Good morning everyone, and thank you for joining the Orthocell webinar. My name is Haley Chartres from H^CK HQ. I am pleased to host today's session and to introduce you to our speakers on the line today, Orthocell CEO and MD, Paul Anderson, Orthocell CFO, Mr. Jim Piper, and CCO, Adam Wood. Shortly, they will provide an overview of the company's results along with an operational update, including the status of the U.S. rollout of Remplir and other strategic initiatives. As always, questions are invited and encouraged throughout the webinar. Should you wish to ask a question, please use the written Q&A facility at the bottom of your screen, and we will be checking those throughout the session. Please welcome Orthocell CEO and MD, Paul Anderson, to start us off.
Thanks, Haley. Thanks for the introduction, and thanks to you all for your participation today. Delighted to see so many investors and potential investors on the call, and really hopeful today we will give you some further clarity on the progress and significant progress that we are making, not just in the United States, but really across the globe. Firstly, as Haley mentioned, we are going to be joined today by Jim, our CFO, and Adam, our Chief Commercialization Officer. But I did want to make an apology. Our Chairman, Mr. John Van Der Wielen, is traveling in Europe at the moment and was unable to join us, but he does send his apologies. Without further ado, we will share the presentation. Just Orthocell at a glance, just for those who perhaps are not completely over the story or are new to the story.
Orthocell, a regenerative medicine company focused on musculoskeletal injuries with a particular focus on our premium product, Remplir, for the regeneration of human nerve tissue. It is a unique product. It has a unique value proposition, and has really had fantastic traction here after introduction in the Australian market, and now a really growing following in the United States. And we are going to demonstrate to you today just some of that fantastic progress that we are making. Really important to note that we have AUD 39 million in the bank, which enables us to have the continued investment in the U.S. sales growth. It is enabling us to expand our manufacturing facility from the capability of around 100,000 units per year to over 350,000 units per year. So we are really excited about that capacity. We are excited about the automation and the optimization that is going along with that.
Really important to note, and one of the big take home messages from today is that the Remplir U.S. strategy is on track, and we continue with our global foundation, and global expansion with a global footprint. But what is really important, and we will go through this as we go through the presentation, that the key commercial metrics are demonstrating growth with sales and continue to build. So, surgeons, hospitals, and unit sales are progressing, and of course, our E.U., U.K. clearance processes continues to be underway. I think what is really important to note is that these are large markets. We have the most advanced product in that market. And we have seen from a global Remplir sales perspective in the September quarter, a growth of 20% quarter-on-quarter. And that is in the markets that we are currently approved to sell in Australia, New Zealand, U.S., Canada, Singapore, Hong Kong, and Thailand.
With the U.K. and E.U. to follow. Many of you may be familiar with this Lassonde curve. It is a curve that is used more in the mining industry, in the mining parlance, but has a lot of really direct relationship to who we are and what we are doing. What we saw was some fantastic lead up work with the introduction of our product into the Australian marketplace. We saw great uptake. We are now on every public hospital shelf. We are in just about every private hospital in the country. We saw that tremendous advancement in conjunction with our FDA clearance, really saw a very solid share price. I guess what we have seen since then is the market has this voracious appetite and expectation for revenue. These are large markets. They are somewhat complex in their market access scenario.
The first 14 months that we have been in market have really been about securing market access, and we are talking about getting the FDA approval, we are talking about state licenses that follow that. We are talking about value analysis committees for each hospitals and hospital groups, and now into the group purchasing organization scenario. We have laid this incredible foundation of market access, and Adam Wood will talk a little bit about that as we go through the presentation. We are now really seeing ourselves with growing revenues, not just globally, but most importantly in the U.S., growing numbers of surgeons and growing numbers of hospitals. We really believe now that we are at this revenue inflection point that is going to enable us to demonstrate a continued consistent growth in that market. I mentioned that we have seen globally an increase in 20% quarter-on-quarter sales of our product.
Even beyond that, when you isolate that down into the U.S., we see the unit sales have increased by 25% quarter-on-quarter. We are now starting to get some real traction from a revenue perspective following all this market access scenarios that we have followed. We are now beginning to get sales in the Singapore, Hong Kong, and Thailand markets, continue to put resources into that, but we still have a laser focus on that U.S. market. That global footprint is a very important part. Just by way of example, why Hong Kong? It is a smaller market. Hong Kong potentially gives you access to the greater Bay Area in China, some 120 million people. It is a strategic piece with Hong Kong. Singapore is the gateway to Asia.
