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What changed in PAVmed Inc.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of PAVmed Inc.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+482 added−408 removedSource: 10-K (2025-03-24) vs 10-K (2024-03-25)

Top changes in PAVmed Inc.'s 2024 10-K

482 paragraphs added · 408 removed · 271 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

92 edited+79 added−44 removed145 unchanged
Biggest changeAs such, FDA has structured the proposed phaseout policy to contain five key stages: ● Stage 1: End the general enforcement discretion approach with respect to Medical Device Regulation (MDR) requirements and correction and removal reporting requirements 1 year after FDA publishes a final phaseout policy, which FDA intends to issue in the preamble of the final rule. ● Stage 2: End the general enforcement discretion approach with respect to requirements other than MDR, correction and removal reporting, Quality System (QS), and premarket review requirements 2 years after FDA publishes a final phaseout policy. ● Stage 3: End the general enforcement discretion approach with respect to QS requirements 3 years after FDA publishes a final phaseout policy. ● Stage 4: End the general enforcement discretion approach with respect to premarket review requirements for high-risk IVDs 3.5 years after FDA publishes a final phaseout policy, but not before October 1, 2027. ● Stage 5: End the general enforcement discretion approach with respect to premarket review requirements for moderate risk and low risk IVDs (that require premarket submissions) 4 years after FDA publishes a final phaseout policy, but not before April 1, 2028.
Biggest changeThe phaseout policy contains the following five stages: ● Stage 1: Beginning on May 6, 2025, which is one year after the publication date of the final LDT rule, FDA will expect compliance with medical device reporting (MDR) requirements, correction and removal reporting requirements, and quality system (QS) requirements regarding complaint files. ● Stage 2: Beginning on May 6, 2026, which is 2 years after the publication date of the final LDT rule, FDA will expect compliance with requirements not covered during other stages of the phaseout policy, including registration and listing requirements, labeling requirements, and investigational use requirements. ● Stage 3: Beginning on May 6, 2027, which is 3 years after the publication date of the final LDT rule, FDA will expect compliance with QS requirements (other than requirements regarding complaint files which are already addressed in stage 1). ● Stage 4: Beginning on November 6, 2027, which is 3½ years after the publication date of the final LDT rule, FDA will expect compliance with premarket review requirements for high-risk IVDs offered as LDTs (IVDs that may be classified into class III or that are subject to licensure under section 351 of the Public Health Service Act), unless a premarket submission has been received by the beginning of this stage in which case FDA intends to continue to exercise enforcement discretion for the pendency of its review. ● Stage 5: Beginning on May 6, 2028, which is 4 years after the publication date of the final LDT rule, FDA will expect compliance with premarket review requirements for moderate-risk and low-risk IVDs offered as LDTs (that require premarket submissions), unless a premarket submission has been received by the beginning of this stage in which case FDA intends to continue to exercise enforcement discretion for the pendency of its review. 4 The FDA also intends to exercise enforcement discretion and generally not enforce some or all applicable requirements for certain categories of IVDs manufactured by a laboratory.
However, the absence of such marks is not intended to indicate, in any way, PAVmed Inc. or its subsidiaries will not assert, to the fullest extent possible under applicable law, their respective rights to such trademarks and trade names.) 9 Health Insurance Coverage and Reimbursement Our ability to successfully commercialize our products will depend in part on the extent to which governmental authorities, private health insurers and other third-party payors provide coverage for and establish adequate reimbursement levels for the procedures during which our products are used.
However, the absence of such marks is not intended to indicate, in any way, PAVmed Inc. or its subsidiaries will not assert, to the fullest extent possible under applicable law, their respective rights to such trademarks and trade names.) Health Insurance Coverage and Reimbursement Our ability to successfully commercialize our products will depend in part on the extent to which governmental authorities, private health insurers and other third-party payors provide coverage for and establish adequate reimbursement levels for the procedures during which our products are used.
We have identified multiple potential use cases across a number of verticals, including clinical trials, commercial use cases, and as a means to improve patient care. Manufacturing The components comprising the Veris Platform are currently supplied to us by our partners TransTek and their U.S.-based subsidiary, Mio Labs. Each has passed a SOC-2 audit by an outside auditor.
We have identified multiple potential use cases across a number of verticals, including clinical trials, commercial use cases, and as a means to improve patient care. Manufacturing The components comprising the Veris Cancer Care Platform are currently supplied to us by our partners TransTek and their U.S.-based subsidiary, Mio Labs. Each has passed a SOC-2 audit by an outside auditor.
Clinical validation analysis demonstrated improved sensitivity and specificity for the detection of esophageal precancer, having demonstrated enhanced assay performance and lower costs in extensive validation studies. 4 Competition The U.S. market for esophageal cancer (i.e., EAC) and pre-cancer (i.e., BE, with or without dysplasia) testing is large, consisting of more than 30 million at-risk individuals over the age of 50.
Clinical validation analysis demonstrated improved sensitivity and specificity for the detection of esophageal precancer, having demonstrated enhanced assay performance and lower costs in extensive validation studies. Competition The U.S. market for esophageal cancer (i.e., EAC) and pre-cancer (i.e., BE, with or without dysplasia) testing is large, consisting of more than 30 million at-risk individuals over the age of 50.
Accordingly, we believe EsoGuard’s total addressable U.S. market opportunity approximates $60 billion based on an effective Medicare payment of $1,938 and the estimated 30 million U.S. patients recommended for screening by clinical practice guidelines. (In December 2019, we secured “gapfill” determination for EsoGuard’s PLA code 0114U through the CMS CLFS process.
Accordingly, we believe EsoGuard’s total addressable U.S. market opportunity approximates $60 billion based on an effective Medicare payment of $1,938 and the estimated 30 million U.S. patients recommended for screening by clinical practice guidelines. (In December 2019, Lucid secured “gapfill” determination for EsoGuard’s PLA code 0114U through the CMS CLFS process.
No employees are covered by a collective bargaining agreement. We consider our relationship with our employees to be good. Corporate Information We were incorporated in Delaware on June 26, 2014. Our corporate headquarters address is 360 Madison Avenue, 25th Floor, New York, NY 10017, and our main telephone number is (917) 813-1828.
No employees are covered by a collective bargaining agreement. We consider our relationship with our employees to be good. 18 Corporate Information We were incorporated in Delaware on June 26, 2014. Our corporate headquarters address is 360 Madison Avenue, 25th Floor, New York, NY 10017, and our main telephone number is (917) 813-1828.
Prior to acquiring or licensing a technology from a third party, we will evaluate the existing proprietary rights, our ability to adequately obtain and protect these rights and the likelihood or possibility of infringement upon competing rights of others. We also rely upon trade secrets, know-how, continuing technological innovation, and upon licensing opportunities, to develop and maintain our competitive position.
Prior to acquiring or licensing a technology from a third party, we will evaluate the existing proprietary rights, our ability to adequately obtain and protect these rights and the likelihood or possibility of infringement upon competing rights of others. 12 We also rely upon trade secrets, know-how, continuing technological innovation, and upon licensing opportunities, to develop and maintain our competitive position.
If Lucid’s CLIA-certified laboratory fails to meet any applicable requirements of CLIA or state law, that failure could adversely affect any future CMS consideration of its technologies, prevent their approval entirely, and/or interrupt the commercial sale of any products and services and otherwise cause Lucid to incur significant expense. Other U.S.
If Lucid’s CLIA-certified laboratory fails to meet any applicable requirements of CLIA or state law, that failure could adversely affect any future CMS consideration of its technologies, prevent their approval entirely, and/or interrupt the commercial sale of any products and services and otherwise cause Lucid to incur significant expense. 15 Other U.S.
Manufacturing cGMP Requirements Manufacturers of medical devices are required to comply with FDA manufacturing requirements contained in the FDA’s current Good Manufacturing Practices (cGMP) set forth in the quality system regulations promulgated under section 520 of the FDCA. cGMP regulations require, among other things, quality control and quality assurance as well as the corresponding maintenance of records and documentation.
Manufacturing cGMP Requirements Manufacturers of medical devices are required to comply with FDA manufacturing requirements contained in the FDA’s current Good Manufacturing Practices (“cGMP”) set forth in the quality system regulations promulgated under section 520 of the FDCA. cGMP regulations require, among other things, quality control and quality assurance as well as the corresponding maintenance of records and documentation.
Commercialization Our EsoGuard commercialization efforts span multiple channels including targeting primary care and GI physicians, who have generally embraced our message that EsoGuard has the potential to expand the funnel of BE-EAC patients who will need long term EGD surveillance and, potentially, treatment with endoscopic esophageal ablation.
Commercialization Lucid’s EsoGuard commercialization efforts span multiple channels including targeting primary care and GI physicians, who have generally embraced our message that EsoGuard has the potential to expand the funnel of BE-EAC patients who will need long term EGD surveillance and, potentially, treatment with endoscopic esophageal ablation.
