HealthCare Capital Partners

Alveolus, Inc. is located in North Carolina. It is a developer of products for the emerging field of non-vascular stenting. Non-Vascular stents are tiny wire mesh tubes used to prop open diseased lumens. The Alveolus Stent System allows physicians to improve the quality of life for patents with inoperable, terminal conditions. The non-vascular stent market is built off the foundation of the highly successful interventional cardiology market. To date, the company has focused its research and development efforts in two primary areas: gastrointestinal and pulmonary. Alveolus received FDA approval, which allows for the selling of the product in the U.S., and a CE Mark, which allows for the selling of the product in Europe.

Alveolus will sell it tracheal/bronchial stent in early 2005 followed by its tracheal/bronchial stent for benign indications in the second quarter of 2005. Next will be the entrance of pulmonary applied products in late 2005 along with various esophageal stents. A number of other products will hit the market in late 2006 thru 2008. With this pipeline of products, Alveolus anticipates that it will be cash positive by Q1 2006.

Alveolus has raised $10 million in July 2004. Also, the company raised $6 million from angel investors prior to this round of funding. The revenue model estimates the following: Healthcare Capital Partners (HCP) feels these revenue potentials are sufficient to warrant an investment. We feel secure in the management team and co-investors. HCP invested $750,000 of the $10 million round along side MDS Capital of Cambridge, MA, MB Ventures of Memphis, TN, and Clayton Associates of Franklin, TN.