Seer Medical, which received $30m from Victoria’s venture capital fund, enters administration

A Melbourne med-tech start-up at the centre of a court fight has fallen into administration, as the company’s co-founder lobbed a shot at Victoria’s $2bn venture capital fund.

The then prime minister, Scott Morrison, with Seer Medical co-founder Dean Freestone.

A Melbourne med-tech start-up at the centre of an extraordinary court fight has fallen into administration.

Seer Medical, which developed at-home epilepsy monitoring equipment and received funding from Victoria’s controversial $2bn venture capital fund Breakthrough Victoria, has experienced serious cashflow problems since at least late 2023.

The Australian can reveal Seer, which was co-founded by scientist Dean Freestone who has subsequently lodged an unfair dismissal claim against the company, will enter administration early next year.

Dr Freestone said he feared Breakthrough Victoria “may wind up the business to avoid my legal action”.

“Whatever happens, I remain proud that Seer offset hundreds of millions in healthcare costs, created hundreds of jobs, entered a billion-dollar US market, and helped tens of thousands of Australians with epilepsy – all with about half the usual industry funding,” he said.

“Seer’s trajectory changed drastically after Breakthrough Victoria took control nearly two years ago, starving the company of resources needed for medtech.

“I believe Breakthrough Victoria declined another shareholder’s offer to save the company last week. It’s likely not too late for Breakthrough Victoria to reconsider and preserve the business and jobs.”

A Breakthrough Victoria spokeswoman said “as the matter is before the courts, it would be inappropriate to comment”.

Seer chief financial officer Tony Dudley wrote to shareholders last week to update them with the news, after one of the company’s key products called the Seer Home System was recalled in August from US and Australian markets.

“As previously communicated, with the product recall and closure of all clinical operations Seer has not received any revenue since August 2024. Since that time, the company has significantly reduced the cash burn, however our current funding is insufficient to sustain ongoing operations,” Mr Dudley said.

“As a board, our responsibility is to ensure we act in the best interest of the company, and we and our advisers have been working tirelessly to investigate all possible sources of funding.

“Unfortunately, at the time of the board meeting on Wednesday, 18 December 2024, no viable offers were available for the board to consider as a path forward.”

Mr Dudley said that after the board deliberated “on the best way forward for Seer”, it unanimously agreed “that after months of effort to source new funding, the best course of action is to appoint a voluntary administrator”.

Former prime minister Scott Morrison tours the Seer medical facility in Melbourne. Picture: David Crosling

Pitcher Partners will be appointed on January 6 and confirmed the business would continue to operate and staff would continue to be paid, he said.

“On behalf of the Seer Medical board of directors, I would like to thank everyone for your ongoing support and acknowledge this has been a difficult time for all and not a position any of us would hope to be in,” he said.

“Once the voluntary administration commences on 6 January, 2025 there will be a series of further communications as to the next steps.”

Breakthrough Victoria announced it would invest in Seer with an initial outlay of $30m by way of a convertible note in July 2022.

The then prime minister, Scott Morrison, visited Seer’s headquarters in Melbourne in 2021, announcing a $1.2bn digital strategy which included a focus on boosting artificial intelligence capability.

At the time, Dr Freestone welcomed the visit saying it “acknowledged Seer’s achievements in building a high-growth MedTech company that is revolutionising healthcare through the use of AI and clinical wearables for at-home monitoring”.

“It is so clear that Seer represents the next wave of emerging businesses that will provide the Australian economy with employment growth and export revenues,” he said.

In court documents, Dr Freestone alleged funding negotiations soured after Breakthrough Victoria attempted to change conditions of a proposed second investment to the company worth $10m.

He alleged Breakthrough Victoria and one of its executives – Sally McCutchan – undermined this second round of capital raising by allegedly withdrawing the offer of $10m unless Seer agreed to “cost-cutting measures” and making certain roles redundant.

On January 23 this year, the entire board except Dr Freestone quit, as fears swirled that the company was about to fall into administration.

Responding to a request for comment from The Australian, a Breakthrough Victoria Spokeswoman acknowledged news the company had been placed into administration but declined to comment on court proceedings.

“Breakthrough Victoria looks forward to working with the administrator and remains a strong believer of the potential impact of Seer Medical’s technology to improve public health and people’s quality of life globally,” she said.

“Until the voluntary administration process has been finalised, we will not know the outcome or financial implications.”

Breakthrough Victoria and Ms McCutchan deny the allegations made against them.