Recent Highlights
- FDA approval of RECELL® System for the
treatment of acute thermal burns in adults
- Commencement of U.S. commercial sales
and shipments
- Clinical results demonstrate patient
benefits and cost savings in multiple conference presentations
- Expansion of commercial and
manufacturing capabilities to support U.S. launch of RECELL
System
AVITA Medical (ASX: AVH, OTCQX: AVMXY), a global regenerative
medicine company, announced that it filed today with the ASX its
Appendix 4C - Quarterly Cash Flow Report for the quarter ended 30
September 2018. Provided below is an update on the substantial
accomplishments achieved during the first fiscal quarter, including
the September 2018 approval by the U.S. Food and Drug
Administration (FDA) of the RECELL® System for the treatment of
patients with acute thermal burns.
FDA Approval to Market RECELL System in the U.S. and First
Commercial Shipments
On 20 September 2018, the FDA approved the RECELL System for the
treatment of acute thermal burns in patients 18 years and older.
The FDA approval allows the Company to commence marketing the
RECELL System in the U.S., the largest market in the world for the
treatment of burns.
“The importance of our approval cannot be overstated, not only
for AVITA Medical but for the burn community. The RECELL System was
the first Premarket Approval (PMA) application for the treatment of
burns approved by the FDA in over 20 years,” said Dr. Michael
Perry, Chief Executive Officer. “We believe that the approval will
allow us to significantly advance the standard of care for the
treatment of severe burns and greatly improve outcomes for
patients.”
Less than a month after FDA approval the Company received the
first commercial sales orders from multiple U.S. burn centers for
the RECELL System and commenced commercial shipment of the product.
The national commercial launch of the RECELL System is not
scheduled to occur until after the completion of hiring and
training of the Company’s field sales force, which is currently
underway. Of the 134 burn centers in the U.S., 24 already have
experience using the RECELL System through participation in
clinical trials and the Compassionate Use and Continued Access
programs. Notably, these 24 burn centers are estimated to treat
more than 30 percent of the U.S. burn patients annually. A number
of the larger burn centers experienced with the RECELL System have
commenced incorporating the product into their practices in advance
of AVITA Medical’s market launch.
RECELL System Clinical Results Prominently Featured in
Conference Presentations
During the first quarter of fiscal 2019 the body of clinical
data supporting the RECELL System combined with support from key
opinion leaders resulted in the presentation of clinical results at
multiple scientific conferences. These presentations continue the
substantial exposure the RECELL System has received at burn and
other scientific conferences throughout 2018 and have greatly
increased the awareness and credibility of the product among burn
care professionals. Recent conference presentations include:
- U.S. Defense Department Military
Health System Research Symposium (August 2018): Results from
the two U.S. pivotal clinical trials supporting the FDA approval
were presented at this premier U.S. military conference. The
results demonstrated that treatment of acute burn wounds with the
RECELL System used substantially less donor skin than required with
conventional split-thickness autografts to achieve closure of burn
wounds, meeting the primary endpoints of both trials.
- 46th Annual Eastern Great Lakes Burn
Conference (September 2018) and Midwest Region Burn
Conference (October 2018): The results of two U.S. pivotal
clinical trials were presented demonstrating the effectiveness and
clinical benefits of the RECELL System. In addition, medical
symposiums were conducted by key opinion leaders at each conference
as the first step in training U.S. physicians within these regions
who had not previously treated patients with the RECELL
System.
Commercial and Manufacturing Preparations for Planned U.S.
Launch of the RECELL System
Among the major investments made by AVITA during the quarter
were substantial efforts to prepare for the U.S. market launch.
These initiatives included the commencement of the recruitment of a
field sales team experienced in regenerative medicine and in the
treatment of burns, completion and assimilation of extensive direct
market research, establishment of pricing and reimbursement
strategies and support infrastructure, and going live with our
customer service team within a business day of FDA approval.
During the quarter the Company also commenced and successfully
completed multiple production runs for the RECELL System within its
newly acquired manufacturing facility in Ventura, California.
Effective July 1, 2018, AVITA Medical acquired the facility from a
Fortune 500 manufacturer that had previously assembled the RECELL
System on a contract basis. The manufacturing runs were performed
after AVITA Medical’s takeover of the facility and represent the
first production activities undertaken by the Company’s own
manufacturing and quality control personnel. This operational
milestone enabled the Company to fulfill the sales orders that were
received shortly after FDA approval, as well as clinical trial and
internal sales requirements.
