Clever Culture to expand APAS portfolio with $2.6m funding package

• Clever Culture developing new benchtop system to bring automated environmental monitoring to smaller pharmaceutical manufacturing facilities
• APAS Revolution expected to expand addressable market for CCS technology by about 50% to $4.3 billion
• Company has secured a $2.6 million funding package, comprising a $1 million placement and $1.6 million unsecured loan

Special Report: Clever Culture Systems is expanding its artificial intelligence-powered microbiology automation portfolio after securing $2.6 million to develop a new benchtop system targeting smaller pharmaceutical manufacturing facilities.

The new configuration of the company’s Automated Plate Assessment System (APAS) has been dubbed APAS Revolution.

Clever Culture Systems’ (ASX:CC5) said it was designed to extend automated environmental monitoring to lower-volume smaller and medium sterile drug manufacturing facilities

These facilities require the quality traceability and efficiency of automated monitoring offered by APAS, but do not require the processing capacity of CC5’s existing APAS Independence system.

APAS Independence automated culture plate reader is the only US Food and Drug Administration (FDA)-cleared AI technology for automated culture plate reading.

Some of the largest pharmaceutical companies globally are among CC5’s customers including AstraZeneca, Bristol Myers Squibb, Novo Nordisk, Pfizer, CSL and Thermo Fisher’s contract drug manufacturing organisation.

The company said development of APAS Revolution responded to customer demand for a smaller-format system suited to lower-volume manufacturing facilities, including sites within the global networks of existing APAS Independence customers.

CC5 recently appointed PSC Biotech as a sales agent for APAS Independence in North America, Canada and Singapore.

PSC Biotech’s established presence in pharmaceutical validation, engineering and regulatory services was expected to provide another channel to reach the smaller and medium-sized manufacturers targeted by APAS Revolution, the company said.

Broadening market opportunity using same tech

Development of APAS Revolution is forecast to increase the estimated total addressable market (TAM) for APAS by ~50%, from $2.8 billion to $4.3bn.

CC5 estimates potential demand for more than 3400 APAS Revolution instruments in addition to the 2300 instruments estimated for APAS Independence.

Together, CC5 said the two APAS platforms were intended to provide an automated environmental monitoring solution across the full spectrum of sterile pharmaceutical manufacturing facilities, from big pharma to smaller, single-site operations.

APAS Revolution will leverage the core technology already used in APAS Independence, including its imaging station, plate-gripping system and validated AI-powered analysis modules.

The approach is expected to reduce development costs, shorten the development timeline and lower technical risk, while providing pharmaceutical customers with a consistent automated monitoring platform across manufacturing facilities of different sizes.

CC5 plans to select an external engineering partner to complete product development, with pre-production instruments expected to be available to customers for evaluation and feedback during CY27. Final product launch is targeted for H1 CY28.

Source: CC5

$2.6 million funding package to support development

To accelerate the project, CC5 has secured commitments for a $2.6m funding package comprising a $1m placement and a $1.6m unsecured loan.

Firm commitments have been received from sophisticated and professional investors for the placement of 62.5 million shares at 1.6 cents each, alongside one unlisted option for every new share subscribed, exercisable at 3c by November 30, 2029.

The placement price represents a 15.8% discount to the last traded price on October 29 and a 15.4% discount to the 15-day volume weighted average price.

CC5 has also secured a $1.6m loan with funds to be received by November 30. The loan carries a 10% annual interest rate, with interest-only payments due quarterly and the principal repayable on November 30, 2027.

The loan terms include the issue of 19.2 million unlisted options, based on 12 options for every $1 in debt provided, with an exercise price of 3c and expiry of November 30, 2029.

CC5 said the funds assisted in retiring the existing $1.7m short term loan due for repayment on December 31, 2026.

It said the funding mix provided a capital-efficient approach to product development, supported by an improved outlook for sales over the next 12 months and beyond.

‘Expanding the commercial opportunity’

CEO Brent Barnes said development of APAS Revolution would broaden the company’s commercial opportunity and create scope to serve more sites within existing customers’ global networks.

“APAS Revolution is an important step in expanding the commercial opportunity for Clever Culture Systems,” Barnes said.

“It will allow us to bring our proven technology to smaller pharmaceutical manufacturing facilities and creates an opportunity to serve more sites within our existing customers’ global networks.”

This article was developed in collaboration with Clever Culture Systems, a Stockhead advertiser at the time of publishing.

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.

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