PERTH, Australia – Australian regenerative medicine company Orthocell Ltd. saw its stock shoot up 350% on Australia's Securities Exchange (ASX:OCC) last week following interim results of its nerve regeneration trial that saw patients regain sensation and muscle function following Celgro nerve regeneration treatment.

Orthocell CEO Paul Anderson told BioWorld Asia that four patients with severe nerve damage experienced an 83% improvement in muscle power two years post-surgery using the Celgro collagen medical device scaffold and have returned to work and daily activity.

Before the treatment, those patients had suffered traumatic peripheral nerve injuries following car accidents, sports injuries or work-related incidents, resulting in complete paralysis or impaired use of their upper limbs. Patients had significant pain and were unable to perform basic activities of daily living, Anderson said.

Celgro is a collagen medical device scaffold that augments the surgical repair of damaged or degenerated tissue. The product acts as a scaffold that works with the tissues' own endogenous cells, or cells can be added to it.

"This bioactive chamber wraps around the nerve and not only protects it from the outside world but it enhances the repair mechanisms internally," Anderson said.

The nerve study is 75% complete, and the four patients that completed the study "have shown outstanding recoveries with high-quality tendon and nerve repair, predictability and consistency in the outcome and a regaining of the motion and motor and sensory nerve functions."

"It's a fantastic indication in what is a very tricky clinical area that is providing tensionless nerve repair and predictability of the outcome," he added.

The current standard is for surgeons to cut a damaged nerve, cut out the dead section and then rejoin it to another nerve, but outcomes are unpredictable.

Rather than suturing the nerve back together, the collagen medical device is a "soft but strong natural biological collagen sheet that enables us to do tensionless nerve repair," he said. "That means we don't have to use all these sutures in the scaffold to wrap around the nerve. It's very adhesive, so it sticks to the nerve, and it also creates a shield from the outside world, effectively reducing scar tissue formation that impedes healing."

"The surgery can be very complex and difficult," according to Alex O'Beirne, the surgeon who conducted the operations at St. John of God Subiaco Hospital at the University of Western Australia.

Using Celgro "enabled us to rejoin severed nerves without tension. Celgro increase the strength and quality of the repair and makes surgery easier," he said.

Patients were measured using the British Medical Research Council Grading System, with a score of zero to five, with zero indicating an inability to contract the affected muscle, and five indicating an optimal result where the newly regenerated nerve has restored full power of affected muscles.

Before the surgery, the first four patients scored a muscle power of zero with complete paralysis or significant difficulty in performing daily activities. Following Celgro treatment, all four scored a muscle power of four, representing an 83% improvement.

"These patients represent a large economic cost to the community, and they're not able to do the normal things that we able-bodied people take for granted like picking up our kids," Anderson said.

"This nerve repair study has "de-risked our portfolio. It's our belief that most of the products on the market are fundamentally not fit for purpose," he added.

Orthocell's biggest competitor uses a neural tube that is rigid and lacks flexibility and, although it protects the nerve, it doesn't enhance the nerve repair, he said.

In the U.S. alone, more than 20 million people suffer from peripheral nerve injury every year with an annual cost of roughly $150 billion, according to Orthocell. That market is estimated to be worth about $1.1 billion per year.

Celgro is already approved in the European Union for guided bone regeneration to repair bone in the jaw.

Last week, Orthocell submitted an application to Australia's Therapeutic Goods Administration (TGA) for regulatory approval of Celgro in Australia for bone and soft tissue regeneration. Having approval in a major market in the EU allows the company to get an abridged assessment with the TGA, because it already holds an ISO 13485 accreditation. That means the TGA will conduct a desktop approach, truncating the review.

"We hope to have approval in six months," he said.

Anderson said Orthocell has completed presubmission meetings with the FDA, and the agency guided the company on what was needed for submission, including a large animal study that has been completed.

Autologous stem cell therapies

Orthocell also has successfully commercialized two autologous cell therapies for treating damaged and degenerated tendons (Ortho-ATI), as well as damaged and degenerated cartilage (Ortho-ACI). Ortho-ATI is available in Australia and New Zealand for patients who have failed conservative treatment options such as corticosteroid injections and exercise programs and have ongoing symptoms.

The Australian company signed a partnership with Depuy Synthes Products for its Ortho-ATI stem cell technology for regenerating tendons and ligaments. That deal was facilitated by Johnson & Johnson Innovation in early 2017. (See BioWorld Today, Jan. 25, 2017.)

The Ortho-ATI intervention uses a patient's own tendon progenitor cells to stimulate the formation of collagen and other connective tissue elements. Those cells are taken from the tendon and cultured in a GMP facility in Western Australia where the volume of cells is expanded and then injected back into the patient via an ultrasound-guided method.

In clinical trials, the stem cell therapy has shown significant pain reduction and functional improvement in a range of different tendons. Clinical data at up to five years post intervention continue to demonstrate significant improvement in pain relief and function.

"From a technology perspective, we've de-risked this technology and validated the market, which allows us to engage heavily on a global stage," Anderson said. "We're not a medical device company; we're a regenerative medicine company. Unlike many of the other companies on the market that have developed collagen scaffolds or other synthetic scaffolds .... ultimately, it's the cellular interaction and the tissue integration that speaks to the quality of the tissue repair and regeneration.

"Regulatory approval in a major market validates our manufacturing system, and Orthocell has attracted key opinion leaders in Europe who are acting as advocates for the product," he added. "We're beginning to get some market traction as well in bone repair, tendon and nerve, and we are finally on the radar on the large end of town in relation to these technologies."

Orthocell's shares were trading at AU64 cents (US44 cents) on the ASX at market close Tuesday. The company has a market cap of AU$77.3 million.