What changed in this filing

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Item 1. Business

2024-03-28 compared with 2023-03-16 · 76 added, 57 removed, 322 unchanged (29% of the section changed)

We were incorporated as a Delaware corporation in 2007.

We are leveraging experience with pre-clinical enhanced ultrasound devices to develop technology for increasing the capabilities of clinical diagnostic ultrasound in order to broaden patient access to the safe diagnosis and treatment of a number of significant medical conditions in circumstances where expensive X-ray computed tomography (“CT”) and magnetic resonance imaging (“MRI”) technology, or other diagnostic technologies such as surgical biopsy, are unavailable or impractical.

In 2010, we began marketing and selling our Nexus 128 system, which combined light-based thermoacoustics and ultrasound to address the imaging needs of researchers studying disease models in pre-clinical applications.

Building on this expertise in thermoacoustics, we have developed a next-generation technology platform—Thermo Acoustic Enhanced Ultrasound, or TAEUSⓇ —which is intended to enhance the capability of clinical ultrasound technology and support the diagnosis and treatment of a number of significant medical conditions that currently require the use of expensive CT or MRI imaging or where imaging is not practical using existing technology.

We ceased production, service support and parts for our Nexus 128 system in 2019 in order to focus our resources exclusively on the development of our TAEUS technology.

We are developing a next-generation enhanced ultrasound technology platform—Thermo Acoustic Enhanced Ultrasound, or TAEUS® in order to broaden patient access to the safe diagnosis and treatment of a number of significant medical conditions in circumstances where expensive X-ray computed tomography (“CT”), magnetic resonance imaging (“MRI”) technology, or other diagnostic technologies such as surgical biopsy, are unavailable or impractical.

Our TAEUS technology uses radio frequency (“RF”) pulses to stimulate tissues, using a small fraction (less than 1%) of the amount of energy that would be transmitted into the body during an MRI scan.

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The RF pulses are absorbed by tissue and converted into ultrasound signals, which are detected by an external ultrasound receiver and a digital acquisition system that is part of the TAEUS system.

The detected ultrasound is processed into images and other forms of data using our proprietary algorithms and displayed to complement conventional gray-scale ultrasound images.

ENDRA uses suppliers of components, such as Blatek Industries, Inc.

and Elite RF, LLC, and contract manufacturers, such as Starfish Product Engineering, Inc., to assemble and test ENDRA's TAEUS® liver system for commercial sale.

Suppliers are vetted before engaging in work with ENDRA and reviewed annually, as part of ENDRA’s quality management system, to assure their performance meets ENDRA's needs.

ENDRA has implemented internal processes to monitor designs, inventory and supply of key components needed to manufacture its TAEUS® liver system.

ENDRA plans its production in accordance with anticipated market demand and availability and lead times of needed materials.

The detected ultrasound is processed into images and other forms of data using our proprietary software and algorithms and then displayed to complement conventional gray-scale ultrasound images.

We use suppliers of components, such as Blatek Industries, Inc.

and Elite RF, LLC, and contract manufacturers, such as Starfish Product Engineering, Inc., to assemble and test the TAEUS liver system for commercial sale.

Suppliers are vetted before engaging in work with the Company and are reviewed annually, as part of our quality management system, to assure their performance meets our needs.

We have implemented internal processes to monitor designs, inventory and supply of key components needed to manufacture our TAEUS liver system.

We plan production in accordance with anticipated market demand and availability and lead times of needed materials.

As described below, our first TAEUS platform application focuses on quantifying fat in the liver and stage progression of nonalcoholic fatty liver disease (“NAFLD”) which, untreated, can progress to Nonalcoholic Steatohepatitis (“NASH”), fibrosis, cirrhosis and liver cancer.

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The data collected from the study, including additional usability inputs, was included in our TAEUS liver device technical file submission for device CE mark, which we received for our NAFLD TAEUS application in March 2020.

ENDRA has eight current or completed clinical research partnerships with research hospitals in North America, Europe and Asia for the conduct of clinical studies comparing our TAEUS clinical system to MRI-Proton Density Fat Fraction (“MRI-PDFF”) in the measurement of liver fat.

In June 2020, we completed a 510(k) Premarket Notification submission to the FDA for the NAFLD TAEUS application.

