Singapore approval for Remplir. Not really new news as this was expected but suggests that approval in other jurisdictions is likely to be forthcoming. Should be a catalyst for revenue growth over the next 12-18 months.

Orthocell has received regulatory approval from the Health Sciences Authority (HSA) in Singapore, allowing the Company to commence sales of its market leading nerve repair product, Remplir™

Singapore is a strategic regulatory jurisdiction, both as a destination for sophisticated medical treatments in the region and as a regulatory gateway to other substantial ASEAN markets

Orthocell is in advanced discussions with an experienced international medical device distributor ahead of the Singapore market launch anticipated for Q1 CY25

The Company continues to accelerate its regulatory program for other jurisdictions, including the key US market, along with Canada, UK, Europe and other ASEAN markets

Remplir is gaining significant traction with new and existing surgeons in Australia and New Zealand driven by Remplir’s unique qualities that enable the reduction of damaging sutures, creation of an optimal healing microenvironment and facilitation of free gliding within the repair site during the critical healing period.

Singapore is a strategic regulatory market and can be used as a stepping stone to approvals in other ASEAN markets (e.g. Thailand, Malaysia, Vietnam, Indonesia and Philippines).

Orthocell’s global regulatory strategy for Remplir continues to progress, with the Company on track to receive regulatory clearance from the US FDA in 1Q CY25 and applications are planned for Canada, Thailand and EU and UK within the next 6-12 months. 

Another positive revenue announcement for OCC. Probably not going to have a significant impact on the SP. FDA approval for the nerve repair cuff Remplir is expected in 2025 followed by US sales likely to act as a catalyst.

A competitor product to OCC's Remplir, Nervealign is another collagen cuff for nerve repair and the company Renerve is planning an IPO in November valuing the company at $24-28M. OCC currently valued at $96M but with additional products. From their website:

ReNerve has developed a unique approach to nerve replacement products by customizing products to specific nerve replacement procedures. Products are manufactured using proprietary technology and development is in the final stages, of filing for an FDA application, with clinical studies being performed with Melbourne hospitals, Australia. Initial readouts show presentation and protection of the nerves with no negative effects.

For anyone looking to go deep there is a good but outdated article from the Royal Society on biomaterial nerve repair.

Axogen is the existing standard of care and all three use a porcine collagen matrix. They have an updated bibliography of research on their site.

Veritas published research in April 2023 on Orthocell which provides further detail on Remplir:

"Orthocell believes that Remplir’s similarity to normal human epineurium is a key differentiator to other devices in this market. The comparator devices, like Integra’s NeuraWrap or Axogen’s Axoguard Nerve Protector devices are designed to bridge gaps at the site of peripheral nerve injury, hence they are designed to be more rigid.

The absence of a fit for purpose nerve repair device in the US creates a unique opportunity for Orthocell – to bring a nerve repair device that assists the surgeons perform surgical repairs while providing consistent high-quality return of muscle function.

Bioactive: The longitudinally aligned porous channels of the inner layer of the membrane creates a bioactive chamber which maximises and guides cell growth. No competitor products promote cell growth to the same extent according to our review of the published literature."

Orthocell has achieved a second consecutive quarter of record revenue, reporting $2.03m in the September 24 Quarter

• Revenue is up 7.82% on the $1.88 million achieved in the June 24 Quarter and up 14.84% from $1.76 million for the same period last year showing clear traction with new and existing surgeons, translating to growing sales of the Company’s market-leading products Striate+™ and Remplir™

Of key importance is the expected near term FDA approval of Remplir in the US, which will open up a USA nerve repair market opportunity estimated to be worth in excess of US$1.6 billion

• Final data for the FDA approval process is due Q4 CY24, followed by the formal submission and anticipated FDA approval in Q1 2025 and progression into sales soon thereafter. 

First Striate+ sales in to Canada by BioHorizons following approval in July. Following the recent statement of aiming for 20% market share OCC have estimated that the Canadian market is estimated to be worth $60M, so potential for $12M in coming years. Still not attracting much market interest.

"Company is accelerating market access into multiple new large markets"

"Brazil and Singapore approvals anticipated within 6-12 months."

Announcement light on detail but trending in the right direction.

Record revenue of $1.84m has been achieved for the June 24 Quarter, which is up 14.41% from $1.61 million in Q3 FY24 and up 9% from $1.68 million for the same period last year, Q4 FY23.

The continued growth will see record FY24 revenue of $6.72 million, up 30.40% from the previous year (FY23) of $5.15 million, demonstrating clear traction in existing markets. 

Company spin

Orthocell aims to secure a 20% market share for Striate+, which would generate approximately AU$50 million in recurring revenue. A similar marketshare for Remplir would generate AU$255 million recurring revenue. Expansion into other markets would see an increase in these projections, demonstrating enormous growth potential for the Company in the immediate future.

Quarterly revenue has grown on average by 9% compounded for the last seven quarters, following Striate+ US and Remplir AUS product launches in November 2022. (9% p/q = 40%p/a compounded)

The reality

Last year's loss before income tax benefit was $9.4M ($6.25M after) on $1.9M from sales and $2.3M from The BioHorizons contract where annual amounts from the lump sum of $23M are transferred to revenue. This will increase to $6.9M for the next three years.

