Name: Orthocell placement to raise $17m for US and global launch for collagen nerve wrap
Uploaded: 2024-10-25T16:00:32+11:00
Channel: Special Report
Description: Orthocell (asx occ) $17m placement will fund further scale-up of manufacturing infrastructure and production cost efficiencies for Remplir.

Orthocell is raising $17m through well supported institutional placement of shares priced at 60c each
Placement backed by new leading Australian and international institutional investors along with existing shareholders
Proceeds will fund the launch of Remplir in the US and other key markets

Special Report: A significant number of new leading Australian and international institutional investors have demonstrated their confidence in regenerative medicine company Orthocell by backing a $17m placement.

The new investors joined key existing institutional shareholders and life science funds to subscribe for 28.3 million shares priced at 60c each – a 12% discount to the 10-day volume weighted average price and a 5% premium to the 60-day VWAP.

Proceeds will be used by Orthocell (ASX:OCC) to fund the launch of Remplir – a collagen wrap to augment nerve repair surgery – in the US and other key markets including Singapore, Southeast Asia, Canada and the EU/UK.

Specifically, it will allow the company to fund further scale-up of manufacturing infrastructure; automation projects to enhance manufacturing cost efficiency; sales force and marketing resources to oversee distribution; working capital; and costs of the placement.

“We are extremely pleased to announce this significant placement following on from our second consecutive quarter of record revenue, regulatory approval of Remplir in Singapore, successful first sales of Striate in Canada, and the exciting outlook for the company as it progresses approvals in new key jurisdictions like the US,” chairman John Van Der Wielen said.

“This allows us to grow the USA market quicker, invest in volume manufacturing and also speed up the progress of our promising pipeline products.”

The placement that was sole lead by Canaccord Genuity, includes a $100,000 subscription from Van Der Wielen that is subject to shareholder approval, will be made under the company’s available placement capacity under ASX Listing Rules 7.1 and 7.1A.

Recent progress

OCC recently received regulatory approval from Singapore’s Health Sciences Authority for Remplir, enabling sales to start in Q1 2025.

Not only is this the first major international approval for Remplir outside of Australia and New Zealand, it could also be used as a stepping stone to approvals in other ASEAN markets such as Thailand, Malaysia, Vietnam, Indonesia and the Philippines.

With an estimated two million peripheral nerve repairs estimated to be performed across Australia/New Zealand, Singapore, USA, EU/UK, Canada, Brazil, Japan and Thailand each year, the company is targeting an addressable nerve repair market estimated to be worth more than US$3.5bn annually.

The company also believes that it is well positioned to drive its Striate+ bone repair product, which is is approved in the US, Europe, Australia/New Zealand, & Canada. Singapore and Brazil approvals expected by Q2 CY25.

Continued growth of sales of both Remplir and Striate+ had led the company to report record revenue of $2.03m in Q1 FY2025, up 7.82% on the $1.88m achieved in Q4 FY2024.

Striate is approved in US, EU, AUS/NZ, & CAN. Singapore and Brazil approvals expected by Q2 CY25.

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.