There are many existing competitors in the remote physiological monitoring space, some of which possess significantly greater financial and other resources and development capabilities than us. Our Veris Platform faces competition from other digital care platforms providing many of the same features, including EHR integration and remote patient monitoring capabilities.
There are many existing competitors in the remote physiological monitoring space, some of which possess significantly greater financial and other resources and development capabilities than us. Our Veris Cancer Care Platform faces competition from other digital care platforms providing many of the same features, including EHR integration and remote patient monitoring capabilities.
When resources permit, we plan to conduct additional development work and animal testing of EsoCure to support a future FDA 510(k) submission. 6 CarpX CarpX is a patented, single-use, disposable, minimally invasive surgical device for use in the treatment of carpal tunnel syndrome.
When resources permit, we plan to conduct additional development work and animal testing of EsoCure to support a future FDA 510(k) submission. CarpX CarpX is a patented, single-use, disposable, minimally invasive surgical device for use in the treatment of carpal tunnel syndrome.
If the FDA determines the product does not qualify for 510(k) clearance, they will issue a Not Substantially Equivalent letter, at which point the Company must submit and the FDA must approve a PMA or issue premarket clearance using the de novo before marketing can begin.
If the FDA determines the product does not qualify for 510(k) clearance, they will issue a Not Substantially Equivalent (“NSE”) letter, at which point the Company must submit and the FDA must approve a PMA or issue premarket clearance using the de novo before marketing can begin.
We believe CarpX is designed to allow the physician to relieve the compression on the median nerve without an open incision or the need for endoscopic or other imaging equipment, and therefore will be significantly less invasive than existing treatments.
CarpX is designed to allow the physician to relieve the compression on the median nerve without an open incision or the need for endoscopic or other imaging equipment, and therefore we believe it will be significantly less invasive than existing treatments.
Led by a team of highly skilled personnel with a track record of bringing innovative products to market, PAVmed is focused on innovating, developing, acquiring, and commercializing novel products that target unmet needs with large addressable market opportunities.
Led by a team of highly skilled personnel with a track record of bringing innovative products to market, PAVmed is focused on innovating, developing, acquiring, and commercializing novel products that target unmet medical needs with large addressable market opportunities.
Although the incubator, PMX, may seek to expand its portfolio with internal or externally sourced technologies in the future, its initial assets, as noted, will include the following products: PortIO Our PortIO implantable intraosseous vascular access device is being developed as a means for infusing fluids, medications and other substances directly into the bone marrow cavity and from there into the central venous circulation.
Although PMX may seek to expand its portfolio with internal or externally sourced technologies in the future, its initial assets will include the following products: PortIO Our PortIO implantable intraosseous vascular access device is being developed as a means for infusing fluids, medications and other substances directly into the bone marrow cavity and from there into the central venous circulation.
A total of 391 members who were deemed to be at-risk for esophageal precancer, underwent a brief, on-site, noninvasive cell collection procedure, performed by our clinical personnel using EsoCheck. Since then, additional testing events have been hosted with the SAFD, and many similar events have been held with fire departments throughout the country.
A total of 391 members who were deemed to be at-risk for esophageal precancer, underwent a brief, on-site, noninvasive cell collection procedure, performed by Lucid’s clinical personnel using EsoCheck. Since then, additional testing events have been hosted with the SAFD, and many similar events have been held with fire departments throughout the country.
We may be unable to respond to such technical advances. Veris Platform Overview In May 2021, we formed Veris Health, a majority-owned subsidiary, focused on digital health technology. In connection with its formation, Veris Health acquired Oncodisc, a digital health company with groundbreaking tools to improve personalized cancer care through remote patient monitoring.
Lucid may be unable to respond to such technical advances. Veris Health Overview In May 2021, we formed Veris Health, a majority-owned subsidiary, focused on digital health technology. In connection with its formation, Veris Health acquired Oncodisc, a digital health company with groundbreaking tools to improve personalized cancer care through remote patient monitoring.
Clinical studies of investigational devices may not begin until an institutional review board (“IRB”) has approved the study. 11 During any study, the sponsor must comply with the FDA’s IDE requirements. These requirements include investigator selection, trial monitoring, adverse event reporting, and record keeping.
Clinical studies of investigational devices may not begin until an institutional review board (“IRB”) has approved the study. 14 During any study, the sponsor must comply with the FDA’s IDE requirements. These requirements include investigator selection, trial monitoring, adverse event reporting, and record keeping.
The content of our website is not incorporated by reference into this Annual Report on Form 10-K, nor in any other report or document we file or furnish with and /or submit to the SEC, and any reference to our website are intended to be inactive textual references only. 15
The content of our website is not incorporated by reference into this Annual Report on Form 10-K, nor in any other report or document we file or furnish with and /or submit to the SEC, and any reference to our website are intended to be inactive textual references only. 19
In terms of other existing products and technologies, we have created an incubator-type platform where we are looking to obtain financing on a product-by-product basis as necessary to advance each asset to a meaningful inflection point along its path to commercialization.
In terms of other existing products and technologies, we have adopted an incubator-type platform where we are looking to obtain financing on a product-by-product basis as necessary to advance each asset to a meaningful inflection point along its path to commercialization.
PAVmed Inc. ATM Facility In December 2021, we entered into an “at-the-market offering” for up to $50 million of our common stock that may be offered and sold under a Controlled Equity Offering Agreement between us and Cantor.
ATM Facility In December 2021, we entered into an “at-the-market offering” for up to $50 million of our common stock that may be offered and sold under a Controlled Equity Offering Agreement between us and Cantor.
Environmental The cost of compliance with federal, state and local provisions related to the protection of the environment has had no material effect on our business. There were no material capital expenditures for environmental control facilities in the years ended December 31, 2023 and 2022.
Environmental The cost of compliance with federal, state and local provisions related to the protection of the environment has had no material effect on our business. There were no material capital expenditures for environmental control facilities in the years ended December 31, 2024 and 2023.
Regulatory In June 2019, we received FDA 510(k) clearance to market EsoCheck in the U.S. as a device indicated for use in the collection and retrieval of surface cells of the esophagus in adults followed by FDA 510(k) clearance in 2022, expanding the use of EsoCheck in adults and pediatric populations in the U.S.
Regulatory In June 2019, Lucid received FDA 510(k) clearance to market EsoCheck in the U.S. as a device indicated for use in the collection and retrieval of surface cells of the esophagus in adults followed by FDA 510(k) clearance in 2022, expanding the use of EsoCheck in adults and pediatric populations in the U.S.
Many of these competitors have obtained all desirable FDA or other regulatory approvals, and superior patent protection, for their products. Certain of our competitors have already commercialized their products, and others may commercialize their products in advance of our products. In addition, our competitors may make technical advances that render our products obsolete.
Many of these competitors have obtained all desirable FDA or other regulatory approvals, and superior patent protection, for their products. Certain of Lucid’s competitors have already commercialized their products, and others may commercialize their products in advance of Lucid’s products. In addition, Lucid’s competitors may make technical advances that render Lucid’s products obsolete.
We plan to make our 510(k) submission for the implantable monitor, which could happen as early as late 2024, if and to the extent resources permit us to do so. Competition The U.S. market for cancer patient care is large.
We plan to make our 510(k) submission for the implantable monitor, which could happen as early as late 2025, if and to the extent resources permit us to do so. Competition The U.S. market for cancer patient care is large.
In May 2021, we received CE Mark certification for EsoCheck (under the Medical Devices Directive 93/42/EEC), and in June 2021, we completed CE Mark self-certification for EsoGuard (under the European In-Vitro Diagnostic Devices Directive (IVDD 98/79/EC)), indicating both may be marketed in CE Mark European countries.
In May 2021, Lucid received CE Mark certification for EsoCheck (under the Medical Devices Directive 93/42/EEC), and in June 2021, Lucid completed CE Mark self-certification for EsoGuard (under the European In-Vitro Diagnostic Devices Directive (IVDD 98/79/EC)), indicating both may be marketed in CE Mark European countries.
These events are ongoing and are an extension of Lucid’s satellite test center program, which brings our precancer testing directly to patients—at their physician’s office and now at testing day events. 2 In March 2023, we launched a Direct Contracting Strategic Initiative (“DCSI”) to engage directly with large Administrative Services Only (“ASO”) self-insured employers, unions and other entities, seeking to replicate the successes of other cancer screening diagnostic companies that have deployed similar strategies.
These events are ongoing and are an extension of Lucid’s satellite test center program, which brings Lucid’s precancer testing directly to patients—at their physician’s office and now at testing day events. 2 In March 2023, Lucid launched a direct contracting strategic initiative to engage directly with large Administrative Services Only (“ASO”) self-insured employers, unions and other entities, seeking to replicate the successes of other cancer screening diagnostic companies that have deployed similar strategies.
Our competitors may also be developing additional methods of detecting esophageal cancer and pre-cancer that have not yet been announced. Most of our existing and potential competitors have substantially greater financial, marketing, sales, distribution, manufacturing and technological resources.
