Below The Knee | Market Signal

The Rules Are Being Rewritten, and Not by CMS Alone

Last week was about structure. This week is about who writes the rules.

A federal court in the Northern District of Georgia vacated two FDA determinations on MiMedx's AXIOFILL. FDA had found the product more than minimally manipulated, so it could not qualify as a Section 361 HCT/P. It had also classified it as a biological product rather than a medical device. The court found FDA's reading of its own regulation wrong and its treatment of similar products inconsistent, and sent both matters back to the agency. This is a procedural win, not a final classification.

CMS is rewriting remote monitoring. Its 2027 Physician Fee Schedule proposal would require RPM and RTM services to be delivered by employees of the billing practice, ending vendor-staffed programs. The insurer community is split on it.

In the CAMPs market, a consensus panel is trying to fill a gap CMS left open. Since January, non-BLA skin substitutes have been paid as incident-to supplies at roughly $127 per cm², and CMS stopped paying for discarded product. It never defined "administered." A new Journal of Wound Care consensus, supported by Biolab Holdings, Kerecis and Swift, proposes a definition: the wound's internal surface area plus a fixation edge of intact skin. For small wounds, that definition can double or more the billable area per application. It is clinically defensible and commercially convenient, and CMS has not adopted it. More in the deep dive below.

Meanwhile, the companies planning to survive the post-LCD market keep stacking evidence and capital. Applied Biologics closed out its CAMPX RCT. AVITA completed its Cohealyx trial. Piomic raised $25M for a pivotal IDE. BioStem secured a $40M equity line.

Regulatory classification, payment definitions, and evidence standards are being contested at the same time, in court, in comment letters, and in journal supplements. The companies that treat any of these as someone else's problem will be on the wrong end of whoever wins.

Here's the week.

Policy | JWC Consensus Proposes a Sizing Standard for CAMPs Under the Flat-Fee Model

The September Journal of Wound Care supplement publishes Consensus guidelines on optimal sizing, administration and documentation of CAMPs (Cole, Carpenter, Chaffin et al.). The panel convened remotely in February 2026 to address a CMS position: only the administered portion of a non-BLA skin substitute is reimbursed, and discarded product is not. The document was sponsored by Biolab Holdings, Kerecis and Swift. Its scope is limited to sheet products.

What it recommends

What it means in dollars

Take a 4 × 3 cm oval wound, about 9.4 cm². Adding a 0.5 cm fixation edge brings the treatment area to about 15.7 cm². A 1 cm edge brings it to about 23.6 cm². At the $127.14/cm² average rate, billable product per application moves from roughly $1,200 to between $2,000 and $3,000. The effect shrinks as wounds get larger. For deep wounds, internal-surface measurement adds area on top of that.

The BTK read

The problem this document addresses is real. CMS changed the payment basis without defining its key term, and providers facing audit risk have pulled back. Clinical overlap onto intact skin is standard grafting practice. But several things matter for how much weight this document should carry.

Watch for:

Regulatory | Federal Court Vacates FDA's AXIOFILL Classification, Remands to Agency

The court ruled that FDA misread its minimal-manipulation regulation. FDA had focused on the placental disc's role in the donor, as a barrier between the fetal and maternal circulations. The court held FDA must instead consider the tissue's original characteristics relevant to reconstruction, repair, or replacement in the recipient. It also found FDA had classified other commercially available human-derived particulate products similar to AXIOFILL as medical devices without adequately explaining the different treatment, and held the biologic classification arbitrary and capricious. The dispute dates to a December 2023 FDA Warning Letter asserting that AXIOFILL's processing went beyond minimal manipulation.

The BTK read: FDA can re-decide on a better record or pursue further legal options, so this is not the end of the matter. The more important part is the court's reading of "minimal manipulation." If tissue characteristics are judged by their use in the recipient rather than their function in the donor, a line of reasoning FDA has used against placental particulates is weakened. Every company with a placental particulate or flowable product should be reading this order. The inconsistency finding also puts pressure on FDA to explain why near-identical products sit on different regulatory pathways. Watch FDA's response on remand.

Reimbursement | Insurers Split on CMS Proposal to End Vendor-Delivered Remote Monitoring

UnitedHealth Group, CVS Health, and Kaiser Permanente all filed letters opposing the proposal, which would effectively bar practices from using contractors to deliver RPM care. Humana and the Blue Cross Blue Shield Association support it. A coalition of more than 230 health care organizations warned the change could disrupt care for over 1 million beneficiaries; that figure is the coalition's estimate, not CMS's, and CMS tied the proposal to program integrity and low-quality vendors. Clinical staff would not need to be physically on site, but they would have to be direct employees under the billing practitioner's general supervision. If finalized, the restriction takes effect January 1, 2027.

The BTK read: UnitedHealth's position is the tell. Its insurance arm recently tried to stop paying for most RPM, citing insufficient evidence, yet the parent company is defending vendor-delivered monitoring because it runs care delivery businesses that depend on it. For wound care and diabetic foot, the exposure sits with programs where a vendor's staff reviews remote foot temperature scans, wound images, or offloading data on behalf of the billing practice. That model is exactly what this rule targets. Watch the final PFS this fall. If it holds, expect vendors to restructure staffing to meet the employment test and smaller practices to drop programs they can't staff.

