Special Report: Dropping milestone numbers this week is Perth-based regenerative medtech Orthocell Ltd for which record quarterly and full year revenue has been driven by a huge uptick in demand across the company’s flagship healing solutions.

An ongoing spike in sales growth for both Orthocell’s market-leading Striate+ and Remplir products has delivered record June quarter revenue of $1.84mn, a jump of 14.4% on the previous quarter and almost 10% more than the same time last year.

Orthocell (ASX:OCC) MD Paul Anderson says the current sales growth trajectory will smash revenue records across the board for OCC in FY24, with the projected $6.72mn – a massive 30.4% beyond last year’s $5.15mn.

In fact, following the Striate+ US and Remplir (ANZ) product launches in November 2022, the Aussie medtech’s collagen medical devices, which help restore damaged or diseased tissue, have now generated seven straight quarters of compound growth by an average of 9%.

And that near-term growth is still ahead of its exponential uptake as global markets begin to adopt the OCC medical devices, which are used to boost repair of damaged tissue by creating a unique healing environment to facilitate tissue regeneration.

 

Accelerating approvals

While the numbers demonstrate a clear watershed moment for existing market traction, Anderson says the company is also accelerating approvals – especially for Orthocell’s breakthrough nerve repair solution Remplir – for new market and geographic expansion where the need for the breakthrough nerve repair product is aligning demand with technology.

”Orthocell currently has two products in the market:  Striate+ – which is a non-invasive treatment for dental bone regeneration, and Remplir – which is an entirely game-changing solution for the people every year who endure damaged nerves or suffer from peripheral nerve pain.

“For all of those millions of people, Remplir will provide a life-changing solution. And that’s why Orthocell is where it is.”

 

A lot of nerve

The global market opportunity for these two products alone is estimated to be somewhere around the US$3 billion mark – a number which can only grow as target populations age and demand for nerve treatments spike.

Striate+ is already a market-leading solution in maturing markets, both at home and across Europe, the UK and in the US, while (Remplir) Orthocell’s nerve repair solution is currently only available at home and in New Zealand.

According to Paul Anderson, Orthocell aims to secure a 20% market share for Striate+, which he says would generate circa $50 million in recurring revenue.

Now apply that formula to Remplir, and a similar market share would generate $255mn in recurring revenue.

Further market expansion would naturally supercharge these projections, too.

OCC’s dental bone solution Striate+ is already distributed globally by strategic partner  BioHorizons, one of the world’s largest dental implant providers, and Anderson says Orthocell and its partners have been focused on driving uptake of Striate+ and Remplir into key regulatory markets.

 

An Aussie world leader in regenerative med

Anderson has been developing emerging medical technologies – with a sharp focus on cellular therapy – for almost 20 years.

He says the milestones already achieved by Orthocell in 2024 will change both the Australian regenerative medtech landscape, as well as the outlook for nerve pain sufferers everywhere.

“Orthocell has completed a record quarter and a record year of revenue, which is an outstanding effort and the results show the company is on track to being a key global player in an extraordinary field.

“I am very pleased with the performance of our distribution partners and the continued increase in product adoption. This revenue growth is evidence our products are achieving traction in their respective markets, underpinned by their ongoing excellence in clinical practice and performance.”

Anderson says the significant revenue growth Orthocell has achieved is set to increase with regulatory strategy in place for both products to expand access into other geographical regions as well as additional approvals in other markets.

“With a highly respected and experienced Board in place, and with market-leading products, our company is in a strong position to continue to gain commercial traction and drive Remplir, our breakthrough nerve repair device, into global markets.”

 

A board to write home about

And that board certainly is highly respected.

Among the various medical luminaries is the 33rd Governor of Western Australia and the former ambassador to the US, the Hon Kim Beazley AC.

As well as non-exec director, the legendary reconstructive surgeon Professor Fiona Wood AM (Australian National Living Treasure), who was Australian of the Year in 2005, and WA Citizen of the Year – two years running – 2003 and 2004.

Prof. Wood is behind the amazing “spray-on skin” treatment for burns, (co-invented with Marie Stoner), which was used to help victims of the 2002 Bali bombings.

Prof. Wood was also pivotal in taking the creation to a world in terrible need of a burns solution – which she did via the $450mn market capped Avita Medical, now operational in over 30 countries.

 

Looking ahead

Orthocell recently reported the successful completion of all Nerve Repair Surgeries in the Remplir US Market Authorisation Study.

Top-line results from this study are expected in Q4 CY24, and Orthocell remains on schedule to submit its US 510(K) market authorisation application in Q4 CY24 and progression into sales soon thereafter.

Orthocell, meanwhile, has a strong balance sheet with $20.6 million in cash and looks ideally placed to accelerate its global market expansion strategy and already start planning beyond the pivotal US product registration for Remplir, which is expected in Q1 CY25.

Following OCC’s application last month to the Therapeutics Goods Australia (TGA) for Australian market approval of SmrtGraft (a tendon repair device), Petra Capital forecast Orthocell’s share price could potentially reach $1.28 per share on the back of the product’s additional potential market share.

We see distribution as well as manufacturing synergies with OCC’s Remplir nerve product, Petra wrote last month.

“As such, it represents a potential attractive revenue stream without much additional cost. With OCC on track for US approval of Remplir in 1QCY25, our TP of $1.28/sh offers >3x upside.”

 

This article was developed in collaboration with Orthocell, a Stockhead advertiser at the time of publishing.

This article does not constitute financial product advice. You should  consider obtaining independent advice before making any financial decisions.