Health Check: Lion City’s Orthocell approval provides a Singapore Sling-board to Asian markets

The Lion City’s go-ahead for Orthocell’s Remplir collagen wrap provides a springboard to other Asian markets.

Singapore has given the thumbs up to Orthocell's Remplir, joining the Raffles Hotel's Singapore Sling in the Asian market. Pic: Getty Images

• Orthocell wins Singaporean approval for its Remplir nerve-repair product

• Lumos wraps up $10 million whip-round amid surge of raisings in the sector

• 'Nice tidy' Cyclopharm eyes profitability from next year as US revenues grow

 

It’s not the US approval Orthocell (ASX:OCC) has been angling for, but Singaporean assent for the company’s nerve regeneration product Remplir opens the door for the company to enter other Asian markets.

Shares in the Perth-based Orthocell entered trading halt late yesterday pending a “Remplir regulatory approval”, which some investors may have posited was the coveted nod from the US Food & Drug Administration.

Instead, the Lion City’s Health Sciences Authority has allowed Remplir to be used for peripheral nerve repair.

A collagen wrap, Remplir fosters an “optimal healing microenvironment” with minimal use of sutures.

The company notes the approval is the first from a key regulatory agency outside of Australia and New Zealand, where the product already is used.

“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,” the company says.

(The key ASEAN markets are Thailand, Malaysia, Vietnam, Indonesia and the Philippines).

Orthocell puts the “global market opportunity” for Remplir at $US3.5 billion, with the US accounting for US$1.6 billion.

FDA approval is expected in the March quarter of 2025.

In Singapore, the company is in advanced chats with an “experienced international distributor" in view of launching Remplir in the same quarter.

In the meantime, Remplir is being used by around 130 orthopaedic and plastic surgeons locally and in NZ.

Orthocell shares this morning gained 6% to 51c.

Cyclopharm eyes profitability on US deal

Nuclear medicine house Cyclopharm (ASX:CYC) is targeting becoming profitable by the end of 2025, after last week winning a large contract with the US Veterans Health Administration.

“From the end of next year we will be cash-flow positive and profitable ,” says CEO James McBrayer. “It’s a nice tidy business.”

A year ago the company won US approval for its Technegas, a device that involves patients inhaling a superheated isotope to enable better lung imaging, especially for pulmonary embolisms.

(It sounds as healthy as chugging a pack of  Marlboro reds but it's actually quite safe).

Despite being approved in scores of other countries – 65 at present – the FDA took 16 years to decide.

The interim agreement with Veterans Health – a health system within itself – will enable the company to access 120 hospitals (those with nuclear medical medicine departments).

The deal is also a springboard to accessing other federal agencies.

Cyclopharm estimates a $US180 million US market for pulmonary embolism, rising to US$900 million with other target lung diseases including chronic obstructive pulmonary disease, asthma and, lest we forget, long covid.

The company is also targeting  2000 of the 8000 US nuclear medicine departments, with Veterans Affairs and other government facilities accounting for about 140 sites.

Last week the company reported US Technegas sales of $250,000 in the 11 months post FDA approval.

The company also reported overall first-half Technegas revenue of a flat $7.46 million, with investment in the US rollout resulting in a loss of $7.48 million compared with a $2.66 million deficit previously.

In June the company won three-year reimbursement from the public US health insurers, which is just as important as FDA approval itself.

Founded in 1991, Cyclopharm took the unusual approach of tackling the rest of the world before the US, which accounts for half of the globe’s nuclear medicine market.

“People are a bit shocked about us,” McBrayer says. “We are a 30-year, overnight success story.”

Astute readers – that’s all of them, of course – will note similarities between Cyclopharm and its ASX lung-imaging peer 4D Medical (ASX:4DX), which is also angling strongly for vet affairs’ work.

But there’s a key difference: Technegas replaces the imaging while 4D’s tools are algos that complement the current scanning methods.

Despite  being further down the evolutionary path, Cyclopharm is valued at $194 million and 4D Medical is worth $220 million. Go figure.

Cyclopharm shares were steady at $1.70.

Lumos wraps up $10 million raising

Lumos Diagnostics (ASX:LDX) has completed its $10 million capital raising by way of a rights offer, with retail holders chipping in for their full allocation of $3.1 million.

The raising was struck at 3.8c, on the basis of one share for every 1.82 held and at a 17% discount to the previous close. Tenmile Ventures, the vehicle of biotech fanboy Andrew ‘Twiggy’ Forrest supported the institutional component and has emerged as a 9.3% Lumos shareholder.

The raising will support the company’s efforts to obtain US laboratory use certification for its point-of-care diagnostic blood test Febridx, to distinguish between bacterial and viral infections.

The company hopes to get its regulatory ducks in a row ahead of the US flu season.

In a mini-spate of raising in the sector, pot play Cann Group (ASX:CAN) is also doing the rounds for $6.35 million, by way of a one-for-three rights offer at 4c apiece, with one attached option for every three shares held (exercisable at 8c within two years).

The 4c component is priced at a steep 53% discount to the average five-day price.

Last week dengue fever-zapper Island Pharmaceuticals (ASX:ILA) undertook a $3.5 million placement at 7c per share, an 11% discount, with one attaching option per share exercisable at the same price within one to two years.

While these raisings are relatively small, they’re consistent with the industry trend.

In fact, industry newsletter Biotech Daily estimates the sector raised $1.5 billion in the year to June 30 2024 and this year should exceed the record $2.182 billion raised in the 2020-21 year before the big freeze set in.

Lumos and Island shares were steady at 4.1c and 13.5c respectively, Cann Group shares lost 5% to 5.7c.

 At Stockhead, we tell it like it is. While Lumos, Orthocell and Island Therapeutics are Stockhead advertisers, they did not sponsor this article.

Originally published as Health Check: Lion City’s Orthocell approval provides a Singapore Sling-board to Asian markets