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Why the AVITA Medical share price stormed 6% higher today

The AVITA Medical Ltd (ASX: AVH) share price was one of the best performers on the local market during the last financial year.

During the period the regenerative medicine company’s shares rose an incredible 500%.

The good news for shareholders is that the company’s shares have started how they finished and raced even higher today.

At the time of writing the AVITA share price is up 6.5% to 44.7 cents.

Why is the AVITA share price storming higher again today?

This morning the company announced positive results from an open-label feasibility study of the RECELL Autologous Cell Harvesting Device (RECELL System) for the treatment of diabetic foot ulcers (DFUs).

According to the release, the data evaluated the clinical performance of the RECELL System, which uses a small amount of a patient’s own skin to prepare Spray-On Skin Cells at the point-of-care, in patients with DFUs that had not responded to standard care treatments.

The release explains that the 26-week, single-arm, observational study included 16 patients treated at three hospitals in the United Kingdom, including the Manchester Royal Infirmary, Kings College Hospital, and Northwick Park Hospital.

Patients enrolled in the study had chronic DFUs ranging in size from 5 to 33 centimetres squared that had failed to heal with standard-of-care treatments.

The study found that 100% of the patients experienced a reduction in DFU wound size following treatment with Spray-On Skin Cells, with an average wound size reduction of 83% at week 26.

Furthermore, 50% of the patients had DFU wounds heal completely, with a median time to healing of 14 weeks, despite the range of severity of ulcers.

And finally, the treatment using the RECELL System provided an acceptable safety profile and received high patient and physician satisfaction scores.

AVITA Medical’s Chief Executive Officer, Dr. Michael Perry, was pleased with the study results.

He said: “We are pleased with the results of the diabetic foot ulcer feasibility study, which demonstrate the potential versatility of the RECELL System as a meaningful treatment option to heal chronic wounds. AVITA is committed to continued exploration of how this innovative regenerative technology may further advance patient care in areas with significant unmet medical need.”

This certainly could be a lucrative market for the company’s RECELL System. Management revealed that National Institute of Health data shows that approximately 25-30 million global diabetics suffer from DFUs.

Other positive performers at this side of the market today include Medical Developments International Ltd (ASX: MVP) and Paragon Care Ltd (ASX: PGC) shares which are up 5% and 8%, respectively, in afternoon trade.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Medical Developments International Limited and Paragon Care Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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