It looks like a better option than most or any others. I've seen a case of someone missing their entire jaw bone and they grew a new one by implanting a porous framework in the back and then removing it, or something
Anyway, what you need to understand about the collagen in bone and how it contributes to the flexibility of bone is this - it is quite organised. The fibres form large bundles, and they are quite long, the microfibres within the bundle also have a specific length. It is also a very dense, crosslinked kind of collagen protein. So what I'm saying is they're not just random bits of collagen. (for reference, collagen makes up about 20% of the DRY weight of bone. The wet weight is larger as collagen is hygrophilic)
If this material allows the ingrowth of actual bone by osteoblasts etc. then yes, it looks like a good option, as the body will be providing it's own native collagen and minerals to grow the new bone.