Sunshine Heart raises $3.3m

By Helen Schuller
Tuesday, 13 December, 2005

Sunshine Heart (ASX:SHC) has raised AUD$3.3 million through a private placement to fund the development of its C-Pulse heart assist device.

The proceeds of the capital raising will be combined with existing cash and a $2.23 million Commercial Ready grant from the Commonwealth government, which the company received earlier this year and will be used to increase the rate of recruitment of patients for the long term clinical trial of the C-Pulse.

In November Sunshine Heart received ethics committee approval to conduct implantations of its C-Pulse device in Australia at Southern Health Monash Medical Centre and The Alfred hospital in Melbourne. The company is expected to announce a third Australian centre, in NSW in 2006.

Two patients out of up to 10 have been implanted with the device in New Zealand. The first patient died of multi-organ failure nearly three months after the operation, from unrelated causes, while the second patient had the device removed one month after it was implanted, after he developed a related infection.

"Sunshine Heart will now progress towards the completion of the clinical trial and progress the driver development to the point of allowing an IDE application to be filed with the FDA," said Sunshine Heart CEO Donald Rohrbaugh in a statement. "These are all key milestones for the company and we are now well funded to undertake these activities."

The C-Pulse is made up of a cuff, similar to the cuffs used to test blood pressure, wrapped around the portion of the aorta just above the heart, outside the blood vessel, and includes a balloon that is inflated and deflated to help the heart force blood down the artery and around the body. A sensing lead transmits the heart's electrical signals to an external driver unit that causes the balloon to inflate and deflate in rhythm with the heart.

Sunshine Heart has issued approximately 16.9 million shares at $0.195 to institutional and sophisticated investors in Australia and New Zealand.

The placement was managed by Intersuisse Corporate and a meeting of shareholders will be held in mid-January to approve the placement. At time of writing Sunshine Heart shares were trading at $0.195.