TIDMRUA
RNS Number : 8940T
RUA Life Sciences PLC
20 November 2023
20 November 2023
RUA Life Sciences Plc
("RUA Life Sciences", the "Company" or the "Group")
Strategy Update
RUA Life Sciences plc (AIM: RUA.L), the holding company of a
group of medical device businesses focused on the exploitation of
Elast-Eon(TM), the world leading long-term implantable biostable
polyurethane, is pleased to provide an update on developments
within the group businesses and the Board's priorities for the
future development of RUA and the funding of its key R&D
projects.
RUA Contract Manufacture
The strategy review undertaken by the Company 18 months ago
resulted in the business focussing on larger opportunities,
particularly in the areas of de-risking client's supply chain
issues which became apparent during Covid. The business unit is
progressing just such an opportunity at present but more
importantly has recently responded to a formal Bid Request for a
product range directly within RUA's implantable textiles sweet spot
that has annual revenue potential of around GBP1.5 million. Another
customer is expected to submit a bid request in the next few months
at a value of around GBP500k. The progression of sales discussions
into formal bid processes gives the board confidence that the
Company is on track to meet its objective of doubling the scale of
the Contract Manufacture business in the medium term.
RUA Structural Heart
Structural Heart is exceeding management's expectations with
regards to the development and testing of the Company's novel
composite material for the creation of heart valve leaflets. The
composite which benefits from Elast-Eon's biostability and blood
contacting properties is designed to improve the durability of
flexible leaflet heart valves. Recent testing results have
surpassed key milestones.
-- flex fatigue testing for durability passed 400 million cycles
equivalent to 10 years in man.
-- a heart valve made of the composite has achieved the key 200
million cycles required by ISO standards for a flexible leaflet
heart valve.
-- hydrodynamic testing demonstrated valve efficiency around 50%
better than current technology.
-- valve flow area is around 25% larger than similar sized valves in the market.
-- Recent patent filing to protect the new IP entitled "
Composite Material, Heart Valve and Method of Manufacture".
Rather than incur the full cost of developing a valve directly,
our strategic focus is now to accelerate the commercial potential
of RUA Structural Heart by making the composite available to the
heart valve industry for incorporation into next generation valves.
The Company expects to shortly formalise an agreement to provide
composite material to a large heart valve company for its own
testing and now that an attractive data pack is available on the
composite, RUA intends to broaden this further through the
industry..
RUA Vascular
RUA Vascular has now reached the stage of being fully prepared
to commence the regulatory testing regime agreed with the FDA
through the pre-sub process to achieve 510k approval. In
summary,
-- a product has been developed on which in vivo data has been
gathered along with in vitro mechanical testing.
-- an automated manufacturing process established, and a pilot manufacturing plant set up.
-- the manufacturing process has attractive cost of goods
analysis, is highly scalable and allows for positive gross margin
potential.
-- the products have already developed OEM customer interest
with the first commercial sale recently achieved.
-- a global distribution partnership has also been put in place
to allow a simplified route to market.
The outstanding workstreams relate in the main to a GLP animal
study to gather two additional intermediate time points as well as
the six-month data collected in the original study, together with a
relatively small clinical study of up to 120 patients with the
performance goal set at six month follow up.
Depending upon time of starting recruitment for the clinical
studies and speed of recruitment, a timeframe to regulatory
approval of between 30 and 36 months and a budget of approximately
GBP6 million is expected.
However, given the current cost of capital and funding of the
business, the Board believes that it is in the best interests of
shareholders to not seek to fund these trials itself but explore
other options for third party funding in the near term.
We believe that the Vascular project has very attractive risk
adjusted returns on the additional investment required to achieve
regulatory approval. The limiting factor however is the cost of
capital placed upon RUA because of the depressed share price. Not
only would dilution relate to the interest in the Vascular project
but the substantial upside potential from both RUA Contract
Manufacture and RUA Structural Heart would be limited for current
shareholders. The investment in RUA Vascular will be exploited by
seeking third party funding whilst retaining an interest in the
project.
The change in strategy has dramatically reduced the future
funding requirements of RUA and the recent developments at both RUA
Contract Manufacture and RUA Structural Heart have provided
opportunities and a pathway for the Group to reach profitability
and cash generation in a significantly shorter timeframe.
The information communicated in this announcement contains
inside information for the purposes of Article 7 of the Market
Abuse Regulation (EU) No. 596/2014.
For further information contact:
RUA Life Sciences
Bill Brown, Chairman Tel: +44 (0)1294 317073
Caroline Stretton, Group Managing Tel: +44 (0)1294 317073
Director
Cavendish Capital Markets Limited Tel: +44 (0)20 7397 8900
(Nominated Adviser and Broker)
Giles Balleny/Dan Hodkinson (Corporate
Finance)
Charlie Combe (Broking)
Michael Johnson (Sales)
About RUA Life Sciences
The RUA Life Sciences group was created in April 2020 when RUA
Life Sciences Plc (formerly known as AorTech International Plc)
acquired RUA Medical Devices Limited to create a fully formed
medical device business. RUA Life Sciences is the holding company
of the Group's four trading businesses, each exploiting the Group's
patented polymer technology.
Our vision is to improve the lives of millions of patients by
enabling medical devices with Elast-Eon (TM) , the world's leading
long-term implantable polyurethane. Whether it is licensing
Elast-Eon (TM) , manufacturing a device or component, or developing
next generation medical devices, a RUA Life Sciences business is
pursuing our vision.
Elast-Eon(TM)'s biostability is comparable to silicone while
exhibiting excellent mechanical, blood contacting and flex-fatigue
properties. These polymers can be processed using conventional
thermoplastic extrusion and moulding techniques. With over 8
million implants and 15 years of successful clinical use, RUA's
polymers are proven in long-term life enabling applications.
The Group's four business units are:
RUA Contract Manufacture: End-to-end contract developer and manufacturer
of medical devices and implantable fabric
specialist.
RUA Biomaterials: Licensor of Elast-Eon (TM) polymers to the
medical device industry.
RUA Vascular: Commercialisation of open surgical vascular
grafts and patches
RUA Structural Development of polymeric leaflet systems
Heart: for heart valves.
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END
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