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Convatec shares slide as US govt cuts skin repair product payments
(Sharecast News) - Shares in Convatec fell sharply on Monday after the company said revenues would be hit by up to 2% as a result of US government changes in payments for skin substitutes.
The Centers for Medicare & Medicaid Services (CMS) said the revised rate would take effect from January 1, 2026 after a consultation period as the Trump administration seeks to make deep cuts to public health spending.
Convatec's skin substitute InnovaMatrix is used as bandages for wounds and ulcers and accounted for about 3% of revenue over the first half of the year.
"InnovaMatrix is a highly effective product with significant health benefits to patients and healthcare professionals. It has strong user feedback and clinical evidence, and we have recently submitted (October 2025) further real-world evidence to CMS, in addition to RWE published in December 2024. Our randomised controlled trials continue to progress towards target publication in 2026," the company said in a statement.
"We are confident of delivering long term profitable growth from InnovaMatrix, including developing sales and securing coverage across a range of indications, both within and outside the United States."
Shares in the company slumped in July when the CMS published its draft proposals, noting that Medicare spending on skin substitutes has risen from $256m in 2019 to more than $10bn in 2024, and blamed the rise on "abusive pricing practices" in the sector.
Reporting by Frank Prenesti for Sharecast.com
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