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Orthocell's easy cell into the US as it secures 12 distributors for nerve repair device Remplir

Orthocell's easy cell into the US as it secures 12 distributors for nerve repair device Remplir

West Australian11-05-2025
Orthocell's easy cell into the US as it secures 12 distributors for nerve repair device Remplir
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Break it Down: Orthocell books first sales revenue in US for Remplir
Break it Down: Orthocell books first sales revenue in US for Remplir

News.com.au

time10-07-2025

  • News.com.au

Break it Down: Orthocell books first sales revenue in US for Remplir

Stockhead's Break it Down brings you today's leading market news in under 90 seconds. In this episode, host Tylah Tully takes a look at Orthocell (ASX:OCC), who have achieved first US revenue from Remplir, its flagship nerve repair product, after the company locked in FDA approval in April. Tune in to hear all about it. While Orthocell is a Stockhead advertiser, it did not sponsor this content. Originally published as Break it Down: Orthocell books first sales revenue in US for Remplir

Health Check: For ASX biotechs, the business of America remains business
Health Check: For ASX biotechs, the business of America remains business

News.com.au

time10-07-2025

  • News.com.au

Health Check: For ASX biotechs, the business of America remains business

A slew of medical device makers report good progress in the US Imagion shares almost double on positive FDA feedback Quiet drug developer PYC Therapeutics wins a friend The US healthcare system is mired down by kerfuffles over tariffs, drug pricing and cuts to regulatory and funding bodies, but for ASX biotechs the wheels of decision-making keep grinding. As President Calvin Coolidge (supposedly) said a century ago, 'the business of America is business' and that will never be Trumped. Among a slew of US-related disclosures, Orthocell (ASX:OCC) notes it has pocketed its first US revenue from its flagship nerve repair device, Remplir. The achievement follows Remplir's first surgical use in the US, for a foot repair in Ohio on June 26. The company also cites revenue from 'subsequent early surgical cases in Florida, sourced from the company's network of specialist distributors'. Orthocell's commercial traction comes just three months after the company won US Food and Drug Administration clearance for Remplir, which wraps around peripheral nerves and protects them during surgery. Yesterday Orthocell reported June quarter revenue of $2.73 million, up 22.8% on the record March quarter. This took annual revenue to $9.19 million, up 35.8%. Crucially, that does not include Remplir US revenue. First US revenue for Artrya, too Meanwhile, heart device maker Artrya (ASX:AYA) has announced its first US revenue for its Salix coronary plaque detection platform. This is by way of a US$600,000, five-year contract with the Georgia and Alabama based Tanner Health. Tanner has a network of five hospitals, cardiovascular centres, and 30 physician practices. 'This first revenue represents a major milestone for Artrya as it continues to transition to a revenue-stage business,' the company says. The FDA approved Artrya's device in March. So like Orthocell, it's not wasting any time in monetising the opportunity. Artrya is 'actively progressing' commercial discussions with other US hospital networks. The company is also girding for FDA clearance of a further module. US approval? Imagion that Imagion Biosystems (ASX:IBX) today almost doubled after the company said it had received positive FDA feedback on the company's proposed phase II imaging trial for HER-2 positive breast cancer. The company aims to detect cancers early with its Magsense imaging tech. Magsense combines the use of magnetically detectable nanoparticles with biological agents. The underlying tech, by the way, was created by a Los Alamos, New Mexico physicist called Edward R Flynn. The good doc tinkered with magnetic sensors after his wife contracted breast cancer. The company plans to lodge an Investigative New Drug Application – that is, assent to start a trial – with the FDA in the current quarter. Imagion says the agency provided 'positive feedback and constructive input regarding the study plan and outcomes.' 