Sunshine Heart, Inc. (NASDAQ:SSH) announced today its financial
results and provided a corporate update for the third quarter of
2015. The Company will host a conference call and webcast at 9:00
AM ET today to discuss its financial results and provide an update
on its ongoing clinical studies.
To access the live webcast, please visit the Investors page of
the Sunshine Heart website at http://ir.sunshineheart.com.
Alternatively, the live conference call can be accessed by dialing
(877) 303 -9826 (U.S.) or (224) 357-2194 (international) and using
conference ID 65012954. An audio archive of the webcast will be
available following the call at http://ir.sunshineheart.com.
"Progress was made in a number of key areas of our business in
the third quarter. I am particularly pleased to have our first
patient reach the 5 year mark on the C-Pulse® therapy. We achieved
positive pre-clinical animal data for pulmonary hypertension,
initial echocardiography and neurohormonal clinical data pointing
to neuromodulation as a mechanism for potential myocardial
recovery, continued site activations in the COUNTER HF™ pivotal
study and progress with our next generation fully implantable
system," commented Dave Rosa, President and Chief Executive Officer
of Sunshine Heart.
Third Quarter Corporate Highlights:
- First patient to reach five years on C-Pulse therapy
- U.S. Food and Drug Administration (FDA) approved amendment for
stopping rule criteria from "all cause deaths" to "mortality
associated with the device, procedure or therapy"
- Initiated protocol development for European post market study
to include recovery endpoints
- Positive results from pre-clinical animal testing applying
counterpulsation to the pulmonary artery to treat pulmonary
hypertension at Jewish Hospital in Louisville, Kentucky
- Initial echocardiography and neurohormonal data from the
OPTIONS HF European post market study and optimization data from
the COUNTER HF study point to neuromodulation as a mechanism for
potential myocardial recovery
- Chronic animal studies initiated at Texas Heart Institute for
C-Pulse fully implantable system; studies remain ongoing
- Sixteen sites activated during the third quarter for a total of
23, and subsequent to quarter end, an additional four sites were
activated, bringing total activated sites to 27
- Seven patients enrolled in the COUNTER HF study during the
quarter, and five additional patients enrolled after quarter
end
- Two abstracts have been accepted for presentation at the
American Heart Association (AHA) meeting in Orlando
- Oral and poster presentations at the Transcatheter
Cardiovascular Therapeutics (TCT) Conference
Third Quarter Financial Highlights:
- Cash used in operations was $18.2 million in the first nine
months of 2015 vs. $17.4 million in the first nine months of
2014
- Cash and cash equivalents on hand at September 30, 2015 was
$27.9 million vs. $31.3 million at year-end 2014
CORPORATE UPDATE
The first patient to reach five years on C-Pulse therapy
occurred this past quarter, which represents a major milestone for
the device. During this quarter, the Company also collected initial
echocardiography and neurohormonal data from the OPTIONS European
post market study and optimization data from the COUNTER HF study
that appears to point to neuromodulation as a mechanism for
potential myocardial recovery. This mechanism of action is not seen
in other pump related technologies such as left ventricular assist
devices (LVADs) and, if confirmed, would position the C-Pulse
therapy as the only mechanical circulatory assist therapy that has
the potential to offer a mechanical unloading and neuromodulation
effects.
Based on the potential impact of this new data, the Company
decided to initiate discussions on a protocol for a modified
European post market study that incorporates many of the OPTIONS HF
endpoints but also includes patient recovery/weaning endpoints.
In October 2015, the Company submitted an application for an NUB
to the InEk, the German Institute for Hospital Remuneration System,
to obtain reimbursement for this important market. A decision is
expected the first week of February 2016.
