🚀 Market Movers – July Highlights
It was a volatile month. Reimbursement fears sent shockwaves, but momentum came roaring back in the final stretch. Here's the breakdown:
📉 Early July:
CMS’s proposed 2026 rule knocked the wind out of the sector.
Skin substitute stocks cratered as site-of-service and ASP-based reimbursement took a direct hit.
WoundCareFund closed mid-month down -3.7%, while the Nasdaq and S&P held positive.
📈 Late July:
The sector rebounded strongly. WoundCareFund closed the month up +1.61%, aided by renewed speculation and a few big winners:
Celularity Inc. +43.6%
Axogen +13.6%
PolyNovo +13.2%
📊 Select Earnings Highlights:
MiMedx: Record EBITDA ($24M), raised FY guidance
Convatec: H1 up 6%, EPS ahead of expectations
Integra: Flat top-line but strong Tissue Technologies traction
CONMED: Q2 +3.1%, strong surgical and wound platform growth
💡 Innovation Signals – What’s Emerging
📉 Skin Sub Crackdown. CMS proposed bundling skin subs under one flat rate by 2026 — signaling the death knell for ASP-based margins in the office setting.
🧠 WISeR is here. CMS dropped its new pilot to cut “low-value care” using AI + clinical review. Skin substitutes are explicitly targeted. This could rewire reimbursement behavior over the next 6 years.
🧊 Cold plasma heats up. Venture Medical’s €6M bet on Plasmacure brings PLASOMA into the U.S. cold plasma wound care race.
🖨️ 3D printed fat grafts? UToledo Health goes futuristic with patient-derived constructs via Tides Medical.
💊 Sanara MedTech launched a VBC wound pilot spanning 6 states using its CoPilot platform. Think in-home, evidence-driven care aimed squarely at payers.
🦶 Arthrex moves quietly. The stealth acquisition of Vomaris brings Procellera bioelectric dressings into the surgical and ortho channel.
🔬 AI + ML in wound healing. New data in Cureus shows machine learning models outperform traditional risk scores in predicting wound healing and limb salvage after revascularization.
🧪 Diagnostics capital stack grows. MolecuLight raised $27.5M. Expect thermal + bacterial + AI triad next - but it might NOT come from Moleculight…
👀 Wound Care Watchdogs – Regulation, Hype, and M&A
⚖️ 2026 Fee Schedule Shake-Up:
CMS proposes phasing out separate reimbursement for skin subs and shifting to an “incident-to” bundled model. The office setting takes the biggest hit. Expect ripple effects in GTM strategies, product choice, and valuation models.
🏛️ CMS 2026 Physician Fee Schedule – Skin Substitute Shakeup
CMS has proposed major reimbursement changes for skin substitutes in its 2026 Physician Fee Schedule draft:
What’s changing:
End of ASP-based reimbursement: Skin substitutes will no longer be paid separately.
Bundled payment model: Reimbursement will shift to a flat-rate “incident-to” supply bundled with the procedure.
Applies in both HOPD and physician office settings.
Segmentation by regulatory path (e.g., 510(k) vs. HCT/P) may drive tiered pricing or eligibility.
Why now?
Medicare Part B spend on skin subs ballooned from $252M in 2019 to $10B+ in 2024 — driven largely by pricing, not volume.
CMS sees this as unsustainable and vulnerable to fraud and abuse.
Potential impact:
Margin compression: Especially for premium-priced amniotics and newer biologics.
Site-of-service shift: Hospital-based providers may gain an edge vs. office settings.
Strategic reset: Companies reliant on ASP pricing must rethink GTM, pricing, and clinical support models.
Market consolidation: Low-evidence or poorly differentiated products could be pushed out.
📉 Bottom line: This is the most disruptive policy change in years for the skin sub segment — and the countdown to 2026 has already started.
📊 Poll Watch: What’s Overhyped in Wound Care?
In July, we ran a LinkedIn poll asking a simple question:
Which wound care segment is getting way too much attention for what it actually delivers?
Nearly 3,000 of you weighed in. The results? Brutal — and revealing.
🥇 “Biologic Everything” dominated with 49% of the vote.
Clinicians and execs alike are signaling fatigue with overpromised, under-evidenced biologics — especially in the context of CMS’s reimbursement crackdown. Flashy collagen doesn’t cut it anymore.
📱 AI-Powered Apps took 20%, as users questioned whether most platforms are solving real clinical problems or just building dashboards for dashboards' sake.
🩹 Smart Dressings grabbed 21%, showing skepticism around sensor-laden bandages still searching for a scalable use case.
💨 Single-use NPWT was the least overhyped at 10%, possibly benefiting from clearer value props and steady procedural volume.
Takeaway: The market is calling BS where it sees it. In a tightening reimbursement and capital environment, evidence > excitement. The innovation bar is rising.