Funding for the development of the RECELL System was provided by
the Biomedical Advanced Research and Development Authority (BARDA),
under the Assistant Secretary for Preparedness and Response, within
the U.S. Department of Health and Human Services, under ongoing USG
Contract No. HHSO100201500028C. Programs discussed above which were
funded under the BARDA contract include the two randomized,
controlled clinical trials, the Compassionate Use and Continued
Access programs, the PMA and related activities, development of the
health economic model demonstrating the cost savings associated
with the RECELL System and two randomized, controlled clinical
trials which will evaluate the RECELL System in the pediatric
population. Also included in the Contract is future procurement of
the RECELL System by BARDA under a vendor-managed inventory system
to bolster preparedness by providing availability for use in a
national disaster.
First Quarter Fiscal 2019 Financial Results
(Unaudited)
(All amounts are in thousands of AUD except where noted)
A copy of the Appendix 4C - Quarterly Cash Flow Report for the
quarter ended 30 September 2018 is attached. Operations for the
quarter were focused primarily on preparation for the U.S. launch
of the RECELL System, limited commercial sales efforts in selected
markets in which the RECELL System is approved for sale, and
preparation for the further clinical development of the RECELL
System. Commercial sales of the RECELL System in the U.S. had not
commenced as of 30 September 2018.
During the quarter ended 30 September 2018, total cash receipts
were $4,476, an increase of $2,265 or 102% over the prior quarter
ended 30 June 2018. Total cash receipts for the quarter ended 30
September 2018 were comprised of receipts from customers of $347
and cash received from BARDA totalling $4,129. Through 30 September
2018, cumulative payments of $20.66 million have been received
under the BARDA contract.
As the result of investments in commercial, manufacturing,
leadership and system capabilities for the U.S. launch of the
RECELL System and related product and corporate initiatives,
payments related to operating expenses increased during the first
quarter of fiscal 2019. During the quarter ended 30 September 2018,
payments for research and development, manufacturing and operating
costs totalled $2,551, a $1,176 or 86% increase compared to the
quarter ended 30 June 2018. Total payments related to commercial,
staffing, administrative and corporate costs for the current
quarter totalled $6,809, a $147 or 2% increase compared to the
quarter ended 30 June 2018. As AVITA Medical undertakes the launch
of the RECELL System in the U.S. and expands research and
development, payments for operating expenses will increase in
future quarters. These expense payments will be partially offset by
receipts under the BARDA contract and receipts from customers.
Total net cash used in operating activities during the quarter
ended 30 September 2018 was $3,820, a $1,184 or 24% decrease
compared to the quarter ended 30 June 2018. The current quarter
decrease in net cash used in operating activities resulted from the
increase in total cash receipts partially offset by the increase in
payments for operating expenses.
During the quarter ended 30 September 2018, net proceeds
provided by an institutional placement of shares to international
and Australian institutional and sophisticated investors was
$3,041. Cash and cash equivalents held at 30 September 2018 was
$14,122.
Future cash requirement will be dependent upon the success of
AVITA Medical’s efforts to commercialize the RECELL System,
particularly in the U.S., and the timing and magnitude of clinical
and other research and development programs the Company elects to
undertake to expand its product pipeline. Until such time that the
Company generates sufficient cash flow from operations, it expects
to fund its future cash requirements through a combination of
current cash resources, issuance of shares and potentially debt
financing.
ABOUT AVITA MEDICAL LIMITED
AVITA Medical is a regenerative medicine company with a
technology platform positioned to address unmet medical needs in
burns, chronic wounds, and aesthetics indications. AVITA Medical’s
patented and proprietary collection and application technology
provides innovative treatment solutions derived from the
regenerative properties of a patient’s own skin. The medical
devices work by preparing a REGENERATIVE EPIDERMAL SUSPENSION™
(RES™), an autologous suspension comprised of the patient’s skin
cells necessary to regenerate natural healthy epidermis. This
autologous suspension is then sprayed onto the areas of the patient
requiring treatment.
AVITA Medical’s first U.S. product, the RECELL® System, was
approved by the U.S. Food and Drug Administration (FDA in September
2018). The RECELL System is indicated for use in the treatment of
acute thermal burns in patients 18 years and older. The RECELL
System produces Spray-On Skin™ Cells using a small amount of a
patient’s own skin, providing a new way to treat severe burns,
while significantly reducing the amount of donor skin required. The
RECELL System is designed to be used at the point of care alone or
in combination with autografts depending on the depth of the burn
injury. Compelling data from randomized, controlled clinical trials
conducted at major U.S. burn centers and real-world use in more
than 7,000 patients globally, reinforce that the RECELL System is a
significant advancement over the current standard of care for burn
patients and offers benefits in clinical outcomes and cost savings.
Healthcare professionals should read the INSTRUCTIONS FOR USE -
RECELL® Autologous Cell Harvesting Device for a full description of
important safety information including contraindications, warnings
and precautions.