Following meetings with the FDA in connection with its review of our application, we determined that the 510(k) pathway was not the optimal option due to the novel nature of our NAFLD TAEUS application and, in February 2022, announced that we would pursue the de novo pathway for FDA reclassification and clearance of our NAFLD TAEUS application.

Each of our TAEUS platform applications will require regulatory approvals before we are able to sell or license the application.

Based on certain factors, such as the installed base of ultrasound systems, availability of other imaging technologies, such as CT and MRI, economic strength and applicable regulatory requirements, we intend to seek initial approval of our applications for sale in the European Union, followed by the United States and China.

We have registered the product in each of our primary target European markets (i.e., Germany, France, and the United Kingdom).

As of December 31, 2023, we had in effect seven clinical evaluation agreements with research hospitals in North America, Europe and Asia for the conduct of clinical studies comparing our TAEUS clinical system to MRI-Proton Density Fat Fraction (“MRI-PDFF”) in the measurement of liver fat.

In June 2020, we submitted a 510(k) Application to the FDA for our TAEUS Fatty Live Imaging Probe (“FLIP”) System.

In February 2022, we announced that we would pursue FDA reclassification and clearance of our TAEUS FLIP System through the FDA’s “de novo” process.

We subsequently voluntarily withdrew our 510(k) Application and submitted a de novo request for the TAEUS system to the FDA in the third quarter of 2023.

In the fourth quarter of 2023, the FDA sent an Additional Information (“AI”) request related to our de novo application.

Since we received the AI request, we have had several interactions with the FDA and have provided additional information.

In order to fully respond to the FDA’s questions, we will need to compile additional clinical data, provide additional device test data, and respond to cybersecurity related questions in a new de novo submission.

We have a scheduled in-person pre-submission meeting with the FDA in the second quarter of 2024.

We currently anticipate completing the necessary clinical studies by the fourth quarter of 2024 and submitting the new de novo request to the FDA in the first half of 2025.

Diagnostic Imaging Technologies

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As a result, they are less accessible to primary care and rural clinics, economically developing markets, and patient bedsides.

As of 2018, there were only approximately 63,000 CT systems and 50,000 MRI systems in the world, approximately 50% of which were located in the U.S.

As of 2024, there are approximately 80,000 CT systems and 58,000 MRI systems worldwide, with a significant portion located in the U.S.

While CT and MRI systems create high quality images, their use is not always practical.

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The global diagnostic ultrasound device market size was valued at $7.7 billion in 2023 and is anticipated to expand at a CAGR of 4.07% from 2022 to 2030.

There are an estimated 1.6 million diagnostic ultrasound systems in global use in 2022.

These numbers include both portable and cart-based ultrasound systems, and cover all types of diagnostic ultrasound procedures, including systems intended for cardiology, prenatal and abdominal use.

We do not currently intend to address cart-based ultrasound systems focused on applications in prenatal care, nor certain portable ultrasound applications such as emergency room medicine, where we believe our TAEUS technology may not substantially impact patient care.

Accordingly, we estimate our addressable market for one or more of our current or future TAEUS applications as approximately 700,000 ultrasound systems currently in use throughout the world.

Accordingly, we estimate our addressable market for one or more of our current or future TAEUS applications to include approximately 700,000 ultrasound systems currently in use throughout the world, in addition to other types of capital equipment.

We believe that demand for ultrasound systems is driven primarily by the following factors:

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Our Solutions

Our TAEUS technology uses a pulsed energy source—specifically, radio-frequency (“RF”) —to generate ultrasonic waves in tissue.

Our TAEUS technology uses a pulsed energy source-specifically, RF—to generate ultrasonic waves in tissue.

These waves are then detected with ultrasound equipment and used to create high-contrast images and other forms of data using our proprietary algorithms.

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After required regulatory approvals, our TAEUS technology can be added as an accessory to existing ultrasound systems, helping to improve clinical decision-making on the front lines of patient care, without requiring substantially new clinical workflows or large capital investments.

We are also developing TAEUS for incorporation into new ultrasound systems manufactured by companies such as GE Healthcare, described more fully below.

We believe that our TAEUS technology has the potential to add a number of new capabilities to conventional ultrasound and thereby enhance the utility of both existing and new ultrasound systems and extend the use of ultrasound technology to circumstances that either currently require the use of expensive CT or MRI imaging systems, where imaging is not practical using existing technology, or where other assessment tools such as surgical biopsy are required.

