Okay, we're going to move on with the next presentation here. My name is Eric Anderson from the TD Cowen Medical Devices Equity Research Team. We are very happy to have AVITA Medical here at the 45th Annual TD Cowen Annual Health Care Conference. I'm going to turn it over to CEO Jim Corbett for a presentation. Thank you.
Thank you, Eric, and good morning to everyone still. It's not quite afternoon, but I do appreciate you coming to hear about the latest activities that we're doing at AVITA. 2025 is turning into a transformational year for us in multiple ways. I'm going to share those with you, and there'll be some time for Q&A at the end. First and foremost, defining the company more clearly. We've been defining ourselves as a regenerative tissue company, which could mean lots of things. We wanted to define ourselves more clearly. What we are is a therapeutic acute wound care company. Those words actually mean quite a bit. In the concept of therapeutic versus palliative, we intend to cure patients, not treat them palliatively and they still having a wound, which implies, of course, acute wounds are not chronic wounds.
You will not see us promoting our products into DFU or VLU or any wound care clinics for those types of purposes. Really, it is burns, it is trauma, and surgical that cause acute wounds that need to be attended to by AVITA products. A very significant change, and we have filled out our portfolio a bit as well. With the advent of RECELL and RECELL GO, GO is the method of automating the disaggregation of the skin cells. We also have RECELL GO Mini, which we just got approval for and just launched. Now, let me spend a moment on those two. RECELL GO is like and similar to original RECELL. They both produce the same output, but they are both 10% total body surface area. Okay?
The RECELL GO Mini is designed for smaller wounds, more commonly found in trauma centers, and they're under 480 square centimeters or less. Our platform really does revolve around the RECELL platform. That said, there are other products and technologies that are used by the same physician on the same patient on the same wound. We have made efforts in the last 18-24 months to broaden our product portfolio to address some of those other products. Two of them are being launched at this very moment. PermeaDerm, which we started launching last year, we did principally evidence development last year, and we have an allograft PermeaDerm comparative study underway at the moment. It is a post-market study that will demonstrate that PermeaDerm is a very suitable replacement for cadaver skin. We have high hopes around the expectation of it.
We also did a co-development work with a company called Regenity Biosciences. What we wanted to do, and it was a rather big task from the beginning, is to develop the dermal matrix. This one is collagen-derived, bovine collagen, that would perform in a very precise manner. Just to give you a scope of it, we use a validated porcine model for this type of comparative testing. We tested 10 different platforms, 18 different versions before we accomplished our goal. What we had in mind was we want to have a matrix that will absorb at the right speed that optimizes vascular ingrowth, and then does not have to be removed and absorbs into the wound and leaves behind a beefy, ready-to-graft wound. We are in the process of enrolling our post-market study on Cohealyx, known very cleverly as Cohealyx One. That was a joke, but Cohealyx.
Yeah.
Nonetheless, what we're looking to demonstrate is time to graft, time to close, and time to go home. Oversimplified, but those are the three big outputs. What we learned is that we are time to graft faster than any other dermal matrix on the market by as much as one to two weeks. That is a really meaningful difference between what we're bringing to market with Cohealyx and what we're bringing to market with our other products. If you think about what we have experienced with RECELL, for burns, we have evidence that demonstrates a 30% reduction in hospital time as a consequence of using RECELL. Proving that Cohealyx gets you graft ready at five days is going to remove days from the whole process for that patient as well. Very in keeping thematically with each other. Of course, we have PermeaDerm.
We have now quite a lot of opportunities for our company. To put it in very clear terms, in a two-stage procedure, if you just took the burns market, we went from a $450 million TAM of RECELL to a $1.5 billion TAM of RECELL PermeaDerm, and Cohealyx. That is in just those 120 or so hospitals. It is a two-stage procedure, and each patient has their own uniqueness. This is all, of course, just the macro view. As an update on GO, GO is going very well. We hit six months deep at the time of these slides' preparation. This is Q4 data I am about to share. In Q4, we had achieved 83% of our revenue was from RECELL GO versus Ease of Use, which is the traditional RECELL. It is our intention to keep them both around.
There are certain indications where physicians would like to work with RECELL Ease of Use, and we'll keep it available for them for that reason. At the same time, RECELL GO on a macro level has many benefits. For example, you can process multiple biopsies at the same time. I think in some of my prior presentations, I've shown as many as six RECELL GO processing units processing skin at the same time. It doesn't actually make less work for the doctor. It just makes the doctor be able to do the work simultaneously. There is a benefit to OR time and anesthesia time and things like that, but it is an advancement in the prep of RECELL. When we talk about PermeaDerm, just a minute about what it is and what its value is.
