The delay of the LCD(s) is good news for many manufacturers since it will continue to enable unlimited use of amniotic products, some of which are priced around $5,000 per sq cm. (That’s more than a 3,000% increase in cost with no data to indicate any improvement in outcome.) With no market controls, it will be fascinating to see just how high prices for Amniotics will go in a world where “better” just means “more expensive.” Although implementing the LCD(s) might slow down the approaching bankruptcy of the Medicare trust fund a little bit, frankly the LCDs alone will not bring sanity to this industry.
I have posted below an interesting analysis by an industry watcher:
Amniotic membrane products have positioned themselves in a strikingly contradictory light. On one hand, manufacturers claim massive innovation to justify extraordinarily high costs, essentially arguing that their product’s novel features demand a premium price. Yet, in the same breath, they insist that these products require no new clinical studies because they are effectively “equivalent” to existing therapies that already have robust evidence. This contradiction comes into even sharper focus when we remember that true 361 products are regulated as minimally manipulated human tissues intended for transplant, not a cutting-edge drug or device. If an amnion membrane product is genuinely just another 361-transplant tissue, then where is this sweeping innovation that supposedly justifies a much higher price point?
You cannot have it both ways: a product that is novel enough to warrant outsized reimbursement cannot simultaneously be generic enough to avoid new clinical trials. If these amniotic membranes are truly functionally identical to what’s already on the market, we could argue they should be priced accordingly, akin to a “generic.” Conversely, if they really are an improvement over existing solutions, they need the rigorous evidence base we expect of genuinely new treatments. As it stands, claiming “massive innovation” while staying in the minimal-manipulation classification without any evidence is somewhat akin to rebranding a donated heart for transplant every week, doubling the price and calling it a groundbreaking invention.
Given this disconnect, a more consistent approach would be for payers and regulators to treat 361 products as the uniform tissues they purportedly are, establishing a price cap based on their “generic” equivalence. This would eliminate the confusion and potential gaming of the system by ensuring that if a product is genuinely 361, it is valued and reimbursed as such. Meanwhile, if a manufacturer truly believes they have a meaningful, evidence-based improvement over the status quo, the onus should be on them to pursue a higher level of FDA oversight, produce robust clinical data, and demonstrate that added value. This would strike the right balance, rewarding genuine innovation while discouraging opportunistic price inflation under the guise of minimal manipulation.
[Name withheld]
Dr. Fife is a world renowned wound care physician dedicated to improving patient outcomes through quality driven care. Please visit my blog at CarolineFifeMD.com and my Youtube channel at https://www.youtube.com/c/carolinefifemd/videos
The opinions, comments, and content expressed or implied in my statements are solely my own and do not necessarily reflect the position or views of Intellicure or any of the boards on which I serve.