We also intend to offer a license for our TAEUS technology to OEMs, such as ultrasound and thermoablative capital equipment makers, for incorporation in their new capital equipment systems.

We believe that our TAEUS technology has the potential to add a number of new capabilities to conventional ultrasound and other types of capital equipment, thereby enhancing the utility and extending the use of these technologies to circumstances that either currently require the use of expensive CT or MRI imaging systems, where imaging is not practical using existing technology, or where other assessment tools such as surgical biopsy are required.

To demonstrate the capabilities of our TAEUS platform, we have conducted various internal ex-vivo laboratory experiments and limited internal in-vivo large animal studies.

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The applicator is positioned in proximity to the target region for measurement.

Future TAEUS platforms are expected to provide two dimensional imaging with a transducer composed of multiple receive elements.

TAEUS platforms will provide two-dimensional imaging with a transducer composed of multiple receive elements.

The RF source and applicator would be similar to those in the first-generation product but the multi-element transducer would allow for multiple applications including:

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In 2022, over 2 billion people globally were estimated to be affected by NAFLD.

The World Gastroenterology Organisation considers NAFLD/NASH a global pandemic affecting rich and poor countries alike.

The World Gastroenterology Organization considers NAFLD/NASH a global pandemic affecting rich and poor countries alike.

Obesity, hepatitis, and diabetes are leading contributors to the development of NAFLD.

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Patients diagnosed with NAFLD and related liver diseases are typically treated with available therapies such as statins, insulin sensitizers and other compounds and are encouraged to adopt lifestyle changes to reduce their weight and improve their overall health.

Glucagon-like peptide 1 (GLP-1) agonists, used for the treatment of type 2 diabetes and obesity are also being evaluated in connection with the reduction of liver fat.

In addition, patients receiving treatment for NAFLD-spectrum liver diseases must continue to be monitored to assess disease progression and the efficacy of treatment.

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We believe our TAEUS technology will enable primary care physicians, radiologists and hepatologists to diagnose NAFLD earlier and monitor patients with NAFLD-spectrum liver diseases more accurately and cost-effectively than is possible with existing technology.

Potential Licensing and Partnership Opportunities

A pipeline of 20+ pharmaceutical compounds targeting liver disease are in development by companies such as Viking Therapeutics, Inventiva, Madrigal Pharmaceuticals, Inc., Akero Therapeutics and Regeneron Pharmaceuticals.

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The companies can also benefit from simpler, non-invasive measurements of biomarkers, such as liver fat, in the clinical stage.

To this end, in March 2021 ENDRA announced a collaboration agreement with Hepion Pharmaceuticals to incorporate TAEUS as an add-on technology to support Hepion’s patient screening and biomarker measurements during its Phase 2b study of its lead drug candidate.

In April 2016, we entered into a Collaborative Research Agreement with General Electric Company, acting through its GE Healthcare business unit and the GE Global Research Center (collectively, “GE Healthcare”).

To this end, in March 2021, ENDRA announced a collaboration agreement with Hepion Pharmaceuticals to incorporate TAEUS as an add-on technology to support Hepion’s patient screening and biomarker measurements during its Phase 2b study of its lead drug candidate, and is working with Hepion to identify a target site at which to utilize TAEUS.

In April 2016, we entered into a Collaborative Research Agreement with GE Healthcare.

Under the terms of the agreement, GE Healthcare has agreed to assist us in our efforts to commercialize our TAEUS technology for use in a fatty liver application by, among other things, providing equipment and technical advice, and facilitating introductions to GE Healthcare clinical ultrasound customers.

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On December 16, 2022, we and GE Healthcare entered into an amendment to our agreement, extending its term to December 16, 2024.

Clinical Studies

In 2018, we received authorization to commence the first human studies in healthy volunteers with our TAEUS clinical system targeting NAFLD, guiding our algorithm development, and comparing our technology to MRI.

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In 2022, we established a clinical collaboration with Shanghai General Hospital (China).

In 2022 we established a research collaboration agreement with Ludwig Maximilian University of Munich, Germany.

As of December 31, 2023, the Company had in effect seven clinical evaluation agreements.

Commercialization

We received CE mark approval for our TAEUS FLIP (Fatty Liver Imaging Probe) system in March 2020, indicating that the TAEUS FLIP system complies with all applicable European Directives and Regulations in the European Union (“EU”) and other CE mark geographies, including the 27 EU member states.