Thailand, you may be surprised or not, but they have a tremendous background in nerve repair and are regarded as some of the world leaders. On top of that, from a pipeline perspective, we have got some really exciting news that we have released to the market just recently around our prostatectomy usage for radical prostatectomy, and I will talk a little bit about that as we go through the presentation. I think what is really important to note, and I think there has been some reaction in the market, is that we have seen a slight decrease in our quarter-on-quarter revenue. That is very explainable, and I am going to go through that. What has happened there is that we received from our partners, BioHorizons, some very large orders in the last quarter.
Those large orders were designed to support international growth in their markets with new markets such as Ecuador and Colombia and others. That was out-of-the-box orders that bumped that revenue up, and we are seeing a normalization and a correction there. What is really important here is not a differential of AUD 200,000 in revenue caused by significant Australia orders, but the 21% growth quarter-on-quarter for Remplir U.S. sales. We have increased the number of units that we have sold by 25% over the quarter. We have increased the number of hospitals that we now have access into, and conversely, we have increased the numbers of surgeons that are now using our product. So 21% growth quarter-on-quarter in revenue, 25% growth in units sold, and a 22% growth in surgeons.
These are key metrics that really enable us to use the monies that we have at hand now to really invest in the U.S. market to continue to grow the sales that we see. You can see here that when we are talking about this larger month that we had here, stimulated by some large orders out of BioHorizons globally, and we have now seen a normalization of that. The important metrics for us to understand here is the significant growth that we are starting to see now in the U.S. market from our revenues on a quarter-by-quarter basis, and 21% quarter-on-quarter U.S. Remplir sales growth is a real testament to the fact that surgeons are liking what they are using. They are repeat users. We are getting new hospitals every day, new distributors, and Adam is going to talk in a lot more detail about that significant progress that we are making.
I think there has been a little bit of conjecture around the use of our product in radical prostatectomy. First and foremost, I want to be very clear that this falls under the current indication. This radical prostatectomy usage of Remplir is a new application within the current indications. Remplir is indicated for the use in peripheral nerve repair. Radical prostatectomy falls into that, as does many and most of the nerve repair surgeries that are outside of the spine. First and foremost, this is a new application, not a new indication. Secondly, the measurements of success for these patients come after around one year post-operatively, and it has taken some time for us to get our first five patients at one year. This is a pilot study.
This is a pilot that is designed to give us a read on how we are going with the outcomes, and we are delighted to report to the market that we had 80% of patients demonstrated encouraging urinary continence outcomes. For the surgeons to comment that this has happened sooner than they have expected is a really exciting outcome. The fact that three of four patients were able to demonstrate a return to erectile function, again, is some really exciting indicators that this technology and this product, Remplir, has a real role to play in radical prostatectomies. Finally, I just wanted to mention that these were an exceptionally difficult group of patients. They all had comorbidities that perhaps inhibited their progress as well. This is a really tough group. All patients underwent extensive removal of tumor tissue. We saw 80% demonstrate urinary continence outcomes and 75% erectile function.
What this does is lays the foundation for us to do a larger, more extensive study of around 130 patients that will give us a much stronger efficacy read. This is not about reimbursement. This is not about the overall efficacy. This is really just showing us that we have a tremendous application here. There is great utility. It is easily used. It does not delay the surgery. It provides hemostatic qualities and protects the nerves, and we have done over 300 of these cases and procedures within the Australian marketplace. Very important to understand this is a new application, not a new indication. Without further ado, I want to hand over now to Jim Piper, our Chief Financial Officer, and Jim will walk us through some of the numbers. Thanks, Jim.
Thanks, Paul. Just the key takeaway is that Orthocell's cash position remains strong and supports the current phase of commercialization. Importantly, we closed the quarter with AUD 39 million in available funds, and cash performance was in line with our internal expectations. Cash spending is driven by normal operating activities, the impact of working capital movements, and the continued focus and investment in the commercialization of Remplir within the U.S. We are well-funded to support the manufacturing capacity upgrades and optimization initiatives. While the expected AUD 3 million of expenditure remains to be incurred, it is incorporated into our monthly modeling and control frameworks. As we continue executing our growth initiatives, our discipline investment program remains focused on two key objectives driven by the commercial adoption of Remplir and the expanding manufacturing capacity.
As Paul said, the planned investments over the coming quarters are expected to increase production capacity by approximately three to four times current levels, positioning this business to meet anticipated future demand in the future years. Importantly, these initiatives are already incorporated into our funding outlook and support our pathway towards cash flow breakeven. We remain confident that we have sufficient capital to execute the strategy with no expectations of additional funding at this stage. I will hand it back to you, Paul.
