Breath Diagnostics

About the offering

Breath Diagnositics patented disease-detection technology can detect compounds connected to cancer and other harmful diseases from your breath — a breakthrough that could potentially transform early cancer and disease screenings as we know it. EXECUTIVE SUMMARY WHY CONSIDER INVESTING IN BREATH DIAGNOSTICS? Breath Diagnostics is revolutionizing disease detection with a patented breath-analysis technology—making screenings more affordable, faster, and less-invasive than current standards. BREAKTHROUGH TECHNOLOGY: Patented, non-invasive breath-analysis platform offering rapid detection of certain diseases without radiation or invasive procedures. For example, with a single breath from a patient, the proprietary microreactor can detect lung cancers with unmatched accuracy — outperforming traditional CT scans and PET imaging by reducing false positives and enhancing early detection. CLINCALLY TESTED: Validated in extensive trials involving over 800 patients, outperforming traditional methods like CT scans in identifying malignant tumors. MAJOR MARKET OPPORTUNITY: Could be positioned to disrupt the $150 billion global cancer diagnostics market, addressing significant unmet needs, particularly in lung cancer screening. OTHER DISEASE DETECTION POTENTIAL: The technology has the potential to detect other diseases including Pneumonia, Tuberculosis, and other cancers, possibly increasing future revenue streams. For the past 30 years, the risk of dying from cancer has steadily declined. However, in the post-COVID world, we’re seeing this trend reverse, as cancer is increasingly shifting from older patient populations to younger ones. Cancer cases diagnosed in people under the age of 50 are called “early onset” cancers – and incidence rates have increased globally by a staggering 79% since 1990. While doctors still haven’t figured out what's driving this increase in early onset cancer, here’s what we do know: Just like any disease, early detection is the key to improving patient outcomes, while lowering total costs. But here’s what most people don’t know: According to the CDC and CMS, laboratory tests represent about three percent of healthcare spending, yet drive ~70% of medical decisions. However, these patient populations are often significantly younger than the recommended age for routine cancer screenings – and in turn, they’re facing more aggressive-appearing and advanced stages of cancer. That’s why investors are eying the $150 billion global cancer diagnostic market, which is poised for significant growth in 2024 and beyond. Cancer diagnostics is a process of discovering biomarkers, proteins, and other indicators that lead to the detection of a cancerous tumor. Imaging, tumor biopsy, laboratory tests (including tumor marker tests), endoscopic examination, surgery, and genetic testing are all possible cancer diagnostic techniques.Source: Precedence Research And when it comes to cancer diagnostic needs, there’s one type of cancer that is both increasingly common, deadly, and expensive to manage: lung cancer. Even though most people assume lung cancer is a smoker's disease, it’s estimated that 10-20% of lung cancer cases in the United States – and as many as 95% in some Asian countries – are diagnosed among patients who never smoked… Source: Journal of Thoracic Oncology Those numbers are rising for reasons currently unknown. With more than 130,000 deaths per year, lung cancer is not only one of the most common types of cancer, it’s the leading cause of cancer deaths in the United States – surpassing deaths from breast, prostate, and colorectal cancers combined! Catch lung cancer early and you’re looking at a 65% survival rate over the next five years. Catch it too late, and you’re looking at a five year survival rate of as low as five percent! However, despite the well known benefits of early screening, more than 50% of the high-risk smoker population who qualify for lung cancer screening had never received a recommendation from their healthcare providers. Of the ones that do, only about six percent of those patients wind up getting screened. Why? While there is certainly a case to be made that the problem is a lack of awareness from providers… Participants who had opted out of lung cancer screening cited five primary barriers to getting screened: Transportation issues and distance to the lung cancer screening facility - a far larger problem than most people realize, and often the primary reason why patients cancel appointments (they can’t get a ride) Concerns about radiation exposure Worry about receiving a false-positive result, followed by invasive procedures, The stress and anxiety following false-positive results Ongoing costs associated with screening and treatment But what if it were possible to dramatically improve the early detection of lung cancer by giving patients confidence in their test results? What if it were possible to make the test non-invasive, have no risk of radiation exposure, and take just 30 seconds to collect the sample — while being as easy as taking a deep breath? And what if you could have your results in one or two days, by simply mailing this patented “Lab on a Chip” technology to the laboratory, and all for a cost that’s surprisingly affordable? Breath Diagnostic’s Management estimates labs would bill ~$600 to cover parts and testing (all of which insurance may cover, if you qualify). Not only that... But what if it were possible also to detect not just lung cancer, but substantially any and all diseases that require some combination of blood, saliva, urine, feces, or hair to diagnose? And for investors focused on generating a return on capital… What if it were possible to target “blockbuster drug” style returns WITHOUT the $1 billion+ price tag it takes to bring one to market? Today’s presentation is dedicated to: The emerging opportunity hidden inside the $33 billion “in vitro diagnostics” (IVD) market… North America in vitro diagnostics (IVD) market size was valued at $29.22 billion in 2020 and expected to reach over $40.43 billion by 2027. How newly adopted IVD regulations could force a secular consolidation – across both clinical laboratories and device makers – which could potentially set the stage for the next generation of “platform” diagnostic tools used in patient encounters… And why a breath-based diagnostics platform could become the “IVD Master Key” that unlocks the promise of personalized medicine – projected to become a $1.2 trillion global market by 2033. Breath Diagnostics is Seeking $3 Million to Further Develop Its Breath-Based Diagnostics Platform and Prepare for the Regulatory Approval Process Breath Diagnostics, Inc (the “Company”) is a medical diagnostics company, founded in 2015, and currently incorporated in the State of Delaware. The Company seeks to build shareholder value by creating, building, and selling IVD tools designed to collect and analyze specific volatile organic compound (VOC) samples found in a patient’s breath. Management believes their breath-based diagnostic tool could one day become used in both early detection