Lucid’s competitors may also be developing additional methods of detecting esophageal cancer and pre-cancer that have not yet been announced. Most of Lucid’s existing and potential competitors have substantially greater financial, marketing, sales, distribution, manufacturing and technological resources.
In 2012, section 513(f)(2) of the FDCA was amended by section 607 of the Food and Drug Administration Safety and Innovation Act (FDASIA), to provide a second option for de novo classification.
In 2012, section 513(f)(2) of the FDCA was amended by section 607 of the Food and Drug Administration Safety and Innovation Act (“FDASIA”), to provide a second option for de novo classification.
EsoGuard and EsoCheck are based on patented technology licensed by Lucid from Case Western Reserve University (“CWRU”). EsoGuard and EsoCheck have been developed to provide accurate, non-invasive, patient-friendly testing for the early detection of EAC and Barrett’s Esophagus (“BE”), including dysplastic BE and related pre-cursors to EAC in patients with chronic GERD. Market Opportunity In 2023, approximately 20,000 U.S.
EsoGuard and EsoCheck are based on patented technology licensed by Lucid from Case Western Reserve University (“CWRU”). EsoGuard and EsoCheck have been developed to provide accurate, non-invasive, patient-friendly testing for the early detection of EAC and Barrett’s Esophagus (“BE”), including dysplastic BE and related pre-cursors to EAC in patients with chronic GERD. Market Opportunity In 2024, approximately 22,000 U.S.
In July 2022, the American Gastroenterology Association (“AGA”) published in their “Clinical Practice Update on New Technology and Innovation for Surveillance and Screening in Barrett’s Esophagus” updated clinical guidance that mirrors the same furnished by the ACG as described above, endorsing the use of non-endoscopic cell collection tools to screen for BE like our EsoCheck Cell Collection Device, which is cited in the update, as an acceptable alternative to endoscopy to directly address the need for noninvasive screening tools that are easy to administer, patient friendly, and cost-effective for the detection of BE.
In July 2022, the AGA published in their “Clinical Practice Update on New Technology and Innovation for Surveillance and Screening in Barrett’s Esophagus” updated clinical guidance that mirrors the same furnished by the ACG as described above, endorsing the use of non-endoscopic cell collection tools to screen for BE like our EsoCheck Cell Collection Device, which is cited in the update, as an acceptable alternative to endoscopy to directly address the need for noninvasive screening tools that are easy to administer, patient friendly, and cost-effective for the detection of BE.
See “ EsoGuard and EsoCheck—Competition ” and “ Veris Cancer Care Platform—Competition ” above for a fuller discussion of the competitive environment for our key products, EsoCheck, EsoGuard and the Veris Cancer Care Platform. 10 Government Regulation Key U.S.
See “ EsoGuard and EsoCheck—Competition ” and “ Veris Cancer Care Platform—Competition ” above for a fuller discussion of the competitive environment for our key products, EsoCheck, EsoGuard and the Veris Cancer Care Platform. 13 Government Regulation Key U.S.
For example, EndoSign, commercialized by Cyted, and much like Cytosponge and our own EsophaCap before it, is a small mesh sponge within a soluble gelatin capsule that needs to reside in the stomach and then is pulled thru the targeted region brushing the lining of the esophagus and then later retrieved, although, unlike EsoCheck, it is unprotected from sample contamination as the brush later passes regions of the upper esophagus and mouth.
For example, EndoSign, commercialized by Cyted, and much like Cytosponge, is a small mesh sponge within a soluble gelatin capsule that needs to reside in the stomach and then is pulled thru the targeted region brushing the lining of the esophagus and then later retrieved, although, unlike EsoCheck, it is unprotected from sample contamination as the brush later passes regions of the upper esophagus and mouth.
To assure sufficient testing capacity and geographic coverage, we have undertaken multiple ways for patients have access to our test. Initially, we built a limited network of our own physical Lucid Test Centers, staffed by Lucid-employed clinical personnel, where patients can undergo the EsoCheck procedure and have the sample sent for EsoGuard testing at Lucid’s CLIA-certified laboratory.
To assure sufficient testing capacity and geographic coverage, Lucid has undertaken multiple ways for patients to have access to its test. Initially, Lucid built a limited network of its own physical Lucid Test Centers, staffed by Lucid-employed clinical personnel, where patients can undergo the EsoCheck procedure and have the sample sent for EsoGuard testing at Lucid’s CLIA-certified laboratory.
Given the large market for pre-cancer testing, we likely will face numerous competitors, some of which possess significantly greater financial and other resources and development capabilities than us. Our EsoGuard test faces competition from procedure-based detection technologies such as upper endoscopy, and other testing technologies such as multi-cancer early detection products.
Given the large market for pre-cancer testing, Lucid likely will face numerous competitors, some of which possess significantly greater financial and other resources and development capabilities than Lucid. The EsoGuard test faces competition from procedure-based detection technologies such as upper endoscopy, and other testing technologies such as multi-cancer early detection products.
EsoGuard and EsoCheck We believe that the flagship product of our majority-owned subsidiary Lucid, the EsoGuard Esophageal DNA Test, performed on samples collected with the EsoCheck Esophageal Cell Collection Device, constitutes the first and only commercially available diagnostic test capable of serving as a widespread testing tool with the goal of preventing esophageal adenocarcinoma (“EAC”) deaths, through early detection of esophageal precancer in at-risk gastroesophageal reflux disease (“GERD,” also commonly known as chronic heartburn, acid reflux or simply reflux) patients.
Lucid Diagnostics We believe that Lucid’s flagship product, the EsoGuard Esophageal DNA Test, performed on samples collected with the EsoCheck Esophageal Cell Collection Device, constitutes the first and only commercially available diagnostic test capable of serving as a widespread testing tool with the goal of preventing esophageal adenocarcinoma (“EAC”) deaths, through early detection of esophageal precancer in at-risk gastroesophageal reflux disease (“GERD,” also commonly known as chronic heartburn, acid reflux or simply reflux) patients.
In 1997, the Food and Drug Administration Modernization Act (FDAMA) added the de novo classification pathway under section 513(f)(2) of the FDCA, establishing an alternate pathway to classify new devices into Class I or II that had automatically been placed in Class III after receiving a Not Substantially Equivalent (NSE) determination in response to a 510(k) submission.
In 1997, the Food and Drug Administration Modernization Act (“FDAMA”) added the de novo classification pathway under section 513(f)(2) of the FDCA, establishing an alternate pathway to classify new devices into Class I or II that had automatically been placed in Class III after receiving an NSE determination in response to a 510(k) submission.
This allowed us to engage directly with Medicare contractor Palmetto GBA and its MolDx Program on CMS payment and coverage.
This allowed Lucid to engage directly with Medicare contractor Palmetto GBA and its MolDx Program on CMS payment and coverage.
Our failure to comply with these privacy laws or significant changes in the laws restricting our ability to obtain stool, blood and other patient samples and associated patient information could significantly impact our business and our future business plans.
Our failure to comply with these privacy laws or significant changes in the laws restricting our ability to obtain patient samples and associated patient information could significantly impact our business and our future business plans.
While we are not aware of other implantable physiologic monitors containing biologic sensors, our competitors may also be developing similar devices that have not yet been announced. Incubator Program On March 21, 2024, the Company announced that it has launched a wholly owned incubator, PMX, to complete development and commercialization of existing portfolio technologies, including PortIO, EsoCure and CarpX.
While we are not aware of other implantable physiologic monitors containing biologic sensors, our competitors may also be developing similar devices that have not yet been announced. 6 Incubator Program On March 21, 2024, PAVmed announced that it had launched a wholly owned incubator, PMX, to complete development and commercialization of existing portfolio technologies, including PortIO, EsoCure and CarpX.
If an investigational device could pose a significant risk to patients, the sponsor company must submit an Investigational Device Exemption, or IDE application to the FDA prior to initiation of the clinical study.
If an investigational device could pose a significant risk to patients, the sponsor company must submit an Investigational Device Exemption (“IDE”) application to the FDA prior to initiation of the clinical study.
For the first time, however, the clinical guideline also endorses nonendoscopic biomarker screening as an acceptable alternative to costly and invasive endoscopy stating that “a swallowable nonendoscopic capsule device combined with a biomarker is an acceptable alternative to endoscopy for BE.” The clinical guideline specifically mentions EsoCheck, along with Lucid’s EsophaCap® device, as such swallowable, nonendoscopic esophageal cell collection devices, as well as methylated DNA biomarkers such as EsoGuard.
For the first time, however, the clinical guideline also endorses non-endoscopic biomarker screening as an acceptable alternative to costly and invasive endoscopy stating that “a swallowable non-endoscopic capsule device combined with a biomarker is an acceptable alternative to endoscopy for BE.” The clinical guideline specifically mentions EsoCheck, as such swallowable, non-endoscopic esophageal cell collection devices, as well as methylated DNA biomarkers such as EsoGuard.
Also, in January 2023, we completed our first #CheckYourFoodTube Precancer Testing Event, with the San Antonio Fire Department (the “SAFD”) during Firefighter Cancer Awareness Month as designated by the International Association of Fire Fighters (IAFF).
