Otonomy Inc (NASDAQ:OTIC) shares rose 17.71% to $13.76 on Friday, following reports that the company was granted approval for its pass-through payments.
On May 20, Otonomy Inc (NASDAQ:OTIC) announced that the Centers for Medicare and Medicaid Services (CMS) has approved transitional pass-through status. In addition, CMS established a new billing code for OTIPRIO (ciprofloxacin otic suspension) called C9479, which will be effective on July 1, 2016.
“We welcome CMS’s decision to grant pass-through status and assign a new C code for OTIPRIO which can be used for billing in the hospital outpatient and ambulatory surgery center (ASC) settings,” said CEO David A. Weber, Ph.D. “Furthermore, the timing of this assignment early in the launch of OTIPRIO will, we believe, be very helpful in our ongoing efforts to facilitate patient access.”
CMS defines C codes as unique temporary pricing codes that were initially established by CMS for the Hospital Outpatient Prospective Payment System (OPPS). These are used on Medicare OPPS claims but may also be recognized on claims from other providers or by other payment systems. With a C code, a drug becomes eligible for payment in addition to the fee received by the facility for the related procedure.
These codes are typically effective for two to three years, with Otonomy Inc (NASDAQ:OTIC) foreseeing that the pass-through payment for OTIPRIO will be available throughout the end of 2018. OTIPRIO is used for the treatment of pediatric patients with bilateral otitis media with effusion undergoing tympanostomy tube placement (TTP) surgery.
Otonomy Inc (NASDAQ:OTIC) is a biopharmaceutical company focused on the development and commercialization of therapeutics for diseases and disorders of the ear. It has developed a technology referred to as sustained-exposure that is designed to deliver drug that is retained in the ear for an extended period of time following a local administration.
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