Fresenius Medical Care shares fell about 5% Thursday after the US health regulator CMS proposed a smaller-than-expected increase to dialysis reimbursement rates and moved to bundle a key drug category into its payment system. CMS proposed a 1.1% increase to the base rate for its end-stage renal disease bundle payment, roughly half what investors had anticipated and well below increases seen in prior years. The regulator also proposed including phosphate binders in the bundle from 2027, removing a payment mechanism that had driven strong uptake of Fresenius's Velphoro drug. UBS analysts said the proposal was worse than usual and below the roughly 2% rate investors had been expecting, warning that they would expect lower utilisation of Velphoro under the bundled payment, meaning the profit pool could fall significantly for Fresenius Medical Care in 2027. While the final rate could still be revised upward, UBS noted that even with such an adjustment, the outcome would likely still imply a margin drag for Medicare patients.
Fresenius Medical Care AG & Co. KGaACMS proposed lower-than-expected dialysis reimbursement rate increase and bundling of phosphate binders, hurting Fresenius Medical Care's revenue and Velphoro drug uptake.
Fresenius SE & Co. KGaA