Shares in Fresenius Medical Care (FMS) are +8.3% and those of DaVita HealthCare Partners (DVA) +6.1% after the Centers for Medicare & Medicaid Services scrapped a proposed 9.4% cut in reimbursement rates for dialysis treatment for patients with end-stage renal disease.
Instead, payments for 2014 and 2015 they will remain flat.
Deutsche Bank comments on the impact to DaVita (DVA -4.9%) of CMS' 2014 Medicare ESRD proposed rule - which reduces dialysis rates by 9.4% - saying the figure is twice as high as expected. Deutsche doesn't plan to make any changes to DVA's model at present, as it expects CMS to make adjustments in a final rule, but the changes would have to improve significantly for for the firm to remain confident in 2014 estimates.
DaVita HealthCare (DVA) slips in the post-session on reports the U.S. Medicare program plans to cut payments to dialysis centers by 9.4% next year, according to a proposal posted online Monday afternoon. Cuts are part of a budget balancing law passed last year. Fresenius Medical Care (FMS) also trades lower on the news. DVA -5.5%, FMS -1.5% AH.
Affymax (AFFY) prints at $3.41 premarket, -78.8%, following yesterday's report of the Omontys recall. AFFY has no other late-stage drugs in its pipeline. Piper expects shares to trade to cash value (~$2) "as investors take into account the lack of visibility." In play: AMGN, whose Epogen dominates the antianemia market (+2.4%), NKTR (which earns royalties on Omontys sales), and FMS, which pulled a trial two weeks ago (-1.3%).
Affymax (AFFY) collapses 28% after saying that Fresenius (FMS) is pausing the further expansion of a trial with Affymax's Omontys treatment for anemia in patients with kidney disease after injecting it in over 18,000 people. Fresenius will now study the results of the test for efficacy and safety. Fresenius said one in 1000 patients suffered allergic reactions, a small number of which were serious, although most were mild.
Affymax (AFFY +15.65%) after announcing that its partner, Takeda Pharmaceuticals, has signed an agreement to supply their anemia treatment Omontys to U.S. dialysis centers run by Germany's Fresenius Medical Care. Fresenius (FMS -2.1%) intends to initially use the drug in 100 centers before expanding the program. (PR)