The TD Cowen's conference was based off the Q423 presentation so...

The TD Cowen's conference was based off the Q423 presentation so for ease of reference, I thought I'd post the salty summary on this thread in case it adds any additional insight for anyone here:

TD Cowen’s 44th Annual Health Care Conference
March 5, 2024 9:50 AM EST

Presented by David O’Toole (CFO)

Revenue Growth

• “From a growth perspective, we are looking to grow over the next 3-5 years at 50% YoY. And that’s going to fuelled by this larger expanded indication full-thickness skin defects as well as our legacy burn business”
• Current FY24 commercial revenue guidance of $78.5 to $84.5 million, 57% - 69% growth over FY23, does not include any revenue from PermeaDerm or any other product expansions “so that’s all upside at this point”
• [JPMH Conference - JC]: “We think the portfolio expansion is going to end up driving revenue growth, perhaps further than we are currently guiding to”

RECELL GO mini

• A large percentage of FTSD are for wound sizes that are <5% TBSA. Many of the surgeons are reluctant to use the standard device which is for a wound that is for 10% TBSA and costs $6,500.
• For smaller wounds, the DRG is less and therefore by using a device that is $6,500, it’s going to cause less profitability to the hospital. [Diagnosis-related group (DRG) is a system which classifies hospital cases according to certain groups,also referred to as DRGs, which are expected to have similar hospital resource use (cost).]
• In design phase of RECELL GO mini for these smaller wound sizes.
• “RECELL GO mini once it’s approved, we will determine what that cost will be, it will be something less than $6,500 but we haven’t made that determination yet”
• “The cost of goods sold will be exactly the same. So, the thought there is our gross margin will be less with RECELL GO mini but we’re going to make it up in volume because of the fact that there are so many significant smaller wounds in that expanded label, full-thickness skin defects.”

International Expansion

• Plan to expand exclusively through third-party distribution partners. Benefits of this strategy:

1. “Don’t have to outlay the cash to build a sales team”
2. “Local distributors know the hospitals, the reimbursement arena, and the KOLs” (key opinion leaders)
3. “We are obviously giving up margin when we are going through a distributor but at the same time, it’s a benefit because we’re getting margin dollars and with very little cost to get those dollars. Most of those dollars drop to the bottom line.”

• “We don’t see the revenue from international being significant this year (2024)”
• [Q4’23 Results Call - JC]: “2024 will be the year to get the foundation in place of all our distribution partners and 2025 will be where I think we see material revenue”

Product Expansion

PermeaDerm

• Product sells for around $0.80 - $1.20/cm2
• Example for a typical RECELL patient (10% TBSA): ~$2,000 of gross revenue with a 50:50 split with Stedical = Avita would net $1,000 which is all gross margin, and most of that would drop to the bottom line
• [Q4’23 Results Call - JC]: "The biosynthetic wound matrix of PermeaDerm fits so many more applications than RECELL. And often, when we’re selling RECELL or promoting it or discussing possible uses of it with a doctor, we might discuss several different patient indications and different patients before a RECELL is chosen to be used on a patient. But all of those patients will be candidates for PermeaDerm in this case. So, it will give our reps an opportunity to have many reasons to fulfill the needs of the customer.”

Dermal Scaffold

• “We’re in animal testing and are also in discussions with a number of dermal scaffolding opportunities. And we look to be able to announce that some time very soon with our next product expansion.”
• [Q4’23 Results Call - Jim Corbett]: “I think the dermal scaffold is a very important technology for us to invest in, and we’ve been researching that field and expect to find a suitable technology in the coming year.”

I don't think there's any point in trying to guess which technologies. Still, I can’t help wondering if any of these products are involved:

Based on the case studies that I’ve read, RECELL has been commonly used successfully with products from Integra, PolyNovo and Kerecis. I’m not sure they’d be wanting to partner with Avita though. In saying that, if the agreement is mutually beneficial, I won’t rule them out.

Vitiligo

“We don’t see this a being a revenue generator until sometime probably in 2026.”