In support of our commercialization efforts in the EU, we have 4 sales representatives in France, the United Kingdom, and Germany and expect to expand marketing efforts into other CE markets as we grow.

In support of our commercialization efforts in the EU, we have a full time sales representative in each of France, the United Kingdom, and Germany and expect to expand marketing efforts into other CE markets as we grow.

We actively attend various trade shows and clinical conferences across the UK and EU to drive our marketing presence amongst medical professionals that constitute our target market.

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We are pursuing FDA premarket clearance of our TAEUS FLIP system to enable sales in the United States.

We submitted a 510(k) Premarket Notification application to the FDA in June 2020.

Our submission happened to coincide with the onset of the COVID-19 pandemic, which strained the FDA’s resources, causing it to prioritize COVID-19 related work and resulting in a backlog of non-COVID-19 premarket files pending review.

Following meetings with the FDA in connection with its review of our application, in February 2022 we determined that the 510(k) pathway was not the optimal option for our TAEUS FLIP system due to its novel nature and announced that we would pursue the de novo pathway for FDA reclassification and clearance of our NAFLD TAEUS application.

See further discussion above in “Item 1.

Business – Overview.”

Other Potential Clinical Applications for our TAEUS Technology

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Thermoablative technologies include RF, microwave, laser and cryogenic ablation.

The global radiofrequency ablation devices market size was valued at $3.59 billion in 2021 and is expected to surpass $10.21 billion by 2030, representing a CAGR of 11% during the forecast period (2022- 2030).

The global radiofrequency ablation devices market size was valued at approximately $3.6 billion in 2021 and is expected to surpass $10.2 billion by 2030, representing a CAGR of 11% during the forecast period (2022-2030).

However, RF and other thermoablative surgery technologies pose risks, including under-treatment of diseased tissue and unintended thermal damage to areas outside the treatment area.

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Methods and algorithms for signal processing, image formation and analysis.

As of December 31, 2022, we maintained a patent portfolio consisting of thirty-three (33) patents issued in the United States and twenty-three (23) issued patents in foreign jurisdictions, five (5) patent applications pending in the United States and thirty-one (31) patent applications pending in foreign jurisdictions relating to our technology.

As of December 31, 2023, we maintained a patent portfolio consisting of forty (40) patents issued in the United States and thirty-two (32) issued patents in foreign jurisdictions, four (4) patent applications pending in the United States and twenty-three (23) patent applications pending internationally relating to our technology.

These patents and patent applications largely cover certain innovations relating to fat imaging, fat quantitation, and temperature monitoring in the liver and other tissues.

Each of our utility patents generally has a term of 20 years from its respective priority (earliest filing) date.

Design patents have a term of 14 years from a respective filing date.

Design patents have a term of 14 years from the filing date of the respective application.

Among our issued utility patents in the U.S., the first patent is set to expire in 2033 and the last patent is set to expire in 2041.

In November 2023, we engaged PatentVest, Inc.

(“PatentVest”), a specialized consulting firm focused on intellectual property valuation, intellectual property portfolio management and intellectual property M&A for clients seeking to protect and leverage their intellectual property portfolio for growth.

Pursuant to a Consulting Services Agreement (the “Services Agreement”) between the Company and PatentVest, PatentVest will undertake a comprehensive assessment of our technology and intellectual property portfolio and work with the Company to create an intellectual property strategy and corresponding plan.

Pursuant to the Services Agreement, the Company agreed to pay PatentVest strictly through the issuance of restricted shares of the Company’s common stock.

Sales and Marketing

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after FDA approval.

As we previously did with our Nexus 128 system, we also intend to partner with several geographically-focused independent medical device equipment distributors to market and sell our TAEUS applications in secondary markets.

We also intend to partner with several geographically-focused independent medical device equipment distributors to market and sell our TAEUS applications in secondary markets.

For instance, we have entered into a distribution agreement with a third-party covering future sales in Vietnam.

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We believe that these OEMs will find our applications attractive as the applications could enable them to generate additional revenue from their installed systems - as they currently do with aftermarket accessory portfolios.

We believe our relationship with GE Healthcare will facilitate this strategy.

Based on our design work and our understanding of the ultrasound accessory market, we intend to price our initial NAFLD TAEUS application at a price point approximating $35,000 to $55,000, which should enable clinical purchasers to recoup their investment in less than one year by performing a relatively small number of additional ultrasound procedures.