Thanks, Jim. Thanks for that synopsis. Again, just really wanted to emphasize what a fantastic position we are as a company with this unique offering, global approvals, a growing uptake of the technology within the United States, and the ability for us to invest in our manufacturing capability, to invest in our sales and marketing activities, and to really drive this exciting technology forward. For the first time at these webinars, I want to welcome Adam Wood to the webinar. Adam is our Chief Commercial Officer. Adam comes with quite some international experience with product launch and commercialization activities in Australia, Asia, and in the United States. Adam has really added really strongly to our team, bringing some fantastic domain knowledge to be able to really engage with our distributors, and to be able to work wholeheartedly on the global expansion program.
Has been a real joy to have Adam on board. I really look forward to introducing Adam to you. Thanks, Adam.
Thanks, Paul, and thank you for the opportunity to present to you all this morning. My name's Adam Wood. I'm the Chief Commercial Officer here at Orthocell. What I'd like to do is just take a few moments to talk you through some of the key measures of activities and also results on behalf of the commercial team. I'll also take the opportunity to highlight some of the leading indicators that we're seeing that, in my experience, are really good predictors for future growth of a commercialization project. As a reminder, the commercial team is very much focused on the U.S. market opportunity, and that's for one simple reason is that it is the largest healthcare market in the world. It's also a mature nerve repair market with over 700,000 peripheral nerve injuries occurring every year.
When faced with a big market, it's really important that your team has focus in order to achieve its goals. Our goal is to achieve a 10% market share of this market by focusing on short gap and non-transected nerve repairs. You may have heard previously Paul talking about this. This really highlights a unique property of Remplir in that we have a single product that has applications across multiple procedure types. It puts us in a real position of advantage. Also for context, it's important to remember that the American population is roughly 10 x- 12 x that of Australia. So it's a really significant market. As we zoom in on the U.S. and we think about where those densities of population exist, there's really four major states that we are focused on. We're thinking about Florida, California, Texas, and New York.
We've had a partner in Florida for a long time, and we also now have three partners in California as distributors. These two areas contribute to unit sales that you see today. I am really excited to report as part of our activity program that we've been able to sign a statewide distributor in Texas and also a distributor in New York City. Why does this matter? When we talk about distributors, they are independent business people, so in a way, they are choosing you as their partner. When we approach a distributor with the prospect of representing Remplir, they will go to their key surgeons, the surgeons that they have relationships with, and seek an opinion as to whether the product will provide clinical benefit in their practice. They also consider whether this product adds to their existing product portfolio and whether it's worth their investment in time.
When we see signatures from such high caliber distributors in the market in these large states, it really validates the program that we have with Remplir, and also the clinical value of the product. Because behind these signatures sit a number of surgeons ready and willing to use the product. We've had a number of other activities across the different areas of our commercial team, sales, medical education, and marketing, which continue to build this momentum of the commercial program. I'll just call out a few highlights for me that have stood out most over the quarter. In total, we now have three new distributors in quarter 1, Texas and New York, as I mentioned, and also Chicago. These are significant geographical areas that we now have coverage and representation. We've also hired two direct sales team members.
These are Orthocell team members, and critically, their job is to partner with distributors to bring them up to speed on Remplir as quickly as possible and help enable sales in their territory. Both of these folks come with experience in the orthopedic industry and also come with them relationships with surgeons that Orthocell otherwise wouldn't know. So there's a real advantage to having these people on our team when we think about the future growth profile. In the past, we've talked a lot about our market access program. We've had a big focus on value analysis committees, which give you access to one or sometimes multiple hospitals. In the first quarter, we were able to sign our first national contract. That's with an integrated delivery network or IDN, which is a large group of hospitals.
Again, this validates the commercial strategy that sits behind Remplir in providing clinical and economic benefit to hospitals. This contract will come into effect in November and provides a significant opportunity for the team in quarter two and beyond. Our medical education program has always been another big focus of ours because we understand that we need to invest in teaching surgeons how to use Remplir in the most effective way to give them confidence to use it with their patients. It's important to note at this point that July and August are typically quiet periods in the U.S. because it's their summer holidays. So we didn't have as many activities run this quarter as we otherwise typically would have. Where we are focusing our attention at the moment with education is cadaveric workshops and labs. We spent a big proportion of FY 2026 creating awareness of the product.