Also, in January 2023, Lucid completed its first #CheckYourFoodTube Precancer Testing Event, with the San Antonio Fire Department (the “SAFD”) during Firefighter Cancer Awareness Month as designated by the International Association of Fire Fighters (IAFF).
Nasdaq Notice On March 7, 2024, the Company received a notice from the Nasdaq Listing Qualifications Department stating that, for the preceding 30 consecutive business days (through March 6, 2024), the market value of the Company’s listed securities (“MVLS”) had been below the minimum of $35 million required for continued inclusion on the Nasdaq Capital Market under Nasdaq Listing Rule 5550(b)(2).
As previously disclosed, on March 7, 2024, the Company received a notice from the Nasdaq Listing Qualifications Department stating that, for the prior 30 consecutive business days (through March 6, 2024), the market value of the Company’s listed securities had been below the minimum of $35 million required for continued inclusion on the Nasdaq Capital Market under Nasdaq Listing Rule 5550(b)(2).
Item 1. Business Background and Overview PAVmed is structured to be a multi-product life sciences company organized to advance a pipeline of innovative healthcare technologies.
Background and Overview PAVmed is structured to be a multi-product life sciences company organized to advance a pipeline of innovative healthcare technologies.
In December 2019, our CLIA-certified then-laboratory partner, completed documentation of EsoGuard analytical validity allowing us to commercialize it as a LDT. In February 2020, we received FDA “Breakthrough Device Designation” for EsoGuard as an in-vitro diagnostic (“IVD”) medical device.
In December 2019, Lucid’s CLIA-certified then-laboratory partner, completed documentation of EsoGuard analytical validity allowing Lucid to commercialize it as a LDT. In February 2020, Lucid received FDA “Breakthrough Device Designation” for EsoGuard as an in-vitro diagnostic (“IVD”) medical device.
We currently have applied for, license or own 55 domestic and foreign patents across 11 families of products, including patents protecting our EsoCheck, EsoGuard and Veris technology. Each of the technologies noted below is protected by multiple families, and only the earliest expiration for the first of the families is listed.
We currently have applied for, license or own 55 domestic and foreign patents across 11 families of products, including patents protecting our EsoCheck, EsoGuard and Veris technology. Each of the technologies noted below is protected by multiple families.
In addition to our own test center locations, we have broadened patient access to our test by establishing a satellite test center program, whereby we are making our personnel available to perform cell collection services inside physician offices or in certain geographies, closely nearby physician offices (in Florida, for the time being) by way of our Lucid Mobile Testing Unit.
In addition to our own test center locations, Lucid has broadened patient access to its test by establishing a satellite test center program, whereby it is making its personnel available to perform cell collection services inside physician offices or in certain geographies, closely nearby physician offices (in Florida, for the time being) by way of our Lucid Mobile Testing Unit.
Our EsoCheck device faces competition from other manufactures with devices designed to collect cell samples from targeted regions of the esophagus.
The EsoCheck device faces competition from other manufacturers with devices designed to collect cell samples from targeted regions of the esophagus.
We may be unable to compete effectively against our competitors either because their products and services are superior or more cost efficient, or because they have access to greater resources than us. These competitors may have greater name recognition than we do.
Lucid may be unable to compete effectively against our competitors either because their products and services are superior or more cost efficient, or because they have access to greater resources than Lucid. These competitors may have greater name recognition than Lucid does.
We are confident that the proposed policy will not have a commercial impact as the Company already has a robust QS management platform for medical devices and EsoGuard will be able to transition to the platform to fulfill the QS requirements, if and when required by the FDA.
We are confident that the proposed final rule will not have a commercial impact as the Company already has a robust QS management platform for medical devices and EsoGuard will be able to easily transition to the platform to fulfill the QS requirements, as required by the FDA.
Additionally, the legislatures in a number of states have passed laws mandating coverage of comprehensive biomarker testing over the past several years. We believe that EsoGuard falls within the definition of a biomarker test and thus we are reviewing how to leverage legislation in those states to expand access to EsoGuard.
Additionally, the legislatures in a number of states have passed laws mandating coverage of comprehensive biomarker testing over the past several years. Lucid believes that EsoGuard falls within the definition of a biomarker test and thus Lucid is reviewing how to leverage legislation in those states to expand access to and reimbursement of EsoGuard.
Employees As of March 21, 2024 we had 107 employees (all of whom were full-time employees), inclusive of our executive officers — our Chairman of the Board of Directors and Chief Executive Officer (“CEO”), our President and Chief Financial Officer (“CFO”), our Chief Operating Officer (“COO”), our Chief Medical Officer (“CMO”) and our General Counsel and Secretary (“General Counsel”).
Employees As of March 20, 2025 we had 39 employees (all of whom were full-time employees), inclusive of our executive officers — our Chairman of the Board of Directors and Chief Executive Officer (“CEO”), our President and Chief Financial Officer (“CFO”), our Chief Operating Officer (“COO”), and our General Counsel and Secretary (“General Counsel”).
Our current test center network currently includes locations in metropolitan areas in Arizona, California, Colorado, Florida, Idaho, Illinois, Nevada, Ohio, Oregon, Texas and Utah.
Our current test center network currently includes locations in metropolitan areas in Arizona, California, Colorado, Florida, Georgia, Idaho, Michigan, Nevada, Texas and Utah.
Therefore, the Veris Platform is not subject to the FDA’s regulatory requirements for devices. Veris Health is also developing an implantable cardiac monitor and is currently interacting with the FDA via pre-submission process, seeking agreement on regulatory strategy and required testing to seek clearance of the monitor.
Veris Health is also developing an implantable cardiac monitor and is currently interacting with the FDA via pre-submission process, seeking agreement on regulatory strategy and required testing to seek clearance of the monitor.
Leveraging our corporate structure—a parent company that will establish distinct subsidiaries for each financed asset—we have the flexibility to raise capital at the PAVmed level to fund product development, or to structure financing directly into each subsidiary in a manner tailored to the applicable product, the latter of which is our current strategy given prevailing market conditions.
Leveraging our corporate structure—a parent company that will establish distinct subsidiaries for each financed asset—we have the flexibility to raise capital at the PAVmed level to fund product development, or to structure financing directly into each subsidiary in a manner tailored to the applicable product. Our current focus is multi-fold.
Further inspections may occur over the life of the product. 14 Other Laws Occupational Safety and Health In addition to its comprehensive regulation of health and safety in the workplace in general, the Occupational Safety and Health Administration has established extensive requirements aimed specifically at laboratories and other healthcare-related facilities.
Other Laws Occupational Safety and Health In addition to its comprehensive regulation of health and safety in the workplace in general, the Occupational Safety and Health Administration has established extensive requirements aimed specifically at laboratories and other healthcare-related facilities.
In addition to obtaining approval for each product, in many cases each device manufacturing facility must be audited on a periodic basis by the Notified Body.
In addition to obtaining approval for each product, in many cases each device manufacturing facility must be audited on a periodic basis by the Notified Body. Further inspections may occur over the life of the product.
In any event, we have established a substantial regulatory and compliance infrastructure that is designed to ensure compliance with these regulations. 12 Physician Payment Sunshine Act On February 8, 2013, the Centers for Medicare & Medicaid Services, or CMS, released its final rule implementing section 6002 of the Affordable Care Act known as the Physician Payment Sunshine Act that imposes annual reporting requirements on device manufacturers for payments and other transfers of value provided by them, directly or indirectly, to physicians and teaching hospitals, as well as ownership and investment interests held by physicians and their family members.
Physician Payment Sunshine Act On February 8, 2013, the Centers for Medicare & Medicaid Services, or CMS, released its final rule implementing section 6002 of the Affordable Care Act known as the Physician Payment Sunshine Act that imposes annual reporting requirements on device manufacturers for payments and other transfers of value provided by them, directly or indirectly, to physicians and teaching hospitals, as well as ownership and investment interests held by physicians and their family members.
Laboratory Operations On February 25, 2022, our new, wholly owned subsidiary, LucidDx Labs Inc. (“LucidDx Labs”), acquired from ResearchDx Inc. (“RDx”), certain licenses and other related assets necessary for LucidDx Labs to operate its own new CLIA-certified, CAP-accredited clinical laboratory located in Lake Forest, CA.
Laboratory Operations On February 25, 2022, a newly-formed wholly owned subsidiary of Lucid, LucidDx Labs Inc. (“LucidDx Labs”), acquired from ResearchDx Inc. (“RDx”), certain licenses and other related assets necessary for LucidDx Labs to operate its own new CLIA-certified, CAP-accredited clinical laboratory located in Lake Forest, CA. Since March 2022, Lucid has conducted EsoGuard testing at its own laboratory.
The date the patents protecting certain of our owned and licensed technology will first begin to expire is as set forth in the table below (although currently pending patent applications, both foreign and domestic, are positioned to provide protection beyond such date in each instance).