and ongoing maintenance of a wide variety of indications. In addition, Management believes they may be able to drive growth through partnerships (or mergers and acquisitions) with clinical laboratories and pharmaceutical companies, in an effort to build a vertically integrated healthcare company. However, in the Company’s current state, Management is focused on what they believe to be the most lucrative indication – the detection of lung cancer using breath analysis. On November 16, 2023, after nearly 10 years, the American Cancer Society released an update of its lung cancer screening guideline to help reduce the number of people dying from the disease due to their smoking history. The new guideline recommends yearly lung cancer screening for people aged 50 to 80 years who smoke or formerly smoked, and have a 20-year or greater history. The advent of computed tomography (CT) scanning has allowed for large-scale screening for lung cancer (LC). It has been noted that it takes up to 50 scans to find one cancer. That’s because CT scans find small nodules frequently, and more than 95% are not cancerous. Rather, lung nodules can be the result of infections or remnants of previous smoking or other conditions, and are usually harmless. The excessive costs involved with repeated radiographic scans, and the morbidity due to unnecessary invasive procedures for benign nodules, weigh against the benefit provided by CT screening for LC. These shortcomings necessitate the development of a diagnostic assay that can discern harmless pulmonary nodules from LC. CORPORATE MILESTONES The Company’s proprietary OneBreathTM breath analysis system (the “Technology”) was developed by organic chemist and then director of chemistry at the University of Louisville, Michael Nantz, and Sean Fu, professor of chemical engineering at the University of Louisville. The Technology was initially supported by a non-dilutive grant provided from the Bill and Melinda Gates Foundation for detection of tuberculosis by breath analysis in 2011, and in 2012, the development of a chemoselective device for analysis of trace carbonyl compounds in exhaled breath. While the Technology showed promising signs for detecting tuberculosis, Management believed the best way to finance the costs of bringing the Technology to market was to focus on a more significant indication – specifically, the detection of lung cancer. This was in thanks to the efforts led by two prominent thoracic surgeons, Dr. Victor van Berkel and Dr. Michael Bousamra, Management received additional funding – from the Kentucky Lung Cancer Research Program, Coulter Foundation Program, and then NIH National Cancer Institute – to develop the lung cancer detection Technology. Developmental highlights include: 10 peer-reviewed papers on breath analysis Multiple trials, which combined, include more than 800 patients across three clinical sites Gates Foundation for detection of tuberculosis grant The development of breath analysis for detection of lung cancer was funded by Kentucky Lung Cancer Research Program, Coulter Foundation Program, and then NIH National Cancer Institute. $3 million financing to advance the development of Gen 2 device with stricter protocols Since 2019, Management has also achieved significant corporate milestones with a limited amount of capital: Designed and developed evacuation units to support pilot study with commercially acceptable processing time Patent coverage in USA, Canada, Europe, Australia, Japan with India approved (but not yet issued) pending Developed LCMS Method with Mayo Lab Services Addressed gaps in primary scientific research initiatives Achieved Acceptable Capture Efficiency Levels of Targeted VOCs Developed 2nd generation microreactor and closed system cassette Significantly diminished systemic process contamination Sourced chemical reagent from fine chemical contract manufacturer and GMP production-capable partner Secured and qualified a microchip fabricator and contract kit manufacturer 2nd generation system captured targeted VOC’s in initial human breath samples with promising results PRO FORMA SUMMARY & USE OF FUNDS The financial projections have not been prepared based on certified public accounting standards and have not been reviewed by an independent accountant. The above financial projections are based on assumptions made by management regarding future events. There is no assurance that actual events will correspond with these assumptions. With regards to the forward-looking assumptions presented by Management, the model assumes the following to be true: 3-4 year product development timeline: Management estimates it will take ~three years to complete the FDA approval process and reach full commercialization for the pneumonia indication and an additional three-four years for lung cancer (screening and indeterminate pulmonary nodule). However, should there be unforeseen delays or additional costs – or changes to the regulatory environment – this may impact both timing of future revenues and magnitude of costs. In addition, failure to achieve regulatory approval would significantly and negatively impact pro forma forecasts. Revenue will be derived from pneumonia diagnostics as well as lung cancer screening (LCS) and indeterminate pulmonary nodule (IPN) diagnostic solutions: Over the next five years, management expects the majority of revenue to come from our post-operative pneumonia prediction tool. If our lung cancer trial proves successful, we anticipate future lung cancer-related revenue to be split approximately 80% from screening and 20% from IPN diagnostics. Ultimately, we expect lung cancer screening to become the dominant source of revenue, surpassing pneumonia diagnostics. Assumptions around manufacturing costs and reimbursement rates for Pneumonia and LCS:Management assumes it will cost ~$100 to manufacture their proprietary product, with potential MSRP of between $600-$800 for LCS and $600-$1000 for Pneumonia. However, for a variety of reasons, these assumptions are most subject to change in the future due to unforeseeable macroeconomic conditions and coverage/reimbursement realities. Access to Capital: Because Management does not anticipate being able to access significant debt or credit facilities, it will be reliant on equity capital to continue to fund operations. As usual, market conditions are subject to change, and may have both positive and negative impacts on Management’s ability to access affordable sources of capital over the forecasted period. While cost of capital may not directly impact pro forma results, management's ability to continue accessing capital to complete key milestones represents a significant risk to future commercialization efforts. The financial projections have not been prepared based on certified public accounting standards and have not been reviewed by an independent accountant. The above financial projections are based on assumptions made by management regarding future events. There is no assurance that actual events will correspond with these assumptions.

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