Wearables Vendors Discuss Reimbursement at Scottsdale Headache Symposium
by Jeremy Koff, senior consulting editor
December 2022 issue
The Scottsdale Headache Symposium is a leading headache conference dating back to 1970. This year’s conference attendance was record breaking, with 1,200 in-person and 300 remote participants.
Noninvasive neuromodulation system vendors were among the vendors participating in the conference. Theranica, which secured a $45 million series C funding round in August 2022, had a significant presence. electroCore, which has been struggling on the public markets with a market cap of about $21 million, had a more conservative presence. Neurolief, developer of the Relivion system, sent several employees to attend the meeting. Cefaly, a direct-to-consumer non-invasive neuromodulation device to treat migraine, was again absent from the conference. Also present at the meeting was an executive from Salvia BioElectronics, an emerging neuromodulation firm based in the Netherlands that has developed a minimally-invasive device to treat migraines.
Among the issues at the forefront was reimbursement, particularly in light of recent CMS decisions that were unfavorable to electroCore and Theranica [NBR Oct22 p1]. NBR spoke with Theranica’s CEO Alon Ironi and electroCore’s senior VP for neurology, Eric Liebler, to gain insights on the impact of CMS’ decisions and their strategies for achieving additional market growth.
According to Ironi, while the CMS decision to disallow reimbursement for the Nerivio device was disappointing, from a strategic perspective, it has no real impact on the business because Theranica hasn’t focused on Medicare to drive its business, particularly since headache disorders typically target those under 65. He disputed CMS’ determination that the Nerivio device is not a DME device, noting that CMS assigned Nerivio a unique HCPCS code as a DME device in 2021.
Theranica has three primary coverage pathways: the first is the Veterans Administration as a DME. Second, as a pharmacy benefit, and lastly, from companies such as MC-Rx where in late 2021, Theranica signed with the pharmacy benefit manager for placement under their formulary. The company believes this means migraine sufferers seeking digital therapeutic product treatment will now have a clear path for reimbursement when they are prescribed Nerivio by their healthcare providers.
More recently, Theranica has explored an additional pathway for coverage, referred to as digital health, and is currently in dialogue with select payors. And while Ironi acknowledges that some payors follow CMS determination, at the end of the day, private payors often look at the economic impact of a treatment regardless of CMS’ determinations. According to Ironi, in the case of migraine roughly 54 percent of migraine sufferers fail to benefit from generic migraine drugs. From a health economic perspective, the Nerivio device can be less expensive than, for example, branded migraine drugs such as CGRPs—which can cost upward of $10,000 per year.
Ironi also pointed out that since October 2022, Point32Health, covering roughly 2 million individuals, announced a 12-month pilot of the Nerivio device for migraine. Earlier this month, Theranica announced that Highmark Inc., an independent licensee of the Blue Cross Blue Shield Association with more than 6 million covered, will conduct a targeted “Coverage with Evidence” program.
On the clinical front, Theranica is waiting for the FDA to grant Nerivio the indication of migraine as a preventive, using the device every other day. In the study supporting this indication, there seems to be a clear carry-over effect for 48 hours. Using the device every other day not only reduces patient burden but also the cost for disposable stimulation pads.
Ironi said that Nerivio can reduce both absenteeism (not showing up at work) and presentism (showing up to work but not being productive). “We can recover about half of these lost dollars, just by having these patients use Nerivio every other day,” Ironi said.
electroCore, a publicly traded company, is one of the earliest commercial pioneers of noninvasive neuromodulation, founded in 2005. The gammaCore device first became commercial in 2011 when it received CE marking and became available in the U.S. in 2017 for its first FDA cleared indication, acute treatment of pain associated with episodic cluster headache.
Even though CMS did assign a payment level for the gammaCore device, the low level was disappointing, particularly compared to the amounts Cala Health received for its wearable. From the CMS discussions and outcomes, it became evident that incorporating feedback into noninvasive neuromodulation devices is important and was a significant argument from Cala Health to justify a much higher payment level. Ironically, the gammaCore device has the capability of providing feedback; however, it wasn’t evident during the CMS meetings beforehand that this capability was so important to argue for higher reimbursement levels. As such, future generation devices of the gammaCore will likely incorporate such feedback. Liebler said that the CMS determination doesn’t have any immediate material impact on the business.
electroCore continues to pursue innovative with new revenue opportunities. The VA continues to represent the largest segment of the business. In addition, there’s a new program from electroCore, called “Concierge,” which partners with medical practices like neurologists and chiropractors, where the device is sold to the healthcare practitioner who in turns marks up the device to the end-user. The program seems to be well received, albeit still in the early stages, growing roughly at 50 percent year over year. This segment has become the largest segment within the cash pay business.
electroCore continues to expand indications. Liebler mentioned several studies using the device for opioid use withdrawal, which will likely support a filing, as well as Parkinson’s disease, nausea, and gastroparesis. Payors such as Highmark continue to offer reimbursement for the device, paid on a monthly prescription basis at about $500 per script.
Summing up the commercial challenge for gammaCore, Liebler mused, “I don’t know that we’ve yet figured a way to capture the enthusiasm behind our science.”