Business Description

Check4® by IdentifySensors® Biologics is a digital diagnostic platform intended to rapidly detect and differentiate multiple pathogens simultaneously at the molecular gene level.

New patented technology eliminates enzymatic amplification and reagents. Graphene-based inks are printed into solid-state electronic biosensors. The technology is intended to move diagnostics away from chemical testing and into a rapid multiplex platform, with a lower limit of detection than the most accurate PCR tests on the market today.

In extensive preliminary studies, printed sensors on thin-film substrates pinpointed target DNA and RNA in saliva in minutes. These new sensors serve as the core to a new Bluetooth portable device intended for point-of-care and over-the-counter use. The company plans to expand the platform to rapidly detect genetic material from dozens of infectious diseases, including respiratory illnesses, diarrheal pathogens and sexually transmitted diseases.

With a target price lower than current molecular tests, Check4® is intended to significantly disrupt the PCR market. This technology has not yet been approved for sale in the United States.

Problem

For the past 50 years, medical science has relied on slow chemical reactions to test for infections from viruses and bacteria. During the pandemic, the public witnessed firsthand how slow and cumbersome the process really is. After samples are taken from patients, most PCR tests required trained clinicians to process the chemical reactions in laboratories.

The method is slow, expensive and time-consuming. What’s more, most patients prefer testing themselves at home, without driving to a clinic and waiting for results. This is particularly true for diseases such as HIV and other STDs. Home antigen tests have taken market share with COVID, but the accuracy of antigen results are often unreliable and not suitable for medical professionals dealing with a host of other problems.

Solution

IdentifySensors® Biologics has developed a small and simple Bluetooth device intended to detect most viruses and bacteria from saliva with a high level of accuracy. The device uses interchangeable cartridges that rapidly detect and differentiate groups of multiple infections simultaneously – anywhere, any time.

Each cartridge is intended to detect as many as three different infections. Results are sent to patients by text message or email in minutes. Tests can be taken at home or through medical professionals. At the heart of this product are cutting-edge electronic biosensors that transmit digital signals through DNA and RNA. When an exact molecular sequence is a match, and analyzed through an algorithm, the test is positive. Using no chemicals, these rapid results are intended to be as accurate as a hospital PCR test.

By shifting infectious-disease diagnostics to a digital platform, testing can become significantly faster, less expensive and more accessible to many more people whose lives depend on it. IdentifySensors plans to market this technology first in Africa, where an Ebola infection is a death sentence to those who encounter it. The Check4 device will then be manufactured for a wide range of other infections, such as strep, flu, COVID, Hepatitis C, RSV, HIV and Lyme.

Business Model

Razor-Razorblade Model

IdentifySensors is developing a razor-razorblade model to sales and marketing. Consumers and health organizations purchase a reusable Bluetooth reader for about $99. Customers then buy an ongoing supply of disposable test cartridges, which are operated by the reader. The single-use cartridges – each of which test for different infections – will range in price between $29 to $199, depending on the number of sensors they hold and the pathogens for which they test.

Following FDA approval – the first approval is expected in mid-2024 – IdentifySensors will begin marketing to health-care organizations, doctors’ offices and hospital systems. Soon after, the company plans to market its products direct to consumers for common infections, such as influenza, COVID, RSV, Lyme and sexually transmitted diseases.

One of the benefits to this technology is the biosensors can be programmed to detect any form of RNA or DNA. This means that that the devices and infrastructure to manufactured them remains the same regardless of the targeted disease. The goal is to significantly disrupt the PCR market for dozens and infections.

Market Projection

The molecular testing market for infectious diseases is roughly $16 billion worldwide. This is for highly accurate molecular tests only, including PCR tests for a wide range of pathogens. This does not include low-quality antigen tests commonly associated with COVID. These products are considered point-of-care, which are generally used in medical settings for accurate and definitive results.

IdentifySensors has run an extensive analysis of this market through planned products, using industry best data and a conservative planning model of only 3 percent market share over five years. Through this model, we project revenues of $36 million in the first full year, ramping up to $440 million dollars by year five.

With a projected EBITDA of 69 percent – and a conservative annual growth rate of 154 percent – the company anticipates a five-year valuation of $2.6 billion, based on a 6X multiple.

Competition

IdentifySensors plans to significantly disrupt the PCR testing market. This includes a wide range of infection in both clinical setting for point-of-care and over-the-counter to consumers.  The company also plans to launch new home testing products that currently do not exist on the market today. These include over-the-counter tests for STDs, HIV and Lyme, among other pathogens.

Traction & Customers

IdentifySensors has begun large-scale manufacturing and is about to submit its first application to the FDA. In the meantime, the company is conversations with several large health care and pharmaceutical companies about partnerships, marketing and sales.

Investors

In the past two years, the company has raised nearly $15 million from Regulation A+ and Regulation D investors. The company is fully audited and is now opening its doors to smaller investors, as we begin the expensive task of clinical trials.

Terms

Risks

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