The date the patents protecting certain of our owned and licensed technology will first begin to expire is as set forth in the table below (although currently pending patent applications, both foreign and domestic, provide protection beyond such date in each instance). For EsoGuard, additional patents have been issued that offer protection until at least 2037.
Oncodisc’s core technologies include designs and patents that would be the foundation for the first intelligent implantable vascular access port with biologic sensors and wireless communication, combined with an oncologist-designed remote digital healthcare platform that provides patients and physicians with new tools to improve outcomes and optimize the delivery of cost-effective care through remote monitoring and data analytics.
Oncodisc’s core technologies include designs and patents that would be the foundation for the first intelligent implantable vascular access port with biologic sensors and wireless communication, combined with an oncologist-designed remote digital healthcare platform that provides patients and physicians with new tools to improve outcomes and optimize the delivery of cost-effective care through remote monitoring and data analytics. 5 Veris Health’s lead product, the Veris Cancer Care Platform, is a comprehensive digital cancer care platform with remote physiological data collection, symptom reporting, telehealth capability and electronic health record (“EHR”) integration.
For EsoGuard, families are pending that, when granted, will offer additional protections until at least 2037. Technology Year EsoCheck May 2034 EsoGuard August 2024 Veris Health November 2038 EsoCure March 2036 CarpX November 2037 PortIO November 2035 Our policy is to aggressively file patent applications to protect our proprietary technologies including inventions and improvements to inventions.
Technology Year EsoCheck May 2034 EsoGuard August 2024 Veris Health November 2038 EsoCure March 2036 CarpX November 2037 PortIO November 2035 Our policy is to aggressively file patent applications to protect our proprietary technologies including inventions and improvements to inventions.
In October 2023, FDA proposed a policy under which FDA intends to phase out its general enforcement discretion approach for LDTs so that IVDs manufactured by a laboratory would generally fall under the same enforcement approach as other IVDs.
In October 2023, FDA proposed a policy under which FDA intends to phase out its general enforcement discretion approach for LDTs so that IVDs manufactured by a laboratory would generally fall under the same enforcement approach as other IVDs. On May 6, 2024, the FDA issued a final rule aimed at helping to ensure the safety and effectiveness of LDTs.
In the year ended December 31, 2023, the Company sold 321,288 shares through its at-the-market equity facility for net proceeds of approximately $1.8 million, after payment of 3% commissions. 8 Intellectual Property Our business will depend proprietary medical device and diagnostic technologies to commercialize.
Subsequent to December 31, 2024, as of March 20, 2025, the Company sold 1,210,704 shares through their at-market equity facility for net proceeds of approximately $0.8 million, after payment of 3% commissions. Intellectual Property Our business will depend on proprietary medical device and diagnostic technologies to commercialize.
International Regulation In order to market any of our products outside of the United States, we would need to comply with numerous and varying regulatory requirements of other countries and jurisdictions regarding quality, safety and efficacy and governing, among other things, clinical trials, marketing authorization, commercial sales and distribution of our products.
We are subject to comparable state laws, some of which apply to all payors regardless of source of payment, and do not contain identical exceptions to the Stark law. 17 International Regulation In order to market any of our products outside of the United States, we would need to comply with numerous and varying regulatory requirements of other countries and jurisdictions regarding quality, safety and efficacy and governing, among other things, clinical trials, marketing authorization, commercial sales and distribution of our products.
The warehousing, logistics, fulfillment and customer support of our products is managed for us by our partners HealthLink International (a leading third-party logistics company) and Path-Tec. 3 License Agreement Under the terms of Lucid’s license agreement with CWRU (as amended to date, the “Amended CWRU License Agreement”), Lucid acquired an exclusive worldwide right to use the intellectual property rights to the EsoGuard and EsoCheck technology for the detection of changes in the esophagus and on sample preservation.
License Agreement Under the terms of Lucid’s license agreement with CWRU (as amended to date, the “Amended CWRU License Agreement”), Lucid acquired an exclusive worldwide right to use the intellectual property rights to the EsoGuard and EsoCheck technology for the detection of changes in the esophagus and on sample preservation.
Federal False Claims Act The False Claims Act prohibits, among other things, any person or entity from knowingly presenting, or causing to be presented, a false or fraudulent claim for payment or approval to the federal government or knowingly making, using or causing to be made or used a false record or statement material to a false or fraudulent claim to the federal government.
In addition, the Affordable Care Act codified case law that a claim including items or services resulting from a violation of the federal Anti-Kickback Statute constitutes a false or fraudulent claim for purposes of the federal civil False Claims Act. 16 Federal False Claims Act The False Claims Act prohibits, among other things, any person or entity from knowingly presenting, or causing to be presented, a false or fraudulent claim for payment or approval to the federal government or knowingly making, using or causing to be made or used a false record or statement material to a false or fraudulent claim to the federal government.
Lucid continues to expand the EsoGuard and EsoCheck evidence portfolio with additional clinical utility, clinical validity, and analytical validity data from a range of ongoing studies and those that have recently completed or will be completed in the upcoming year.
Clinical utility studies are also important for general EsoGuard commercialization by facilitating physician understanding of test indications and potential benefit to the patients. Lucid continues to expand the EsoGuard and EsoCheck evidence portfolio with additional clinical utility and clinical validity data from a range of ongoing studies and those that will be completed in the upcoming year.
As a result of this clinical input, we have initiated a product development project to incorporate intraluminal ultrasound into the device to include real time imaging of the ligament to be cut together with critical anatomic structures, and will continue to pursue that project, as resources permit.
As a result of this clinical input, we have initiated a product development project to incorporate intraluminal ultrasound into the device to include real time imaging of the ligament to be cut together with critical anatomic structures, and will continue to pursue that project, as resources permit. 7 Recent Developments Business EsoGuard Medicare Coverage In November 2024, Lucid submitted to MolDx its complete clinical evidence package in support of a request for reconsideration of the non-coverage language in the LCD to secure Medicare coverage for EsoGuard.
The notification letter stated that the Company would be afforded 180 calendar days (until September 3, 2024) to regain compliance. In order to regain compliance, the Company’s MVLS must close at $35 million or more for a minimum of ten consecutive business days.
The notification letter stated that the Company would be afforded 180 calendar days (until July 22, 2025) to regain compliance. In order to regain compliance, the closing bid price of the Company’s common stock must be at least $1 for a minimum of ten consecutive business days.
Reimbursement and Market Access As noted above, in December 2019, we secured “gapfill” determination for EsoGuard’s PLA code 0114U through the CMS CLFS process. This allowed us to engage directly with Medicare contractor Palmetto GBA and its MolDx Program on CMS payment and coverage. In October 2020, CMS granted EsoGuard final Medicare payment determination of $1,938.01, effective January 1, 2021.
This allowed Lucid to engage directly with Medicare contractor Palmetto GBA and its MolDx Program on CMS payment and coverage. In October 2020, CMS granted EsoGuard final Medicare payment determination of $1,938.01, effective January 1, 2021.
Management Services Agreement/Payroll Benefits and Expense Reimbursement Agreement with Lucid Diagnostics On March 22, 2024, PAVmed and Lucid entered into an eighth amendment to the management services agreement between PAVmed and Lucid (“MSA”) to increase the monthly fee thereunder from $0.75 million per month to $0.83 million per month, effective as of January 1, 2024.
Intercompany Agreements with Lucid On August 6, 2024, the Company and Lucid entered into a ninth amendment to the management services agreement between them (“MSA”) to increase the monthly fee thereunder from $0.83 million per month to $1.05 million per month, effective as of July 1, 2024.
As a result of this limitation and our then-current public float, in May 2023, we amended our “at-the-market offering” to cover up to an additional $18 million of our common stock.
As a result of this limitation and our then-current public float, in May 2023, we amended our “at-the-market offering” to cover up to an additional $18 million of our common stock. In the year ended December 31, 2024, the Company sold 1,032,298 shares through its at-the-market equity facility for net proceeds of approximately $1.3 million, after payment of 3% commissions.
In the future, we believe this opportunity will only expand through the implantable physiologic monitor, data commercialization, and the expansion into other markets aside from oncology. 5 Commercialization/Sales We are currently pursuing strategic partnerships with leading academic oncology systems, whereby we would become the exclusive digital health solution for these institutions’ oncology departments.
Commercialization/Sales We are currently pursuing strategic partnerships with leading academic oncology systems, whereby we would become the exclusive digital health solution for these institutions’ oncology departments.
Manufacturing EsoCheck is currently manufactured for us by our partners Coastline International (“Coastline”), a high-volume device manufacturer, and Sage Product Development. Our current line at Coastline can produce up to 25,000 units per year. With Coastline’s improvement and expansion, there is capacity to scale exponentially. Our EsoGuard Specimen Kits are currently manufactured for us by our partner Path-Tec.
Lucid’s current line at Coastline can produce up to 25,000 units per year. With Coastline’s improvement and expansion, there is capacity to scale exponentially. Lucid’s EsoGuard specimen kits are currently manufactured by Path-Tec. Path-Tec also manages warehousing, logistics, fulfillment and customer support of Lucid’s products.