It is a biosynthetic wound care dressing that is porous, and the porosity is adjustable by just stretching the dressing itself. It allows for breathing in, allowing air in and exudate out. It is clear. When you're treating a graft, you don't want to have to lift the dressing to see how it is because it will pull away the wound graft. Being clear has some real distinct benefits. You can see if there's any infection that's growing. We are at the moment have almost 100 accounts that are evaluating. We're having a very substantial uptake at the moment. I spent some time on the Cohealyx qualities earlier. I'll share with you in the next slide this preclinical porcine study because we have that. We also had the first case done at Ohio State, and they did a press release.
It is really rather remarkable what it did. Right at the moment, we are enrolling 20 sites into the IRB post-market study. It will be an objective performance criteria study, OPC. It will be looking at time to graft, time to close, time to go home. That is what really counts. If you look at it, how it did here, these are three separate from the porcine wound model. This study takes an assumption that at day seven, we are going to graft. You can see that at day seven, going downward, the Cohealyx was ready to graft on day seven. It corresponds to the orange bar. In the multiple samples we did, 98% of the time, Cohealyx was ready for grafting at day seven. The other two are commonly used competitors. You can see in one case, they do pretty well.
They were in the 85% range. The other was in the 65% range. It means it just simply takes longer for them to get there. Now, if you look at this one in Ohio State, this is like the doctor was effusive. He treated this patient. It was a small wound, about 200 sq cm. Didn't get RECELL, but got, as you look at A and then B down below, that has Cohealyx applied to it. Day seven is the top C that you can see. That is ready for grafting, which they do in the bottom C. In D, day 10, the patient's ready to go home. This doctor said in his quote in the media, which was again an Ohio State PR mode, that this would have been a 30-day treatment for this patient and they're home in 10 days.
Really, really, really a terrific outcome. We have very high hopes for Cohealyx. You could ask, how does this all work for our business model? You would take this and we're going to go look at the column on the right. This would be for a two-stage procedure. You might use PermeaDerm twice during the procedure. You might temporize early before you did the dermal matrix, and you might cover the wound graft with it after. A PermeaDerm covering 2,000 sq cm would be $2,000. You might do it twice. That's $2,000-$4,000. You might use on a 20% TBSA wound. I talked to a physician yesterday. We were talking about some related matter. He had done eight on a patient the day before. Of course, if you're doing eight, it implies 80% total body surface area.
Not many technologies can take care of that patient. Anyway, in a 20% patient, you would get 6,500-13,000 RECELL kits. Then just using a $10 per square centimeter cost for a dermal matrix, which is below the market price, you might use as little as $20,000 worth or as much as $40,000. If you add all that together, it has taken a procedure that as recently as June last year had a $6,500-$13,000 potential TAM for a burn case to $28,500-$57,000 in six months' time by the expansion of our product line. Again, these are approved. We are doing market prep work with Cohealyx right at the moment. As you saw, we were treating some patients. We are actively selling PermeaDerm. We expect RECELL GO to edge into the 90s here during Q1.
A lot of change in the AVITA world this year. Now, this is about the rest of the market we treat, which we now refer to. We have historically referred to it as full-thickness skin defects, which is a little misleading because it's so broad. The full-thickness happens to be the language in the FDA approval, which includes the area in the shaded box on the lower right, which are chronic wounds. We are not counting those in our market definition and don't intend to promote there as VLUs and DFUs are really not therapeutic acute wounds. They are chronic wounds that get treated palliatively largely. That's just not where we're sending our organization or where we're spending our clinical research or any of our product effort. Having said that, all these other surgical and trauma wounds are indicated for RECELL.
If you add them up, you get to a similar math as I just did for the burn market. You get about $2 billion in TAM. You take the two, you add the 1.5, you get 3.5. From June last year, where we had a $500 million TAM in burns only, and now burns plus trauma plus these new products, we have a $3.5 billion TAM. A lot of opportunity for us to help patients heal better, help our customers have other options to treat their patients. We are really terrifically excited about that. On the future side, we are expecting MDR approval for RECELL GO. This is like waiting for Godot. The MDR notified body folks are just slow, and ours is no exception. We did pay an expedite fee to be ready by October of last year.
We are in the final stages and do expect it during Q2. It will cover the MDR countries. Australia is covered, and the European Union. Japan has a separate application, and we'll be applying there. We're going to be all using third-party distributors. We're not going to invest in a direct organization at this time in those markets. It will be largely a positive margin contribution versus a net expense loss. I'll keep you updated as soon as we get it because we're all ready. We've got units built with the proper electronics on it and ready to ship. As we look ahead to 2025, there are some very clear priorities for us that you can easily see. Our number one issue is sales execution. We've got new leadership there. Robin Vandenberg has been in place since July.