In international markets outside of Europe, our portfolio is
marketed under the RECELL System brand to promote skin healing in a
wide range of applications including burns, chronic wounds and
aesthetics. The RECELL System is TGA-registered in Australia, and
CFDA-cleared in China.
In Europe, our portfolio of medical device products received
CE-mark approval as three tailored product presentations, with
three individual brand names. The RECELL Autologous Cell Harvesting
Device is designed for the treatment of burns and plastic
reconstructive procedures; REGENERCELL™ Autologous Cell Harvesting
Device has been formulated for chronic wounds including leg and
foot ulcers; and RENOVACELL™ Autologous Cell Harvesting Device is
tailored for aesthetic applications including the restoration of
pigmentation.
To learn more, visit www.avitamedical.com.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This letter includes forward-looking statements. These
forward-looking statements generally can be identified by the use
of words such as “anticipate,” “expect,” “intend,” “could,” “may,”
“will,” “believe,” “estimate,” “look forward,” “forecast,” “goal,”
“target,” “project,” “continue,” “outlook,” “guidance,” “future,”
other words of similar meaning and the use of future dates.
Forward-looking statements in this letter include, but are not
limited to, statements concerning, among other things, our ongoing
clinical trials and product development activities, regulatory
approval of our products, the potential for future growth in our
business, and our ability to achieve our key strategic, operational
and financial goal. Forward-looking statements by their nature
address matters that are, to different degrees, uncertain. Each
forward- looking statement contained in this letter is subject to
risks and uncertainties that could cause actual results to differ
materially from those expressed or implied by such statement.
Applicable risks and uncertainties include, among others, the
timing of regulatory approvals of our products; physician
acceptance, endorsement, and use of our products; failure to
achieve the anticipated benefits from approval of our products; the
effect of regulatory actions; product liability claims; risks
associated with international operations and expansion; and other
business effects, including the effects of industry, economic or
political conditions outside of the company’s control. Investors
should not place considerable reliance on the forward-looking
statements contained in this letter. Investors are encouraged to
read our publicly available filings for a discussion of these and
other risks and uncertainties. The forward-looking statements in
this letter speak only as of the date of this release, and we
undertake no obligation to update or revise any of these
statements.
+Rule 4.7B
Appendix 4C
Quarterly report for entities subject to Listing Rule
4.7B
Introduced 31/03/00 Amended 30/09/01,
24/10/05, 17/12/10, 01/09/16
Name of entity Avita Medical Limited
ABN
Quarter ended (“current quarter”) 28 058 466 523 30
September 2018
Consolidated statement of cash flows
Current quarter$A’000
Year to date(3
months)$A’000
1. Cash flows from operating activities
1.1 Receipts from customers 347 347 1.1a Receipts from government
contract (BARDA) 4,129 4,129 1.2 Payments for (a) research and
development (1,526) (1,526) (b) product manufacturing and operating
costs (1,025) (1,025) (c) advertising and marketing (1,933) (1,933)
(d) leased assets (152) (152) (e) staff costs (3,513) (3,513)
(f) administration and corporate costs
(1,211) (1,211) 1.3 Dividends received 1.4 Interest received 44 44
1.5 Interest and other costs of finance paid 1.6 Income taxes paid
1.7 Government grants and tax incentives 1,020 1,020 1.8 Other
(provide details if material)
1.9
Net cash used in operating activities
(3,820) (3,820)
Consolidated statement of cash
flows
Current quarter$A’000
Year to date(3
months)$A’000
2. Cash flows from investing activities
(340)
(340)
2.1 Payments to acquire: (a) property, plant and equipment (b)
businesses (see item 10) (c) investments (d) intellectual property
(e) other non-current assets 2.2 Proceeds from disposal of: (a)
property, plant and equipment (b) businesses (see item 10) (c)
investments (d) intellectual property (e) other non-current assets
2.3 Cash flows from loans to other entities 2.4 Dividends received
(see note 3) 2.5 Other (provide details if material)
2.6
Net cash used in investing activities
(340) (340)
3. Cash flows from financing activities 3.1 Proceeds
from issues of shares 3,250 3,250 3.2 Proceeds from issue of
convertible notes 3.3 Proceeds from exercise of share options 3.4
Transaction costs related to issues of shares, convertible notes or
options (209) (209) 3.5 Proceeds from borrowings 3.6 Repayment of
borrowings 3.7 Transaction costs related to loans and borrowings
3.8 Dividends paid 3.9 Other (provide details if material)
3.10 Net cash from financing activities
3,041 3,041
Consolidated statement of
cash flows
Current quarter$A’000
Year to date(3
months)$A’000
4. Net increase in cash and cash equivalents for the
period 4.1 Cash and cash equivalents at beginning of
quarter/year to date
14,825
14,825
4.2 Net cash used in operating activities (item 1.9 above) (3,820)
(3,820) 4.3 Net cash from used in investing activities (item 2.6
above) (340) (340) 4.4 Net cash from financing activities (item
3.10 above) 3,041 3,041 4.5 Effect of movement in exchange rates on
cash held 416 416
4.6 Cash and cash equivalents at
end of quarter 14,122
14,122
5.