Our current focus is multi-fold. We continue to pursue commercial expansion and execution of EsoGuard, which is the flagship product of our majority-owned subsidiary Lucid Diagnostics Inc. (Nasdaq: LUCD) (“Lucid” or “Lucid Diagnostics”). In addition, through a separate majority-owned subsidiary, Veris Health Inc.
We continue to support the commercial expansion and execution of EsoGuard, which is the flagship product of our subsidiary Lucid Diagnostics, of which we remain the shareholder with the largest voting interest. In addition, through a separate majority-owned subsidiary, Veris Health, we offer the Veris Cancer Care Platform.
Although the LCD indicated that it found that no currently existing test has fulfilled all these criteria, it indicated that it will “monitor the evidence and may revise this determination based on the pertinent literature and society recommendations.” We expect to submit EsoGuard for Technical Assessment under this foundational LCD later this year.
Although the LCD indicated that it found that no currently existing test has fulfilled all these criteria, it indicated that it will “monitor the evidence and may revise this determination based on the pertinent literature and society recommendations.” In November 2024, Lucid submitted to MolDx its complete clinical evidence package in support of a request for reconsideration of the non-coverage language in the LCD to secure Medicare coverage for EsoGuard.
In parallel with preparing to submit EsoGuard for Technical Assessment with MolDX, Lucid is aggressively pursuing EsoGuard commercial insurer payment and coverage.
In parallel with our request for reconsideration of the LCD, Lucid is aggressively pursuing EsoGuard commercial insurer coverage and payment.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeThis conflict of interest could have a negative impact on our operations. ● Our ability to be successful will be totally dependent upon the efforts of our key personnel. ● Our officers and directors have fiduciary obligations to other companies and, accordingly, may have conflicts of interest in determining to which entity a particular business opportunity should be presented. ● Our business, financial condition and results of operations could be adversely affected by the political and economic conditions of the countries in which we conduct business. ● Failure in our information technology or storage systems could significantly disrupt our operations and our research and development efforts, which could adversely impact our revenues, as well as our research, development and commercialization efforts. ● We may become the subject of various claims, threats of litigation, litigation or investigations which could have a material adverse effect on our business, financial condition, results of operations or price of our common stock. 16 Risks Associated with Healthcare Regulation, Billing and Reimbursement, and Product Safety and Effectiveness ● If private or governmental third-party payors do not maintain reimbursement for our products at adequate reimbursement rates, we may be unable to successfully commercialize our products which would limit or slow our revenue generation and likely have a material adverse effect on our business. ● FDA has proposed a policy under which it would phase out its general enforcement discretion approach for LDTs so that IVDs manufactured at a laboratory would generally fall under the same enforcement approach as other IVDs.
Biggest changeMoreover, if these or any future facilities or our equipment were damaged or destroyed, or if we experience a significant disruption in our operations for any reason, our ability to continue to operate our business could be materially harmed. ● We may make investments in products we have not yet developed, and those investments may not be realized. ● We may not obtain the expected benefits of the incubator financing structure and may incur additional costs. ● Our products and services may become subject to unfavorable pricing regulations, third-party reimbursement practices or healthcare reform initiatives, thereby harming our business. ● Our products and services may cause serious adverse side effects or even death or have other properties that could delay or prevent their regulatory approval, limit the commercial desirability of an approved label or result in significant negative consequences following any marketing approval. ● Product liability lawsuits against us could cause us to incur substantial liabilities and to limit commercialization of any products that we may develop. ● We may not be able to protect or enforce our intellectual property rights, which could impair our competitive position. ● We may be subject to intellectual property infringement claims by third parties which could be costly to defend, divert management’s attention and resources, and may result in liability. ● Competitors may violate our intellectual property rights, and we may bring litigation to protect and enforce our intellectual property rights, which may result in substantial expense and may divert our attention from implementing our business strategy. ● Our business may suffer if we are unable to manage our growth. ● Our ability to be successful will be totally dependent upon the efforts of our key personnel. ● Our officers and directors have fiduciary obligations to other companies and, accordingly, may have conflicts of interest in determining to which entity a particular business opportunity should be presented. ● Our business, financial condition and results of operations could be adversely affected by the political and economic conditions of the countries in which we conduct business. ● Failure in our information technology or storage systems could significantly disrupt our operations and our research and development efforts, which could adversely impact our revenues, as well as our research, development and commercialization efforts. ● We may become the subject of various claims, threats of litigation, litigation or investigations which could have a material adverse effect on our business, financial condition, results of operations or price of our common stock. 20 Risks Associated with Healthcare Regulation, Billing and Reimbursement, and Product Safety and Effectiveness ● If private or governmental third-party payors do not maintain reimbursement for our products at adequate reimbursement rates, we may be unable to successfully commercialize our products which would limit or slow our revenue generation and likely have a material adverse effect on our business. ● FDA has proposed a policy under which it would phase out its general enforcement discretion approach for LDTs so that IVDs manufactured at a laboratory would generally fall under the same enforcement approach as other IVDs.
Our business, financial condition and results of operations could be adversely affected by the political and economic conditions of the countries in which we conduct business.
Our business, financial condition and results of operations could be adversely affected by the political and economic conditions of the countries in which we conduct business. Our business, financial condition and results of operations could be adversely affected by the political and economic conditions of the countries in which we conduct business.
The market price for our common stock may be influenced by many factors, including the following: ● factors in the public trading market for our stock that may produce price movements that may or may not comport with macro, industry or company-specific fundamentals, including, without limitation, the sentiment of retail investors (including as may be expressed on financial trading and other social media sites and online forums), the direct access by retail investors to broadly available trading platforms, the amount and status of short interest in our securities, access to margin debt, trading in options and other derivatives on our common stock and any related hedging and other trading factors; ● speculation in the press or investment community about our company or industry; ● our ability to successfully commercialize, and realize revenues from sales of, any products we may develop; ● the performance, safety and side effects of any products we may develop; ● the success of competitive products or technologies; ● results of clinical studies of any products we may develop or those of our competitors; ● regulatory or legal developments in the U.S. and other countries, especially changes in laws or regulations applicable to any products we may develop; ● introductions and announcements of new products by us, our commercialization partners, or our competitors, and the timing of these introductions or announcements; ● actions taken by regulatory agencies with respect to our products, clinical studies, manufacturing process or sales and marketing terms; ● variations in our financial results or those of companies that are perceived to be similar to us; ● the success of our efforts to acquire or in-license additional products or other products we may develop; ● developments concerning our collaborations, including but not limited to those with our sources of manufacturing supply and our commercialization partners; ● developments concerning our ability to bring our manufacturing processes to scale in a cost-effective manner; ● announcements by us or our competitors of significant acquisitions, strategic partnerships, joint ventures or capital commitments; ● developments or disputes concerning patents or other proprietary rights, including patents, litigation matters and our ability to obtain patent protection for our products; ● our ability or inability to raise additional capital and the terms on which we raise it; ● the recruitment or departure of key personnel; ● changes in the structure of healthcare payment systems; ● market conditions in the medical device, pharmaceutical and biotechnology sectors; ● actual or anticipated changes in earnings estimates or changes in stock market analyst recommendations regarding our common stock, other comparable companies or our industry generally; ● trading volume of our common stock; ● sales of our common stock by us or our stockholders; ● general economic, industry and market conditions; and ● the other risks described in this “Risk Factors” section.
The market price for our common stock may be influenced by many factors, including the following: ● factors in the public trading market for our stock that may produce price movements that may or may not comport with macro, industry or company-specific fundamentals, including, without limitation, the sentiment of retail investors (including as may be expressed on financial trading and other social media sites and online forums), the direct access by retail investors to broadly available trading platforms, the amount and status of short interest in our securities, access to margin debt, trading in options and other derivatives on our common stock and any related hedging and other trading factors; ● speculation in the press or investment community about our company or industry; ● our ability to successfully commercialize, and realize revenues from sales of, any products we may develop; ● the performance, safety and side effects of any products we may develop; ● the success of competitive products or technologies; ● results of clinical studies of any products we may develop or those of our competitors; ● regulatory or legal developments in the U.S. and other countries, especially changes in laws or regulations applicable to any products we may develop; 36 ● introductions and announcements of new products by us, our commercialization partners, or our competitors, and the timing of these introductions or announcements; ● actions taken by regulatory agencies with respect to our products, clinical studies, manufacturing process or sales and marketing terms; ● variations in our financial results or those of companies that are perceived to be similar to us; ● the success of our efforts to acquire or in-license additional products or other products we may develop; ● developments concerning our collaborations, including but not limited to those with our sources of manufacturing supply and our commercialization partners; ● developments concerning our ability to bring our manufacturing processes to scale in a cost-effective manner; ● announcements by us or our competitors of significant acquisitions, strategic partnerships, joint ventures or capital commitments; ● developments or disputes concerning patents or other proprietary rights, including patents, litigation matters and our ability to obtain patent protection for our products; ● our ability or inability to raise additional capital and the terms on which we raise it; ● the recruitment or departure of key personnel; ● changes in the structure of healthcare payment systems; ● market conditions in the medical device, pharmaceutical and biotechnology sectors; ● actual or anticipated changes in earnings estimates or changes in stock market analyst recommendations regarding our common stock, other comparable companies or our industry generally; ● trading volume of our common stock; ● sales of our common stock by us or our stockholders; ● general economic, industry and market conditions; and ● the other risks described in this “Risk Factors” section.