What we are doing now is focusing on converting that awareness into the application of Remplir, giving surgeons hands-on experience with the product so they can then implant it confidently in their patients. Fortunately for us, it also allows a greater measurement of return on investment from these events, because you typically see surgeons coming away from labs and then using the product because their interest has been validated before attending the event. The outcome of that activity is that we onboarded 17 new surgeons in the first quarter, which is a great effort by the team and something that we are very proud of. I do want to note, however, that a lot of those surgeons came late in the quarter.
When you reflect on new surgeons compared to unit sales, the new surgeons weren't necessarily represented in total unit sales, but they've given us a really strong exit run rate from September, and we're seeing that momentum build into October and future sales, which is really exciting. The majority of our sales, roughly 80%, came from repeat usage or existing customers, which is also a good sign for us as well. Remplir is performing as expected, and surgeons are willing to use it multiple times. 80% of the business is coming from repeat users. That's a really good indicator of success. It minimizes customer churn, which really matters at this stage in a commercialization project.
Number of hospitals continues to grow as well, and you'll start to see a divergence between the number of surgeons and the number of hospitals, because we will be expanding our footprint in a hospital. This is maybe the first quarter where we've been able to report that divergence where we have a number of surgeons and relatively fewer hospitals. It is important to note, however, that we do have surgeons operating at multiple hospitals. You do have a Remplir user that may be a single surgeon at three hospitals, which is the counter to that measure, just for your information. The measure that I'm most proud of, though, to report to you in terms of what it means for the future of Remplir in the U.S. is the figure at the bottom with regards distributor coverage.
We finished FY 2026 at 50% coverage of the U.S. population, and we set ourselves a target in FY 2027 to achieve 80%. At the end of quarter one, with those significant distributor signings ahead of schedule, we now sit at 70% coverage of the U.S. population. That is an incredibly strong foundation to accelerate growth into FY 2027, as we're ahead of schedule in terms of having sales people representing the product in the market. If we look at some of these measures quarter-on-quarter, you can see continued steady growth across all measures, as Paul Anderson mentioned before, hospitals, surgeons, and significantly, unit sales.
It's worth repeating, though, that unit sales are benefiting from new customers, but the true value of those customers has not been realized in the first quarter because those surgeons were onboarded late due to the summer holiday break in the U.S., which gives us great excitement moving forward into the second quarter. We don't talk about these initiatives as much in terms of digital marketing, but we talk a lot about distributors. I just wanted to touch on what we're doing to provide assistance to our distributors in a digital context. The advantage for these tools for us as a company early in its phase is it gives us a really scalable, cost-effective way to create awareness of the product. We've launched a new website, a distributor portal, and a surgeon hub to give information to our stakeholders in real time to give confidence around Remplir.
Significantly, these platforms enable us to run digital marketing campaigns as well to drive engagement at physical events. This is very much a partnership when we think about how we are promoting Remplir in the U.S. Really, the key event for us to end on in the first quarter from a promotional point of view was the American Society for Surgery of the Hand. You can think of this event as the Super Bowl for nerve repair surgery. Every company and all of the key surgeons are in attendance at this event, and I can tell you that our team, the Orthocell team, left this conference with incredible confidence around the product and what the future of this commercialization program could mean for the company. The reason for that was surgeon engagement, quite simply.
As you'll see on the slide, we had over 250 new and existing surgeons having meaningful conversations with us. We had a number of different forums they could engage with us. We had a trade display or a booth where we collected 90 qualified leads for follow-ups. We ran an innovation forum. An innovation forum is an invitation event where surgeons speak to their experience with Remplir to educate the audience as to how it's fitting into their clinical practice. We are very grateful to have some key opinion leading surgeons from the U.S. talk at this forum, and a thank you to Doctors Brogan, Dawn, Morgan, and Lee, who all shared their experience at this event around how Remplir is having an impact for their patients.
I think most significantly when we think about the lead indicator for future success, we had over 30 surgeons attend our surgical lab. A surgical lab is an event that you can run at the conference where you can do cadaveric exposure to Remplir's product and teach surgical techniques. The reason why 30-plus surgeons matters here is because there's a lot of other options at the conference for surgeons to go and do. For them to give up their time to attend this lab demonstrates there's a genuine interest in the product, and they are looking at ways of understanding better how Remplir can fit into their practice. A thank you to Doctors Dawn, Valerio, and Hoyen, who were our faculty at that event.
I think as an Australian company, it's worth pausing to reflect the significance that just a year into our commercial launch, we now have an entirely American key opinion leading surgeon panel delivering these events. That's really impactful at a local level because they're seeing from their peers validation that Remplir is a product that they should also be considering using. As a salesperson, you always hope that the surgeons use your language when describing your product. It means that they really believe in your scientific narrative, and they can see that value for their patients. That's exactly what we saw in the innovation forum.