Based on our design work and our understanding of the medical capital equipment market, we intend to price our initial liver TAEUS system at a price point of approximately $65,000, which we believe could enable clinical purchasers to recoup their investment in less than one year by performing a relatively small number of additional procedures, initially paid out-of-pocket by patients until government and private insurance reimbursement is secured for the TAEUS liver procedures.

Some of our future TAEUS offerings are expected to be implemented via a hardware platform that can run multiple individual software applications that we plan to offer TAEUS users for a one-time licensing fee, enabling users to perform more procedures with their existing ultrasound equipment and retaining more patients in their clinics rather than referring them out to a regional imaging medical center for a CT or MRI scan.

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We contracted with StarFish Product Engineering, Inc.

(“StarFish”), a medical device contract manufacturing company, to develop ENDRA’s prototype TAEUS device into a clinical product that met CE regulatory requirements required for commercial launch.

We leveraged StarFish’s expertise for the preparation and submission of our CE Technical File documentation, submitted in December 2019, which enabled us to secure the CE Mark for the TAEUS liver application in March 2020.

We also leveraged StarFish’s expertise for preparation of documentation for the 510(k) submission made to the FDA in June 2020.

The relation with StarFish has expanded to include the contract manufacture of the TAEUS® liver system.

We also leveraged StarFish’s expertise for preparation of documentation for the 510(k) submission made to the FDA in June 2020 and our de novo submission to the FDA in the third quarter of 2023.

The relationship with StarFish has expanded and now Starfish is our designated contract manufacturing partner for the TAEUS® liver system.

As the contract manufacturer, StarFish sources components internally or via third party suppliers.

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In March 2020, we received a positive certification from a government-accredited group (“Notified Body”) for our NAFLD TAEUS application, enabling us to market this application in the EU with the necessary CE Mark.

The certification, which has been issued under the then applicable framework of the Medical Device Directive but taking into consideration the transitionary provisions of the MDR, will expire in May 2024 and re-certification under the MDR will be required in order to continue marketing of the application in the EU.

There is currently a significant lag for recertification of medical devices under the MDR, due to the requirement to have the competent Notified Bodies be re-designated for purposes of the MDR, as there is a shortage of available Notified Bodies that have already been re-designated for all the medical devices requiring (re-)certification.

The certification, which has been issued under the then applicable framework of the Medical Device Directive but taking into consideration the transitionary provisions of the MDR, should initially expire in May 2024 and re-certification under the MDR will be required in order to continue marketing of the application in the EU.

However, there is currently a significant lag for recertification of medical devices under the MDR, due to the requirement to have the competent Notified Bodies be re-designated for purposes of the MDR, as there is a shortage of available Notified Bodies that have already been re-designated for all the medical devices requiring (re-)certification.

In light of this development, in February 2023, the European Parliament adopted a Regulation to amend the MDR transition period and to remove the sell-off provisions in the MDR.

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The application was submitted for clearance under Section 510(k) of the FD&C Act.

Following meetings with the FDA in connection with its review of our application, we determined that the 510(k) pathway was not the optimal option due to the novel nature of our TAEUS system and, in February 2022, announced that we would pursue the de novo pathway for FDA approval of our NAFLD TAEUS application.

We are currently in the process of preparing a submission for the classification of our NAFLD TAEUS application as a Class II device under a de novo review, which process is described below under “ FDA Approval or Clearance of Medical Devices ”.

This de novo submission will include as support clinical data gathered from human studies comparing liver fat measurements by our TAEUS device to measurements by MRI-PDFF.

We expect that the FDA’s grant of our initial de novo request will allow us to sell the NAFLD TAEUS application in the U.S.

with general imaging claims.

Following meetings with the FDA in connection with its review of our application, we determined that the 510(k) pathway was not the optimal option due to the novel nature of our TAEUS system and, in February 2022, announced that we would pursue the “de novo” pathway to request the classification of our NAFLD TAEUS application as a Class II device, as described below under “ FDA Approval or Clearance of Medical Devices ”.

In the third quarter of 2023, we submitted a de novo request to the FDA that included as support clinical data gathered from human studies comparing liver fat measurements by our TAEUS device to measurements by MRI-PDFF.