'I'm very pleased with the trajectory of our communications with the FDA', says Imagion exec chairman Bob Proulx. Investors were pleased as well: the FDA's kind words sent the stock up as much as 92% this morning. Imricor wins Northstar approval Coming back to heart health, Imricor Medical Systems (ASX:IMR) has won European regulatory approval for Northstar, as well as its second-generation ablation catheters and capital equipment. This was under the Continent's European Medical Device Regulation, a more stringent gateway than the old rules. Imricor has developed the world's only MRI-guided ablation catheter, which are single-use consumables. Consisting of a workstation and software, Northstar is key to making the magic happen. In mid-April the European gatekeepers approved the catheters under the old pathway. 'Investments in sales and marketing are beginning to pay dividends, with the number of hospitals in the active European pipeline increasing from seven to 26 over the past six months,' Imricor says. As always, the US presents the biggest market. There, the company has lodged vital documentation with the FDA as part of the Northstar approval process. The company aims to submit all its supportive clinical data by the first half of 2026. 'Approval of Northstar will mark the commercial entry point for Imricor in the US and enable Imricor's sales team to initiate site engagement and pipeline development,' the company says. Mach 7 maintains cruising altitude ProMedicus (ASX:PME) 'mini me' Mach7 Technologies (ASX:M7T) has affirmed its revenue forecast for the year to June 2025, albeit at the lower end of things. Mach 7 also expects to break even. On preliminary unaudited numbers, Mach 7 expects revenue of $33-34 million, in line with guidance of $33-36 million and 15-25% higher than previously. Management expects recurring revenue – subscription revenue and maintenance and support revenue – to be 20% higher. But CARR – contracted annual recurring revenue - should come in at $30-31 million, just below the guided $32-35 million. 'Mach 7 is in a strong financial position with no debt and expects to be operating cash flow positive for the 2024-25 year,' management chirps. Mach 7 provides medical imaging software, including image diagnosis and vendor-neutral image archiving. In crude terms Mach7 is 'same but different' to Pro Medicus – a key commonality being a US focus. But they don't compete directly, by and large. A key difference, of course, is that Mach 7 is worth $80 million, with $22 million of cash backing. Pro Medicus is valued at $33 billion, with its shares surging 140% over the last year. Mach 7 shares have decline 44% over his period. Sniffing a bargain, Mach 7 is lapping up its own shares by way of an ongoing share buyback. Mach 7's new CEO Teri Thomas officially started on July 1 and will update investors on July 29. Thomas headed breast imaging outfit Volpara Technologies, before it was taken over by a South Korean suitor last year. Why we like PYC Drug developer PYC Therapeutics (ASX:PYC) has maintained a low profile and that's partly because of its convoluted story over the years. But the Perth-based PYC now has a clearer focus on a portfolio of four rare disease candidates for rare inherited diseases, across three clinical trials. Growing investor awareness has pushed PYC's market cap to more than $840 million. Broker Bell Potter reckons there's room for more as PYC 'has continued to execute impressively in recent months.' PYC's trials cover the eye diseases retinitis pigmentosa type 11 (RP11) and autosomal dominant optic atrophy (ADOA), as well as polycystic kidney disease (PKD). The most advanced, RP11 is fully recruited should start a registrational phase 2/3 trial in the next six to nine months. This follows recent FDA feedback on trial design. 'Early data has impressed on measurements likely to be primary endpoints in the future registrational trial,' Bell Potter says. The trial would be the first ever pivotal study for RP11, which has no current treatment and affects 1500 to 3500 Americans. Bell Potter values PYC shares at $2.30, a 58% increment on their current value.