This is exciting for us because as, again, a lead indicator for success, it validates what we are saying to surgeons about the benefit of the product, and it shows incredibly strong surgeon engagement from U.S. surgeons critically, and it mirrors what we saw in Australia and New Zealand. Again, confidence for the future is what we take away from this. Commercializing a medical device is a complex, multidimensional project. It is challenging. At the heart of that project will always sit a product. That will always be the key to success. In another way, if the product is providing benefit, you've got a really big head start on success, and that's exactly what we're seeing with Remplir validated by these surgeons.
Just in closing, I'll just leave you with three thoughts for me, what I took away from the first quarter that gives me confidence that we're on the right track in the U.S. and Remplir is gaining traction. Number one, we have significant attendance at our events from surgeons. Surgeons are busy people. They only attend events that they're genuinely interested in. Surgeons are giving up their time to learn about Remplir. They want to understand how it can fit into their clinical practice. Number two, our surgeon engagement is really, really strong. We see messages on a weekly, if not daily basis, from customers to our U.S. team emphatically expressing their joy of using Remplir. It genuinely makes procedures easier. It improves clinical outcomes, and intraoperatively, it's a great product to use.
Surgeon engagement is really strong from our existing customers, and we continue to see new customers onboarding to the product. That's a really strong indicator for success. Last but by no means least, our distributor network, our footprint, and ultimately our sales team. We've been able to grow that sales team representation significantly ahead of our expectations. That is the foundation for growth. Having the coverage across the population gives you the opportunity to start to see compound returns on effort, and that's what I hope I'll be here to tell you about in future webinars as we continue to grow our presence in the U.S. with Remplir. Thank you for your time.
Thanks, Adam, for that really complete and thorough update. I think it's also worth noting that momentum is a really, really important part of this process. You can't buy momentum, you have to grow it. Market access is a really important part of that. I think it's fair to say that the market expected us to perhaps have more revenue at this stage. Certainly there has been some headwinds that we face in relationship to the VAC approvals and in particular state licensing. But that market foundation work, that market access work is now complete. The education programs we're running are world-class. The surgeons that we have on board are outstanding. We've seen, as I mentioned, a 21% growth in our U.S. revenue. We've got some fantastic indicators. The December quarter is looking great. October is really reflective of all this momentum that we're gaining.
I think it is fair to say that there has been some headwinds, some delays in getting some of that market access, but most of that is now behind us. Hopefully you can see today that there is a significant amount of momentum which is building around this product and certainly building around the recognition of who we are as a company. The fact that we have an outstanding scientific narrative. We are now known as the company with the science in the U.S., and a product that matches the rhetoric, a product that makes surgeons' jobs easier. It makes patient outcome more predictable and more consistent, and it shortens surgery time. Basically, the product enables the payers to be happy. Lots of value analysis committee approvals. The payers understand the price leverage with our product. It is important that the surgeons are happy.
The tactile feel of this product, the moment you put it into a surgeon's hands, they recognize that it is special. They recognize that it is different. So give them access to the hospital system, give them access to the payers, and they will use our product, and we are starting to see that with those increased revenues. It is an exciting phase for us. We are seeing, and probably the most important cohort is successful patient outcome continue to replicate what we have seen here in Australia and other regions. We are really excited about the next phase for us. As I mentioned, the foundations for growth are in place. We have a U.K. distributor of the highest order ready to go. We have achieved first sales. We have appointed a Thailand distributor, and we have had our first sales in Thailand.
These are really busy activities, and we are really looking forward to elucidating further our prostate data. Expanding our manufacturing facility to enable us to have no roadblocks for manufacturing, to be able to continue on and really absorb this fantastic momentum that we are having from a manufacturing perspective. Important to note, so important for us to own that manufacturing. We own our manufacturing margin. We own that intellectual property, which is really important. We continue to work on other markets, the E.U. and U.K., as we have mentioned. We have got our pipeline product in SmrtWrap is in preparation for our pre-submission meeting with the U.S. This is a really exciting product, another derivation from our platform for tendon repair, a product that can go straight into our current distributor network.
Not only are we building a distributor network and market access for Remplir, we are also conversely building market entry for our SmrtWrap for tendon repair. We look forward to giving further U.S. operations, and seeing so many of you on the webinar today really encourages us to continue to provide information via this sort of scenario. Remplir publications and evidence generation and, as I mentioned, a global update. Lots of activities to come, lots of really exciting milestones. But most importantly, I think what you are going to see is an increase in our revenues quarter on quarter for Remplir in the U.S. commensurate with what our thoughts and plans are. Without further ado, that is probably enough from me, and I will hand back over to Haley Chartres to marshal questions from the floor, please.
