Tissue Regenix: Poised for growth

Hardman & Co

Tissue Regenix Group plc (LON:TRX) is focused on the development and commercialisation of two proprietary processing technologies for the repair of soft tissue (dCELL) and bone (BioRinse). It has a broad portfolio of marketed regenerative medicine products for the biosurgery, orthopaedics and dental markets. In the past two years, the focus has been on its commercial strategy, restructuring to service demand, and commencing a capacity expansion programme in its US facilities. Phase 1 of the expansion programme has been completed, which, together with the potential return of elective surgeries following the pandemic, positions TRX well for growth and profitability.

  • Strategy: TRX is building an international regenerative medicine business around its proprietary technology platforms, underpinned by compelling clinical outcomes. Work has begun to expand production capabilities, enabling the business to grow its distribution networks, via strategic partnerships, to drive sales momentum.
  • Capacity expansion: Phase 1 has been completed through the creation of a new freezer facility (3x capacity) and by moving the distribution and supporting staff into the new facility. This has freed up space in the existing facility to add two new clean rooms, which have come on stream on time and on budget.
  • Positioning: Through its established network of relationships and distributors, there is strong underlying demand for TRX’s products. The 50% increase in manufacturing capacity will be coming on stream around the time that there is expected to be a return in elective surgeries, positioning TRX for 2H’21 growth.
  • Risks: The main risk is predicting the timing and pace of recovery from the global pandemic, as well as a recovery in the number of elective surgeries. While all the signals are pointing in the right direction, there can be no certainty that this will occur during 2021. Consequently, TRX is maintaining a cautious stance.
  • Investment summary: Tissue Regenix Group has a portfolio of innovative regenerative products with regulatory approval in both the US and EU. Realignment of its commercial strategy to maximise sales through strategic and distribution partnerships has been successful, resulting in increased demand for its products. TRX is scaling up its manufacturing capacity to meet this pending demand, leaving it well positioned to deliver sales growth when surgeries return, which should result in a re-rating.

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