The US Medicare coverage had given Pacific Edge access to about 20 million Americans. Photo: Supplied / Pacific Edge
- Pacific Edge loses key US Medicare coverage for its flagship test
- Loss of coverage likely represents a major revenue blow for the Dunedin-based company
- Company's share price more than halved following the final decision
- Pacific Edge may still pursue legal action
Bladder cancer diagnostics company Pacific Edge's share price plunged more than 60 percent after a US Medicare provider confirmed it would no longer cover the company's flagship Cxbladder test.
The final decision by Novitas meant Medicare coverage of Cxbladder would end from 23 February, but Pacific Edge has indicated it may appeal or pursue legal action.
Trading in Pacific Edge shares resumed at market open on Monday morning, after a temporary trading halt on Friday following the draft announcement.
Its share price was at 13.4 cents on Friday, but fell 63 percent or by more than 8 cents, to 5 cents a share in early trade on Monday.
The loss of coverage would likely result in a major financial blow for the company, with Medicare coverage helping deliver $6.5 million in first half operating revenue, which was more than half of its overall revenue.
Pacific Edge chief executive Peter Meintjes said the Dunedin-based firm was disappointed by the finalised local coverage determination (LCD), saying it "misunderstands the science".
"Furthermore, we cannot believe that Novitas would commit in writing to review our most recent evidence as part of developing this LCD and then fail to do so," Dr Meintjes said.
"Ignoring a randomised controlled trial published during the lengthy deliberations on the LCD and the consensus of the urology community runs counter to the mandate of a US government health insurance programme," he said.
Pacific Edge said it may pursue a preliminary injunction and legal challenge against the decision.
It said it may also further review its operations to reduce cash burn, submit to Novitas for reconsideration and explore strategic alternatives that could support it in regaining reliable Medicare coverage.
