OCC (ASX) Media thread

Originally posted by saltland: ↑

While we wait for the new investor presentation to be released, I thought I'd share screenshots from the JP Equity Investor Briefing in case it's helpful for anyone. I've also included some of my thoughts, notes and miscalculations.

“Current analyst risk-adjusted valuations per share of $0.90 and $1.28”:

18 April 2023 | Veritas Securities Ltd | Analyst Report - https://orthocell.com/wp-content/uploads/2023/04/Veritas-Note-OCC_180423.pdf
13 June 2023 | Petra Capital – ‘Providing innovative tools for surgical success; Buy, A$1.21tgt’ – Analyst, Tanushree Jain

Not many institutional investors yet (4%) - hopefully, coming soon.

"Paul and the team have done a great job recently in raising the profile of the Company with institutional investors through the initiation of coverage by two Sydney based broking firms. My role is to assist Paul and the team in consistently promoting the Orthocell story and increasing the percentage of stock held by high quality investors. I believe we present a compelling investment case, and we are starting to gain traction with some high-profile investors buying on market. There is more work to do, but we are clear on the path ahead to optimise the share register, and what it will take to drive upward pressure on the stock price." - JVDW

Australian reimbursement approval granted at AU$1,354 per unit in November 2022
Prescribed List of Medical Devices and Human Tissue Products

BioHorizons and ACE Southern are replacing their previous product in the U.S., which already has 20% market share, with Striate+.
Sounds to me like the revenue ramp up to 20% market share could be rapid if it’s a relatively straight forward transition.

"EU/UK on track to exceed initial unit guidance"
Not sure what the initial unit guidance was, but another revenue stream has commenced and should start to show up in the Q2'24 results.

Striate+ Global Wholesale Revenue Breakdown based on 20% Market Share:
US: AU$50M x ($300M/$727M) = AU$20.6M
EU/UK: AU$50M x ($180M/$727M) = AU$12.4M
AU/NZ: AU$50M x ($34M/$727M) = AU$2.35M
Current Total = AU$35.35M p.a.

Canada: AU$50M x ($34M/$727M) = AU$2.35M (FY25+)
Brazil: AU$50M x ($65M/$727M) = AU$4.5M (FY26+)
Japan: AU$50M x ($114M/$727M) = AU$7.8M (FY26+)
Future Total: AU$50M p.a.

BH and ACE will be aiming to increase market share with Striate+ (superior product to competitors) so there’s potential for the future recurring revenue to be >AU$50M.

“We believe that BioHorizons chose Orthocell over other membranes due to evidence that Striate+ performs better than incumbent products, in particular the popular Bio-Gide. The Bio-Gide membrane has been used in over 2 million patients over the past 20 years according to its website which if replicated could earn Orthocell >$80m of revenue, on our estimates.” – Veritas Securities

“Protect” and “cap” look like new additions to the corporate deck - could explain the some of the “fantastic insights” and increase from 11,780 to 39,200 estimated procedures in Australia?

PA: AUS launch is providing “fantastic” insights into how the company is going to approach the U.S. marketplace.

Remplir Global Wholesale Revenue Breakdown based on 20% market share:
AU/NZ: AU$255M x ($35M/$2250M) = AU$4M
Current Total: AU$4M

US: AU$255M x ($1602M/$2250M) = AU$182M (CY25+)
EU/UK: $255M x ($613M/$2250M) = AU$69M (CY26+)
Future Total: AU$255M

Looking forward to seeing the other upcoming catalysts too.

PA: “I think this company is undervalued and is really heading somewhere”
I get the feeling that the journey to "somewhere" will involve happy patients, doctors, partners, and shareholders.

Expand

Axogen, Stryker and Integra have non-suture solutions, and 10 % of US market.

Axogen is the marked leader of that pack, and reports "double digit" growth. It seems to offer a porcine "wrap" style product.

Yet OCC says broadly and without citing evidence that all 3 have exhibited "sub-optimal outcomes".

Perhaps some of these 3 are active in Aus and surgeons have been able to compare with Remplir?

Any insights into this key competitive boast by OCC?

And how is TAM estimated, when 90% of the market is suturing, and presumably much lower cost?