Osteopore’s agreement with Kontour is the first step towards gaining entry into the Chinese market.

Regenerative bone and tissue implant specialist, Osteopore (ASX:OSX), has moved one step closer to a China market entry after signing a distribution deal with Kontour (Xi’an) Medical Technology.

Under the deal, the Shanghai stock exchange-listed Kontour will market and sell Osteopore products across mainland China.

Kontour has agreed to a  purchase target of US$500k of Osteopore products in the first year and US$1m  in the second year, subject to receiving a clearance from China’s NPMA (National Medical Products Administration).

The terms with Kontour also include an exclusive four-year agreement under which Kontour and Osteopore will conduct a number of clinical trials to obtain the required data to achieve NMPA approval.

NMPA is the Chinese regulatory body with the jurisdiction to approve the sale of medical products  across all  Chinese territories.

If the clinical trials are successful, an NMPA approval will allow Osteopore products to be marketed and sold across the country.

“This is a significant step in our commercialisation strategy, as the large Chinese market will be very important to Osteopore,” said OSX executive chairman, Mark Leong.

 

The right partner

Kontour is a leading manufacturer and distributor of surgical supplies across China, and is  listed on the Shanghai Stock Exchange with a market cap of around 3.38bn Yuan  (approximately $711m).

The  company produces neurosurgery products, titanium materials for neurosurgery, skull internal fixation repair systems, sternum fixation systems, rib fixation systems and others.

Osteopore has chosen to partner with Kontour because the company has significant experience in the Chinese regulatory process.

It’s anticipated that the NMPA regulatory approval will take around 24 months to complete.

Kontour was also selected due to its impressive nationwide network of hospitals and surgeons in mainland China.

In addition, the two companies agree that Osteopore products are complementary to Kontour’s current offering of neurosurgical plates and screws.

Adding Osteopore’s products to the mix could potentially help Kontour’s customers improve patient outcomes and lower complication rates during and after surgery.

Because of that, the initial focus for Kontour will be to gain clearance for Osteopore’s craniofacial (neurosurgery) products.

“The Osteopore bioresorbable implant is the first of its kind to be successfully developed and commercialised for surgical use,” said Kontour general manager, Alan Zhu.

“Their innovative implants can dissolve over time, leaving only natural healthy bone.

“Osteopore bioresorbable implants are perfect complementaries to Kontour’s neural closure product portfolio, and can benefit Chinese craniotomy patients in the long term,” Zhu added.

 

Opportunity in China

China is a significant and high priority market for Osteopore, and the company is set to pursue this huge market.

Preparations have already been made with the registration of its products with Hong Kong’s Medical Device Control System (MDACS) in December last year.

This registration allows Osteopore and Kontour to market its bioresorbable implants in the Greater Bay area, and provide implants to hospitals under special access needs.

According to Wikipedia, the Greater Bay Area has a total population of approximately 71.2 million people (5% of China’s total population), and includes nine mega cities as well as two special administrative regions, Hong Kong and Macau.

“We are laying the necessary groundwork to enter the Chinese market and working with the right partner is essential,” said Leong.

“We are glad to begin our partnership with Kontour, starting with our craniofacial products.”

The deal with Kontour is for a fixed term of four years, subject to renewal for an additional one year period.

Osteopore’s patented technology fabricates specific micro-structured scaffolds for bone regeneration through 3D printing and bioresorbable material.

Its patent-protected scaffolds are made from proprietary polymer formulations that naturally dissolve over time to leave only natural, healthy bone tissue.

This significantly reduces post-surgery complications commonly associated with permanent bone implants.

 

This article was developed in collaboration with Osteopore, 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.

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