Tissue Regenix: QuickView

Tissue Regenix is achieving excellent clinical results with its decellularised medical devices – natural human or porcine tissues with all cells and DNA removed. In vascular dCELL patches, stem cells rapidly colonise grafts. However, showing clear superiority takes time. Human heart valve grafts show good performance in Brazilian trials. In a human dermal dCELL graft pilot study, 45% of leg ulcers healed within six weeks. The business is well funded with £26m cash and is commercially run with
vascular patch EU sales expected to start in FY14.

Invasion Of The Stem Cells: EU Sales Expected In 2014
The dCELL vascular patch is CE marked and sales are expected from FY14. In the US, a regulatory route is in FDA discussion. Solid data was presented from Yale where a dCELL porcine vascular graft in rats showed rapid stem cell infiltration. Established commercial products are Teflon (PTFE) based. It was not clear what clinical endpoint might show superiority. A better market could be dialysis patients where the connection grafts have high 60% failure rates; a pilot study is under way.

Brazilian Valves -- An Ongoing Beat
The Ross Operation replaces a diseased aortic valve with patient’s pulmonary valve. The dCELL human valve has been used to replace the reused right pulmonary valve; 141 patients have been trialled in Brazil to date. A specific aortic human valve is also being tested with 41 patients. A decellularised human valve, SynerGraft, is available in the US from Cryolife. Big companies, like Medtronic, provide porcine valves such as the Mosaic, which dominate the $1bn market. dCELL valves might compete in the smaller market for younger patients and teenagers; partners are being sought.

Leg Ulcers: Skin Deep Product
Although 70% of ulcers heal with compression therapy (Ripon 2007), about 20% are resistant. A dCELL human skin patch has been in a 20-patient pilot study where 45% of ulcers had healed after six weeks; six-month data is due Q4. A UK registry may start in 2013. A porcine dermal study starts H113 with sales by 2016.

Valuation: Good Science But Ignores Timing And Sales Risks
Tissue Regenix has good science and, so far, the products look excellent. Key sensitivities are time to market, especially in the US, and proving clinical superiority but the equity market seems to be disregarding these risks and pricing in massive potential sales. A 2012 equity issue gave 31 July cash of £26.1m for development.

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