Stratatech nabs $247M BARDA contract for skin tissue device

Stratatech's StrataGraft tissue after three months (left) compared to a skin autograft (right)--Courtesy of Stratatech

Wisconsin devicemaker Stratatech scored a $247 million contract with the U.S. Department of Health and Human Services' Biomedical Advanced Research and Development Authority (BARDA) to develop its skin replacement product for severe burns, giving the company a boost as it chases FDA approval for its product.

The 5-year contract builds on a previous agreement between BARDA and Stratatech, which handed the latter $47 million to develop its StrataGraft tissue. Under the new contract, Stratatech will receive $60 million up front and more funds further down the line, potentially bringing its total award to about $265 million, the company said in a statement.

Madison, WI-based Stratatech will use funds to fuel clinical studies of StrataGraft in "key patient populations," the company said in a statement, aiming to file an application for FDA marketing approval. The contract also gives the government an option to buy StrataTech's tissue "for use in case of a natural or man-made mass casualty emergency," it added, potentially widening its patient pool.

StrataGraft uses a proprietary human keratinocyte cell line to imitate human skin, closing wounds resulting from burns. Stratatech has already seen promising results for its device, with a recent study showing that a single application of the product closed wounds in 27 out of 28 patients included in the trial, the company said in a statement. And the tissue holds promise as an alternative to other wound care methods such as cadaver skin or synthetic dressings, which can result in infection or significant scarring.

"The financial impact of this new award to Stratatech is unquestionably significant and will accelerate our transition into a fully integrated, operating company," CEO B. Lynn Allen-Hoffmann said in a statement. "Providing these patients with an off-the-shelf regenerative skin tissue has the potential to transform severe burn care. Our partnership with BARDA has been and continues to be instrumental in advancing this orphan product through clinical development."

Stratatech is not the only wound care company reeling in funds from BARDA. Micro-cap Avita Medical ($AVMXY) recently nabbed a $54 million contract with BARDA for an ongoing trial of its ReCell burn treatment device. Avita will get $16.9 million up front for the study, and the company plans to complete enrollment by the end of this year.

- read Stratatech's statement