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Nevro's (NVRO) PDN Therapy Gets Noridian's Medicare Coverage

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Nevro Corp. (NVRO - Free Report) recently announced that Noridian has released an update to their Local Coverage Billing and Coding article for spinal cord stimulators for chronic pain to include two new ICD-10 codes that cover Painful Diabetic Neuropathy (“PDN”). The modification, which was made on Mar 4, 2022, is effective for procedures performed on or after Jan 1, 2022.

It is to be noted that Noridian is the Medicare Administrative Contractor (“MAC”) overseeing the majority of the western United States.

The latest favorable coverage decision is expected to strengthen Nevro’s foothold in the global spinal cord stimulation (“SCS”) therapy business.

Significance of the Coverage Decision

Per management, the positive coverage decision by Noridian is a very favorable development for the Medicare-aged population covered by the MAC, as this is expected to offer better access to Nevro's proprietary 10 kHz Therapy for PDN patients.

The latest favorable coverage by Noridian follows the recent positive coverage decision by UnitedHealthcare in January. Per the company press release, this “increases coverage in the US to approximately 43% of PDN patients, up from approximately 25% of patients at the end of 2021.”

Industry Prospects

Per a report by Market Data Forecast, the global SCS market was estimated to be $1,871.6 million in 2020 and is anticipated to reach $2,827.4 million by the end of 2025 at a CAGR of 8.6%. Factors like rising cases of chronic and neuropathic pain, and growing adoption of SCS therapy are likely to drive the market.

Given the market potential, the latest positive coverage is expected to significantly boost Nevro’s business worldwide.

Notable Developments

In February, Nevro announced that favorable 12-month data from the SENZA-NSRBP (non-surgical refractory back pain) randomized controlled trial (“RCT”) was published online in the Journal of Neurosurgery: Spine. The data show that high-frequency 10 kHz SCS therapy results in significant improvement in NSRBP patients compared to Conventional Medical Management.

In January, the company received the FDA’s approval for expanded labeling for its Senza SCS System associated with the treatment of NSRBP. The approval, specific to Nevro's exclusive 10 kHz Therapy, categorizes the Senza System as the only SCS system with specific labeling to treat NSRBP patients.

Price Performance

Shares of the company have lost 55.1% in the past year compared with the industry’s 8.3% fall. The S&P 500 has risen 6.9% in the same time frame.

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Zacks Rank & Key Picks

Currently, Nevro carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the broader medical space include Henry Schein, Inc. (HSIC - Free Report) , Allscripts Healthcare Solutions, Inc. (MDRX - Free Report) and AMN Healthcare Services, Inc. (AMN - Free Report) .

Henry Schein, flaunting a Zacks Rank #1 (Strong Buy) at present, has an estimated long-term growth rate of 11.8%. HSIC’s earnings surpassed estimates in the trailing four quarters, the average beat being 25.5%. You can see the complete list of today’s Zacks #1 Rank stocks here.

Henry Schein has gained 27.8% compared with the industry’s 5.8% growth over the past year.

Allscripts has an estimated long-term growth rate of 16.3%. MDRX’s earnings surpassed estimates in the trailing four quarters, the average beat being 64.8%. It currently carries a Zacks Rank #2 (Buy).

Allscripts has gained 36.9% against the industry’s 50.8% fall over the past year.

AMN Healthcare has an estimated long-term growth rate of 16.2%. AMN’s earnings surpassed estimates in the trailing four quarters, the average beat being 20%. It currently sports a Zacks Rank #1.

AMN Healthcare has gained 33.1% against the industry’s 57.6% fall over the past year.