In particular, they could: ● require us to dedicate a substantial portion of our cash flow from operations to payments on our indebtedness; ● limit, among other things, our ability to borrow additional funds and otherwise raise additional capital, and our ability to conduct acquisitions, joint ventures or similar arrangements, as a result of our obligations to make such payments and comply with the restrictive covenants in the indebtedness; ● limit our flexibility in planning for, or reacting to, changes in our businesses and the industries in which we operate; 18 ● increase our vulnerability to general adverse economic and industry conditions; and ● place us at a competitive disadvantage compared to our competitors that have lower fixed costs.
In particular, they could: ● require us to dedicate a substantial portion of our cash flow from operations to payments on our indebtedness; ● limit, among other things, our ability to borrow additional funds and otherwise raise additional capital, and our ability to conduct acquisitions, joint ventures or similar arrangements, as a result of our obligations to make such payments and comply with the restrictive covenants in the indebtedness; ● limit our flexibility in planning for, or reacting to, changes in our businesses and the industries in which we operate; ● increase our vulnerability to general adverse economic and industry conditions; and ● place us at a competitive disadvantage compared to our competitors that have lower fixed costs.
If we are not successful in bringing one or more products to market, whether because we fail to address marketplace demand, fail to develop viable technologies or otherwise, we may not generate any revenues and our results of operations could be seriously harmed. We may not obtain the expected benefits of the incubator financing structure and may incur additional costs.
If we are not successful in bringing one or more products to market, whether because we fail to address marketplace demand, fail to develop viable technologies or otherwise, we may not generate any revenues and our results of operations could be seriously harmed. 26 We may not obtain the expected benefits of the incubator financing structure and may incur additional costs.
Our trade secrets may be vulnerable to disclosure or misappropriation by employees, contractors and other persons. We may be subject to intellectual property infringement claims by third parties which could be costly to defend, divert management’s attention and resources, and may result in liability. The medical device industry is characterized by vigorous protection and pursuit of intellectual property rights.
Our trade secrets may be vulnerable to disclosure or misappropriation by employees, contractors and other persons. 28 We may be subject to intellectual property infringement claims by third parties which could be costly to defend, divert management’s attention and resources, and may result in liability. The medical device industry is characterized by vigorous protection and pursuit of intellectual property rights.
This, in turn, could have an adverse impact on trading prices for our common stock, and could adversely affect our ability to access the capital markets. 33 Under our management services agreement with Lucid Diagnostics, many of our personnel and other resources are devoted to ensuring Lucid Diagnostics complies with the above requirements applicable to public companies.
This, in turn, could have an adverse impact on trading prices for our common stock, and could adversely affect our ability to access the capital markets. Under our management services agreement with Lucid Diagnostics, many of our personnel and other resources are devoted to ensuring Lucid Diagnostics complies with the above requirements applicable to public companies.
If an active market is not sustained for any reason, it may be difficult for you to sell your securities at the time you wish to sell them, at a price that is attractive to you, or at all. 31 Our stock price may be volatile, and purchasers of our securities could incur substantial losses.
If an active market is not sustained for any reason, it may be difficult for you to sell your securities at the time you wish to sell them, at a price that is attractive to you, or at all. Our stock price may be volatile, and purchasers of our securities could incur substantial losses.
Any of these events could prevent us from achieving or maintaining market acceptance of the particular product. 22 Product liability lawsuits against us could cause us to incur substantial liabilities and to limit commercialization of any products that we may develop. We face an inherent risk of product liability exposure related to the sale of any products we may develop.
Any of these events could prevent us from achieving or maintaining market acceptance of the particular product. Product liability lawsuits against us could cause us to incur substantial liabilities and to limit commercialization of any products that we may develop. We face an inherent risk of product liability exposure related to the sale of any products we may develop.
Because we have not generated substantial revenue or cash flow to date, unless we are able to generate substantial revenue in the near-term (which we do not anticipate being able to do), we will require additional funds to: ● Continue our research and development; ● Pursue clinical trials; ● Commercialize our new products and services; ● Achieve market acceptance of our products and services; ● Establish and expand our sales, marketing, and distribution capabilities for our products and services; ● Protect our intellectual property rights or defend, in litigation or otherwise, any claims we infringe third-party patents or other intellectual property rights; ● Invest in businesses, products and technologies, although we currently have no commitments or agreements relating to do so; ● Otherwise fund our operations.
Because we have not generated substantial revenue or cash flow to date, unless we are able to generate substantial revenue in the near-term (which we do not anticipate being able to do), we will require additional funds to: ● Continue our research and development; ● Pursue clinical trials; ● Commercialize our new products and services; ● Achieve market acceptance of our products and services; ● Establish and expand our sales, marketing, and distribution capabilities for our products and services; ● Protect our intellectual property rights or defend, in litigation or otherwise, any claims we infringe third-party patents or other intellectual property rights; and ● Invest in businesses, products and technologies, although we currently have no commitments or agreements relating to do so.
Moreover, achieving and sustaining compliance with applicable federal and state privacy, security and fraud laws may prove costly. The Company’s medical products may in the future be subject to product recalls that could harm its reputation, business and financial results.
Moreover, achieving and sustaining compliance with applicable federal and state privacy, security and fraud laws may prove costly. 34 The Company’s medical products may in the future be subject to product recalls that could harm its reputation, business and financial results.
This further exhausts management and other personnel resources that could be used for other revenue-generating activities. If we experience material weaknesses in our internal control over financial reporting in the future, our business may be harmed.
This further exhausts management and other personnel resources that could be used for other revenue-generating activities. 38 If we experience material weaknesses in our internal control over financial reporting in the future, our business may be harmed.
These factors include: ● challenges associated with cultural differences, languages and distance; ● differences in clinical practices, needs, products, modalities and preferences; ● longer payment cycles in some countries; ● credit risks of many kinds; ● legal and regulatory differences and restrictions; ● currency exchange fluctuations; ● foreign exchange controls that might prevent us from repatriating cash earned in certain countries; ● political and economic instability and export restrictions; ● variability in sterilization requirements for multi-usage surgical devices; ● potential adverse tax consequences; ● higher cost associated with doing business internationally; ● challenges in implementing educational programs required by our approach to doing business; ● negative economic developments in economies around the world and the instability of governments, including the threat of war, terrorist attacks, epidemic or civil unrest; ● adverse changes in laws and governmental policies, especially those affecting trade and investment; ● health epidemics and /or pandemics, such as the COVID-19 pandemic, epidemics resulting from the Ebola virus, or the enterovirus, or the avian influenza virus, or the pandemic resulting from a novel strain of a coronavirus designated “Severe Acute Respiratory Syndrome Coronavirus 2” - or “SARS-CoV-2”, which may adversely affect our workforce as well as our local suppliers and customers; ● import or export licensing requirements imposed by governments; ● differing labor standards; ● differing levels of protection of intellectual property; ● the threat that our operations or property could be subject to nationalization and expropriation; ● varying practices of the regulatory, tax, judicial and administrative bodies in the jurisdictions where we operate; and ● potentially burdensome taxation and changes in foreign tax.
These factors include: ● varying practices of the regulatory, tax, judicial and administrative bodies in the U.S. and other jurisdictions where we operate; ● potentially burdensome taxation and changes in domestic and foreign tariffs; ● challenges associated with cultural differences, languages and distance; ● differences in clinical practices, needs, products, modalities and preferences; ● longer payment cycles in some countries; ● credit risks of many kinds; ● legal and regulatory differences and restrictions; ● currency exchange fluctuations; ● foreign exchange controls that might prevent us from repatriating cash earned in certain countries; ● political and economic instability and export restrictions; ● variability in sterilization requirements for multi-usage surgical devices; ● potential adverse tax consequences; ● higher cost associated with doing business internationally; ● challenges in implementing educational programs required by our approach to doing business; ● negative economic developments in economies around the world and the instability of governments, including the threat of war, terrorist attacks, epidemic or civil unrest; ● adverse changes in laws and governmental policies, especially those affecting trade and investment; ● health epidemics and /or pandemics, such as the COVID-19 pandemic, epidemics resulting from the Ebola virus, or the enterovirus, or the avian influenza virus, or the pandemic resulting from a novel strain of a coronavirus designated “Severe Acute Respiratory Syndrome Coronavirus 2” - or “SARS-CoV-2”, which may adversely affect our workforce as well as our local suppliers and customers; ● import or export licensing requirements imposed by governments; ● differing labor standards; ● differing levels of protection of intellectual property; and ● the threat that our operations or property could be subject to nationalization and expropriation.