In the fourth quarter of 2023, the FDA sent us an AI request related to our de novo application.

Since we received the AI request, we have had several interactions with the FDA and have provided additional information.

We have a scheduled in-person pre-submission meeting with the FDA in the second quarter of 2024.

We currently anticipate completing the necessary clinical studies by the fourth quarter of 2024 and submitting the new de novo request to the FDA in the first half of 2025.

We expect that, should we be successful in obtaining the FDA’s grant of our de novo request, we will have clearance to market the liver fat fraction TAEUS application in the U.S.

with specific tissue fat content claims.

However, we will need to obtain additional FDA clearances to be able to make diagnostic claims for fatty tissue content determination.

Accordingly, to support our commercialization efforts we expect that, following receipt of the FDA’s grant of our initial de novo request, we would submit one or more additional applications to the FDA, each of which would need to include additional clinical trial data, so that following receipt of the necessary clearances we may make those diagnostic claims.

We believe these additional applications will be eligible for submission under Section 510(k) following the reclassification that would be established by the FDA’s grant of the anticipated de novo request for our NAFLD TAEUS device.

We believe these additional applications will be eligible for submission under Section 510(k) following the reclassification that would be established by the FDA’s grant of the de novo request for our liver fat fraction TAEUS device.

European Union

The primary regulatory environment in Europe is the European Union, which consists of 27 member states encompassing most of the major countries in Europe.

In the European Union, applications incorporating our TAEUS technology are regulated as Class IIa medical devices by the European Medicines Agency (the “EMA”) and the European Union Commission.

The primary regulatory environment in Europe is the European Union.

In the European Union, applications incorporating our TAEUS technology are regulated as Class IIa medical devices.

As described above, our NAFLD TAEUS application has received, and we expect our future applications will need to receive, a CE mark from an appropriate Competent Authority or Notified Body, as the case may be, as a result of successful review of one or more submissions prepared by our contract engineering and manufacturer(s), so that such applications can be marketed and distributed within the European Economic Area.

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The audit procedure, which will include on-site visits at our facility, and the contract manufacturer’s(s’) facility(ies), will require us to provide the contract manufacturer(s) with information and documentation concerning our quality management system and all applicable documents, policies, procedures, manuals, and other information.

Additionally, in order to import our devices into various EU countries, we must comply with the Restriction of Hazardous Substances Directive (“RoHS”) and the Registration, Evaluation, Authorisation and Restriction of Chemicals (“REACH”).

We have undertaken initial processes to meet compliance with RoHS and REACH and will need to ensure that we and our suppliers are compliant with these laws to do business in the European Union.

In the European Union, the manufacturer of medical devices is subject to current Good Manufacturing Practice, or cGMP, as set forth in the relevant laws and guidelines of the European Union and its member states.

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Further inspections may occur over the life of the application.

We also must comply with data privacy regulations in the European Union and the UK.

The collection and use of health data and other personal data including data collected in clinical trials is governed in the EU by the General Data Protection Regulation (“GDPR”), which imposes substantial obligations upon companies and new rights for individuals.

The GDPR also forms part of the law of Great Britain (England and Wales, Scotland and Northern Ireland) by virtue of section 3 of the European Union (Withdrawal) Act 2018 and as amended by the Data Protection, Privacy and Electronic Communications (Amendments etc.) (EU Exit) Regulations 2019 (SI 2019/419) (“UK GDPR”).

Failure to comply with the GDPR may result in fines of the higher of (i) €20,000,000 or (ii) 4% of the preceding fiscal year’s total annual global revenues of the noncompliant company, among other administrative penalties.

Although we do not expect to obtain possession of any personal data from the operation of our products, the GDPR has increased our responsibility and potential liability in relation to personal data involved in the operation of our products, and we may be required to implement additional measures in order to comply with the GDPR and with other laws, rules, regulations and standards in the EU and UK relating to privacy and data protection.

This may be onerous and if our efforts to comply with GDPR or other applicable laws, rules, regulations and standards are not successful, or are perceived to be unsuccessful, it could adversely affect our business.

FDA Regulation

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Marketing may commence only when the FDA issues an order finding substantial equivalence.

Historically, the typical 510(k) review time has been approximately nine to twelve months from the date of the initial 510(k) submission.

In many instances, the 510(k) pathway for product marketing requires only non-clinical testing as proof of substantial equivalence to a lawfully marketed predicate device for a given indication.

