Company Overview

EndoSound(R), Inc. is a medical technology company focused on expanding access to endoscopic ultrasound (EUS), a diagnostic modality used in gastrointestinal care. The company has developed a system designed to enable ultrasound capability using standard gastroscopes commonly found in endoscopy settings.

Endoscopic ultrasound is widely used in hospital environments but is less commonly available in ambulatory surgical centers and community-based hospital settings due to cost, infrastructure, and training requirements. EndoSound’s approach is intended to address certain elements of these constraints; however, adoption, utilization, and clinical outcomes may vary across care settings.

The company’s first-generation system has received FDA clearance. Regulatory clearance does not ensure clinical adoption, commercial success, or improved patient outcomes.

The current offering is intended to support continued product development, manufacturing readiness, and commercialization of the company’s next-generation endoscopic ultrasound system.

Selected Investment Considerations

The following points summarize certain factors that may be relevant when evaluating the Company. These considerations are not exhaustive and should be reviewed in conjunction with the full offering materials.

1. The company has developed an FDA-cleared first-generation system designed to enable ultrasound functionality using standard gastroscopes
2. The product is intended to integrate into existing endoscopy workflows without requiring dedicated echoendoscopes
3. The company is pursuing a model that includes both system sales and recurring procedure-based revenue
4. Early clinical use has provided operational feedback that informs ongoing product development
5. Market adoption is subject to a range of factors, including physician acceptance, training requirements, reimbursement dynamics, and institutional purchasing decisions

Industry Context and Problem

Endoscopic ultrasound is a diagnostic procedure that combines standard endoscopy with ultrasound imaging, allowing physicians to evaluate the gastrointestinal tract and surrounding structures in greater detail than with standard endoscopy alone. It is used in the evaluation of certain GI cancers, lesions, and other conditions where additional imaging is needed to inform next steps.

Access to EUS is largely concentrated in larger hospitals and academic medical centers. Traditional EUS systems typically require dedicated echoendoscopes, significant upfront capital investment, and physicians who have completed specialized training beyond standard endoscopy. Community hospitals and ambulatory surgery centers, where a substantial share of routine endoscopy takes place, often lack one or more of these requirements.

When a patient's initial endoscopy occurs at one of these settings and ultrasound imaging is needed to evaluate a finding, that patient is generally referred to a separate facility. The referring site cannot complete the evaluation on its own. Depending on the provider and region, these referrals may result in scheduling delays, additional patient appointments, and a break in continuity of care.

EndoSound has developed an FDA-cleared system intended to address this access gap at the point where endoscopy is already being performed. The system is designed to add ultrasound capability to standard gastroscopes that many facilities already own, rather than requiring the purchase of a traditional dedicated EUS system, which can cost approximately $450,000 or more. EndoSound's system is priced at approximately $60,000.

The system is intended to integrate into existing endoscopy workflows without requiring new infrastructure or significant changes to room staffing and setup. EndoSound continues to refine its product based on direct feedback from physicians using the system in clinical practice. Actual integration, utilization, and physician adoption may differ across institutions, and there can be no assurance that future iterations will achieve intended performance or market acceptance.

Development Status and Trajectory

The company reports that its first-generation system has progressed through product development, regulatory clearance, and use in clinical settings.

According to company-reported internal tracking, the system has been used in hundreds of procedures across 17 active clinical sites as part of routine endoscopy workflows. These figures have not been independently verified.

Feedback from early clinical use has informed the design of a next-generation system. The transition from initial clinical use to broader commercialization is subject to additional development, manufacturing, and market factors, all of which involve uncertainty.

Market Opportunity

EndoSound has estimated its addressable market based on published upper endoscopy procedure volumes, site-of-care distribution, and internal assumptions regarding adoption and per-procedure pricing of approximately $650.

Approximately 8 million upper endoscopy procedures are performed each year in the United States. According to the company, an estimated 80% of hospitals and 97% of ambulatory surgery centers do not currently offer EUS, primarily due to the capital requirements and infrastructure associated with traditional systems.

Based on this landscape, EndoSound estimates its market opportunity as follows:

1. Total Addressable Market (TAM): approximately $19 billion
2. Serviceable Addressable Market (SAM): approximately $7.2 billion
3. Initial Serviceable Obtainable Market (SOM): approximately $1.8 billion

These estimates are derived from internal modeling using procedure volume data and pricing assumptions. They are intended to illustrate the scope of the opportunity as the company sees it and should not be interpreted as projections of future financial performance. Actual market opportunity may differ materially based on adoption rates, pricing, competition, and other factors outside the company's control.

Clinical and Economic Considerations

The company believes that expanding access to ultrasound-enhanced endoscopy may have clinical and economic implications at the point of care. EndoSound's system is designed to enable Echo-EGD, defined as a standard upper GI endoscopy enhanced with ultrasound imaging, in settings where traditional EUS systems are not deployed.