Thank you, Paul, Adam, and Jim. If Jim and Adam would like to jump back on the line too, just so we can see your faces as we move through the questions. Thank you to everybody for your engagement on the line. We have lots and lots of questions to get through and lots and lots of attendees on the line today, which is a great sign of engagement with Orthocell the company. Just to dive in, Paul, this is not unexpected, but one question is, you have spoken many times about hockey stick growth, and that's what the market is waiting for. This has been much slower than expected. In practical terms, is such growth and OCC even approaching cash flow breakeven years away?
Look, I think it's really important to note that to get a hockey stick growth, you have to have access to the market. If you don't have access to the payers and the hospitals, then you don't get a hockey stick. So this first 14 months of us being in market has really been about market access. The state licensing, for instance, you need a home state license. That took some three months to get. We then have seven of the largest states all requiring licensing, and New York, who's just come through, took up to a year for us to get that license. There has been some headwinds with regards to getting access to the market. But what we're seeing now, and as you can see evidenced through Adam's presentation, is great surgeon engagement. Lots of hospitals now have the capacity to use our product.
GPOs, which are now coming on board, that's group purchasing organizations which have access to multiple hospitals. So, we now really believe that the momentum is genuine. The surgeon engagement has been outstanding and second to none. And we're expecting to see significant and material revenue growth over the coming quarters.
Well, thanks, Paul. And a question perhaps here for Jim. There is an estimate of achieving cash flow breakeven from 6,000 Remplir product sales. Could you clarify if that number includes or excludes Remplir sales outside of the U.S., please?
Thanks, Haley. I think if you go back to what Adam presented previously, we talk about per U.S. or per total Orthocell breakeven, the U.S. needs to contribute approximately 10,000 units to break even. 6,000 procedures is the requirement basis. Sometimes a procedure is more than one unit. We approximate somewhere between 1.7 - 2 units per surgery. That requires obviously about 30 procedures annually, or we estimate 30 procedures annually per surgeon. So 200 - 300 surgeons will get us there. It's not unrealistic that it's far away, but the U.S. needs to contribute that number to break even.
Thanks, Jim. Paul, just another one, reflecting on some group sentiment on the line. From recent trading activity, the market clearly is not satisfied with Orthocell's progress, dropping over 15% in recent days, despite your comments re progress. I respectfully ask you as MD of Orthocell, have you actively made efforts to encourage institutional investment in the company, or do you feel that the current risk of the environment of the market makes that a difficult proposition for the company?
No, great question, and a really important part of our growth as a company is to attract institutional investors. I can say that we've put in a lot of work and effort in engaging with those institutional investors. For every seller of a share, there's a buyer, and some of those buyers have been institutional investors. They recognize that we can't be blown up by a wrong phase III clinical outcome, that this is not a drug of high risk. This is a medical device that has global approvals, that has surgeon activities across the globe in Australia and the U.S. It's a product that has outstanding scientific narrative, one that, as I mentioned, can't be blown up. The institutional investment interest in our company is growing on a daily basis.
Thank you, Paul. One for Adam, just in relation to sentiment from the surgeons abroad. Are you experiencing any practical pushback from surgeons in relation to their use of Remplir in the U.S.?
Look, I paused in answering the question, Haley Chartres, and thanks for the question from the audience, because in my experience over the last 20 years launching a number of different products, it is common that there are challenges in either the surgical application of the product, maybe the performance is not quite there. A lot of it relates to usability challenges. We do not see any of that with Remplir. In my experience, this is really a unique product in that sense. The ease of which it handles the surgical application, it actually performs above expectations. So I actually stand here in a, I guess, somewhat surprised in a way just based on my experience, that genuinely no, we really see the surgeon adoption of this product as unequivocally positive. It is what really gives us a lot of energy moving forward, is the feedback that we get from surgeons.
As Paul Anderson mentioned before, I think you combine that enthusiasm for the product with market access and reimbursement, that is a winning combination. So my confidence in the surgeon sentiment is really, really high.
Thanks, Adam Wood. Just another quick one. A curious question about the U.S. market for some of our Australian investors in particular, but how does entering the hospital ecosystem work? Are these hospitals the ones that existing Remplir users operate at?
Adam Wood, do you want to take that one?