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In the de novo process, the FDA must determine that general and special controls are sufficient to provide reasonable assurance of the safety and effectiveness of a device which has no predicate.

Upon receipt of a de novo request, the FDA will conduct an acceptance review to assess the completeness of the application and whether its meets the minimum threshold of acceptability.

Upon receipt of a de novo request, the FDA will conduct an acceptance review to assess the completeness of the application and whether it meets the minimum threshold of acceptability.

If the de novo request is accepted for substantive review, the FDA will conduct a classification review of legally marketed device types and analyze whether an existing legally marketed device of the same type exists, which information is used to confirm the subject device is eligible for de novo classification.

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maintaining an appropriate system for obtaining, reviewing, assessing and appropriately collecting and registering reports from patients, users, distributors or healthcare professionals of suspected incidents, complaints, non-confirming products, recalls and/or withdrawals;

ensuring the traceability of all devices placed onto the market by the manufacturer, including through a unique devise identification system;

preparing and maintaining SOPs for product withdrawal, recall or other field safety corrective and preventive actions (“CAPA”) as well as maintaining a system to manage CAPA that ensures collection and evaluation of internal and external quality information, the identification of failure causes and the implementation of enduring corrective actions to eliminate failure causes and to prevent recurrence;

ensuring supply chain traceability and ensure proper quality monitoring of any distributors;

preparing of post-marketing surveillance reports and additional studies on the medical devices;

regular (and, if required, ad hoc) reporting to the competent authorities in accordance with MDR.

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Other Regulations

We and our contractors also must comply with numerous federal, state and local laws relating to matters such as safe working conditions, manufacturing practices, environmental protection, fire hazard control, and hazardous substance disposal.

We and our contractors must comply with numerous federal, state and local laws relating to matters such as safe working conditions, manufacturing practices, environmental protection, fire hazard control, and hazardous substance disposal.

Furthermore, we are subject to various reporting requirements including those prescribed by the Affordable Care Act and the Dodd-Frank Wall Street Reform and Consumer Protection Act.

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Unanticipated changes in existing regulatory requirements or the adoption of new requirements could adversely affect our business, financial condition, and results of operations.

We will also become subject to regulations and product registration requirements in many foreign countries in which we may sell our products, including in the areas of product standards, packaging requirements, labeling requirements, import and export restrictions and tariff regulations, duties and tax requirements.

Additionally, third parties designing, manufacturing or conducting human studies of our devices will be subject to local regulations, such as those of Health Canada.

We are also become subject to regulations and product registration requirements in foreign countries in which we have received approval may sell our TAEUS liver device, including in the areas of product standards, packaging requirements, labeling requirements, import and export restrictions and tariff regulations, duties and tax requirements.

Additionally, third parties designing, manufacturing or conducting human studies of our devices are subject to local regulations, such as those of Health Canada.

The time required to obtain clearance required by foreign countries may be longer or shorter than that required for EMA or FDA clearance, and requirements for licensing a product in a foreign country may differ significantly from EMA and FDA requirements.

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However, the risk of environmental liabilities cannot be completely eliminated.

While we believe that we are the only company developing RF-based thermoacoustic ultrasound products, we will face direct and indirect competition from a number of competitors, many of whom have greater financial, sales and marketing and other resources than we do.

While we believe that we are the only company developing RF-based thermoacoustic ultrasound products, we face direct and indirect competition from a number of competitors, many of whom have greater financial, sales and marketing and other resources than we do, and offer alternatives to RF-based thermoacoustic technology for measuring the fat content of liver with ultrasound machines.

Manufacturers of CT and MRI systems include multi-national corporations such as Royal Philips, Siemens AG and Fujifilm Corporation, many of whom also manufacture and sell ultrasound equipment.

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As of December 31, 2023, we had 21 employees, all of whom are employed on a full-time basis.

Thirteen full-time employees were engaged in research and development activities, four full-time employees were engaged in sales activities, two full-time employees were engaged in product assembly, and two full-time employees were engaged in administrative activities.

Twelve full-time employees were engaged in research and development activities, three full-time employees were engaged in sales activities, three full-time employees were engaged in product assembly, and three full-time employees were engaged in administrative activities.

Geographically, we employ fifteen people in the United States, three people in Canada, one person in France, one person in Germany and one person in the United Kingdom.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business