Pacific Edge Shares Tumble as Medicare Ruling Ends Key Reimbursements

Highlights:

• Shares Plunge 63%: Pacific Edge Limited's (NZX: PEB) stock dropped to $0.050 after Novitas announced the end of Medicare reimbursements for its key diagnostic tests.
• Company Challenges Decision: Pacific Edge criticized Novitas for disregarding updated research and misinterpreting the standard of care in evaluating hematuria patients.
• Revenue Streams at Risk: The Medicare ruling raises concerns about Pacific Edge's U.S. revenue prospects, a significant growth market for the company.

Pacific Edge Limited (NZX: PEB) has faced a major setback after Novitas, the Medicare administrative contractor overseeing its U.S. laboratory, announced the discontinuation of reimbursements for the company’s flagship diagnostic tests, including Cxbladder Triage, Detect, and Monitor. This decision led to a significant drop in Pacific Edge’s share price, which plunged 63% to $0.050 in early trading on Monday following the lifting of a trading halt.

Medicare Ruling Sparks Controversy

Pacific Edge has strongly opposed Novitas’ decision, criticizing the contractor for misinterpreting the standard of care in hematuria evaluations. The company argues that Novitas ignored recent peer-reviewed research supporting the efficacy of Cxbladder tests and repeated errors in its analysis.

Impact on Share Price

At the time of writing, Pacific Edge's shares remain at $0.050, reflecting investor concerns over the financial and operational implications of losing Medicare reimbursements. This development casts uncertainty over the company’s U.S. revenue streams, which have been a key growth area.

Company’s Response

Pacific Edge’s management is committed to challenging the ruling, emphasizing the clinical value of its Cxbladder suite and its importance in modern diagnostic care. The company intends to present further evidence to demonstrate the effectiveness of its products and reverse the decision.

The abrupt share price drop highlights the challenges faced by medical technology firms reliant on reimbursement frameworks. For Pacific Edge, the ruling marks a critical moment as it navigates both regulatory hurdles and investor sentiment.

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