EchoIQ Limited (ASX: EIQ)
Abstract
EchoIQ Limited (ASX: EIQ) is a Sydney-based medical technology company whose software, EchoSolv, reads the measurements from an echocardiogram and tells a cardiologist how likely it is that the patient has a serious heart condition they might otherwise miss. This is the first Samso Research Workup on a company outside resources, and the reason for the exception is that EchoIQ presents the same problem a pre-production explorer presents. That problem is a valuation built on what happens next, revenue close to nothing and a binary event in the middle of the story.
On 8 September 2026 the FDA issued a Not Substantially Equivalent determination on the 510(k) application for EchoSolv HF, the heart failure product. The shares fell from A$1.28 to A$0.64 the following day, a fall of 50 per cent, and on to A$0.485 by 14 September. On 17 September the company said the matters the FDA cited were limited to aspects of the statistical analysis supporting clinical validation, with no concerns identified on the underlying technology, and that clearance could be achieved over the coming quarters. The shares closed at A$0.710 on 21 September. That characterisation is the company's. The FDA has published nothing. The determination does not affect EchoSolv AS, the aortic stenosis product cleared in October 2024, which continues to be sold in the United States.
What the clearance established is narrower than most commentary suggests. EchoSolv AS is cleared as an adjunct to echocardiography, not as a screening test or a diagnostic. Three performance figures circulate and they come from three different datasets. The 0.986 quoted almost everywhere appears in both the Australian derivation study and the Boston cohort. The figure the FDA reviewed was an AUROC of 0.948 on a third dataset, and in the reader study five cardiologists improved from 0.865 unassisted to 0.883 assisted, which did not reach statistical significance. There is a genuine body of peer-reviewed evidence behind the product, produced largely by the same company-linked investigator group, and all four published studies are retrospective.
The more consequential problem sits in reimbursement rather than regulation. EchoIQ has no dedicated billing code in the United States, having been refused a Category III code twice in 2025, and bills under an unlisted cardiovascular code at US$100 to US$150 to the hospital, of which it receives 30 to 60 per cent. Its closest comparable business, Ultromics, holds a code, a payment classification and a published rate of about US$316 paid to the hospital.
The consequence shows in the accounts. Over the six months to 30 June 2026 the company processed roughly twenty thousand echocardiograms and recorded A$737 of revenue in that half, against A$91,646 for the full year. Receipts from customers in the Appendix 4C were nil in each of four consecutive quarters. Samso found no disclosure of the number of live paying sites.
Against that, the balance sheet is strong. The company reported cash at bank of over A$105 million as at July 2026 following a A$110 million placement, against an operating burn of roughly A$2.7 million a quarter. It has the time and the money to take another run at the FDA and to keep selling EchoSolv AS while it does. No director sold a share in FY2026, though directors are constrained by trading windows, so an absence of selling carries less weight than a purchase does. One director added shares on market for A$227,757 and one added shares on exercise. The Samso Call on EchoIQ is Time to Look at Taking a Position, and section 15 sets out the five things behind it and the one question it does not settle. The nearest dated item is the 30-day window to file a request for supervisory review of the determination. That window runs from the date of the FDA's decision, which the company has not disclosed, so the closing date is not on the public record.