With respect to the COUNTER HF study, on August 31, 2015, the
Company announced that the FDA approved an amendment to the
stopping rule criteria for the study. The Agency agreed to change
the protocol from "all cause deaths" to "mortality associated with
the device, procedure or therapy." Sunshine Heart previously
communicated that it expected to have all sites reactivated by end
of August 2015. Due to site related delays, the Company finished
the quarter with 23 sites activated, with eight sites being
reactivated in the last few weeks of the quarter. Despite the
limited number of sites, Sunshine Heart enrolled seven patients
during the third quarter, and five patients have been enrolled so
far in the fourth quarter. As of the quarter ended September 30,
2015, an aggregate of 55 patients have been enrolled, of which 30
have been randomized into the COUNTER HF study. Subsequent to
quarter end, the Company activated an additional four sites and now
has 27 activated centers with another 13 in process. In total,
twenty centers have been activated since the end of the second
quarter.
An important accomplishment during the quarter was the continued
development work for the C-Pulse technology platform. The Company
conducted a pre-clinical pulmonary artery hypertension study at
Jewish Hospital in Louisville, Kentucky under the guidance of Dr.
Mark Slaughter. This acute animal study demonstrated a profound
impact in reducing pulmonary hypertension in the animals.
Additional pre-clinical studies are planned in the fourth quarter
of 2015.
Sunshine Heart furthered the development of its fully
implantable system in the third quarter. As previously
communicated, chronic animal studies were launched at Texas Heart
Institute and are progressing well. The Company plans to initiate
discussions with the FDA in the fourth quarter regarding the
Expedited Access Pathway (EAP) approach to market. If approved,
this could potentially expedite the process for obtaining U.S.
approval and have significant implications for the Company's growth
strategy.
As part of the Company's on-going effort to evaluate C-Pulse's
current development strategy and potential, the Company hosted a
U.S. advisory board meeting on October 21, 2015 comprised of key
thought leaders in the cardiovascular space. Key topics discussed
at the forum included a review of the COUNTER HF study, European
recovery study design, applications such as pulmonary hypertension,
business development opportunities and the fully implantable
system.
PRESENTATIONS AND PUBLICATIONS
Sunshine Heart conducted oral and poster presentations at the
Transcatheter Cardiovascular Therapeutics (TCT) Conference held in
San Francisco, California on October 11 to 15, 2015. During the
quarter, the Company submitted a number of important presentations
and papers, including two abstracts that were accepted for
presentation at the upcoming AHA meeting in Orlando:
- Reduced Heart Failure Readmission Rates: Clinical Experience
with the C-Pulse® Extra-Aortic Counterpulsation System to be
presented by Dr. Sanjeev Aggarwal, Mid-America Heart and Vascular,
Kansas City MO.
- Arterial and Cardiac Hemodynamics In Advanced HF Patients
Implanted with A Para-Aortic Counterpulsation Device Assessed by
Pulse Wave Analysis to be presented by Dr. Eduardo Rame, Hospital
of University of Pennsylvania, Philadelphia PA.
FINANCIALS
The Company's revenue to date has been generated by implants of
the C-Pulse System at hospitals and clinics in conjunction with its
U.S. COUNTER HF clinical study. The Company did not record any
revenue during the third quarter of 2015 as there were no implants
performed during this period that qualified for reimbursement. The
Company recognized $59,000 in revenue during the third quarter of
2014. Results for the nine months ended September 30, 2015 and 2014
include revenue of $59,000 and $118,000, respectively. The Company
has obtained reimbursement for some, but not all of its implants,
because some private insurance companies and certain governmental
institutions have a non-coverage policy for experimental or
investigational procedures.
Product costs incurred for the Company's clinical studies are
deemed to be development costs and, accordingly, are expensed to
research and development as incurred.
Operating expenses in the third quarter of 2015 totaled $6.3
million, compared to $6.2 million in the third quarter of 2014.
Equity compensation expense included in operating expenses totaled
$0.5 million for the third quarter of 2015 and $0.7 million for the
comparable period in 2014. Excluding equity compensation expense,
non-GAAP operating expenses totaled $5.7 million and $5.5 million
for the three months ended September 30, 2015 and 2014,
respectively. Operating expenses for the quarter reflect lower
spending resulting from the consolidation of certain management
positions, offset by increased investments in clinical
infrastructure.
