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| NeuroPace's RNS System--Courtesy of NeuroPace |
NeuroPace's implantable neurostimulator will receive new technology add-on payments from the federal Centers for Medicare & Medicaid Services in recognition of its clinical benefits compared with older therapies for the treatment of uncontrolled epilepsy in adults.
"We are grateful CMS recognizes the substantial benefits the RNS System has provided to patients and the need for patients who suffer from uncontrolled seizures to have access to this therapy," NeuroPace CEO Frank Fischer said in an Aug. 6 statement. "Epilepsy centers have moved quickly since PMA approval to make the RNS System available. To date, 35 Comprehensive Epilepsy Centers that meet all the qualifications for the highest level of epilepsy care have completed required training and are able to implant the RNS System."
NeuroPace says the RNS System is the only neurostimulation device that delivers stimulation on an as-needed basis due to its unique ability to monitor and assess the brain's response to its treatment. It is approved for "treatment for adults with partial onset seizures with one or two seizure onset zones whose seizures have not been controlled with two or more antiepileptic drugs," according to the company statement.
If patients fail to improve after medication, doctors typically recommend neurosurgery to remove the part of the brain that's causing the seizures, but often that isn't feasible, Fischer said in an interview. That's when the RNS System comes into play. According to the CEO, of the 2.3 million adults in the U.S. have epilepsy, the market opportunity for the RNS is 400,000 to 500,000 patients.
Fischer said the company expects CMS's decision to increase access to the device among those patients because it will enable hospitals to just about break even on the total costs of the procedure, which includes the cost of the device as well as the associated surgery. So far, the device has been implanted in 45 patients commercially, and is available in about 35 out of 120 level 4 epilepsy centers, he said.
In what FierceMedicalDevices deemed one of the most significant approvals of the year, the RNS System received a PMA from the FDA in November 2013 after randomized controlled trials found that the implant reduced the number of seizures per month by almost 38%. Fischer said he expects an upgraded version of the device to be offered by the end of 2015 -- and he hopes to take the company public around that time as well.
New technology add-on payments provide additional reimbursement for new technologies that are inadequately paid under the diagnosis-related group (DRG) system, which provides reimbursement based on the average cost of all the therapies in the DRG. To qualify for the bonus reimbursement payment, the new technology must represent "an advance in medical technology that substantially improves, relative to technologies previously available, the diagnosis or treatment of Medicare beneficiaries," CMS explains on its website.
The maximum add-on payment is the DRG payment plus 50% of the estimated costs of the new technology. The maximum amounts to an additional $18,475 in reimbursement for the hospital, Fischer told FierceMedicalDevices, adding that the actual add-on payment would vary for each hospital. The add-on payment lasts for two to three years--the amount of time it takes to collect and reflect data on the new technology's cost in the DRG payment through recalibration of the average payment.
All companies applying for the add-on payment made their case at a CMS town hall in February. St. Jude Medical's ($STJ) CardioMEMS heart failure monitor and Abbott's ($ABT) MitraClip mitral valve repair device also qualified for the payments.
- read the release
- get more on new tech add-on payments from CMS
Special Report: 2013's top FDA approvals in med tech - NeuroPace's antiepilepsy neurostimulation implant
Editor's Note: This article has been updated to include facts obtained from interview with NeuroPace CEO Frank Fischer.