Shares in Nuheara fell by as much as 27 per cent today after the UK’s National Health Service removed the company's IQbuds Boost hearing bud from its hearing aid category.
In a statement, Nuheara said its UK distributor, Puretone, advised the company its IQbuds had instead been placed under the NHS’ niche innovation category due to a “revised contractual process” with the publicly funded healthcare provider.
In November, Northbridge-based Nuheara won a two-year contract to provide the NHS with its IQbuds Boost hearing bud for adults and children with mild-to-moderate hearing loss.
Under the deal, Nuheara was eligible to receive a portion of NHS expenditure on hearing devices for adults and children in the mild-to-moderate hearing loss category during this period.
The NHS supplies 75 per cent of all the UK’s hearing aids, and the IQbuds Boost was set to be prescribed alongside traditional hearing aids.
In a statement to the ASX, Nuhera said it expected £34.5 million ($61 million) worth of purchases by the NHS in this hearing loss category within the first 12 months of the contract and approximately £138 million ($242 million) over the full four-year term.
The contract was set to commence in April 2019, with provision for a further two-year extension.
Nuheara chief executive Justin Miller said the company understood the NHS changes.
“Having met with our distributor and NHS, we understand the regulatory direction of the NHS for category separation of traditional hearing aids and hearables,” he said.
“We have been advised this new categorisation process will commence in May 2019 and we look forward to working with our distributor Puretone, and the NHS to deliver self-care innovative hearing solutions to their customers.”
Shares in Nuheara closed down 14.5 per cent at 5.9 cents.