She's a well-developed executive from Smith & Nephew and is doing really a terrific job of energizing our sales team and preparing them to do something they never did before. Before, they sold a once-in-category product that nobody else had. We would sell it in a certain way that was not aware of any competitors. Clearly, with dressings and dermal matrix, we'll have competitors. We think we're ready for that. The product portfolio expansion, which I've shared with you, creates a tremendous opportunity for the company. In terms of 2025 financial guidance, we've given guidance for the year of $100 million-$106 million. That would be a 55%-65% growth. A couple of comments to go with that. We are also committing to cash flow and GAAP profitability in Q4.
Somebody said, "How would I think about getting there with your annual guidance? You're not giving quarterly guidance anymore." Yes, that's because, of course, our type of patient is going to be very event-driven. We think this will work better from a big-picture point of view. We had about $26 million in operating expenses in Q4, and about $3 million plus of that was non-cash. We have no net headcount during the year and no extensive programs to spend money on. You can almost take that 2023, take our gross profit, put revenue model together, and figure out what our revenue has to be in Q3 or Q4 for that to happen, right? For it to happen with GAAP and with positive cash flow, likely that happens ahead of the GAAP by a quarter with that range of non-cash costs.
That looks to be a year of transformation to me. A greatly expanded portfolio that will really make a difference for treating the patient. Got RECELL, got ease of use. We'll have RECELL GO. We have RECELL GO Mini. We have Cohealyx, and we have PermeaDerm. Our reps are not looking for something to do. They've got a lot to do. With that, I'll take any questions you may have. Yeah, it's a great question. Let's break it up a little bit. The VACs on the burn sites were very well established. We expect those to go in a predictable form. What we experienced in the trauma centers was something I had never experienced before myself. Every single hospital required evaluation. That's unusual. Usually, you're coming in with a new product, and you're taking the place of another product on the shelf.
You have better features, benefits, clinical benefits, cheaper, whatever. One goes off, one goes on. That was pretty effective. They were rather motivated to do it because it almost always included some level of economic benefit. The surprise for us in the last year was the fact that they all said, "Okay, we aren't really giving you approval, but go do two cases." That is easier said than done when the approval is characterized that way. It takes time. Those accounts, we now are in, and we are bringing products in that they have. Recently, we got a large PermeaDerm conversion at one of our biggest burn centers. Out came the preceding, the incumbent got removed from the hospital. That happened pretty quickly. It happened in like two months. Nothing like we were experiencing before and in a very large university.
That gives us some confidence. In the case of both the Cohealyx and PermeaDerm, we expect shorter VAC times. We're doing some things that are very VAC-friendly. We intend to price below the market. We have a consignment system already implemented with RFID. Each package will have an RFID chip on it. Every rep has a reader, and it will reconcile it. If the hospital does not have one, we're going to make it easy for them to take on and not have to spend working capital. That is very VAC-friendly. We're going to bring them a better product. We're going to give it to them for less money. We're going to make it easier to manage. We have put that together with what I would like to say the VACs in mind. I think they still have a role.
Their role is their role. They want to control what goes in the hospital, and they should. It did not occur to us that we know RECELL, but trauma centers did not. That was kind of our challenge to overcome. Another matter, all trauma centers are not equal. Just counting them will lead you to the wrong place. There is level one, two, three, and four. The level ones and twos matter a whole lot more than the three or four. We have taken that to heart too in how we are targeting. That is how we see the VACs at the moment. I call it, with respect to Cohealyx, we are kind of running Ohio State football. We are going to run up the middle. We are going to go right into our power.
We are going to do what we do well with the people we know well. That is where we will start. Yeah. The study itself, Cohealyx One, 20 sites. As you know, clinical trials have a statistical plan that goes with them. When your statistical signal is really big, your sample size goes down, right? When your statistical signal is really low, you need a big number to prove it. The number we are trying to compete against is 14 and 21 days ready to graft. We are at 7. The number we need is 40 to get that study done. It is being done post-market, and we are allowed to put it on the podium while the study is still running. We will be using those cases on a site basis.
If you were at a hospital and you had done three, you'll get on the podium with an abstract and show everybody how it's going. We're going to have results very quickly during the month of March and be ready for what's happening on April 1 is we're going to have the 700 sq cm sizes ready, which is, of course, you need three of those for a 10% TBSA patient. We'll be ready to go full blast at 1st of April. I think in Q2, we're going to see a lot of effect from Cohealyx. PermeaDerm is ramping up because it also has a study going with allograft, which it's doing. It's comparing very favorably. Yeah, we do, Josh. I think two things are going to help. We won't be having this dissonance where we've got a sledgehammer pounding a nail.
A 10% TBSA product to treat a two and a half or less TBSA wound did not really work for the docs. We got that. The other good thing is for those wounds, we also have a dermal matrix, and we also have a dressing for them. We have a stronger portfolio to offer them in terms of, "Oh, it is a perfect RECELL case. Oh, it is like the one I showed you, which did not get RECELL, but it got Cohealyx." There is a for the trauma and surgical centers, right, for the trauma centers, we are going to do a lot better with this broader portfolio.