where do we go from now

Investment in Biotech, particularly a start-up company, is not without risk - at the end of the day it is all about generating positive cashflow.

According to Fool's Biotech checklist, biotech companies worthy of investment should have the following:

1. successful products on the market (CCE has a proven technology - don't really know why the uptake of the products is slow)

2. A deep product pipeline with late-stage candidates(CCE has number of products - CellSpray, CellSpray XP and ReCell)

3. Drugs and candidates that target large or underserved markets (???)

4. Partnerships and marketing agreements with blue-chip drug manufacturers (Should have taken this approach early rather going alone - profit will be shared but it is better than no earnings)

5. Research & development spending (this has been postponed on 29 March 2007 announcement)

6. Enough cash to fund operations for two years (as at 29 March 2007 announcement of a cash burn of average of $800,000 per month and around $13m - the cost cutting to reduce the the cash burn by more than 50% may help to arrest the cash burn - the cash reserve certainly will be less than 2yrs)

7. Experienced management (??? - let's see whether Andrew Cannon can pull it off in finding suitable licensors of the technology and partnership. I am not sure whether to continue to focus on building sales in selected number of high potential approved markets for ReCell will work. CCE will need to look for a blue-chip partners/alliances and to capitalise on their networks )

8. Favorable financial analysis (can't be determined - no earnings)

The ASX announcement dated 20 March 2007

The agenda

1. FDA: CCE is discussing with FDA to amend the protocol so that it will have the opportunity to treat more patients with the appropriate burn injury. As an example, if 10 patients come into a hospital for treatment, under the old protocol only 3 may have been eligible for inclusion. The changes to the protocol may now result in say 6 patients being eligible so CCE will hopefully increase the patients available for inclusion and therefore speed up the recruitment until we reach the 70 patients required. We will see how this will play out.

2. Finding partnerships and licensors: this may take time should have thought of this early than to go it alone - nevertheless it is a good start - reduce cash burn, tapping into the network of successful businesses of partners/alliances.

3. May sell the technology if every thing fails - but with no sustainable earnings it will be difficult to leverage for a better price for the technology.

4. Continue building sales on the existing approved markets for ReCell: Unless they know exactly the slow uptake issue and then they can rectify it - if not, it may be better to tap on the any good blue-chip partners/alliances to cross-sell their products.

Where do we go from now? it is a good question - nobody knows. May have to wait for another 6 to 9 months to see what comes out from its announcement.