Yeah, sure. There's definitely some differences in the U.S. market relative to Australia, which is maybe the origin of the question. The process for the U.S. is beyond signing a distributor and having access to the state through licensing, which is initial part of the process, you typically need to apply for approval to use the product at a hospital, which is in the form of either a large national contract or approval at the local hospital level from the value analysis committee. In order to gain that approval, you need a surgeon to apply for access to the product. So up front you need to sell the product to a surgeon. They need to want to use it. They then apply for the approval at the hospital. Once granted that approval, there are a couple of options in terms of how the product is then used.
Hospitals can purchase stock up front, keep it on the shelf. Remembering that nerve injuries are an acute injury, they're typically related to accidents and sometimes at short notice. So that provides convenience to have stock on the shelf, so they can buy stock on shelf. We can consign it, so we essentially lend them the stock, or we deliver stock specifically for a single case. But the critical difference between the U.S. and the Australian market is that additional layer of hospital approval which sits at the procurement level. And it's really designed to slow down, I guess, the commercialization of devices to stop runaway spend by companies wheeling in products without any sort of governance around purchasing. So it's not unique to Orthocell.
It applies across the industry, and I think once we get onto the other side of these value analysis committee approvals and hospital contracts and so forth, it does provide a barrier to entrant for any new company coming in. Because anybody who launches a product, regardless of the therapeutic area into the space in the U.S. today, is going to follow the same path that we've followed. So we reflect on our experience with positivity. I think relative to our peers, we're actually ahead of the game. We've been very deliberate in making applications to the value analysis committees, which I think ultimately is a reflection of the surgeon interest. So again, surgeon interest is really the thing that gets us all up out of bed in the commercial team every morning really enthusiastic about Remplir and we're confident that's going to see us through.
Thanks, Adam. Just a specific one for Jim in relation to U.S. Remplir sales as well. The U.S. Remplir sales AUD 400K, 149 units indicates an average unit sales price of AUD 2,600, AUD 2,700. Is that accurate? What is the actual margin? If you're able to help us with that one, Jim.
Yeah. Thanks, Haley. Look, at the end of the day, I can't. The math is fundamentally correct around that. We have a couple of different SKUs, different sizes, different pricing, and obviously it's a U.S. dollar versus an Australian dollar, so there is some FX fluctuations that will occur over time. But we don't release margin information around our individual products. But what I can say is that if you looked at our previous financials and you look at our future financials coming along, the impact of the healthy margins that the Remplir product in the U.S. will provide, is something that you'll observe. And that takes into consideration that we're making good margins on what is a device that we own. We own the manufacturing all the way through to the customer, which is fantastic.
They are healthy, and they do represent the investment that's been made in producing that product. So I look forward to presenting those financials in the coming half and full year.
Thanks, Jim. Just a follow-up part to that question. You mentioned the target of 10,000 Remplir units in the U.S. to reach breakeven. Seems a long way off from current levels. When can we expect this to be achieved?
Yeah. I think that's a really good one. So Adam probably allude to the value of 10,000 units is something that we're obviously gearing towards as an inflection point. There's probably two inflection points. There's one is the breakeven point for the U.S. in terms of it being self-sustaining, and the second one is its contribution to the Orthocell overall breakeven. I think if you looked at Adam's presentation and you looked at the amount of procedures that we need to get to and the amount of surgeons that's offering the presentation, 200 - 300, you can see that it can easily get there when Adam talks about that the four key states are equivalent to Australia. And then if you look at what we've done in Australia over the last two to three years, or sorry, three to four years, we're approaching 4,000 - 5,000 units in four years.
I think you can easily see that it is quite achievable and it is quite realistic.
Great. Thank you, Jim. Just another one for Adam. Will Orthocell appoint further U.S. distributors?
Yeah. As I mentioned, we've gone through a pretty busy period of recruiting distributors, and I think it's important to always have a consolidation period after that recruitment. We are conscious that we need to take time to onboard the distributors that we've signed. There definitely will be a slowing in cadence of distributor hiring relative to what we've seen in quarter one, but that's not to say that we are necessarily going to stop hiring. Remplir now has a reputation in market where we get quite a significant number of inbound inquiries, so distributors in the U.S. reaching out to us actively asking to represent the product. At the moment we're really taking those inquiries on a case-by-case basis, making sure that we judge the return on effort from our team relative to the distributors that we already currently have within our portfolio.
The short answer is we will continue to recruit, but I think it's important to note that we do need to consolidate the distributors that we've hired and really make sure that those guys are happy, they're up and running, and their surgeons are also confident using Remplir.
