$0.230
Opened: 06-Sep-2024
Shares Held at Open: 3,470,000
What does EIQ do?
Echo IQ (ASX:EIQ) is a technology company that uses AI to provide early warning and enhanced detection of heart disease.
What is the macro theme?
Heart diseases are the leading cause of death worldwide.
Diagnosis is performed by humans who have to interpret 3D models of the heart, which leads to inaccuracy and delayed or missed diagnosis costs lives.
With 30% of all deaths around the world attributed to cardiovascular disease, we think EIQ solves for a pressing problem as AI increasingly enters the health economy.
Why did we invest in EIQ?
The data shows that the AI algorithm works.
Imminent share price catalyst in potential aortic stenosis FDA approval.
Multi-billion dollar market target for “heart failure” diagnostics assistant.
Second catalyst for FDA approval on heart failure could be within 12 months.
Exclusive commercial access to the world's biggest heart data repository
Clear pathways to commercialisation in the USA - the biggest healthcare market in the world.
SaaS revenue model, potential to rapidly grow revenue and/or secure large licensing deals.
Cost savings, 3 seconds until results, removing bias
What do we expect EIQ to deliver?
Objective #1: Secure FDA approval for aortic stenosis product
FDA approval for aortic stenosis will allow EIQ to commercialise its technology for this product. We want to see this happen by the end of September 2024.
Milestones
FDA clearence for aortic stenosis
Objective #2: Commercialise aortic stenosis product
We want to see EIQ make sales and grow its revenue for this product.
Milestones
Reimbursement approvals
First partnership from aortic stenosis product
Second partnership with hospital network
Third partnership with hospital network
Deal with healthcare provider (Pharma company)
Licensing deal (medical device manufacturer/imaging company)
Objective #3: Secure FDA approval for heart failure product
FDA approval will allow EIQ to commercialise its technology for heart disease.
Milestones
Publish results of clinical study (A)
FDA Pre-Submission meeting
Clinical study (B) starts
Clinical study (B) interim results
Clinical study (B) final results
FDA 510(k) application
FDA 510(k) decision
Objective #4: Commercialise heart failure product
We want to see EIQ make sales and grow its revenue for this product. This is a much bigger market than aortic stenosis.
Milestones
Secure reimbursements
First sales from heart failure product
Deal with healthcare provider (Pharma company)
Licensing deal (medical device manufacturer/imaging company)
What could go wrong?
Regulatory Risk
EIQ has applied for FDA clearance under the 510(k) pathway for aortic stenosis and will apply for FDA clearance for heart failure.
There is no guarantee that the FDA will provide clearance, and the application may be rejected.
Also, EIQ’s strategy is reliant on securing reimbursement for its product.
If EIQ is not able to secure a reimbursement deal then its commercialisation strategy may need to pivot.
Sales/Commercialisation risk
EIQ is reliant on its partners, both under the licensing and reimbursement strategy, to use EIQ’s product.
If EIQ’s product is not used (because it doesn’t add value back to the provider), then it won’t be able to generate revenue.
There is no guarantee that EIQ’s product will be used by its partners and, therefore, no guarantee of revenue.
Funding and dilution risk
EIQ is a small cap company and is essentially pre-revenue. This means that EIQ may need to raise funds in the future via capital raises that may incur dilution to shareholders.
Competition Risk
There may be other companies developing AI products in the medtech space. It is possible for competing products to enter the market.
Key personnel risk
EIQ is reliant on a number of key professionals via its scientific advisory board and board more generally. If these personnel leave it could hurt the company’s prospects.
Market risk
There is always the possibility that broader market sentiment gets worse and shares as a whole trade lower, taking EIQ’s share price with it. Alternatively, there could be further sector specific pain ahead where junior explorers suffer a lot more than the broader market.
What is our investment plan?
We plan to hold a position in EIQ for the next 3-5 years (and beyond) as it progresses its plan to gain significant market penetration in the large US market.
We eventually may look to take some profits by selling up to ~20% of our holding (in line with our holding policy and escrow conditions) if the share price materially rerates on the company successfully delivering on the key objectives listed above.
