Orthocell Ltd (ASX:OCC, OTC:ORHHF) has finalised a binding agreement with Marine Biomedical Pty Ltd, lifting its equity stake and securing strategic rights to a next-generation bone regeneration technology as it broadens its regenerative medicine portfolio.
The Perth-based company said it has increased its direct investment in Marine Biomedical from 1.72% to 11.7% for a total consideration of A$1.05 million, converting a previously announced memorandum of understanding into a formal commercial relationship.
As part of the agreement, Orthocell has secured a first right of refusal over distribution rights for Marine Biomedical’s bone substitute product PearlBone™, as well as any future bone repair and regeneration products developed by the company.
Expanding into bone regeneration
PearlBone is a bone substitute derived from sustainably sourced pearl shells from the West Australian Kimberley coast and is designed for use in orthopaedic, trauma and reconstructive surgery. Orthocell said the technology has promising applications in procedures where complex, multi-tissue injuries require coordinated regeneration of bone, nerve and soft tissue.
The deal adds a bone repair solution to Orthocell’s existing portfolio, which is currently focused on nerve and tendon repair products, and further positions the company as a multi-tissue regenerative medicine player.
Orthocell said the agreement allows it to leverage its established distribution networks, particularly in the United States, where it has relationships with specialist distributors and surgeons across orthopaedic and plastic surgery markets.
Chair John Van Der Wielen said the timing of the investment was deliberate, with Marine Biomedical approaching a key regulatory milestone with the US Food and Drug Administration (FDA).
“This partnership adds further value to Orthocell’s strategy by introducing a leading bone regeneration product that can be sold alongside Orthocell’s market-leading collagen device,” he said.
“PearlBone strengthens our biologically driven portfolio and positions Orthocell as a multi-product company spanning bone, nerve and tendon repair. This investment is sensibly timed for shareholders, given the impending FDA application, and we believe Marine Biomedical has the potential to become a large and successful biotechnology company in its own right.”
Regulatory pathway and market opportunity
Marine Biomedical is nearing completion of its pivotal study to support a US FDA 510(k) submission for PearlBone, which is targeted for the March quarter of FY26. Subject to regulatory clearance, the product would be positioned for entry into the estimated US$1.6 billion global bone substitute market.
Orthocell said Marine Biomedical is well advanced along its US regulatory pathway and that its team will continue to operate autonomously, with no significant internal resourcing commitment expected from Orthocell.
The company views PearlBone as a complementary offering to its existing collagen-based medical devices, particularly in trauma and reconstructive settings where surgeons often manage injuries involving multiple tissue types.
Balance sheet strength maintained
Orthocell said it retains a strong financial position following the transaction, with cash reserves of A$49.4 million as at the last reporting date. The company also expects to receive an R&D tax incentive refund of about A$3 million in the March quarter of FY26, which it said would support ongoing commercial expansion.
The announcement follows Orthocell’s recent efforts to scale its US presence, including the rollout of specialist distributor networks for its nerve repair product Remplir™ and continued progress towards broader commercialisation of its regenerative medicine platform.
Read more: Orthocell delivers record December quarter revenue
Governance considerations
Orthocell noted that managing director Paul Anderson, who is also a director of Marine Biomedical, abstained from board deliberations and voting related to the agreement in line with corporate governance best practice.
The company said the formalisation of the relationship strengthens its long-term strategy of building a diversified biologics portfolio, with bone regeneration now added alongside nerve and tendon repair as a key growth pillar.