debacle completely over-rode my recollection of the NTAP opportunity! It is infuriating(to me anyway), that an opportunity to update on the coding remediation was missed. I suspect that, with all the US shareholders lawyering up over prior disclosures and non-disclosures, the lawyers are making sure all announcements are buttoned down and robust. No loosey, goosey interim updates. October is going to pass very slowly!

11