Operating expenses for the nine months ended September 30, 2015
were $19.7 million, compared to $19.2 million in the same period of
2014. Equity compensation expense included in operating expenses
during the first nine months of 2015 totaled $2.1 million, compared
to $2.2 million during the same period of 2014. Excluding equity
compensation expense, non-GAAP operating expenses totaled $17.6
million and $17.1 million for the nine months ended September 30,
2015 and 2014, respectively. The increase over the prior year is
primarily attributable to increased development expenses associated
with the Company's fully-implantable system, along with increased
investments in clinical infrastructure.
Net loss in the third quarter of 2015 was $6.6 million, or $0.36
per share, compared to $6.1 million, or $0.36 per share, in the
third quarter of 2014. Excluding equity compensation expense, third
quarter 2015 and 2014 net non-GAAP losses totaled $6.0 million, or
$0.33 per share, and $5.4 million, or $0.32 per share,
respectively. Net loss in the nine months ended September 30, 2015
was $20.0 million, or $1.11 per share, compared to $18.8 million,
or $1.12 per share, in the nine months ended September 30, 2014.
Excluding equity compensation expense, net non-GAAP losses for the
nine months ended September 30, 2015 and 2014 totaled $17.9
million, or $0.99 per share, and $16.7 million, or $0.99 per share,
respectively.
Cash used in operating activities totaled $18.2 million for the
nine months ended September 30, 2015 compared to $17.4 million for
the same period of 2014, with the increase driven primarily by
higher research, clinical, and development expenses as well as
interest expense on outstanding debt. During the first nine months
of 2015, the Company received net proceeds from financing
activities of $15.1 million, as follows: $7.1 million from the sale
of common shares under the Company's existing "at the market"
facility, and $8.0 million from borrowings under a $10.0 million
debt facility with Silicon Valley Bank. The Company had $27.9
million in cash and cash equivalents on September 30, 2015,
compared to $31.3 million at December 31, 2014.
With regards to the Company's loan facility and the required
equity raise by March of 2016, we are exploring alternative
structures with a goal of achieving increased financing
flexibility. We cannot comment on the specifics of these
alternatives or assess the likelihood of success as these
discussions are ongoing.
SUNSHINE HEART, INC.
AND SUBSIDIARIES |
Condensed Consolidated
Statements of Operations and Comprehensive Loss |
(Unaudited) |
(In thousands, except per share
amounts) |
|
|
Three months
ended September 30, |
Nine months
ended September 30, |
|
2015 |
2014 |
2015 |
2014 |
Net sales |
$ -- |
$ 59 |
$ 59 |
$ 118 |
|
|
|
|
|
Operating expenses |
|
|
|
|
Selling, general and administrative |
1,725 |
2,361 |
6,259 |
6,965 |
Research and development |
4,548 |
3,808 |
13,404 |
12,284 |
Total operating expenses |
6,273 |
6,169 |
19,663 |
19,249 |
Loss from operations |
(6,273) |
(6,110) |
(19,604) |
(19,131) |
Other income (expense), net |
(282) |
(22) |
(499) |
22 |
Loss before income taxes |
(6,555) |
(6,132) |
(20,103) |
(19,109) |
Income tax (benefit) expense |
3 |
-- |
(124) |
(265) |
Net loss |
$ (6,558) |
$ (6,132) |
$ (19,979) |
$ (18,844) |
|
|
|
|
|
Basic and diluted loss per
share |
$ (0.36) |
$ (0.36) |
$ (1.11) |
$ (1.12) |
|
|
|
|
|
Weighted average shares outstanding – basic
and diluted |
18,330 |
16,903 |
18,045 |
16,881 |
|
|
|
|
|
Other comprehensive
income: |
|
|
|
|
Foreign currency translation
adjustments |
$ (16) |
$ 17 |
$ (22) |
$ (5) |
Total comprehensive
loss |
$ (6,574) |
$ (6,115) |
$ (20,001) |
$ (18,849) |
|
|
|
Condensed Consolidated
Balance Sheets |
(Dollars in thousands, except
share and per share amounts) |
|
|
September 30,
2015 |
December 31,
