Healthcare Industry News:  BIOGUARD 

Devices Wound Care Reimbursement

 News Release - July 9, 2008

Derma Sciences Achieves Significant Commercialization Milestone With Reimbursement Codes for MEDIHONEY(TM)

Reimbursement for new product formulations to drive growth of the line

PRINCETON, N.J., July 9 (HSMN NewsFeed) -- Derma Sciences, Inc. (OTC Bulletin Board: DSCI ), a provider of advanced wound care products, announced today that it has achieved a significant milestone in the launch of its MEDIHONEY(TM) dressing line by securing reimbursement codes for the three recently released new product formulations. The Statistical Analysis Durable Medical Equipment Regional Carrier (SADMERC) -- a contracted intermediary and carrier for the Centers for Medicare & Medicaid Services (CMS) -- has notified the company of its decision regarding Healthcare Common Procedure Coding System (HCPCS) codes for billing purposes for the new MEDIHONEY(TM) formulations.

CEO Ed Quilty stated, "This is another significant milestone for Derma Sciences and our launch of the MEDIHONEY dressing line. Navigating through reimbursement hurdles in this industry can prove very challenging, so we are delighted that the new formulations of MEDIHONEY will be reimbursed. This should help to add significant volume to our MEDIHONEY sales, as a large portion of our current sales for this product are to markets driven by reimbursement. As we have announced in the past, the launch of this line has been very successful. The awareness of MEDIHONEY in the wound care market is quite strong after only a few months on the market, and we continue to build an impressive body of clinical evaluations -- at this point exceeding 1,100. The products are being widely adopted, and these new formulations will allow customers to use the products on a much greater variety of wound types."

The new codes will allow applicable customers to bill for all the new MEDIHONEY dressing formulations. Customers will include Medicare's Part B program, private insurance plans, and the various Medicaid programs. Medicare Part B provides coverage for 'Surgical Dressings' for patients at home between clinics or physician visits, and when not receiving home health nursing services. It also provides coverage for wound dressings for residents in Nursing Homes not under a Medicare Part A 'skilled care' benefit stay who have Part B coverage. The Medicaid programs (one for each state) provides coverage for 'Surgical Dressings' for at-home use by the beneficiary. Insurance plans often provide payment for wound dressings in addition to the coverage of care in a Nursing Home and for dressings used at home by the patient and in some cases when home health services are provided. Coverage within these programs greatly enhances Derma Sciences' ability to penetrate the long term care and home health markets, both of which make up a significant share of the overall wound care dressings market. The awarded codes are as follows:

A6240 Hydrocolloid dressing, wound filler, paste, per fluid ounce (Item #31501)

A6237 Hydrocolloid dressing, wound cover, pad size 16 sq. in. or less, with any size adhesive border, each dressing (Item #31422)

A6238 Hydrocolloid dressing, wound cover, pad size more than 16 sq. in. but less than or equal to 48 sq. in., with any size adhesive border, each dressing (Item #31445)

A6234 Hydrocolloid dressing, wound cover, pad size 16 sq. in. or less, without adhesive border, each dressing (Item #31222)

A62334 Hydrocolloid dressing, wound cover, pad size more than 16 sq. in. but less than or equal to 48 sq. in., without adhesive border, each dressing (Item #31245)

About Derma Sciences

Derma Sciences is a global manufacturer and marketer of advanced wound-care products. Its key product, MEDIHONEY, is sold throughout the world by Derma Sciences and Comvita New Zealand -- the licensor of the patented honey-based technology -- and is the leading brand of honey-based dressings for the management of wounds and burns. The product has been shown to be effective in a variety of wounds and burns, and was recently the focus of a large-scale randomized controlled trial on leg ulcers. Derma has two products in development: the BIOGUARD(TM) line of barrier gauze dressings, and DSC127, the company's novel angiotensin analog for accelerated wound healing and scar reduction. The barrier technology was licensed from Quick-Med in Q1 of 2007 and is pending its initial FDA marketing clearance. DSC127 was licensed from The University of Southern California in Q4 of 2007 and is entering into a Phase II study, with anticipated initial patient enrollment to begin in Q3 of 2008. For more information about Derma Sciences, Inc., visit its home page on the Internet at http://www.dermasciences.com.


Source: Derma Sciences

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