HeartSciences Closes Non-Dilutive Financing to Increase its Cash Runaway Ahead of Upcoming FDA Submission

Rhea-AI Summary

HeartSciences (NASDAQ: HSCS), an AI-powered medical technology company focusing on early heart disease detection through ECG/EKG transformation, has secured $1.9 million in net proceeds through a non-dilutive financing. This unsecured loan note has an 18-month maturity. Additionally, the company recently extended a $500,000 loan note to September 2025. CEO Andrew Simpson highlighted that these financial moves have extended the company's capital runway by $2.4 million since late August, providing significant opportunities to achieve valuable commercial milestones. The financing comes ahead of upcoming FDA submissions, positioning HeartSciences for potential growth in the medical technology sector.

Positive

• Secured $1.9 million in non-dilutive financing
• Extended $500,000 loan note to September 2025
• Increased cash runway by $2.4 million
• Upcoming FDA submissions indicate potential product approval
• Non-dilutive nature of financing preserves shareholder value

Negative

• Taking on additional debt with new loan note
• Reliance on external financing may indicate cash flow challenges

Insights

Financial Analyst

HeartSciences' recent $1.9 million non-dilutive financing is a strategic move that bolsters its financial position. This unsecured loan, coupled with the $500,000 loan extension, provides a total of $2.4 million in additional runway. The 18-month maturity of the new loan offers flexibility, allowing the company to focus on its upcoming FDA submissions without immediate repayment pressure.

The non-dilutive nature of this financing is particularly noteworthy. It allows HeartSciences to access capital without diluting existing shareholders' equity, which is often a concern with traditional equity fundraising. This approach suggests management's confidence in the company's near-term prospects and potential FDA approval.

However, investors should note that while this financing extends the cash runway, it also increases the company's debt obligations. The success of HeartSciences will largely depend on the outcome of the FDA submissions and subsequent commercialization efforts.

Medical Research Analyst

HeartSciences' focus on AI-powered ECG/EKG technology for early heart disease detection positions it at the forefront of a critical medical need. The company's upcoming FDA submissions represent a pivotal moment that could significantly impact its market potential. The additional capital secured through this non-dilutive financing is important for supporting these regulatory efforts.

The AI-driven approach to ECG interpretation has the potential to revolutionize cardiovascular diagnostics by improving accuracy and enabling earlier detection of heart disease. If successful, this technology could lead to better patient outcomes and reduced healthcare costs. However, the FDA submission process is rigorous and approval is not guaranteed.

Investors should closely monitor the progress of HeartSciences' FDA submissions, as a positive outcome could be a game-changer for the company and the field of cardiology diagnostics. The extended cash runway provides a buffer for navigating the often lengthy and unpredictable regulatory process.

Southlake, TX, Sept. 12, 2024 (GLOBE NEWSWIRE) -- Heart Test Laboratories, Inc. d/b/a HeartSciences (NASDAQ: HSCS; HSCSW) (“HeartSciences” or the “Company”), an artificial intelligence (AI)-powered medical technology company focused on transforming ECGs/EKGs to save lives through earlier detection of heart disease, today announced the close of a non-dilutive financing, with $1.9 million in net proceeds.  The unsecured loan note has an 18-month maturity date and follows the recent 12-month extension of a $500,000 loan note to September 2025.

Andrew Simpson, CEO of HeartSciences, said, “We have extended our capital runway by $2.4 million since late August ahead of our upcoming FDA submissions. This has been achieved with non-dilutive capital and provides significant opportunity for HeartSciences to hit a number of valuable commercial milestones.”

About HeartSciences

Heart Test Laboratories, Inc. d/b/a HeartSciences is a medical technology company focused on applying innovative AI-based technology to an ECG (also known as an EKG) to expand and improve an ECG's clinical utility. Millions of ECGs are performed every week and the Company's objective is to improve healthcare by making it a far more valuable cardiac screening tool, particularly in frontline or point-of-care clinical settings. HeartSciences has one of the largest libraries of AI-ECG algorithms and is developing AI-ECG solutions to be made available on either a hardware agnostic cloud-based platform or its proprietary MyoVista® wavECG™ device, to help identify cardiovascular disease in any care setting worldwide in a manner to best suit different care providers. HeartSciences' first product candidate for FDA clearance, the MyoVista® wavECG™, or the MyoVista®, is a resting 12-lead ECG that is also designed to provide diagnostic information related to cardiac dysfunction which has traditionally only been available through the use of cardiac imaging. The MyoVista® also provides conventional ECG information in the same test.

For more information, please visit: https://heartsciences.com/. X: @HeartSciences

Safe Harbor Statement

This announcement contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are made under the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995 and are relating to the Company's future financial and operating performance. All statements, other than statements of historical facts, included herein are "forward-looking statements" including, among other things, statements about HeartSciences' beliefs and expectations. These statements are based on current expectations, assumptions and uncertainties involving judgments about, among other things, future economic, competitive and market conditions and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond the Company's control. The expectations reflected in these forward-looking statements involve significant assumptions, risks and uncertainties, and these expectations may prove to be incorrect. Investors should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. Potential risks and uncertainties include, but are not limited to, risks discussed in HeartSciences' Annual Report on Form 10-K for the fiscal year ended April 30, 2024, filed with the U.S. Securities and Exchange Commission (the "SEC") on July 29, 2024 and in HeartSciences' other filings with the SEC at www.sec.gov. Other than as required under the securities laws, the Company does not assume a duty to update these forward-looking statements.

Contacts:

HeartSciences
Gene Gephart
+1-682-244-2578
info@heartsciences.com

Investors
Gilmartin Group
Vivian Cervantes
investorrelations@heartsciences.com

FAQ

How much non-dilutive financing did HeartSciences (HSCS) secure in September 2024?

HeartSciences (HSCS) secured $1.9 million in net proceeds through non-dilutive financing in September 2024.

What is the maturity date of HeartSciences' (HSCS) new unsecured loan note?

The new unsecured loan note secured by HeartSciences (HSCS) has an 18-month maturity date.

How much has HeartSciences (HSCS) extended its capital runway since late August 2024?

HeartSciences (HSCS) has extended its capital runway by $2.4 million since late August 2024.

What upcoming milestone is HeartSciences (HSCS) preparing for with this financing?

HeartSciences (HSCS) is preparing for upcoming FDA submissions with this financing.