C3 raises $10 million, readies for product launch

Clinical Cell Culture (C3; ASX: CCE) has completed an AUD$9.8 million placement to Australian institutional and sophisticated investors to help fund the company's expansion into European and US markets.

Approximately 23.4 million shares were issued at $0.42, a discount of slightly more than 10 per cent to Tuesday's closing price of $0.47.

The company has also announced a further $1.5 million worth of shares will be made available to existing shareholders through a share purchase plan, providing it with a total of $11.34 million in cash before costs if all shares are taken up.

"We are extremely enthusiastic about our future now with this money in the bank," said CEO Troels Jordansen.

Jordansen said the funds would primarily be used to launch the company's ReCell device in Europe, Australia, New Zealand, Japan and the USA. ReCell enables the harvesting a patient's own skin cells for processing and redelivery to a wound surface,

Jordansen said the company already had distributors set up in Europe, and the Asia-Pacific, and was in the process of finalising a distributor for Japan.

ReCell is likely to be launched in Europe in the first half of next year, after application for a CE Mark later this year.

The company's other product lines, CellSpray and CellSpray XP, which are both used to treat burns and other skin wounds, will be launched in Europe in the next few months.

C3 has also identified its path to market in the lucrative US market, Jordansen said. Because devices exist that operate on a similar basis to rapidly process a patient's cells for reapplication, the ReCell device can be registered under the 510(k) approval process.

"We expect to do a 510(k) submission in the first half of next year and get approval in the second half of next year," he said. "The alternative would have been a biologicals application, involving a trial of 200-300 patients, high costs and a long time to get to market."

A similar registration path will be followed in Japan.

The upside for C3 is that it expects to be cash positive within twelve months of launching ReCell in Europe in the first half of next year, says Jordansen, and the existing capital should be sufficient to carry the company through the next 18 months of expansion.

The company also has $12 million worth of options outstanding, some of which will expire at the end of this year, and some at the end of next year.

"We are optimistic that we will be able to get some proportion of this," Jordansen said. While one of the tranches of options is priced at $0.60, analyst reports from eG Capital and other groups have targeted share prices upwards of $0.80.