Smith & Nephew's EXOGEN Bone Healing System to Receive Expanded Medicare Coverage

29 April 2005

Smith & Nephew Orthopaedics (NYSE: SNN, LSE: SN) today announced that the United States Centers for Medicare & Medicaid Services (CMS) has expanded existing Medicare coverage of its EXOGEN◊ Bone Healing System for the treatment of all nonunion bone fractures, regardless of whether the fracture has had prior surgical intervention.

The EXOGEN◊ Bone Healing system delivers low-intensity pulsed ultrasound to a fracture site, and is the only ultrasound stimulation device approved by the FDA for the treatment of nonunion fractures. In addition, the EXOGEN◊ system is the only osteogenic bone stimulator of any kind approved by the FDA for accelerating the healing of indicated fresh fractures*.

Medicare has reimbursed the cost of using the EXOGEN◊ device since 2000 in nonunion fracture cases where surgery has failed to heal a fracture. Medicare will now offer reimbursement for the use of the EXOGEN◊ system for all nonunions, regardless of whether they have had prior surgical intervention.

"This decision opens up more options for patients and surgeons, providing a non-invasive alternative to surgical treatment, and offering an opportunity for people to regain their mobility," said Joe Woody, vice president and general manager of the Clinical Therapies division of Smith & Nephew. "We have worked closely with CMS, providing data from clinical studies and other scientific data that consistently demonstrated similar healing rates in patients with and without previous surgery, as well as economic analyses that highlighted the cost-effectiveness of EXOGEN◊."

Nonunions are defined clinically as the point when bone healing has stopped and will not proceed without some type of intervention. Three studies conducted on nonunions demonstrated that use of the EXOGEN◊ Bone Healing System for 20 minutes per day, with no other change in treatment, was highly successful for all bones, all fracture locations, and all types of fracture irrespective of the type of orthopaedic fracture management.

CMS' decision was in response to Smith & Nephew's request that the requirement for failed prior surgical intervention to qualify for reimbursement be removed. Data presented and reviewed by CMS included:

  • Newly published scientific data on the EXOGEN◊ unit mode of action, which indicates that EXOGEN◊ affects a range of cells important to the fracture healing process.
  • Published economic analysis¹ which concludes, based on the high success rates in the clinical studies, that the EXOGEN◊ system is the most cost-effective bone stimulator for the treatment of nonunion fractures.

In coming to a decision to expand nonunion coverage for the EXOGEN◊ Bone Healing System, CMS reviewed the science, assessed the overwhelmingly positive public comment from physicians and patients, and conducted their own pooled analysis of the clinical data - which showed an 85% success rate with the EXOGEN◊ unit regardless of whether there had been prior surgery or not.

¹ "Cost-Effectiveness of Bone Stimulators in the Conservative Treatment of Stable Nonunion Fractures" by M Oremus (Pharmaccess, Inc. Montreal Canada), M Schultz (Pharmaccess, Inc. Montreal Canada), CS Whitman (Hugh Chatham Memorial Hospital, Elkin, NC, USA), JD Conway (Sinai Hospital of Baltimore, Baltimore, MD, USA)

*The indicated fresh fractures include fresh, closed, posteriorly displaced distal radius fractures and fresh, closed or Grade 1 open tibial diaphysis fractures in skeletally mature individuals when these fractures are orthopaedically managed by closed reduction and cast immobilization.

Editors' note: Digital photographs of the EXOGEN◊ Bone Healing System mentioned in this release are available.

Clinical Therapies

Smith & Nephew Orthopaedics' Clinical Therapies, which markets the EXOGEN◊ Bone Healing System and SUPARTZ◊ joint fluid therapy, is a business division within Orthopaedics. The Clinical Therapies business has grown considerably, 50% in the U.S. and 44% globally in 2004.

About Smith & Nephew

Smith & Nephew (NYSE: SNN, LSE: SN) is a global medical technology business, specializing in Endoscopy, Orthopaedics and Advanced Wound Management products. Smith & Nephew ranks as the global leader in arthroscopy and one of the world's leaders in advanced wound management and is one of the fastest growing orthopaedics companies in the world.

Smith & Nephew is dedicated to helping improve people's lives. The company prides itself on the strength of its relationships with its surgeon and professional healthcare customers, with whom its name is synonymous with the highest standards of performance, innovation and trust. The company has more than 8,000 employees and operates in 32 countries around the world and generated sales of nearly $2.3 billion.

Forward-Looking Statements

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Victor Rocha
Smith & Nephew, Inc.
(901) 399-6771