A good example of how information can become available about small companies before it should. On the 19th a post on HC reported that the AMA had rejected EIQ's request for a CAT 3 reimbursement code. The SP went in to freefall with speculation and ended the day -25%. Many posters queried the initial post asking why the company had not released the information if it was true. A trading halt ensued and then the embarrassing response from the company today.

"Yes. Echo IQ Limited (EIQ) became aware of information concerning it on 19 May 2025 that had not been announced to the market.

The Company filed an application with the Current Procedural Technology (CPT) Editorial Panel of the American Medical Association for a Category III CPT code for reimbursement for reporting noninvasive evaluation of aortic stenosis derived from augmentative analysis of measurements obtained from an echocardiogram (EchoSolv AS). This will create a specific code for the use of Echosolv AS as a new or emerging technology.

On 17 May 2025 at 1:00AM AEST, the Company was notified via a letter from the CPT Editorial Panel rejecting this request, noting that two of the general criteria for Category I and Category III codes were not met.

The letter was sent to Dane Brescacin, the Company’s Vice President of Regulatory Affairs, who was unwell over the weekend and was not at work on Monday, 19 May 2025.

Andrew Grover, Executive Chair, called Dane Brescacin at approximately 1:00pm AEST on Monday, 19 May 2025 given concerns regarding the Company’s trading to check if there was any explanation for the increased volume and decreased share price.

Mr Brescacin then checked his emails and a trading halt request was sent to the ASX immediately.

The letter confirms that the Company can submit a new code change application addressing the deficiencies identified by the Panel. This application must be submitted by 11 June 2025 in order to be considered at the September 2025 Panel meeting. The Company intends to submit this application. The Company understands it is not uncommon for applications to be rejected initially, and it is confident it can strengthen its application to be able to meet the criteria in the second application submission to the CPT Editorial Panel of the American Medical Association. The Company is now progressing revisions to its submission, which will account for all feedback and guidance provided to date to ensure greater alignment to the AMA’s criteria. Resubmission is expected to occur prior to the next deadline of 11 June 2025, which will allow the Company to present its application in September 2025 for a potential code receipt shortly thereafter.

This post on HC was useful in explaining the process:

"For the Miscellaneous Reimbursement code, approval rates for reimbursement claims range from 20% to 40% - relatively low compared to Category III and Category I codes. This is because miscellaneous codes are generally less standardised, require more rigorous justification for use, and often involve case-by-case approval processes by insurers. Material revenue uplift is expected upon achieving a dedicated Category III CPT code.

Category III CPT codes are assigned to new and emerging technologies and typically receive higher reimbursement approval rates from insurers, usually between 40-60%. Echo IQ has filed an application for a Category III CPT code with the Centers for Medicare & Medicaid Services (CMS) and anticipates receiving approval by mid-2025. This code will streamline the reimbursement process, boosting both institutional adoption rates and overall revenue generation as healthcare providers experience greater confidence and predictability in reimbursement claims.

The most substantial revenue enhancement is projected following the eventual receipt of a Category I CPT code. Category I codes signify widespread clinical acceptance and usage and typically result in the highest approval rates for reimbursement claims, generally between 80-100%. The achievement of a Category I CPT code not only enhances the reimbursement approval rate substantially but also typically increases the reimbursable amount, further improving Echo IQ's revenue potential."