Biocurious: Nerve repair champion Orthocell is taking it slow and steady in the US fast lane
Biocurious: Nerve repair champion Orthocell is taking it slow and steady in the US fast lane

News.com.au

time08-07-2025

  • News.com.au

Biocurious: Nerve repair champion Orthocell is taking it slow and steady in the US fast lane

Orthocell is staging the US rollout of its Remplir device, including 'pausing' enlisting too many distributors at once In Remplir's first US commercial usage, an Ohioan surgeon has deployed the device successfully More than 300 investors tuned into Orthocell's update last week For Orthocell (ASX:OCC) co-founder and CEO Paul Anderson, winning US Food & Drug Administration (FDA) marketing approval is more like a waypoint in the commercialisation path, rather than the endgame. In early April the FDA green-lit the company's flagship nerve repair product Remplir, exposing the company to a potential US$1.6 billion-a-year market. The Perth-based Orthocell can't be accused of assuming the biotech gods will serve up commercial success on a platter. Anderson says Orthocell was preparing its rollout strategy two years ago, including strategic tie-ups with distributors and laying the groundwork with opinion-leading surgeons. 'You don't just get an FDA approval and expected things to happen, you must be ahead of the game,' Anderson says. A mere three months post approval, Orthocell last week reported the first US commercial use of Remplir, by a surgeon in Ohio for a foot repair. It's not a race Paradoxically, management is on a strategic 'go-slow' in the fast-paced, make-or-break US market. Having appointed 14 east coast distributors, the company has 'paused' the rollout of any more until the current complement is properly trained and supported. Orthocell has also focused on the parties with what Anderson dubs the best 'domain knowledge' – those who can lead the company to the key hospitals and influential surgeons. 'You can't be scattergun,' Anderson says. 'We have 14 distributors to train and educate, with 100 reps on the ground. 'It's important that we provide them with the best education to support the brand.' Orthocell is also not ignoring the dull-but-important stuff of obtaining state-by-state licensing, navigating hospital procurement and onboarding day surgery hospitals (a key market). Stitching up the suturing market A collagen cuff derived from porcine material, Remplir envelops a severed nerve and helps the healing process. The device is also approved locally and in New Zealand, Canada, Singapore, Thailand and Hong Kong. Remplir is the only product that mimics the outside of the nerve, called the epineurium. Given that, the device requires few or no stitches: a technique unchanged since the late nineteenth century. 'We are actively redefining the way surgeons approach nerve repair,' Anderson says. 'Remplir is the only product in the market that enables surgeons to connect nerves, to protect them from scar tissue and compression; and cap nerves (for amputations).' Published studies show that patients with no voluntary movement had 85% of their function restored two years post-surgery. They also had improved strength and range of motion, which Anderson dubs 'outstanding outcomes that represent everything Remplir has to offer". To date, 206 surgeons in over 166 local and Singaporean hospitals have used Remplir, including plastic reconstructive, orthopaedic, vascular and neurological surgeons. Better bang for revenue buck Naturally, a medical product needs to be clinically superior – but that's not enough to ensure financial success in a well-competed sector. As yesterday's update from US drug entrant Botanix Pharmaceuticals (ASX:BOT) shows, too many clipping-the-ticket intermediaries can spoil the revenue story. 'Unlike other medtechs, Orthocell has no royalty liabilities and as we get into revenue growth, investors will reap the reward,' chairman John Van Der Wielen says. 'Royalty liabilities significantly erode margins in the sector." He adds that most device makers outsource their manufacturing, resulting in margin erosion. Orthocell's process is being kept in house. Revenue growth 'will take care of profits' Orthocell last week disclosed record June quarter revenue of $2.73 million, 23% higher than the March quarter. Revenue has risen for five consecutive quarters, at a compound annual rate of 9.5%. However, this annual run rate of circa $9 million doesn't include any US Remplir revenue. Striate sales in Australia, New Zealand and Singapore grew 28%. Management won't predict US revenues or when the company achieves profits – but expect blank ink on the bottom line in the 'near future'. 'Our expenses are growing at a lower rate than revenue, so the 'jaws' eventually will cross over and push the business into profit,' Van Der Wielen says. 'Cash burn is reducing, revenue is increasing and I believe we have more than enough cash to take the business forward.' Over time, Orthocell has invested $80 million in developing its product platform. The company does not have to incur more sunk costs, leaving a largely variable distribution cost base. 'Premium' product at a discount price Tapping Remplir's cost advantages, Orthocell is pricing the 'premium' product at just below those of US competitors. 'We are making it easy for the hospitals to order our product,' Anderson says. Orthocell has set its US pricing at parity with what's charged in other countries. This is a poltically sage gambit that should please the Commander in Chief as he ponders his 'most favoured nation' drug policy. While obtaining US reimbursement is the be-all-and-end-all for most drug makers, Anderson notes a capacious user-pays capacity for nerve repair. 'The take-home message is there is enormous revenue to be gained, even if you don't have US reimbursement,' Anderson says. That said, hospitals should fund Remplir by a mechanism that allocates a bundle of cash per procedure, rather than for specific items. Passionately Australian Around 300 investors tuned into Orthocell's webcast last week – no doubt reflecting the stock's 270% surge over the past 12 months. As it hones its US push, one thing Orthocell won't be doing is ceding its manufacturing base in Perth, which has the capacity for 100,000 units annually. Remplir's long shelf life means it's easy to ship elsewhere. 'We are passionate manufacturers of this product in Australia – and that's because it's the right place to make it,' Anderson says. 'We have the best raw material in the world and a great gross margin and economies of scale.' Judging from his chairman's utterances, Anderson can approach his end-of-year salary review with confidence. 'As a board, we could not be happier with what we have achieved over the last 12 months,' Van Der Wielen says.

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