Sunshine Heart, Inc. (SSH — NEUTRAL): Takeaways from Analyst...

Sunshine Heart, Inc. (SSH — NEUTRAL): Takeaways from Analyst Event at TCT

Posted on Wed, Sep 17th, 2014 at 7:46 am
by Sean Lavin — POSTS | DISCLAIMER RSS Email Phone: 305.301.8198
Categories: Equity Research, USA, Report, Healthcare, Medical Technology
Tags: Sunshine Heart, SSH , C-Pulse
Mgmt reiterated its expectation for 10+ trial patients in Q3; implantable C-Pulse System moving along.

• Though no specific update on U.S. trial enrollment numbers was provided at SSH’s Analyst Event at TCT, mgmt reiterated their expectation of Q3 enrollments reaching double digits. Per mgmt, an additional two trial sites have been activated since 2Q and more pts are being identified and screened to potentially participate in the trial.
• FDA has responded to SSH’s request to consider an interim analysis in the COUNTER HF trial with 4-5 questions. It is hard to forecast what the FDA will do here, but the fact the agency responded with questions and did not say no is a small positive in our view. That said, we feel enrollment numbers are most important to the SSH story at this time. The company hopes to discuss its strategy for the next gen implantable system (C-Pulse 2) when it responds to FDA’s questions regarding the interim analysis. Mgmt is hopeful that the FDA may consider a small safety trial for C-Pulse 2 rather than requiring a full efficacy trial. It’s impossible to predict how the FDA will respond to SSH’s responses and requests but we feel there will be multiple updates soon.
• Update on fully implantable system. Investigators are continuing to conduct animal studies with C-Pulse 2. While still early, one 90-day animal study that was presented showed an encouraging hemodynamic profile and an aorta free of any injury. The doc discussed his belief that C-Pulse 2 with transcutaneous energy (TETs) has the best shot of getting through the FDA at this point in time given the pump’s non-obligatory nature (ability to turn on and off without harming the patient) vs. other devices (such as LVADs) in development with TETs. In addition, the presenting doc feels confident that the Penn State Arrow LionHeart data has helped pave the way for TETs by showing no skin nor thermal injury problems in 4+ years of patient follow-up data. Though we think this makes sense and believe the elimination of a drive line could be a game changer for the Class 3 pt population, we have no idea how the FDA will approach transcutaneous energy. The next near term objective for C-Pulse development is to make the turbine smaller, tweak a few features in hopes to make the device easier to implant, and continue working with Cirtec and Minnetronix to make the electronics associated with the pump more robust. We feel eliminating the drive line would cause a big boost in Class III patients wanting the device.