If the sales revenue increases at 30% ( 40% p/a so far off a low base) which is being optimistic then FY25 could see break even on paper. Another licensing agreement for Remplir post approval could change things dramatically (US product registration for Remplir expected in Q1 CY25). Patent life on Striate appx 10 years.

I am still puzzled as to why OCC has not gained traction with the market but I assume that they fall into the loss-making microcap ignore section for most. $20M in the bank as of the last quarter to fund ongoing development and now a third revenue-generating product launch. SP has been basically flat for the last year other than the odd blip trading in the 35-40c range. Currently at the bottom of this range and should really be topping up.

OCC to Launch Third Revenue Generating Product in SmrtGraft™ for Tendon Repair

Orthocell submits TGA application for approval to commence sales of its SmrtGraft™ Product in Australia, which is used for tendon repair and regeneration applications

Submission follows positive results from its tendon regeneration study indicating that SmrtGraft reduces the rate of treatment failure and the need for revision surgeries. All patients in the study achieved successful tendon repair, with significant improvements in pain, function and quality of life. None of the participants required further surgery for a re-tear of the rotator cuff tendon – an important finding since revision surgeries for re-tears is reported to occur in up to 57% of cases. 

SmrtGraft will be the third revenue generating product to be launched by the Company, in addition to Striate+™ (for dental bone regeneration) and Remplir™ (for peripheral nerve repair) which are already in market

While the SmrtGraft study focussed on repairs to the rotator cuff tendon, the product has the potential to be used in multiple tendon applications in addition to the rotator cuff, including tendons in the knee, hip, ankle, elbow, wrist and hands. 

Significant addressable market for SmrtGraft, estimated to be worth more than US$1.2 billion annually, with >800,000 surgical repairs of RC tendons alone completed in just the AUS, USA and EU per year

Geographical roll-out strategy for tendon and ligament repair devices in progress, starting with Australia and other key regulatory jurisdictions to follow

Held

Study results confirming the efficacy of OCC's main revenue product Striate+. Only 99 patients and no comparison to current standard of care but above Googled average success of 95%. Should see revenue show in next quarter.

Post-market clinical study results displayed that dental implant treatment with guided bone regeneration utilising Orthocell’s Striate+™ dental membrane resulted in an outstanding 98.6% success rate.

This compelling real-world evidence confirms Othocell’s dental membrane product, Striate+, as the optimal medical device for all types of guided bone regeneration and dental implant procedures.

These results will raise the profile of Striate+ with new and existing dental surgeons and greatly assist the Company’s exclusive global distributor, BioHorizons, in growing product adoption.

The addressable market for the Striate+ product is estimated to be worth more than US$700 million per annum1 in which Orthocell is already growing its revenue.

“Striate+ is a best-in-class dental membrane that facilitates the highest quality bone and tissue repair. Predictable and high-quality bone regeneration is of utmost importance to deliver functional and aesthetically pleasing outcomes for patients. We are delighted to share this compelling real-world data.”

The Striate+ Study will likely raise the profile of Striate+ with existing and new dental surgeons and assist BioHorizons in growing product adoption in an addressable market estimated to be worth more than US$700 million per annum.

Article in the West Australian about Striate+

OSX (up 10%) another ASX regenerative microcap announced a big research deal with Singaporean institutions that looks to be in direct competition to OCC’s dental striate product.

Osteopore secures lead role in Clinical-industrial Partnership with National Dental Centre Singapore and A*STAR research institutes through A$19m project, develops next generation jaw implant to access the A$1.26b dental bone graft and membrane market

Further progress on the ACL collagen rope development. Next trial on sheep for closer model to humans. Avoids hamstring tendon harvest to simplify procedure. 

“Approximately 15,000 ACL knee reconstructions are done annually in Australia and up to 200,000 per year in the United States,” 

“harvesting the patient’s tendon significantly extends surgery time, introduces donor site pain, morbidity and potentially nerve damage. Tendon harvest can result in donor-site tendon tears and/or rupture during rehabilitation, prolonging recovery time. There is also a limited amount of healthy graft tissue available, which may compromise the repair or inhibit the opportunity for subsequent repairs.”

Promising data for CelGro® collagen rope for Anterior Cruciate Ligament reconstruction
• Pre-clinical study data in rabbits indicate that a novel CelGro® collagen ‘rope’ is a viable alternative to conventional autologous tendon grafts for Anterior Cruciate Ligament (ACL) reconstruction
• CelGro® collagen rope promoted ligamentisation and exhibited tissue architecture that mimics native ACL
• CelGro® collagen rope integrated with the host bone tunnel and was biomechanically comparable to hamstring tendon autograft
• Results position CelGro® collagen rope as the potential first off-the-shelf biological device for ACL reconstruction
• In light of these results, Orthocell plans to advance development of this technology and will commence a larger animal study followed by first-in-human trials

Orthocell receives new US patent for CelGro®

~ New US divisional patent granted for CelGro®

~ Patent covers the method of manufacture of collagen medical devices and as an aid in the surgical repair of soft tissue injuries

~ CelGro® patents have been previously granted in the US, Canada, Europe, China, Japan, Singapore, Australia and New Zealand

~ CelGro® dental (recently renamed Striate+) approved for use in US, Europe and Australia

~ Global addressable market for CelGro® is in excess of >US$10bn1 and growing.

DISC: I Hold