The news: Tissue regeneration business PolyNovo has entered a trading halt as it is set to publish a response to a news report that said its lower cost products could benefit from the US government health insurance agency's spending crackdown.

The context: In July, the US Centre for Medicare & Medicaid Services (CMS) proposed plans that are partially aimed at reducing "waste and unnecessary use of skin substitutes".

This includes capping CMS reimbursement payments for skin substitutes to a flat fee of USD806 ($1233.16) per square inch that is below previous payments, which could reach up to USD2000 per square inch.

According to The Australian, the changes have boosted PolyNovo's confidence in increasing sales in the US and is reportedly in early talks with a distributor.