Tissue Therapies to dump $1.4m of old inventory, raising $7.7m...

Tissue Therapies to dump $1.4m of old inventory, raising $7.7m as it looks to cut out EU delays

• LIAM WALSH
• THE COURIER-MAIL
• FEBRUARY 04, 2015 10:37PM

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Tissue Therapies is among Queensland’s biotechnology companies.

TISSUE Therapies will dispose of $1.4 million worth of its wound-healing substance as it battles European delays.

The move is a cost-saving measure. It cuts storage fees for older product that Brisbane-based Tissue said could still actually be used but faced relabelling problems.

The aim is to bring in “newly manufactured product with current labelling to the market when approval for sale in (Europe) is achieved”, said Tissue’s accounts, released on Wednesday.

The move was detailed as Tissue planned to raise $7.7 million via institutional investors and current shareholders.

The fundraising is at 21c a share, a 36.5 per cent discount to recent stock prices. Tissue closed down 3.5c at 25.5c.

For the past three years, Tissue has blamed bureaucratic delays for repeatedly missing guidance for getting European regulatory clearance. It hopes for approval this year.


Tissue’s technology, VitroGro, helps heal wounds such as horrid ulcers.

The company now will push ahead with a US approvals and trials, deciding to “uncouple” such steps from getting the green light for European sales.

“We need to move,” Tissue chief executive Steven Mercer told The Courier-Mail.

Risks highlighted in a capital-raising presentation included the possibility of more delays.

Tissue posted a $5 million half-year loss, steeper than the $3.3 million loss from year earlier.

The latest loss included the $1.4 million impairment charge for inventory that will be dumped, and is a non-cash hit.

Tissue had in its previous accounts argued the carrying value of VitroGro inventory was recoverable.