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Nevro Corp. (NVRO - Free Report) recently announced that Aetna had updated their spinal cord stimulation (SCS) coverage policy to explicitly cover painful diabetic neuropathy (PDN), effective Aug 29, 2022. The company also announced that Novitas and First Coast, the Medicare Administrative Contractors (MACs) had published their draft Local Coverage Determinations (LCDs), which have proposed updated coverage criteria to include PDN refractory to conventional medical management for SCS devices with an explicit FDA approval to treat PDN.
It is worth mentioning that presently Aetna is one of the largest health plans in the United States and covers approximately 22 million commercial lives. The MACs currently cover the areas of New Jersey and Colorado, among others.
The latest favorable coverage decisions are expected to strengthen Nevro’s foothold in the global SCS therapy business.
Significance of the Coverage Decisions
Nevro believes that once the MACs’ LCDs’ proposal is finalized, it will imply that Medicare patients in all 50 states will enjoy coverage for PDN and will add approximately 17 million covered Medicare lives. However, the review of the proposed LCDs is ongoing and potential finalization dates have not yet been confirmed.
Per Nevro’s management, the positive coverage advancements for the significant number of commercial and Medicare patients covered by these carriers will likely provide greater access to the company’s proprietary 10 kHz Therapy for PDN patients. Notably, Aetna’s recent coverage decision follows reconsidering its decision in the early part of the year, thereby changing its SCS coverage policy to explicitly cover PDN.
The recent favorable coverage decisions, which follow other recent decisions from UnitedHealthcare, Blue Cross Blue Shield and Noridian, increase coverage in the United States to approximately 54% of PDN patients, up from 25% of patients at the end of 2021. It is worth mentioning that if the Medicare MAC coverage policies from Novitas and First Coast are finalized, it is expected to increase coverage in the United States to approximately 66% of PDN patients.
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 the growing adoption of SCS therapy are likely to drive the market.
Given the market potential, the latest positive coverages are expected to significantly boost Nevro’s business worldwide.
Notable Developments
Last month, Nevro reported its second-quarter 2022 results, wherein it recorded improvement in its overall top line and robust domestic revenues. Uptick in total U.S. permanent implant procedures, U.S. trial procedures and sequential improvement in U.S. PDN trial procedures was also witnessed.
In July, Nevro announced positive clinical data from the complete 12-month results from the SENZA-PDN Randomized Controlled Trial (RCT), including health-related quality of life outcomes in patients with PDN treated with high-frequency 10 kHz SCS.
In June, Nevro announced positive results from data presentations at the American Diabetes Association’s Scientific Sessions. The data supported the use of 10 kHz SCS therapy for patients with chronic pain, including results from the SENZA PDN RCT.
Price Performance
Shares of the company have lost 63.9% in the past year compared with the industry’s 32.7% fall and the S&P 500's 13.7% decline.
Image Source: Zacks Investment Research
Zacks Rank & Key Picks
Currently, Nevro carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader medical space are AMN Healthcare Services, Inc. (AMN - Free Report) , ShockWave Medical, Inc. (SWAV - Free Report) and McKesson Corporation (MCK - Free Report) .
AMN Healthcare, flaunting a Zacks Rank #1 (Strong Buy) at present, has an estimated long-term growth rate of 3.2%. AMN’s earnings surpassed the Zacks Consensus Estimate in all the trailing four quarters, the average beat being 15.7%.
AMN Healthcare has lost 13.6% compared with the industry’s 38.2% fall in the past year.
ShockWave Medical, sporting a Zacks Rank #1 at present, has an estimated growth rate of 33.1% for 2023. SWAV’s earnings surpassed estimates in all the trailing four quarters, the average beat being 180.1%.
ShockWave Medical has gained 30.7% against the industry’s 32.7% fall over the past year.
McKesson, carrying a Zacks Rank #2 (Buy) at present, has an estimated long-term growth rate of 9.9%. MCK’s earnings surpassed estimates in three of the trailing four quarters and missed the same in one, the average beat being 13%.
McKesson has gained 76.4% against the industry’s 14.6% fall over the past year.
