Avita Medical (ASX:AVH) said today that it closed the $2.64 million deal for its respiratory business with Medical Developments International.
The division includes Avita’s Breath-A-Tech and Funhaler asthma spacers designed to optimize the use of medicinal puffers, marketed in Australian pharmacies. The buyout was announced in December 2015.
“With the sale of the respiratory business, we now have complete focus on our most valuable asset – our ReCell autologous cell harvesting technology,” CEO Adam Kelliher said in prepared remarks. “The sale proceeds will enable us to focus on our core commercialization and clinical goals, such as completing our ReCell FDA approval trial, currently underway in the U.S.”
The deal consisted of $2.2 million in cash plus 125,000 shares in Medical Developments International, escrowed for 6 months or $440,000 cash.
In September, Avita Medical said it won $53.9 million in contracts from the Biomedical Advanced Research and Development Authority for development and procurement of Avita’s ReCell autologous cell harvesting device.
The 5-year contract will provide an initial $16.9 million to support the company’s pursuit of FDA premarket approval for its ReCell device, and to procure more than 5,000 of the devices to establish an inventory to handle mass casualty scenarios that involve burn injuries, Avita Medical said.
Under the contract, Avita also has the opportunity to receive up to $37 million upon execution of specific contract options to further support clinical studies and post-market surveillance that could be potentially required by the FDA to expand the device to the pediatric population, the company said.