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- Houston We Have (HWH) is planning to buy artificial intelligence provider Alerte Echo IQ for $7.45 million to support earlier and more accurate detection of heart disease
- Echo IQ is a specialist artificial intelligence provider with the ability to predict Aortic Stenosis (AS), one of the most common heart valve diseases in people over 65
- The company sees a global opportunity for the technology, once additional regulatory approvals are secured
- Payment includes $1 million upfront and the issue of $1.5 million worth of HWH shares at 5 cents per share
- A milestone payment of $250,000 cash and 15 million HWH shares will be issued once Echo IQ meets a revenue hurdle within three years
- A second payment of $2.9 million and 20 million HWH shares will be delivered upon Echo meeting a larger revenue hurdle within three years
- Firm commitments have been received for a $2.5 million equity placement
- Shares have soared 43.4 per cent at 7.6 cents apiece
Houston We Have (HWH) is planning to buy artificial intelligence provider Alerte Echo IQ for $7.45 million to support earlier and more accurate detection of heart disease.
The life sciences technology company, Alerte Echo IQ, is a specialist artificial intelligence provider with the ability to predict Aortic Stenosis (AS), one of the most common heart valve diseases in people over 65.
Artificial Intelligence, in conjunction with exclusive access to the National Echo Database Australia, allows the company to identify patients who are both at risk and treatable for the disease.
In early testing, ECHO IQ AI was found to predict severe cases of AS that were missed by other diagnostics.
The technology aims to provide earlier and more accurate detection of both severe and moderate AS, increasing the opportunity to treat patients through either surgical or trans-catheter aortic valve replacement — leading to improved quality of life and improved survival.
If left untreated, the mortality rate from severe aortic stenosis is 67 per cent at five years.
With valve replacement surgery offering a 94 percent, five-year survival rate, there is significant interest in the early and accurate detection of the disease.
Consequently, the company says applying this technology internationally, could represent a significant medium-term commercial opportunity, once additional regulatory approvals are secured.
Adding to this, HWH Chairman Andrew Grover said, the acquisition of ECHO IQ gives the company another growth platform in a large and lucrative sector and exposure to a much larger market opportunity globally.
Houston says ECHO IQ will “complement” its portfolio, which already includes 17 Australian health funds.
Additionally, the augmented intelligence capability that sits within the existing portfolio, namely Intelfuze, could be applied to the ECHO IQ proposition to potentially increase performance and accuracy further.
ECHO IQ Founding Partner Professor Geoff Strange commented on the deal.
“Our team has developed incredible capability in this vital sector and we believe that Houston We Have will be able to use the development work completed to date, and the unique access to the NEDA database to deliver transformational solutions for clinical cardiology diagnostics and major corporates in the echo machine manufacturing and reporting software spaces,” he said.
Payment
The acquisition will include $1 million upfront and the issue of $1.5 million worth of HWH shares at 5 cents per share.
A milestone payment of $250,000 cash and 15 million HWH shares at 5 cents will be issued once Echo IQ meets a US$5 million (approximately A$6.5 million) revenue hurdle within three years, provided the money is derived from a contract with a leading artificial heart valve manufacturer.
A second payment of $2.9 million and 20 million HWH shares will be delivered upon Echo meeting a US$10 million (approximately A$13.1M) revenue hurdle within 3 years.
Funding for the acquisition and supporting growth will be via a $2.5 million capital fundraising with 50,000,000 shares (at $0.05) issued.
The Placement will be completed without shareholder approval, other than
4,000,000 shares being subscribed for by related parties to HWH.
HWH plans to use the fundraising to provide the $1 million upfront payment and $1.5 million to increase resourcing at the company.
In particular, resourcing will conclude the remaining software development work necessary to secure Therapeutic Goods Approval in Australia and corresponding FDA approval for the US, as well as to commercialise this and other company opportunities, including investment in marketing and sales.
Shares have soared 43.4 per cent at 7.6 cents apiece at 12:50 pm AEDT.