2014 |
|
(unaudited) |
ASSETS |
|
|
Current assets |
|
|
Cash and cash equivalents |
$ 27,899 |
$ 31,293 |
Accounts receivable |
— |
59 |
Other current assets |
765 |
360 |
Total current assets |
28,664 |
31,712 |
|
|
|
Property, plant and equipment,
net |
595 |
661 |
Other assets |
108 |
— |
TOTAL ASSETS |
$ 29,367 |
$ 32,373 |
|
|
|
LIABILITIES AND STOCKHOLDERS'
EQUITY |
|
|
Current liabilities |
|
|
Current portion of long-term debt |
$ 2,867 |
$ — |
Accounts payable and accrued
expenses |
2,329 |
2,079 |
Accrued salaries, wages, and other
compensation |
856 |
1,079 |
Total current
liabilities |
6,052 |
3,158 |
Long-term debt, net of
discount |
4,880 |
— |
Total liabilities |
10,932 |
3,158 |
|
|
|
Commitments and contingencies |
— |
— |
|
|
|
Stockholders' equity |
|
|
Series A junior participating preferred stock
as of September 30, 2015 and December 31, 2014, par value $0.0001
per share; authorized 30,000 shares, none outstanding |
— |
— |
Preferred stock as of September 30, 2015 and
December 31, 2014, par value $0.0001 per share; authorized
39,970,000 shares, none outstanding |
— |
— |
Common stock as of September 30, 2015 and
December 31, 2014, par value $0.0001 per share; authorized
100,000,000 shares: issued and outstanding 18,337,683 and
16,982,642 shares, respectively |
2 |
2 |
Additional paid‑in capital |
163,761 |
154,540 |
Accumulated other comprehensive income: |
|
|
Foreign currency translation
adjustment |
1,250 |
1,272 |
Accumulated deficit |
(146,578) |
(126,599) |
Total stockholders'
equity |
18,435 |
29,215 |
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY |
$ 29,367 |
$ 32,373 |
|
|
Condensed Consolidated
Statements of Cash Flows |
(Unaudited) |
(In thousands) |
|
|
Nine months
ended September 30, |
|
2015 |
2014 |
Operating Activities: |
|
|
Net loss |
$ (19,979) |
$ (18,844) |
Adjustments to reconcile net loss to cash
flows used in operating activities: |
|
|
Depreciation |
241 |
198 |
Stock-based compensation expense,
net |
1,811 |
1,924 |
Amortization of debt discount |
102 |
— |
Changes in operating assets and
liabilities |
|
|
Accounts receivable |
59 |
— |
Other current assets |
(406) |
(207) |
Other assets |
(108) |
— |
Accounts payable and accrued
expenses |
48 |
(429) |
Net cash used in
operations |
(18,232) |
(17,358) |
|
|
|
Investing Activities: |
|
|
Purchases of property and equipment |
(175) |
(205) |
Net cash used in investing
activities |
(175) |
(205) |
|
|
|
Financing Activities: |
|
|
Net proceeds from the sale of common
stock |
7,055 |
16 |
Proceeds from borrowings on long-term
debt |
8,000 |
— |
Net cash provided by financing
activities |
15,055 |
16 |
|
|
|
Effect of exchange rate changes on cash |
(42) |
(14) |
Net decrease in cash and cash
equivalents |
(3,394) |
(17,561) |
Cash and cash equivalents - beginning of
period |
31,293 |
54,136 |
Cash and cash equivalents - end of
period |
$ 27,899 |
$ 36,575 |
|
|
|
Supplement schedule of non-cash
activities |
|
|
Stock options and restricted stock units
classified as liabilities, net |
$ — |
$ (337) |
Warrants issued in connection with debt
financing |
$ 355 |
$ — |
USE OF NON-GAAP MEASURES
Management uses non-GAAP measures to establish operational goals
and cash flows, and believes that non-GAAP measures may assist
investors in analyzing underlying trends in the Company's business
over time. Investors should consider these non-GAAP measures in
addition to, and not as a substitute for or as superior to,
financial reporting measures prepared in accordance with GAAP. In
this press release, the Company has reported non-GAAP measures of
operating expenses, net loss and loss per share, which exclude
equity compensation expenses related to stock options, warrants,
restricted stock units and common stock awards, and reconcile to
GAAP operating expense, GAAP net loss and GAAP loss per share as
follows:
SUNSHINE HEART, INC.
