Qld's Tissue Therapies aims for $3.5m IPO

Queensland University of Technology spin-off Tissue Therapies is seeking to raise AUD$3.5 million in an IPO of seven million shares at $0.50.

The company, which lodged its prospectus with ASIC last week, is planning to use the funds to support its R&D and product development strategies, as well as to expand its marketing, IP protection and business development activities, said chairman Roger Clarke.

"Our commercial strategy is to continue the development of VitroGro products and applications and pursue a mix of direct sales, distribution and licensing revenues," Clarke said. "We also anticipate supplying reagents to enhance the growth of mammalian cells for research and industrial cell culture markets internationally."

The company launched its first VitroGro products for the research market, including VitroGro coated tissue culture plates and tubes, in late 2003. But the company sees applications of the VitroGro technology to wound healing, coatings for orthopaedic implants, cosmeceuticals and industrial cell culture as much bigger markets.

The basis of the VitroGro technology is the ability of the vitronectin protein -- a major glycoprotein found in the blood, plasma and the extracellular matrix of many tissues -- to bind and deliver multiple growth factors to cells.

"By presenting growth factors as a complex with Vitronectin we get more effective stimulation of migration and growth," said Dr Zee Upton, the company's consulting chief scientific officer and head of the tissue bioregeneration and integration program at QUT.

Initially, the company will focus its efforts on wound healing applications, including burns and ulcers. The company has developed and validated the use of the technology to more effectively grow cultured keratinocytes, or skin cells, in the laboratory and is working on a range of other cell types including embryonic stem cells.

Upton said the Red Cross was working with QUT on using the technology in the treatment of patients with extensive burns, with the intent to develop a spray-on skin formulation and a dermal substitute. And the company is also in discussions with Queensland's Royal Children's Hospital to look at applications of the technology to smaller burns and scalds. "We hope to start animal studies later this year," Upton said.

In the long term, Tissue Therapies plans to develop the technology as a 'bioactive band-aid' for wound healing. The company has already held early discussions with potential partners including wound care and cell culture reagent companies.

There are also a number of other potential applications, particularly in the area of industrial cell culture, where the company hopes to develop VitroGro as a serum-free source of growth factors.

The company follows a contract research model with a group of 26 scientists at QUT working on aspects of the projects. Unlike many university spin-offs, which use IP to create a company, Tissue Therapies was formed by the founding scientific and business staff, and the technology was licensed in to the company by QUT.

After the float, QUT will be the majority shareholder in the company with 16.7 per cent of the issued shares. Other shareholders will include the QUT scientists involved in the company and Orbit Capital, a boutique investment group that has been associated with the company since it was founded.

The placement, underwritten by ABN AMRO Morgans Corporate, is scheduled to open on March 2 and close on March 23, with listing on the Australian Stock Exchange to occur in early April.