Some hospitals are starting to promote gastric band surgery for patients with lower BMIs, in a sign that the recent Food & Drug Administration decision to lower the threshold of obesity that a patient must exhibit in order to fit the indication for gastric banding surgery could turn out to be a boon for Allergan Inc. (NYSE:AGN).
The Davis Clinic in Houston, Texas, announced that it will offer the weight-loss surgery for the newly included range of obese patients, using Allergan's Lap-Band device, which first won FDA clearance in 2001.
Prior to February of this year, gastric banding surgery was approved only for patients with a body mass index of 35 or higher. The FDA expanded the approved group to include patients with a BMI of 30 or higher who also exhibit a co-morbid condition like diabetes or hypertension, enabling about 26 million more people to opt for the surgery, according to a clinic release.
While the influx of candidates is a clear win for Allergan, the lower threshold of patients doesn't qualify for insurance coverage, meaning they'll have to pay cash for the procedure.