AND SUBSIDIARIES |
Reconciliation of
non-GAAP amounts to GAAP |
(Unaudited) |
(In thousands, except per share
amounts) |
|
|
Three months
ended September 30, |
Nine months
ended September 30, |
|
2015 |
2014 |
2015 |
2014 |
Operating Expenses |
|
|
|
|
GAAP operating expenses |
$ 6,273 |
$ 6,169 |
$ 19,663 |
$ 19,249 |
Equity compensation expense |
(537) |
(700) |
(2,094) |
(2,188) |
Non-GAAP operating
expenses |
$ 5,736 |
$ 5,469 |
$ 17,569 |
$ 17,061 |
|
|
|
|
|
Net Loss |
|
|
|
|
GAAP net loss |
$ (6,558) |
$ (6,132) |
$ (19,979) |
$ (18,844) |
Equity compensation expense |
537 |
700 |
2,094 |
2,188 |
Non-GAAP net loss |
$ (6,021) |
$ (5,432) |
$ (17,885) |
$ (16,656) |
|
|
|
|
|
Loss Per Share |
|
|
|
|
GAAP basic and diluted loss per
share |
$ (0.36) |
$ (0.36) |
$ (1.11) |
$ (1.12) |
Non-GAAP basic and diluted loss
per share |
$ (0.33) |
$ (0.32) |
$ (0.99) |
$ (0.99) |
|
|
|
|
|
Weighted average shares outstanding – basic
and diluted |
18,330 |
16,903 |
18,045 |
16,881 |
About the COUNTER HF Study
COUNTER HF is a prospective, randomized, multi-center clinical
study. It is being conducted by heart failure and cardiac surgeon
specialists in the United States. It is expected to randomize 388
patients in up to 40 clinical sites. The purpose of the study is to
determine whether the C-Pulse System is a safe and effective
treatment for heart failure patients who meet the following key
study qualifications:
- NYHA Class III or early Class IV heart failure*;
- Ejection fraction ≤ 35% (measure of how well the heart pumps
blood);
- Taking appropriate heart failure medications as prescribed by
doctor; and
- Have been evaluated for cardiac resynchronization therapy with
or without defibrillation (CRT, CRT-D) or implantable cardioverter
defibrillator (ICD) therapy.
*New York Heart Class (NYHA) Class III or early Class IV: Very
limited in daily activities or unable to do activities without
discomfort. Become tired, short of breath, and have heart
palpitations during physical activity. Note: Other qualifications
apply and study doctors will determine who is eligible for the
study.
About the OPTIONS HF Study
The OPTIONS HF study is a post-market, multi-center,
prospective, open label study that will include 50 patients in up
to 15 European centers. The study is designed to observe clinical
outcomes of heart failure patients treated with the C-Pulse system.
The primary endpoint is comparable to the COUNTER HF study as it
evaluates the rate of re-hospitalization due to worsening heart
failure and heart failure related death in addition to many other
traditional heart failure endpoints.
