Avita Medical Ltd (RCEL)

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Avita's U.S. Trials May Hold Key To Re-Cell Adoption.

From lifescientist.com

Clinical trials funded by the US Department of Defense could give Avita Medical (ASX:AVH) the data needed to stimulate take-up of its ReCell spray-on skin product, says report.

Major US clinical trials of Avita Medical's (ASX:AVH) ReCell spray-on skin could provide the impetus needed to stimulate adoption of the technology in the medical community, a recent report suggests.

A feature published in OzEquities today questions why mainstream adoption of the ReCell technology – which involves using a patient's own skin cells to create a skin graft analogue without the risk of rejection or scarring at the skin graft site – has been such a long time coming.

OzEquities stipulates that rapid regulatory approvals and the immediate success and application of the technology may have hampered more widespread adoption.

The company originally set up to commercialise the skin culture technology, Clinical Cell Culture, pursued a strategy aimed at maximising the product's commercial availability. The underlying CellSpray technology has been approved in 40 countries.

ReCell has so far been used on more than 4,500 patients, including on victims of the Bali bombing in 2004.

But OzEquities suggests that targeting 40 countries at once with marketing efforts “rather than seeking out the approval of the handful of prestigious surgeons in a few leading hospitals in the developed world” could have been detrimental to take-up of the technology.

“The product was officially accepted in 40 countries. But take up by the medical profession, in the absence of trusted leading professional opinion, did not happen,” the report states.

Investors became disillusioned with Clinical Cell Culture's progress, and its share price sank. This led to the merger of the company with Visionmed and its renaming to Avita Medical in 2008.

Certainly ReCell has advantages compared to traditional skin graft surgery. The method requires just a 1cm2 sample of a patient's skin, can be performed within 40 minutes, and there is no danger of infection or creation of a secondary wound.

Yet the technology is yet to hit mainstream adoption in the surgical setting, perhaps due to the lack of formal trial data.

But major clinical trials on the horizon could provide the robust clinical data needed to stimulate adoption, OzEquities suggested. Avita Medical has received funding from the US Department of Defense to conduct trials of ReCell in burns and scar repair to support an FDA application for the technology.

Success in these trials, scheduled for 2013, could help Avita meet its goal of achieving critical mass for ReCell by 2014.

Avita Medical (ASX:AVH) shares were trading unchanged at 13c as of 2:30pm on Friday. Wilson HTM has a price target of 39c on the shares.