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2008 Annual General Meeting Chairman's Address
30 / 10 / 2008
Last month, Sunshine Heart achieved the most significant milestone in the short history of the Company. In September, the US Food and Drug Administration (FDA) granted conditional approval to undertake a 20 person US feasibility trial for the C-PulseTM heart assist device.
This approval gives Sunshine Heart a clear regulatory pathway to commercialisation of C-Pulse, across global markets, within a reasonable timeframe.
The feasibility trial
The trial, in six University based heart failure research centres in the eastern part of the US (from Florida to Illinois to Pennsylvania) will be the first FDA sanctioned heart assist device therapy trial for moderate heart failure. Sunshine Heart is in the final stages of preparing to conduct the trial and we are presently working with the six research centres for final approvals. These are the last procedural steps to be taken prior to enrolling patients. We have final product on the shelf and are otherwise ready to proceed.
The Co-Principal Investigators, Drs William Abraham from The Ohio State University Medical Centre and Patrick McCarthy from Northwestern University School of Medicine, will lead the clinical trial activities as plans proceed to undertake the first procedures this calendar year. Enrolment of all 20 patients will take six to nine months with a six-month follow up period.
The FDA approval was a turning point for Sunshine Heart and is a testament to many years of detailed planning work by our engineering and clinical teams in Australia and the US. The FDA application was lodged in June 2007.
The US trial data will also be used in an application for CE mark approval in Europe.
We also see the prospect of revenues as the Company was, in September, given Reimbursement Category B for the US clinical trial. The cost of the C-Pulse system will be eligible for US Medicare reimbursement coverage. Sunshine Heart and regional offices of the Center of Medicare and Medicaid Services will now resolve reimbursement amounts.
The way ahead
Sunshine Heart's investment proposition is quite simple and it remains true to the founders' original vision. We take the view that a safe, simple, non blood-contacting heart assist device, based on the proven concept of counter-pulsation is an essential therapy for heart failure physicians treating patients with moderately severe heart failure. There is a large unmet clinical need for such a device in global health care markets.
The key to safety and patient convenience is the ability of C-Pulse to be switched on and off, and disconnected as required. These features give C-Pulse a special competitive advantage and, we believe, a unique position in the heart assist device market.
The engineering team is also working on a fully implantable second generation device, the C-Pulse II. This design will use power transmission across the skin, without a percutaneous line. This product enhancement will increase user acceptance and expand the market for the device.
Funding
In June, the Company completed a rights issue of ordinary shares which raised approximately $5.4 million. Existing shareholders took up 71% of the issue with the balance going to underwriters.
The Company ended June 2008 with around $10 million in cash and currently has approximately $7.3 million in cash. Additional funds will be required to complete the feasibility trial. Consequently, in early 2009 we will seek additional funding.
The Company has been extremely careful with its cash spend and has achieved its current stage of development with a considerably lower cash spend than other companies at a similar stage of development. What we believe is attractive to investors, current and prospective, is the significant market opportunity for C-Pulse, and the current pathway to commercialization.
New Chairman
All Boards need change and I announced in September that I will retire from the Chairmanship of Sunshine Heart at the conclusion of this Meeting. I plan to continue to serve the Company as a Non-Executive Director, in the sho
This approval gives Sunshine Heart a clear regulatory pathway to commercialisation of C-Pulse, across global markets, within a reasonable timeframe.
The feasibility trial
The trial, in six University based heart failure research centres in the eastern part of the US (from Florida to Illinois to Pennsylvania) will be the first FDA sanctioned heart assist device therapy trial for moderate heart failure. Sunshine Heart is in the final stages of preparing to conduct the trial and we are presently working with the six research centres for final approvals. These are the last procedural steps to be taken prior to enrolling patients. We have final product on the shelf and are otherwise ready to proceed.
The Co-Principal Investigators, Drs William Abraham from The Ohio State University Medical Centre and Patrick McCarthy from Northwestern University School of Medicine, will lead the clinical trial activities as plans proceed to undertake the first procedures this calendar year. Enrolment of all 20 patients will take six to nine months with a six-month follow up period.
The FDA approval was a turning point for Sunshine Heart and is a testament to many years of detailed planning work by our engineering and clinical teams in Australia and the US. The FDA application was lodged in June 2007.
The US trial data will also be used in an application for CE mark approval in Europe.
We also see the prospect of revenues as the Company was, in September, given Reimbursement Category B for the US clinical trial. The cost of the C-Pulse system will be eligible for US Medicare reimbursement coverage. Sunshine Heart and regional offices of the Center of Medicare and Medicaid Services will now resolve reimbursement amounts.
The way ahead
Sunshine Heart's investment proposition is quite simple and it remains true to the founders' original vision. We take the view that a safe, simple, non blood-contacting heart assist device, based on the proven concept of counter-pulsation is an essential therapy for heart failure physicians treating patients with moderately severe heart failure. There is a large unmet clinical need for such a device in global health care markets.
The key to safety and patient convenience is the ability of C-Pulse to be switched on and off, and disconnected as required. These features give C-Pulse a special competitive advantage and, we believe, a unique position in the heart assist device market.
The engineering team is also working on a fully implantable second generation device, the C-Pulse II. This design will use power transmission across the skin, without a percutaneous line. This product enhancement will increase user acceptance and expand the market for the device.
Funding
In June, the Company completed a rights issue of ordinary shares which raised approximately $5.4 million. Existing shareholders took up 71% of the issue with the balance going to underwriters.
The Company ended June 2008 with around $10 million in cash and currently has approximately $7.3 million in cash. Additional funds will be required to complete the feasibility trial. Consequently, in early 2009 we will seek additional funding.
The Company has been extremely careful with its cash spend and has achieved its current stage of development with a considerably lower cash spend than other companies at a similar stage of development. What we believe is attractive to investors, current and prospective, is the significant market opportunity for C-Pulse, and the current pathway to commercialization.
New Chairman
All Boards need change and I announced in September that I will retire from the Chairmanship of Sunshine Heart at the conclusion of this Meeting. I plan to continue to serve the Company as a Non-Executive Director, in the sho