Closing in on first proprietary product

Collagen Solutions is a biomaterials company developing and manufacturing medical grade collagen components for use in medical devices, research and regenerative medicine. A number of investment initiatives have been introduced to accelerate the rate of growth, including global commercial infrastructure and development of a pipeline of finished medical devices, the first of which will be ChondroMimetic for repair of small cartilage lesions. Eight years after implantation, clinical outcomes with ChondroMimetic were at least as good as could be expected, and better than those published in the literature for alternative methods of cartilage repair.

• Strategy: Management has embarked on an investment strategy through a series of initiatives to increase the growth opportunities. This strategy is moving COS from a reliable, quality collagen supplier to one that also has proprietary products that will make it into profitable, and cash-generative, at a faster pace.
• ChondroMimetic: Best described as a clever, bi-layered and easy-to-use sponge that allows the regeneration of cartilage and bone, the product has good provenance having received CE Mark in 2008 and implanted into ca.600 patients. However, for reasons prior to COS’s ownership, the CE Mark lapsed.
• Eight-year outcomes: As part of the process of re-applying for CE Mark, 15/17 patients from the original trial in 2009-10 have been reassessed. The ChondroMimetic scaffold produced a sustained long-term regeneration of cartilage, undifferentiated from native cartilage, with improved clinical symptoms.
• Next steps: COS has initiated the submission for CE Mark, which will be supplemented by these data, allowing the re-issuance of CE Mark during 2H’18. Meanwhile, COS is continuing active discussions with potential commercial partners, on both a local (e.g. deal for South Korea) and more global basis.
• Investment summary: ChondroMimetic fulfils COS’s stated strategy to move further up the value chain. These exceptional eight-year clinical outcomes will significantly differentiate it from competing therapies. In order to maximise returns, COS needs to conclude commercial arrangements in readiness for a European launch in 2H’18, and with a strong partner capable of undertaking the trials needed to launch the product in the US.