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Nevro's (NVRO) PDN Therapy Gets Positive Coverage Updates
Nevro Corp. (NVRO - Free Report) recently announced that Aetna had updated their spinal cord stimulation (SCS) coverage policy to explicitly cover painful diabetic neuropathy (PDN), effective Aug 29, 2022. The company also announced that Novitas and First Coast, the Medicare Administrative Contractors (MACs) had published their draft Local Coverage Determinations (LCDs), which have proposed updated coverage criteria to include PDN refractory to conventional medical management for SCS devices with an explicit FDA approval to treat PDN.
It is worth mentioning that presently Aetna is one of the largest health plans in the United States and covers approximately 22 million commercial lives. The MACs currently cover the areas of New Jersey and Colorado, among others.
The latest favorable coverage decisions are expected to strengthen Nevro’s foothold in the global SCS therapy business.
Significance of the Coverage Decisions
Nevro believes that once the MACs’ LCDs’ proposal is finalized, it will imply that Medicare patients in all 50 states will enjoy coverage for PDN and will add approximately 17 million covered Medicare lives. However, the review of the proposed LCDs is ongoing and potential finalization dates have not yet been confirmed.
Per Nevro’s management, the positive coverage advancements for the significant number of commercial and Medicare patients covered by these carriers will likely provide greater access to the company’s proprietary 10 kHz Therapy for PDN patients. Notably, Aetna’s recent coverage decision follows reconsidering its decision in the early part of the year, thereby changing its SCS coverage policy to explicitly cover PDN.
The recent favorable coverage decisions, which follow other recent decisions from UnitedHealthcare, Blue Cross Blue Shield and Noridian, increase coverage in the United States to approximately 54% of PDN patients, up from 25% of patients at the end of 2021. It is worth mentioning that if the Medicare MAC coverage policies from Novitas and First Coast are finalized, it is expected to increase coverage in the United States to approximately 66% of PDN patients.
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 the growing adoption of SCS therapy are likely to drive the market.
Given the market potential, the latest positive coverages are expected to significantly boost Nevro’s business worldwide.
Notable Developments
Last month, Nevro reported its second-quarter 2022 results, wherein it recorded improvement in its overall top line and robust domestic revenues. Uptick in total U.S. permanent implant procedures, U.S. trial procedures and sequential improvement in U.S. PDN trial procedures was also witnessed.
In July, Nevro announced positive clinical data from the complete 12-month results from the SENZA-PDN Randomized Controlled Trial (RCT), including health-related quality of life outcomes in patients with PDN treated with high-frequency 10 kHz SCS.
In June, Nevro announced positive results from data presentations at the American Diabetes Association’s Scientific Sessions. The data supported the use of 10 kHz SCS therapy for patients with chronic pain, including results from the SENZA PDN RCT.
Price Performance
Shares of the company have lost 63.9% in the past year compared with the industry’s 32.7% fall and the S&P 500's 13.7% decline.
Image Source: Zacks Investment Research
Zacks Rank & Key Picks
Currently, Nevro carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader medical space are AMN Healthcare Services, Inc. (AMN - Free Report) , ShockWave Medical, Inc. (SWAV - Free Report) and McKesson Corporation (MCK - Free Report) .
AMN Healthcare, flaunting a Zacks Rank #1 (Strong Buy) at present, has an estimated long-term growth rate of 3.2%. AMN’s earnings surpassed the Zacks Consensus Estimate in all the trailing four quarters, the average beat being 15.7%.
You can see the complete list of today’s Zacks #1 Rank stocks here.
AMN Healthcare has lost 13.6% compared with the industry’s 38.2% fall in the past year.
ShockWave Medical, sporting a Zacks Rank #1 at present, has an estimated growth rate of 33.1% for 2023. SWAV’s earnings surpassed estimates in all the trailing four quarters, the average beat being 180.1%.
ShockWave Medical has gained 30.7% against the industry’s 32.7% fall over the past year.
McKesson, carrying a Zacks Rank #2 (Buy) at present, has an estimated long-term growth rate of 9.9%. MCK’s earnings surpassed estimates in three of the trailing four quarters and missed the same in one, the average beat being 13%.
McKesson has gained 76.4% against the industry’s 14.6% fall over the past year.