8-K: Helius Medical Technologies Secures Key HCPCS Codes for PoNS Therapy, Paving Way for Reimbursement

Helius Medical Technologies has obtained HCPCS Level II codes for its PoNS device, a significant step towards securing reimbursement for the treatment of gait deficits.

Summary

• Helius Medical Technologies has been assigned Healthcare Common Procedure Coding System (HCPCS) Level II codes for both the PoNS controller and mouthpiece.
• The codes, A4593 for the controller and A4594 for the mouthpiece, will be effective April 1, 2024.
• The company plans to provide additional information to the Centers for Medicare & Medicaid Services (CMS) to support reimbursement.
• Helius anticipates that CMS will determine a reimbursement amount for the PoNS device components by October 1, 2024.
• The company recently raised $1.5 million through its At-The-Market (ATM) program, extending its cash runway into the third quarter of 2024.

Sentiment

Score: 7

Explanation: The document is positive due to the achievement of HCPCS codes and the extension of the cash runway, but there are still risks and uncertainties related to reimbursement and market adoption.

Positives

• The assignment of HCPCS codes is a critical step towards reimbursement for PoNS therapy.
• The company has extended its cash runway into the third quarter of 2024 through recent stock issuances.
• PoNS therapy is a novel approach for treating balance and gait deficits.
• The company is pursuing authorization for stroke treatment in the U.S., which could significantly expand its market.

Negatives

• The company is still reliant on securing reimbursement from third-party payers.
• There is no guarantee that CMS will determine a favorable reimbursement amount.
• The company faces risks related to capital requirements, market awareness, and regulatory approvals.

Risks

• The company's ability to achieve its business objectives is dependent on securing additional capital.
• Disruptions in the banking system and financial markets could impact the company's access to capital.
• The company faces risks related to training physical therapists, securing contracts with rehabilitation clinics, and obtaining national Medicare coverage.
• There are risks associated with building a commercial infrastructure, securing state distribution licenses, and building relationships with key opinion leaders.
• The company faces risks related to manufacturing, labor shortages, and supply chain issues.
• The company's ability to maintain and enforce its intellectual property rights is crucial.
• Clinical trials, product development, and regulatory processes all pose risks to the company's success.
• The company's operating costs and use of cash are significant factors.
• The company's ability to achieve significant revenues is not guaranteed.
• Ongoing government regulation poses a risk to the company's operations.

Future Outlook

The company anticipates securing reimbursement for PoNS therapy and expanding its market reach, including pursuing authorization for stroke treatment in the U.S. and achieving positive cash flow.

Management Comments

• Helius President and Chief Executive Officer, Dane Andreeff, stated that the HCPCS codes mark a critical reimbursement and access milestone.
• Andreeff believes there is a reasonable likelihood that CMS will determine a reimbursement amount for the PoNS device by October 1, 2024.
• Andreeff also noted that the company has continued to manage its cash burn and extended its cash runway into the third quarter of this year.

Industry Context

This announcement is significant for the neurotech industry as it represents a step forward in securing reimbursement for innovative medical devices. The successful implementation of PoNS therapy could set a precedent for other neuromodulation technologies.

Comparison to Industry Standards

• The assignment of HCPCS codes is a crucial step for medical device companies seeking reimbursement, similar to how companies like Insulet (PODD) and Dexcom (DXCM) have navigated the reimbursement landscape for their diabetes technologies.
• The timeline for CMS reimbursement determination is typical for medical devices, often taking several months after the assignment of codes, similar to the process followed by companies like Medtronic (MDT) for their implantable devices.
• The company's focus on expanding into new indications, such as stroke, is a common strategy for medical device companies to increase their market share, similar to how companies like Stryker (SYK) and Johnson & Johnson (JNJ) expand their product portfolios.

Stakeholder Impact

• Shareholders will benefit from the potential for increased revenue and market value.
• Patients with gait deficits due to MS will have increased access to PoNS therapy.
• Physical therapists will have the opportunity to expand their services with PoNS therapy.
• The company's employees will benefit from the company's growth and success.

Next Steps

• The company plans to provide additional information to CMS to support reimbursement economics.
• The company will participate in public meetings with CMS this summer.
• The company will continue to pursue authorization for stroke treatment in the U.S.

Key Dates

Keywords

HCPCS codes, PoNS therapy, reimbursement, neuromodulation, gait deficit, multiple sclerosis, CMS, medical device, neurotech, stroke