Why Merit Medical is launching WRAPSODY early despite Medicare payment setback

Why Merit Medical is accelerating WRAPSODY’s commercial rollout despite Medicare reimbursement setbacks

Merit Medical Systems Inc. (NASDAQ: MMSI) has announced a major strategic shift in the commercial rollout of its WRAPSODY Cell-Impermeable Endoprosthesis, following a significant delay in obtaining U.S. Medicare reimbursement approval. The vascular access device, designed for haemodialysis patients with venous outflow obstructions, will now be launched commercially across the United States under a revised go-to-market strategy that deprioritizes immediate reimbursement from the Centers for Medicare & Medicaid Services.

The move comes after the Centers for Medicare & Medicaid Services deferred review of Merit Medical’s Transitional Pass-Through incremental payment application for WRAPSODY to the Calendar Year 2027 Outpatient Prospective Payment System rule. This means the earliest possible date for securing Medicare incremental payment coverage is January 1, 2027, more than a year after the product received U.S. Food and Drug Administration pre-market approval in December 2024.

Rather than wait for a regulatory green light that may not materialize in the near term, Merit Medical Systems has withdrawn the application entirely and initiated a full U.S. commercial launch of WRAPSODY based on strong efficacy data, early clinician demand, and international momentum. Analysts tracking the stock say this marks a calculated pivot that prioritizes clinical adoption and revenue acceleration, even if it temporarily sacrifices the benefits of enhanced payment status.

How WRAPSODY fits into Merit Medical’s dialysis strategy and global growth outlook

The WRAPSODY Cell-Impermeable Endoprosthesis is designed to address a critical complication for haemodialysis patients: venous outflow obstruction in arteriovenous fistulas or grafts. These obstructions are a common cause of dialysis access failure, often leading to costly reinterventions and reduced quality of life for patients. WRAPSODY is engineered to prolong patency and reduce repeat procedures, making it an appealing proposition for interventional nephrologists and vascular surgeons.

Beyond the United States Food and Drug Administration approval in late 2024, the device has also secured key regulatory milestones abroad. Health Canada approved WRAPSODY in April 2025. It also carries the CE mark for Europe and is commercially available in Brazil. These approvals laid the groundwork for Merit Medical Systems’ broader international registry program, including the WRAP North America Registry and WRAP Global Registry, both designed to collect real-world outcomes and safety data over multi-year periods.

The pivotal WAVE trial, which served as the foundation for regulatory submissions, demonstrated strong 24-month patency rates in both randomized arteriovenous fistula and single-arm arteriovenous graft cohorts. The results, according to industry watchers, provide sufficient clinical justification for immediate launch, even in the absence of reimbursement tailwinds.

Merit Medical Systems is positioning WRAPSODY as a differentiated, margin-accretive product that could serve as a cornerstone of its dialysis-access portfolio in the years ahead. The company has forecasted U.S. revenue from WRAPSODY in the range of USD 2 million to USD 4 million for full-year 2025.

What the Medicare delay means for reimbursement and adoption in U.S. hospital settings

The Transitional Pass-Through payment program, administered by the Centers for Medicare & Medicaid Services, provides higher reimbursement for new medical technologies in the hospital outpatient and ambulatory surgery center settings. For many medical device manufacturers, securing this temporary add-on payment is crucial in the early commercial phase, as it allows hospitals to recoup more of the device cost and drives faster adoption.

The Centers for Medicare & Medicaid Services’ decision to defer WRAPSODY’s application to the 2027 rule cycle was described as disappointing by Merit Medical Systems, but also as an opportunity to accelerate access without relying on a protracted regulatory process. The company’s leadership stated that a new commercial strategy would now focus on optimizing clinical adoption using existing payment structures.

Under the current plan, Merit Medical will sell WRAPSODY to hospitals, dialysis centers, and ambulatory surgery centers under the standard Medicare payment mechanisms, which may not fully cover the cost of the device. This means that providers will need to justify WRAPSODY adoption based on its clinical performance and long-term value, rather than short-term reimbursement incentives.