Clinical | Applied Biologics Closes Out CAMPX RCT, Publishes Preclinical XWRAP Data

Applied Biologics announced last patient, last visit in its CAMPX randomized controlled trial of XWRAP in diabetic foot ulcers. An updated analysis submitted to SAWC Fall randomized 222 patients with Wagner Grade 1 or 2 DFUs. In the intent-to-treat population, 30.9% of patients on XWRAP plus standard of care achieved complete closure at 12 weeks, versus 17.5% on standard of care alone (p=0.023). Separately, the company published preclinical research reporting a 74% higher integrated histology resolution score for XWRAP versus conventionally processed placental tissue, with lower inflammation and dermal necrosis. It is also running a retrospective real-world study across 10–15 high-volume wound centers, with endpoints including time to closure, number of applications, recurrence, and cost-to-close.

The BTK read: Applied Biologics is building the evidence stack payers now expect: RCT, real-world data, mechanism. The CAMPX effect is statistically significant, but a 31% absolute closure rate is modest, and including Wagner 2 ulcers likely pulls both arms down. The preclinical comparison is company-sponsored and in an animal model; it supports a "processing matters" marketing argument, not a clinical claim. Watch the full dataset at SAWC Fall and whether a peer-reviewed publication follows.

Clinical | AVITA Medical Completes Cohealyx Trial

AVITA Medical has completed its Cohealyx trial, a post-market study of its collagen dermal matrix in full-thickness wounds. Interim results on 40 patients showed a median time to grafting of 11 days, with 25% grafted within 7 days and 72% within 14 days. The comparison was against a literature-derived benchmark from a meta-analysis of leading dermal matrices, not a concurrent control arm.

The BTK read: Time to graft is a hospital economics argument: fewer days to closure means shorter stays. The weakness is the design. A single-arm study against a literature benchmark won't settle comparisons with established dermal matrices. The full dataset should confirm or erode the interim numbers. Watch whether AVITA uses it to anchor value analysis committee pitches alongside RECELL.

Investment | Piomic Medical Closes $25M Round to Fund COMS One Pivotal Trial

Piomic Medical closed a $25M growth round led by Swisscanto, bringing total funding past $50M. Proceeds fund completion of the MAVERICKS IDE pivotal trial, a U.S. approval filing, and expansion into infection management and sports medicine. The company holds FDA Breakthrough Device Designation, a CE mark, and CPT Category III codes active since January 2025. It has also retained eligibility for Medicare transitional payment under the alternative NTAP pathway.

The BTK read: Piomic is building its reimbursement path before approval: Breakthrough designation, Category III codes, and NTAP eligibility already in place. That sequence is how device-based wound therapies avoid the adoption stall that follows clearance without payment. The pivotal readout is the gating event.

Financial | BioStem Technologies Secures $40M Committed Equity Facility

BioStem Technologies (Nasdaq: BSEM) entered a $40M committed equity facility with Roth Principal Investments. The facility lets BioStem issue shares at its discretion for working capital and general corporate purposes.

The BTK read: A committed equity facility is flexible, dilutive capital, not a vote of confidence from new investors. Paired with its recent positioning around surgical biologics, BioStem is funding a move away from the most scrutinized part of the perinatal wound market. Watch the draw pace and share count.

Tempo Therapeutics received a $2.25M NIH SBIR grant to advance its MAP technology for complex wounds. MAP is a synthetic, flowable scaffold. Tempo has a De Novo application pending with FDA and counts J&J Innovation – JJDC among its investors. Non-dilutive funding for a synthetic entrant sits outside the tissue classification fights dominating this week.

Rezera announced plans for REVEAL-PAD, a multicenter study of inflammation's role in peripheral artery disease. A planned study is not data; we'll track it when the protocol posts.

BioWound Solutions was selected to exhibit Keramatrix at Vizient's Innovative Technology Exchange, a contracting on-ramp to hospital purchasing. Selection is not a contract, but it's the step before one.

Incisional NPWT: a new study finds selective use of incisional negative pressure wound therapy reduces surgical-site infections, with trade-offs. The payer question for incisional NPWT has moved from whether it works to which patients justify the cost.

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September 23–27 | Kuala Lumpur, Malaysia — WUWHS 2026 – World Union of Wound Healing Societies Congress (in progress)

October 1–4 | Bengaluru, India — DFSICON 2026 — Hilton Garden Inn Bengaluru, Embassy Manyata Business Park

October 8–10 | New Delhi, India — ASVS–VSICON 2026 — Pullman & Novotel New Delhi Aerocity

October 15–18 | Las Vegas, NV — SAWC Fall 2026 — Caesars Palace

October 22–24 | Anaheim, CA — DFCon 2026 — JW Marriott

November 6 | Virtual — WoundCon Fall 2026

Early December (dates TBD) | San Antonio, TX — DFUpdate 2026 (ALPS)

December 9–12 | Phoenix, AZ — Desert Foot, Multi-Disciplinary Limb Salvage & Wound Care Conference

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Next up: SAWC Fall in three weeks, where the CAMPX data will be presented and where the sizing debate will be in every hallway. BTK will be there, and a quick turnaround to DFCON!

-Scott