Disclosure: Disclosure: S3 Consortium Pty Ltd (the Company) and Associated Entities own 3,470,000 EIQ Shares and the Company’s staff own 140,000 EIQ shares at the time of publishing this Investment Memo. The Company has been engaged by EIQ to share our commentary on the progress of our Investment in EIQ over time.
EIQ signs first hospital deal just weeks after successful US FDA approval
Nov 19, 2024
Nov 19, 2024 |
13 min
A top US cardiology hospital has just agreed to integrate Echo IQ (ASX: EIQ)’s technology into its practice. EIQ has an FDA cleared, AI-powered algorithm that helps detect heart diseases. Yesterday, EIQ announced that it had signed an integration agreement with Beth Israel Deaconess Medical Center in the USA.
EIQ Secures FDA Clearance - can now market and sell in the USA.
Oct 9, 2024
Oct 9, 2024 |
13 min
EchoIQ (ASX: EIQ) just secured FDA clearance for its AI-powered algorithm that helps detect heart diseases.
EIQ - Is FDA approval imminent? What happens after that?
Sep 25, 2024
Sep 25, 2024 |
18 min
Diseases of the heart are the leading cause of death worldwide. But diagnosis is complex - and delayed or missed diagnosis costs lives. Echo IQ (ASX: EIQ) is a tech company that has a remarkably accurate AI based tool to detect heart diseases early. Based on company timelines, FDA approval for its technology could happen any day now.
More on our Latest Investment EIQ
Sep 7, 2024
Sep 7, 2024 |
12 min
Yesterday we announced our new Investment in Echo IQ (ASX: EIQ). This is our 9th new Investment made this year. EIQ is developing an AI-powered diagnostics assistance tool that detects adverse heart conditions.
Our new Investment is Echo IQ (ASX:EIQ)
Sep 6, 2024
Sep 6, 2024 |
13 min
Today we are announcing our newest Investment. It’s an ASX healthcare technology stock just a few weeks from a major share price catalyst.
EIQ Investor Webinar - our key takeaways
Nov 7, 2024
Nov 7, 2024 |
3 min
Yesterday, our AI heart disease detection Investment, EchoIQ (ASX: EIQ) held an investor webinar which we tuned into.
EIQ Webinar Today
Sep 12, 2024
Sep 12, 2024 |
34.0 seconds
Our AI heart health Investment, Echo IQ (ASX: EIQ) will host an investor webinar on today, September 12th at 11am AEST
Market Optimism Peaks Ahead of the Holidays
Nov 16, 2024
Nov 16, 2024 |
11 min
The world is still digesting what exactly the US election result will mean for the next four years. The weeks after an election is often a “honeymoon phase”.
Insights from Industry Leaders at IMARC
Nov 2, 2024
Nov 2, 2024 |
17 min
A few of our team was in Sydney this week for the IMARC conference, and to hear from some of our Portfolio Companies. IMARC is the largest mining conference in Australia - so the big mining companies show up, but also well attended by small cap companies and investors. The sentiment “vibe” is definitely improving, something we’ve been observing and pointing out in recent weekend editions.
Major Announcements Driving Volatility in Small Caps
Oct 12, 2024
Oct 12, 2024 |
15 min
The mood is good in small cap land. Cautious… but good. It was another positive week, with plenty of green across the board.
Riding the Bull and Bear Cycles
Oct 5, 2024
Oct 5, 2024 |
19 min
Everyone's a “genius” in a small cap bull market. At least that is what it felt like between November of 2020 and June of 2022. All IPO’s oversubscribed, cap raises were highly competitive and good news was being rewarded with on-market buying. Everything was going up. (Remember things like Afterpay? Lithium at $80,000/t? Gamestop? Shells with a $10M EV? The occasional “50 bagger”?) Since then, it has been MUCH harder to navigate the small cap market during the “bear” winter.
Silver and gold shines again while med-tech companies make moves
Sep 28, 2024
Sep 28, 2024 |
13 min
With the AFL Grand final just around the corner we take a look at how Gold and Silver are shining through.