The company references published data and internal estimates suggesting the following potential outcomes:

1. Echo-EGD may identify pancreatic disease in approximately 40% of patients presenting with dyspepsia
2. It may change clinical management in approximately 25% of cases compared to standard upper GI endoscopy alone
3. Use as a first-line diagnostic tool has the potential to shorten the diagnostic timeline from approximately 10 weeks to approximately 2 weeks
4. Estimated savings of approximately $4,600 in insurance costs per episode of care
5. Estimated savings of over $1,100 in patient out-of-pocket expenses per episode of care

Outcomes may vary depending on patient population, provider expertise, and clinical setting. No assurance can be given that EndoSound's system will achieve similar results across all institutions or use cases, and these figures should not be interpreted as guarantees of clinical or financial performance.

Business Model

EndoSound intends to generate revenue through two channels: an upfront system sale and recurring per-procedure usage fees.

1. Facilities purchase the EndoSound system for approximately $60,000, compared to traditional EUS systems that often cost $450,000 or more and require dedicated scopes
2. After installation, the company charges approximately $650 per procedure each time the system is used in clinical practice
3. The company reports gross margins of approximately 95% on per-procedure revenue

This structure is intended to generate recurring revenue that grows alongside procedure volume at each installed site, without requiring additional capital equipment purchases. These figures reflect current pricing targets and internal estimates. Actual revenue, margins, and pricing may vary based on market conditions, customer agreements, and reimbursement dynamics.

Commercial Traction

The company reports the following operational milestones, based on internal tracking that has not been independently verified:

1. Hundreds of procedures completed using the first-generation system across 17 active clinical sites
2. Roughly 50 facilities have expressed preliminary interest or are in various stages of engagement regarding the next product iteration
3. $3.5M raised in the company's initial round, including $1.4M through Wefunder
4. $5M non-dilutive licensing and royalty agreement executed with a strategic partner for commercialization rights in China
5. EndoSound received ASGE and AGA Innovation of the Year recognition in 2022

Expressions of interest from facilities do not constitute binding purchase commitments. Commercial adoption remains subject to individual purchasing decisions, clinical validation requirements, and operational considerations at each institution. Industry recognition does not imply endorsement of the company's securities or investment opportunity.

Use of Proceeds

The company intends to use proceeds from this offering for purposes that may include:

1. Commercial expansion and sales efforts
2. Manufacturing and supply chain development
3. Continued product development and engineering
4. General corporate and administrative expenses

Actual allocation of funds may vary based on operational priorities, market conditions, and other factors.

Management

EndoSound's leadership team includes individuals with backgrounds spanning clinical EUS practice, ultrasound engineering, and medical device commercialization. Prior experience does not guarantee future performance or the success of the company.

1. Scott Aldrich Jr., Chief Executive Officer - Medical device executive with 20+ years in gastrointestinal devices. Previously held strategy and commercialization roles at MotusGI, Mauna Kea, and Pentax Medical.
2. Stephen Steinberg, MD, Founder and Chief Medical Officer - GI physician with 40+ years of clinical and academic experience. Has performed thousands of EUS procedures, served as a key opinion leader in the field, and co-invented EndoSound's core technology.
3. Scott Corbett, Founder and Chief Technology Officer - Biomedical engineer with 30+ years in ultrasound. Holds 19 patents, co-invented EndoSound's technology, and previously held engineering leadership roles at GE, Tyco Healthcare, and Sonivate.
4. Paul Henwood, Chief Operating Officer - Operations executive with experience scaling early- and mid-stage technology companies. Began his career as an ultrasound transducer engineer and later served in senior leadership roles including CEO and President. Helped lead MicroConnex through operational growth and a successful exit.
5. Josh Cohn, Chief Commercial Officer - Medtech commercial leader with 18 years of sales experience. Former National Sales Director at Pentax Medical, focused on EUS commercialization across hospitals and ambulatory surgery centers.

Risk Considerations

An investment in EndoSound involves a high degree of risk. These risks include, but are not limited to:

1. Early-stage company risk and limited operating history
2. Uncertainty of product adoption and market acceptance
3. Regulatory and compliance risks
4. Dependence on key personnel
5. Competition from existing and emerging technologies
6. Reimbursement variability across healthcare systems
7. Potential need for additional capital
8. Illiquidity of the investment

Investors should be prepared to lose their entire investment.

Forward-Looking Statements

This communication contains forward-looking statements, including statements regarding product development, market opportunity, and business strategy. These statements are based on current expectations and assumptions that involve risks and uncertainties.

Actual results may differ materially from those expressed or implied in forward-looking statements. No assurance can be given that the Company will achieve its objectives or that any investment will result in a financial return.