The Telix Pharmaceuticals Ltd (ASX: TLX) share price has surged more than 12% in response to positive news in the US.
Telix is a biopharmaceutical company that’s focused on the development and commercialisation of therapeutic and diagnostic radiopharmaceuticals and associated medical devices.
CMS proposes improved payment
In an announcement to the ASX, Telix said it welcomed the proposed changes announced by the Centers for Medicare & Medicaid Services (CMS) for the Hospital Outpatient Prospective Payment System (OPPS) rule to “improve payments for diagnostic radiopharmaceuticals for Medicare patients” in the US, “facilitating continued patient access after transitional pass-through payment status expires.”
With Telix Pharmaceuticals being part of this, the ASX share seems poised to benefit, according to the market.
With these proposed changes, diagnostic radiopharmaceuticals including Illuccix (a Telix product) will continue to be paid separately by CMS for traditional ‘Medicare fee for service’ patients in the hospital outpatient setting after the expiry of transitional pass-through payment status. The ASX share also said this would apply to new diagnostic products being developed by Telix, if approved.
Telix explained that what currently happens in the US is the costs associated with diagnostic radiopharmaceuticals are packaged together into the payment for scans. The CMS is proposing refinements to this policy to improve the accuracy of the overall payment amounts by paying separately for any diagnostic radiopharmaceutical with a per-day cost of more than US$630.
Proposed OPPS rules are published annually and have a 60-day comment period, which will end on 9 September 2024. The final rule will be issued in early November 2024 and take effect on 1 January 2025.
Management commentary
The Telix Americans CEO Kevin Richardson said:
Telix welcomes the proposed rule, which will facilitate more equitable and reliable access to advanced imaging for all patients and support physicians to prescribe the most clinically appropriate solution. We commend the vision of CMS and the coalition, along with patient groups, for raising awareness about the necessity to reform the payment system to enhance patient outcomes and access. Telix is committed to continued innovation in the field of radiopharmaceutical diagnostics to provide new solutions to further patient access, especially for underserved patient populations and in areas of high unmet clinical need.
Final thoughts on the Telix Pharmaceuticals share price
I’m not an expert on biopharmaceutical, or Telix in-particular. But, this sounds like good news and the market is obviously excited.
The company could continue to do well, but I don’t know if today’s price is good value. However, it’s good to see an Australia company (from Melbourne) is progressing in the US.
There are other ASX growth shares I’d rather focus on that I have a better understanding of.