💰 M&A Watch: The Engine Is Running Hot
After a few quiet quarters, M&A in wound care and limb salvage is officially back — and H1 2025 delivered a clear message: capital is in motion, and strategic buyers are circling.
🔎 Notable H1 Activity:
Arthrex quietly acquired Vomaris Innovations, planting a flag in bioelectric dressings and signaling expansion into surgical, trauma, and foot & ankle care.
Venture Medical snapped up ProgenaCare’s keratin-based wound care assets.
Tiger Wound Care acquired NOVO Health’s HealPACK surgical wound platform.
Mölnlycke Health Care made aggressive moves:
€115M investment in U.S. dressing manufacturing
€400M in new financing
Strategic stake in Siren, maker of diabetic sensor socks
🔥 Diagnostics are heating up:
MolecuLight raised $27.5M to scale its real-time imaging platform, add thermal capability, and push global growth — acquisition bait?
🦶 In Foot & Ankle:
Zimmer Biomet acquired Paragon 28 for ~$1.2B, expanding its surgical portfolio with total ankle, forefoot, and flatfoot solutions.
📦 Broader Medtech Signals:
Stryker bought Inari Medical (~$4.9B) for CLI and venous disease
Boston Scientific picked up Bolt and SoniVie for a combined $1B+
Beta Bionics and Caris Life Sciences IPO’d, spotlighting momentum in diabetes tech and AI diagnostics
🧠 What’s Next for H2 2025?
Mölnlycke is cashed up and on the hunt
MolecuLight could be next to go
Arthrex’s stealth move may ignite new demand for sensor-based platforms
And diagnostic + digital convergence? No longer a buzzword — it’s happening
📈 July Fund Performance – WoundCareFund Pulse
The WoundCareFund closed out July at $430.42/share, up +1.4% from June’s $424.46. While broader markets wrestled with mixed earnings and macro headwinds, the fund posted a modest but meaningful gain, driven by strength in select diagnostics, biologics, and surgical platforms. Volatility remained high, but sector-specific momentum is building. Let’s break it down, week by week 👇
Week | Weekly Change | Top Performers | Notable News |
|---|---|---|---|
Week 1 | +2.0% | Spectral AI, ORGO, AVITA | Medicare optimism, burn pipeline growth |
Week 2 | -3.7% | Spectral AI, INFU, Convatec | CMS 2026 rule panic |
Week 3 | +3.3% | Celularity, Axogen, PolyNovo | Sector rebound + M&A speculation |
Week 4 | -0.02% | Next Science, Surmodics, Penumbra | Stability amid broader market volatility |
🗓️ Key Earnings in August:
8/5: Smith+Nephew
8/7: AVITA, Organogenesis, Treace
8/8: SANUWAVE
8/13: MediWound
9/16: Advanced Medical Solutions
🔦Innovation Index Spotlight - MiMedx🔦
MiMedx took the spotlight in July with a double-punch of strategic expansion and financial strength, positioning itself as more than a regenerative graft company. With its newly announced partnership and investment in Vaporox—a reimbursed, FDA-cleared adjunct therapy device—MiMedx is moving aggressively to pair biologics with advanced wound healing technologies. Add in record Q2 revenue, an EPS beat, and raised full-year guidance, and it’s clear: MiMedx isn’t just riding the recovery wave—they’re reshaping the category.
Why MiMedx owns the July spotlight:
Strategic Expansion into Adjunct Therapies
Announced exclusive collaboration with Vaporox (July 16), acquiring rights to a reimbursed, FDA-cleared device (Vaporous Hyperoxia Therapy).
This is a bold signal of category expansion - they are no longer just a placental graft player; they’re now bundling biologics with device-based adjuncts.
Record-Breaking Q2 Results
$98.6M in quarterly revenue (+13% YoY), highest ever.
Strong EBITDA performance and a surprise EPS beat ($0.10 vs. $0.05).
Management raised full-year guidance - a confident signal to investors and partners.
Momentum Across Franchise
Commercial traction in both wound and surgical segments.
Clear integration strategy: combining product + platform for better outcomes and reimbursement positioning.
Positioned for synergy with VHT as CMS reimbursement tightening looms on the skin-sub front.
📬 Closing Thoughts
🎇 We kicked off the month with a call for real independence — the kind that saves limbs, not just fireworks. - see it here
As CMS tightens the screws and innovation heats up, Below the Knee continues to track what matters: capital, capability, and care convergence.
If you're building in this space — or investing in it — now's the time to stay close to the signals.
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Thanks for reading — and for advancing wound care below the knee and beyond.
👋 Got news? New launch, trial, or market play? DM me or hit reply—we spotlight rising players every month.
— Scott
Publisher, Below the Knee
LinkedIn | WoundCareFund.com