Experts in health economics say this shift places greater emphasis on cost-effectiveness, real-world outcomes, and physician advocacy. While it may limit the pace of early adoption, it could ultimately result in stronger long-term market penetration if the device proves its clinical value in standard practice.

How Merit Medical plans to offset the lack of Medicare TPT with clinical evidence and provider engagement

Merit Medical Systems is not entering this next phase of commercialization unprepared. The company is investing in large-scale registries to generate real-world data on WRAPSODY’s performance in diverse clinical settings. The WRAP North America Registry will enroll up to 250 patients across the United States and Canada. A complementary WRAP Global Registry is already active in select international markets.

The company is also ramping up field education, physician training, and hospital engagement efforts, banking on the strength of the WAVE trial and physician demand. While the absence of incremental reimbursement creates short-term friction, Merit is betting that WRAPSODY’s efficacy and durability will be compelling enough to justify its use even without payment enhancements.

With dialysis access maintenance representing a large and underpenetrated segment of the vascular intervention market, Merit Medical Systems is positioning WRAPSODY not just as a stopgap product, but as a long-term strategic pillar in its interventional portfolio. Executives believe that commercial traction in 2025 will pave the way for stronger volume growth once CMS and private payers revisit reimbursement in future cycles.

How investors are reacting to the pivot and what to watch going forward

Investor sentiment around the announcement has been cautiously constructive. Merit Medical Systems stock was trading around USD 85 in mid-November, showing modest volatility but no sharp negative reaction to the reimbursement news. Analysts covering the stock had already flagged the possibility of a CMS delay, and the company’s proactive shift appears to have mitigated downside risk.

On the financial front, Merit Medical Systems reported second-quarter 2025 revenue of USD 382.5 million, marking a year-over-year increase of 13.2 percent. Full-year guidance was raised to between USD 1.495 billion and USD 1.507 billion, and adjusted earnings per share are now projected at USD 3.52 to USD 3.72. Analysts believe these fundamentals give Merit room to absorb near-term challenges in WRAPSODY’s U.S. launch.

Institutional investors will likely monitor several key variables in the coming quarters, including WRAPSODY unit sales, hospital and ambulatory surgery center penetration, registry enrollment rates, and overall margin trends. Any signs of strong physician uptake or favorable real-world data could trigger a re-rating of the stock, especially if Merit Medical Systems can show progress in offsetting the lack of Medicare add-on payments.

Analysts tracking the interventional medical device space say the broader lesson from this development is clear: regulatory timelines remain unpredictable, and medtech firms must increasingly rely on data, market execution, and provider engagement to drive adoption rather than waiting passively for reimbursement clarity.

What are the key takeaways from Merit Medical’s WRAPSODY strategy shift after Medicare delay?

• Merit Medical Systems Inc. (NASDAQ: MMSI) has withdrawn its Transitional Pass-Through (TPT) payment application for WRAPSODY following CMS’s decision to defer review until the 2027 OPPS rule.

• The WRAPSODY Cell-Impermeable Endoprosthesis will now be fully commercialized in the United States without waiting for incremental Medicare reimbursement.

• The decision follows U.S. Food and Drug Administration approval in December 2024 and additional approvals in Canada, Europe, and Brazil.

• Merit Medical Systems is emphasizing strong 24-month WAVE trial data and launching WRAP North America and WRAP Global real-world evidence registries.

• The company reaffirmed 2025 U.S. WRAPSODY revenue guidance between USD 2 million and USD 4 million, targeting hospitals, ASCs, and dialysis centers under current payment codes.

• Investors and analysts are expected to monitor WRAPSODY adoption rates, registry outcomes, and potential reimbursement updates in the CY 2027 OPPS cycle.

• Despite short-term reimbursement headwinds, analysts view the pivot as a proactive move that could accelerate long-term adoption through clinical performance and provider engagement.