Regenerative devices company $OCC announced an important step forward in the US today with approval from across the DoD and Veterans Affairs Health organisation for Remplir.
ASX Announcement
Orthocell has secured approval for its Remplir peripheral nerve repair device to be sold across the U.S. Department of Defence and Veterans Affairs hospital networks, comprising 51 DoD military hospitals and 170 VA medical centres. This is a meaningful US channel expansion, adding to the 32 Value Analysis Committee approvals already secured (covering 115+ hospitals) and 57 further VAC applications pending. The company's existing 17-state U.S. distributor network will be the primary vehicle for reaching military and VA surgeons within these newly accessible facilities.
The announcement leans heavily on recently-announced, real-world validation from Ukraine, where Remplir was used in 23 surgical procedures on injured soldiers across both primary and secondary nerve repair indications. Orthocell frames this combat-theatre experience as direct evidence of the device's portability, ease of use, and suitability for the trauma profiles typical in military healthcare. While this might be argued a logical and credible narrative for this particular channel, it is important to remember that the lion's share of the VAH is directed at veteran's and their dependents, often long after they have left the service. So the announcement should, to my way of thinking, be considered in the context of a large public health opportunity, rather that the conflict-linkage to Ukraine.
From a commercial momentum perspective, the release is careful to note that this approval arrives alongside what management describes as "increasing revenue traction" in the U.S. market more broadly. The key execution question, as always with OCC, will be conversion: approval and access are necessary but not sufficient conditions, and the density of the existing distribution footprint across the 221 newly accessible facilities will determine how quickly this translates into incremental revenue.
Now, the 221 "accessible facility" opportunity is significant. For comparison, in early 2025, $OCC indicated that Remplir was being used in 169 facilities in the ANZ market. So this one approval arguably unlocks an even larger TAM in one go.
The market has responded strongly today, SP up anything from 10%-20%. But here a note of caution should be applied. The blanket DoD and VAH approval essentially puts Remplir on the formulary list. However, DoD and VAH isn't a monolithic, centrally controlled organisation. From my understanding, individual facilities or local groups of facilities will have their own VACs which will require a local clinician champion to apply for approval. So this really still comes down to how good is the distributor network works together with the small $OCC US-based team to drive adoption.
My Overall Takeaway
I'm OK with today's SP reaction, mainly because I think the market is undervaluing $OCC. However, I consider the SP reaction reflects a naive view of what the VAH approval means in practice. Proof of my investment thesis relies on the quarter-by-quarter momentum of sales and other leading indicators I have written about at length before.
Good news, but it doesn't change the key measures I'm tracking.
Disc: Held
