Just a few short years ago, the market for skin replacements and substitutes looked drastically different.  It was a time when not only were Apligraf and Dermagraft market leaders, but they even competed with one another, with the latter being manufactured by Shire and the former, by Organogenesis.

In terms of reimbursement landscape, a fee-for-service prevailed, meaning that physicians were reimbursed separately for the service and product used. Under this model it was feasible—and common—for physicians to use these two products to treat wounds. Reimbursement was available for the whole cost of the product, even if just a small part of the skin replacement was used and the rest discarded.

In 2014, the CMS (Centers for Medicaid & Medicare Services) overhauled the way wound care products are reimbursed, through the introduction of a bundled payment system. Additionally, wound care products were categorized into high- and low-reimbursement categories, based on the average selling price of the product in question.  In a short period of time, it became disadvantageous to use products that fell in the low-reimbursement category.

By then, Apligraf and Dermagraft were no longer competing products, with both being owned by Organogenesis. At the same time, there was an influx of manufacturers—such as MiMedx Group and Osiris Therapeutics—entering and gaining traction in the amniotic-derived allograft space, further crowding the market.

As a result, in 2015, the US market for skin replacements and substitutes looks completely different. From the types of products being used to the competitive landscape, these are exciting and dynamic times in a lucrative market that is projected to grow as rates of obesity and diabetes climb, thereby increasing the rates of chronic wounds.

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