Avita Medical (ASX:AVH) said yesterday that sales of its Recell device in the European Union were temporarily interrupted due to an administrative issue with its notified body and announced a new Japanese marketing and distribution deal.

The Valencia, Calif.-based company said that the sales interruption occurred after its EU-based notified body “reported open items related to administrative and procedural non-conformities,” but said that the action has no impact outside the EU and that issues are not related to product quality, safety or performance.

Avita said that it does not actively promote the product in the region and that activity there is limited to filling purchase requests as they are received, with an average of $40,000 in sales per month.

“It is important to note that this interruption is unrelated to the performance and safety of our products and does not impact the U.S. market. We will work closely with the authorities to close this administrative request as soon as possible, and no later than the 3rd quarter of calendar 2019. We do not actively promote in the EU at this time but do want to ensure that our products are available as soon as possible to those institutions who request it and to patients who can benefit from their use,” Avita CEO Dr. Mike Perry said in a press release.

In a separate release, Avita said that it inked a Japanese marketing and distribution deal with Cosmotec, who recently filed with the country’s Pharmaceuticals and Medical Devices Act, or JPMDA, for approval of Avita’s Recell system.

Avita said that the JPMDA has accepted the application for review and that the review is expected to take nine months to one year. Financial terms of the deal with Cosmotec were not released.

“The number of patients suffering from chronic wounds and decubitus ulcers is increasing in Japan due to aging. Japan is also planning for the Tokyo Olympic Games in 2020 and must be prepared for major disasters such as a large earthquake. We are very proud to add the Recell System to our product lineup. With over 30 years since our foundation, Cosmotec has been doing business in 90-100% of high acute care hospitals in Japan in the fields of cardiac surgery, vascular surgery, and wound care. As a member of the M3 Group, we can deliver the Recell System’s benefits to at least 90% of Japanese plastic surgeons and dermatologists through the portal site ‘m3.com.’ With this opportunity, we would like to contribute to the advancement of burn injury and wound care in Japan,” Cosmotec prez Kiyoshi Takei said in a prepared statement.

“We are very excited to partner with Cosmotec on the commercialization of the Recell System in Japan, a key global market. Cosmotec’s experience marketing medical devices and other products into hospitals and surgical suites throughout Japan, including specialties requiring a high level of training such as cardiovascular treatment, make them an ideal partner for us. We are also pleased that they are backed by the M3 Group, a major healthcare company with great physician access in Japan and other markets. The filing of the JPMDA application is a major milestone, and we look forward to making the Recell System available to patients in Japan,” Perry said in a press release.

Last month, Avita Medical reported raising approximately $14.4 million in a new round of equity financing, according to an SEC filing.

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