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Stock of the day

PolyNovo set for growth with Medicare reform

PolyNovo's stock gains momentum as US Medicare shifts could favour cost-effective skin products, impacting reimbursement policies.

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(AI video summary)

This video was created on 2 September 2025 for IG audiences by ausbiz.

ASX code: PNV

PolyNovo's market potential

PolyNovo shares surged after exiting a trading halt, driven by potential changes to United States (US) Medicare reimbursements. These reforms could favour cheaper skin products, reducing the reliance on pricier alternatives.

The US Centres for Medicare and Medicaid Services (CMS) proposes capping skin substitutes at US$800 per square inch, down from US$2000, aiming to reduce waste.

Financial performance

PolyNovo's revenue aligned with consensus, though earnings before interest, taxes, depreciation, and amortisation (EBITDA) were at the lower end. Its pivotal clinical trial, BARDA, awaits US Food and Drug Administration (FDA) approval, expected in several months.

Investment outlook

Despite board challenges, PolyNovo’s growth and innovative products draw attention. It's on many watch lists for potential inclusion pending approvals, with analysts deeming it a speculative 'buy'.

  

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