Norland says pDEXA sales have rebounded

January 22, 1997

The chief executive of bone densitometry firm Norland MedicalSystems said this month that sales of the company's pDEXA lineof peripheral densitometers have bounced back after a slump lastyear caused by new Medicare reimbursement codes for

The chief executive of bone densitometry firm Norland MedicalSystems said this month that sales of the company's pDEXA lineof peripheral densitometers have bounced back after a slump lastyear caused by new Medicare reimbursement codes for peripheraldensitometry. Reynald Bonmati, chairman and president of the WhitePlains, NY, company, said Norland's decision to cut pDEXA pricesafter the new codes were released helped demand for pDEXA returnto levels recorded earlier in the year.

The Health Care Financing Administration in November releasednew codes that lowered Medicare reimbursement for peripheral densitometryfrom $124 to $37.57. Axial densitometry slipped from $124 to $121.16(SCAN 1/8/97). The release of the new codes caused Norland's stockto slump from around $20 a share at the beginning of the monthto a low of under $8 a share in early December.

Bonmati said some of that decline may have been due to negativepublicity generated about the codes by Norland's competitors,which market axial systems that were not as affected by the changes.Norland believes, however, that the HCFA ruling clears up confusionabout peripheral densitometry, according to Bonmati.

"Although I feel that a reimbursement rate for peripheralscans set at approximately $70 would have been appropriate giventhe $120 reimbursement rate set for traditional DEXA scans, Ibelieve that the establishment of a separate code means that peripheralbone densitometry is here to stay," he said.

In other news, Norland has hired Jay Galeota as vice presidentof marketing to develop point-of-care densitometry markets. Galeotaformerly was senior director of marketing at Merck for its Fosamaxosteoporosis drug, which has driven much of the growth in thebone densitometry segment.