Replay and Transcript: Barclays: Radiotherapy KOL call - Emerging risks and opportunities

Research evidence excerpt

Replay and Transcript: Barclays: Radiotherapy KOL call - Emerging risks and opportunities

Barclays | Replay and Transcript

We were pleased to host an investor call with Dr Peter Orio, chair of Radiation Oncology at The

Dana-Farber Cancer Institute and Associate Professor at Harvard Medical School on risks and

opportunities in the radiotherapy market, after meeting with him and companies at ESTRO last

month (see our feedback here). We highlight three key takeaways:

1. Reimbursement. Orio indicated hospitals are likely seeing ~10% reimbursement cut as a

result of CMS shift to three-level reimbursement system. Private insurance tends to follow CMS.

His centre is slightly more protected due to higher reimbursement for research. Prostate

treatment defaults to Level 2 (~14% cut), need motion management to upgrade to Level 3.

Some regional/ standalone centres could face significant financial challenges and see 25-30%

reimbursement hit (dependent on payor mix). Could accelerate replacement cycles due to

upgrades needed to achieve Level 3.

2. Volume growth. Expects to see 4-5% incidence growth, from ageing populations and

patients perhaps needing multiple rounds, with further upside potential from using radiation

therapy outside of oncology (eg Alzheimer's and osteoarthiritis). This growth is partially offset

by a continued shift to hypofractionation.

3. Radiopharma. Radiopharmaceuticals likely to be brought into the radiation oncology

department, and out of nuclear medicine, as radiation side effects needs to be managed. KOL

sees the radiopharma opportunity as significant, with low start-up costs and highly profitable

treatments. Sees radiopharma as complementary to external beam radiation therapy. We