About the C-Pulse®
Heart Assist System
The C-Pulse Heart Assist System, or C-Pulse System, an
investigational device in the United States, Canada and countries
that do not recognize the CE mark approval, utilizes the scientific
principles of intra-aortic balloon counter-pulsation applied in an
extra-aortic approach to assist the left ventricle by reducing the
workload required to pump blood throughout the body, while
increasing blood flow to the coronary arteries. Combined, these
potential benefits may help sustain the patient's current condition
or, in some cases, reverse the heart failure process, thereby
potentially preventing the need for later-stage heart failure
devices, such as left ventricular assist devices (LVADs),
artificial hearts or transplants. It may also provide relief from
the symptoms of Class III and ambulatory Class IV heart failure and
improve quality of life and cardiac function. Based on the results
from our feasibility study, we also believe that some patients
treated with our C-Pulse System may be able to stop using the
device due to sustained improvement in their conditions as a result
of the therapy. Caution: Investigational device, limited by Federal
(or United States) Law to Investigational use. About
Sunshine® Heart
Sunshine Heart, Inc. (Nasdaq:SSH) is an early-stage medical
device company focused on developing, manufacturing and
commercializing the C-Pulse System for treatment of Class III and
ambulatory Class IV heart failure. Sunshine Heart has completed an
approved U.S. Food and Drug Administration (FDA) feasibility
clinical study of the C-Pulse System and presented the results in
November 2011. In March 2012, the FDA notified the Company that it
could move forward with an investigational device exemption (IDE)
application. Sunshine Heart received unconditional approval from
the FDA in November 2012 to initiate its pivotal study. In July
2012, Sunshine Heart received CE Mark approval for its C-Pulse
System in Europe. Sunshine Heart is a Delaware corporation
headquartered in Minneapolis with wholly owned subsidiaries in
Australia and Ireland. The Company has been listed on the NASDAQ
Capital Market since February 2012.
Forward-Looking Statements
Certain statements in this release are forward-looking
statements that are based on management's beliefs, assumptions,
expectations, and information currently available to
management. All statements that address future operating
performance, events or developments that we expect or anticipate
will occur in the future are forward-looking statements, including
without limitation, our expectations with respect to product
development and commercialization efforts, clinical and
pre-clinical studies activities and results, design and development
of future studies, site activations, patient enrollment in
studies, timing of regulatory filings and approvals, regulatory
acceptance of our filings, research and development activities,
ultimate clinical outcomes and benefits of our products to
patients, market and physician acceptance of our products,
intellectual property protection, and potentially competitive
product offerings. The risk factors described in our filings with
the SEC could cause actual events to adversely differ from the
expectations indicated in these forward-looking statements.
Management believes that these forward-looking statements are
reasonable as and when made. However, you should not place undue
reliance on forward-looking statements because they speak only as
of the date when made. Sunshine Heart does not assume any
obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise. Sunshine Heart may not actually achieve the plans,
projections or expectations disclosed in forward-looking
statements, and actual results, developments or events could differ
materially from those disclosed in the forward-looking statements.
Forward-looking statements are subject to a number of risks and
uncertainties, including without limitation, the possibility that
regulatory authorities do not accept our application or approve the
marketing of the C-Pulse System, the possibility we may be unable
to raise the funds necessary for the development and
commercialization of our products, and those described in our
filings with the SEC. We do not assume any obligation to
publicly update or revise any forward-looking statements, whether
as a result of new information, future events or
otherwise.
CONTACT: For further information, please contact:
Investor:
Candice Knoll
Blueprint Life Science Group
T: +1-415-375-3340 Ext. 4
Claudia Drayton
Chief Financial Officer
Sunshine Heart, Inc.
T: +1-952-345-4200
Media:
David Schull
Russo Partners
T: +1-212-845-4271
Christopher Hippolyte
Russo Partners
T: +1-646-942-5634
CHF Solutions (NASDAQ:CHFS)
Historical Stock Chart
From Mar 2024 to Apr 2024
CHF Solutions (NASDAQ:CHFS)
Historical Stock Chart
From Apr 2023 to Apr 2024