Reconciliation of cash and cash
equivalentsat the end of the quarter (as shown in the
consolidated statement of cash flows) to the related items in the
accounts
Current quarter$A’000
Previous quarter$A’000
5.1 Bank balances 14,122 14,825 5.2 Call deposits - - 5.3 Bank
overdrafts - - 5.4 Other (provide details) - -
5.5 Cash and cash equivalents at end of quarter
(should equal item 4.6 above) 14,122
14,825 6.
Payments to directors of the entity and
their associates
Current quarter$A'000
6.1 Aggregate amount of payments to these parties included in item
1.2 (256) 6.2
Aggregate amount of cash flow from loans
to these parties included in item 2.3
6.3
Include below any explanation necessary to
understand the transactions included in items 6.1 and 6.2
6.1 Executive Director remuneration (164k), Directors fees (64k),
Clinical Advisory Board fees (11k), and Bioscience Consultancy
(17k)
7. Payments to related entities of the
entity and their associates
Current quarter$A'000
7.1 Aggregate amount of payments to these parties included in item
1.2 7.2 Aggregate amount of cash flow from loans to these
parties included in item 2.3 7.3 Include below any
explanation necessary to understand the transactions included in
items 7.1 and 7.2
8.
Financing facilities available
Total facility amountat quarter
end$A’000
Amount drawn atquarter
end$A’000
Add notes as necessary for an
understanding of the position
8.1 Loan facilities 8.2
Credit standby arrangements 8.3 Other (please
specify) 8.4
Include below a description of each
facility above, including the lender, interest rate and whether it
is secured or unsecured. If any additional facilities havebeen
entered into or are proposed to be entered into after quarter end,
include details of those facilities as well.
9. Estimated cash outflows for next
quarter $A’000 9.1 Research
and development 1,300 9.2 Product manufacturing and
operating costs 500 9.3 Advertising and marketing 1,200 9.4 Leased
assets 125 9.5 Staff costs 4,100 9.6 Administration and corporate
costs 750 9.7 Other (provide details if material)
9.8
Total estimated cash outflows*
7,975
* Pertains to outflows only, inflows from customer receipts and
government contracts, which totalled $4,476 for the quarter ended
30 September 2018, are not included.
10.
Acquisitions and disposals of business
entities(items 2.1(b) and 2.2(b) above)
Acquisitions Disposals
10.1 Name of entity
10.2 Place of incorporation or registration
10.3 Consideration for acquisition or disposal
10.4 Total net assets 10.5 Nature of
business
Compliance statement
- This statement has been prepared in
accordance with accounting standards and policies which comply with
Listing Rule 19.11A.
- This statement gives a true and fair
view of the matters disclosed.
Dale SanderDale SanderChief Financial Officer31
October 2018
Notes
- The quarterly report provides a basis
for informing the market how the entity’s activities have been
financed for the past quarter and the effect on its cash position.
An entity that wishes to disclose additional information is
encouraged to do so, in a note or notes included in or attached to
this report.
- If this quarterly report has been
prepared in accordance with Australian Accounting Standards, the
definitions in, and provisions of, AASB 107: Statement of Cash
Flows apply to this report. If this quarterly report has been
prepared in accordance with other accounting standards agreed by
ASX pursuant to Listing Rule 19.11A, the corresponding equivalent
standard applies to this report.
- Dividends received may be classified
either as cash flows from operating activities or cash flows from
investing activities, depending on the accounting policy of the
entity.
+ See chapter 19 for defined terms1 September 2016
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FOR FURTHER INFORMATION:US MediaSyneos Health
Public RelationsChristian PflaumerPhone +1-212-229-8412Nicole
BeckstrandPhone
+1-858-431-9611AVITAMedicalTeam@syneoshealth.comorOUS
MediaMonsoon CommunicationsSarah KemterPhone +61 (0)3
9620 3333Mobile +61 (0)407 162
530sarahk@monsoon.com.auorInvestors:Westwicke
PartnersCaroline CornerPhone
+1-415-202-5678caroline.corner@westwicke.comorAVITA Medical
LtdDale A. SanderChief Financial OfficerPhone
+1-661-367-9178dsander@avitamedical.com
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