Great. Paul, I know this is a fairly new area of disclosure on the ASX, but the prostate data, there has been some questions around the size of the sample, and the clinical group there. Can you just talk us through the methodology and where that program's sitting as well?
Yeah. A representation of data of that nature is really about making sure that you can say that it is safe, the product is safe, that it can be easily used by the surgeon, it doesn't elongate surgery time, and that there is a tolerability and evidence of efficacy. This is a very well-trodden pathway. At no stage were we ever going to be presenting efficacy data in a full-blown study. That will come. What this study has done has really given confidence to surgeons in this space that it's got high utility, that it's safe and tolerable, and that there's a strong evidence of efficacy. We will continue to collate data. There's an old saying in this industry that research and data has no downtime. Just because we're doing further research doesn't mean that there's a halt to the commercialization of the technology.
It doesn't mean that there's a roadblock. It simply means that you continue to build the body of evidence, and that's what this initial study was all about. We're now working with a number of different groups, urology groups, to plan, and to execute on a clinical study of over 100 patients, which is significant. It'll take around eight months for us to recruit those patients, but in no way does that impede our commercial development. As I mentioned before, we are indicated for use in peripheral nerve repair, and this radical prostatectomy nerve bundle protection is a new application within that. So we will continue to collect data both in a real-world evidence perspective as well as prospective studies as we continue the commercialization pathway.
Thanks, Paul. Just another follow-up question there is how much do you anticipate the study will cost?
Yeah, great question. We're expecting around AUD 300,000 for the cost of that, maybe a little bit more for the cost of that study. When you're talking about the value of that study, when you're talking about the size of it's very efficiently run, and very effective in the resources. We're teaming up with not just one urology surgeon, but a team of seven. We've got a great team of surgeons who do many numbers of radical prostatectomies. It means that we can recruit in a rapid way, that we can then start to report those results even sooner.
Thank you, Paul. We still have a lot of questions coming in, but we are nearly at time. Just cherry-picking one here for you, Adam. What sales revenue are you expecting from the U.S. going forward? Will the growth rate accelerate from current levels?
Yeah. Thanks, Haley. Look, obviously we don't provide projections or forecasts at this point, but I guess just reflecting on what I presented earlier, there's a lot to like about where we're at right now as an organization in the U.S. Some of those leading indicators that I spoke about are all really strong. The foundational elements are on track or significantly ahead of target when we think about distributors. If you just take into account the coverage that we have, the access profile that we have, and you combine that with the surgeon engagement that we've spoken about, we are really excited about what the future holds. As I said, I hope to be here in coming quarters reporting really positive compound growth results. You reflect on what we've achieved, we've achieved that with a coverage from our distributor network of somewhere between 5% and 50%.
We've now shifted that to 70%. That's a material uplift in terms of feet on the ground salespeople in the U.S., and every week we're seeing increased approvals from our value analysis committees. We also have, critically, that IDN contract, that integrated delivery network contract, that provides access to a number of hospitals coming into effect in November. These are some catalysts that really start to open up the market for us. So there's a lot to be positive about, and certainly my team are really looking forward to what we can get done in the U.S. in the coming months.
Thank you, Adam. It's certainly an exciting time. Paul, any final comments just to finish us off today?
Yeah. Thanks, Haley. There's a couple of things that really resonate very strongly with me, and Orthocell and hopefully with investors as well. We certainly don't shy away from the fact that we've been punished in the marketplace. There's no question about that. But I think that there's a voracious appetite for revenue, and hopefully today you've seen that there's a very defined, a very clear program that gives us market access. You can't buy that. That takes time, and we've done that. What I hope you also have seen today is that momentum is everything. We're seeing surgeon conviction, the ability for us to spend funds in the U.S. to grow our business. So we're seeing more consistent use of our product from surgeons who are involved in the program. We're seeing more consistent uptake of the product by new surgeons.
We're seeing more consistency in our hospital and our VAC and our GPOs. So all of that bringing together will enable us to have a material increase in our revenue and continue to ride this momentum that we see. So it's a great time to get involved in this stock. And certainly, as I mentioned before, we are very much on our pathway to success in the United States and globally.
Thank you very much, Paul, Jim, and Adam, and of course to all our supporters and investors on the line today. That includes the Q&A and presentation. If you have any remaining questions, please direct them in writing to general@orthocell.com. That again is general@orthocell.com. We'll endeavor to get back to you as soon as possible. The webinar will be available on YouTube following the session later today. That now concludes today's webinar. Thank you for your continued support and for joining us on the line.
Thank you.