I thought that yesterday’s AGM format was a great idea. All the speakers were impressive and helped provide a deeper understanding of various facets of the business.
The following is drawn from my notes.
Dr. Marcus Wagstaff – Adult Burns and Plastic and Reconstructive Surgery, Royal Adelaide Hospital, PolyNovo Medical Advisory and Shareholder
Dr. Wagstaff was keen to point out that BTM is now widely seen as standard of care and that as surgeons have become more confident in its use, they are using it more often and more widely. He commented that when surgeons move to new units, they want to take BTM with them. There was some discussion between Dr. Wagstaff and David Williams regarding use of BTM in war zones. It was mentioned that BTM was brought voluntarily into Ukraine by British surgeons. It seems to have gone well, because Ukraine surgeons are now asking for more supply. Dr. Wagstaff said there are 2000 patients in Ukraine waiting for this tech. It appears that there is also demand in the current Middle Eastern conflict. DW indicated that there are various organisations that are helping with funding.
When asked which product he anticipated would be leading the way at PolyNovo in 5 years’ time, Dr. Wagstaff nominated Novosorb use in ulcers because he thinks it does such a great job in this application.
Dr. Wagstaff is an author of a published article reporting results of a pilot study in Adelaide in which BTM was used in the reconstruction of DFUs.
Ahmed Hassan – Director of Operations
When Ahmed Hassan arrived at PolyNovo last year, the company was manufacturing 1,000 devices per month. With the opening of PolyNovo’s second facility late last year, and other improvements in operational efficiency, the rate has increased to 10,000 devices per month, with capacity to manufacture 170,000 devices per year at the current two shifts and to 200,000+ by adding a third shift. A co-located new manufacturing facility, currently being designed and due to be operational in CY26, will have an annual capacity of 500,000 devices.
Ed Graubart - Sr. Vice President, Sales and Marketing, US & Canada
Ed Graubart responded to a question about agreements with US GPOs. I believe he said that the GPO agreements are up for negotiating every 3 years and that the company is negotiating with several major GPOs, but any agreement will have to be mutually beneficial. Any new GPO agreements should be known by mid-next year.
Graubart stated that sales focus in the US isn’t on burns but on trauma, and specifically mentioned that hundreds of limb amputations are performed every day in the United States.
Dr. Anand Shastri – CMO, India
The delightful Dr. Shastri said that Novosorb BTM was one of just two new technologies he had seen during his 35 years as a surgeon that he considered to be “transformative”. He was genuinely excited by the product, describing its results as phenomenal, with benefits including return of function, reduced need for rehabilitation, better scar outcomes, a shorter learning curve for medical staff and a significantly lower price. First sales have already happened in India, to private hospitals. Sales in public hospitals in India occur via a tender system, with the cheapest tender always the winner. Tenders have already been submitted and BTM is known to be the lowest-priced of the tenders submitted. Dr. Shastri expects that it will not be too much longer until the first successful tenders are announced.
Dr. David McQuillan - R&D/ Chief Technical and Scientific Officer
I think that most shareholders would agree that slow progress in R&D has been one of PolyNovo’s weakest points over the past few years. Just over a year ago, Dr. McQuillan moved from a directorship position at PolyNovo to lead R&D development at the company. Since then, his team has increased from 4 to 14. The company is also said to have engaged with “world leaders in textile engineering, hernia mesh development and manufacturing, as well as experts in breast reconstruction”.
The increased focus and allocation of resources to R&D seems to now be yielding dividends. The team seems to have finally settled upon preferred hernia product designs with the development of a new knitted polymer mesh material product suitable for use on its own as well as in a product where it is combined with BTM.
The existing range of BTM and MTX options is also being expanded with line extensions of different sizes and widths for different applications and also incorporation of antimicrobial coating.
In 5 years’ time, Dr. McQuillan envisages that BTM will remain PolyNovo's flagship product but that hernia and breast products will be gaining traction.
PNV Price at posting:
$1.30 Sentiment: Hold Disclosure: Held
(20min delay)