In addition, any such off-label use of the Company’s products may increase the risk of injury to patients, and, in turn, the risk of product liability claims, and such claims are expensive to defend and could divert the Company’s management’s attention and result in substantial damage awards against the Company. 30 Risks Associated with Ownership of Our Common Stock We may issue shares of our common and /or preferred stock in the future which could reduce the equity interest of our stockholders and might cause a change in control of our ownership.
In addition, any such off-label use of the Company’s products may increase the risk of injury to patients, and, in turn, the risk of product liability claims, and such claims are expensive to defend and could divert the Company’s management’s attention and result in substantial damage awards against the Company. 35 Risks Associated with Ownership of Our Common Stock We may issue shares of our common and /or preferred stock in the future which could reduce the equity interest of our stockholders and might cause a change in control of our ownership.
In order to obtain approval, we may need to conduct clinical trials necessary to support a FDA 510(k) notice or PMA application will be expensive and will require the enrollment of large numbers of patients, and suitable patients may be difficult to identify and recruit. ● The results of the Company’s clinical trials may not support our product candidate claims or may result in the discovery of adverse side effects. ● Even if we receive regulatory approval for any product we may develop, we will be subject to ongoing regulatory obligations and continued regulatory review, which may result in significant additional expense and subject us to penalties if we fail to comply with applicable regulatory requirements. ● Healthcare reform measures could hinder or prevent our products’ commercial success. ● If we fail to comply with healthcare regulations, we could face substantial penalties and our business, operations and financial condition could be adversely affected. ● The Company’s medical products may in the future be subject to product recalls that could harm its reputation, business and financial results. ● If the Company’s medical products cause or contribute to a death or a serious injury, or malfunction in certain ways, we will be subject to medical device reporting regulations, which can result in voluntary corrective actions or agency enforcement actions. ● If the Company is found to be promoting the use of its devices for unapproved or “off-label” uses or engaging in other noncompliant activities, the Company may be subject to recalls, seizures, fines, penalties, injunctions, adverse publicity, prosecution, or other adverse actions, resulting in damage to its reputation and business.
In order to obtain approval, we may need to conduct clinical trials necessary to support a FDA 510(k) notice or PMA application will be expensive and will require the enrollment of large numbers of patients, and suitable patients may be difficult to identify and recruit. ● The results of the Company’s clinical trials may not support our product candidate claims or may result in the discovery of adverse side effects. ● Even if we receive regulatory approval for any product we may develop, we will be subject to ongoing regulatory obligations and continued regulatory review, which may result in significant additional expense and subject us to penalties if we fail to comply with applicable regulatory requirements. ● Healthcare reform measures, including those targeting Medicare or Medicaid, could hinder or prevent our products’ commercial success. ● If we fail to comply with healthcare regulations, we could face substantial penalties and our business, operations and financial condition could be adversely affected. ● The Company’s medical products may in the future be subject to product recalls that could harm its reputation, business and financial results. ● If the Company’s medical products cause or contribute to a death or a serious injury, or malfunction in certain ways, we will be subject to medical device reporting regulations, which can result in voluntary corrective actions or agency enforcement actions. ● If the Company is found to be promoting the use of its devices for unapproved or “off-label” uses or engaging in other noncompliant activities, the Company may be subject to recalls, seizures, fines, penalties, injunctions, adverse publicity, prosecution, or other adverse actions, resulting in damage to its reputation and business.
Moreover, the incubator financing structure may be not fully insulate the liabilities of our subsidiaries from each other or from PAVmed, especially if we do not observe the requisite corporate formalities or adequately capitalize PAVmed or its subsidiaries. 21 Our products and services may become subject to unfavorable pricing regulations, third-party reimbursement practices or healthcare reform initiatives, thereby harming our business.
Moreover, the incubator financing structure may not fully insulate the liabilities of our subsidiaries from each other or from PAVmed, especially if we do not observe the requisite corporate formalities or adequately capitalize PAVmed or its subsidiaries. Our products and services may become subject to unfavorable pricing regulations, third-party reimbursement practices or healthcare reform initiatives, thereby harming our business.
Although our management determined that our internal control over financial reporting was effective as of December 31, 2023, we may experience material weaknesses in our internal control over financial reporting in the future. Any necessary remediation efforts would place a significant burden on management and add increased pressure to our financial resources and processes.
Although our management determined that our internal control over financial reporting was effective as of December 31, 2024, we may experience material weaknesses in our internal control over financial reporting in the future. Any necessary remediation efforts would place a significant burden on management and add increased pressure to our financial resources and processes.
However, there can be no assurance that Lucid will be able to successfully transition the platform to fulfill the QS requirements, if and when required by FDA, and its failure to do so could have a material impact on Lucid’s ability to commercialize EsoGuard and on our business as a whole.
However, there can be no assurance that Lucid will be able to successfully transition the platform to fulfill the QS requirements, as required by FDA, and its failure to do so could have a material impact on Lucid’s ability to commercialize EsoGuard and on our business as a whole.
Any such failures could have a material impact on our ability to commercialize our products. 20 We or our third-party manufacturers may not have the manufacturing and processing capacity to meet the production requirements of clinical testing or consumer demand in a timely manner.
Any such failures could have a material impact on our ability to commercialize our products. 25 We or our third-party manufacturers may not have the manufacturing and processing capacity to meet the production requirements of clinical testing or consumer demand in a timely manner.
If demand for the EsoGuard test outstrips this capacity, and we fail to add additional equipment and staff, or complete, or timely complete, an expansion of its available laboratory facilities, it may significantly delay our EsoGuard processing times and limit the volume of EsoGuard tests we can process, which may adversely affect our business, financial condition and results of operation.
If demand for the EsoGuard test outstrips this capacity, and we fail to add additional equipment and staff, or complete, or timely complete, an expansion of Lucid’s available laboratory facilities, it may significantly delay EsoGuard processing times and limit the volume of EsoGuard tests Lucid can process, which may adversely affect our business, financial condition and results of operation.
APB 14-1, Accounting for Convertible Debt Instruments That May Be Settled in Cash Upon Conversion (Including Partial Cash Settlement), which has subsequently been codified as Accounting Standards Codification 470-20, Debt with Conversion and Other Options, or “ASC 470-20.” Under ASC 470-20, an entity must separately account for the liability and equity components of the convertible debt instruments (such as the Senior Convertible Notes) that may be settled entirely or partially in cash in a manner that reflects the issuer’s economic interest cost.
APB 14-1, Accounting for Convertible Debt Instruments That May Be Settled in Cash Upon Conversion (Including Partial Cash Settlement), which has subsequently been codified as Accounting Standards Codification 470-20, Debt with Conversion and Other Options, or “ASC 470-20.” Under ASC 470-20, an entity must separately account for the liability and equity components of the convertible debt instruments (such as the September 2022 Senior Convertible Note) that may be settled entirely or partially in cash in a manner that reflects the issuer’s economic interest cost.
Additionally, even after receipt of marketing approval of our products and services, if we or others later identify undesirable side effects or even deaths caused by such product, a number of potentially significant negative consequences could result, including: ● we may be forced to recall such product and suspend the marketing of such product; ● regulatory authorities may withdraw their approvals of such product; ● regulatory authorities may require additional warnings on the label that could diminish the usage or otherwise limit the commercial success of such products; ● the FDA or other regulatory bodies may issue safety alerts, Dear Healthcare Provider letters, press releases or other communications containing warnings about such product; ● the FDA may require the establishment or modification of Risk Evaluation Mitigation Strategies or a comparable foreign regulatory authority may require the establishment or modification of a similar strategy that may, for instance, restrict distribution of our products and impose burdensome implementation requirements on us; ● we may be required to change the way the product is administered or conduct additional clinical trials; ● we could be sued and held liable for harm caused to subjects or patients; ● we may be subject to litigation or product liability claims; and ● our reputation may suffer.
They could also result in a more restrictive label or the delay or denial of regulatory approval by the FDA or other comparable foreign regulatory authority. 27 Additionally, even after receipt of marketing approval of our products and services, if we or others later identify undesirable side effects or even deaths caused by such product, a number of potentially significant negative consequences could result, including: ● we may be forced to recall such product and suspend the marketing of such product; ● regulatory authorities may withdraw their approvals of such product; ● regulatory authorities may require additional warnings on the label that could diminish the usage or otherwise limit the commercial success of such products; ● the FDA or other regulatory bodies may issue safety alerts, Dear Healthcare Provider letters, press releases or other communications containing warnings about such product; ● the FDA may require the establishment or modification of Risk Evaluation Mitigation Strategies or a comparable foreign regulatory authority may require the establishment or modification of a similar strategy that may, for instance, restrict distribution of our products and impose burdensome implementation requirements on us; ● we may be required to change the way the product is administered or conduct additional clinical trials; ● we could be sued and held liable for harm caused to subjects or patients; ● we may be subject to litigation or product liability claims; and ● our reputation may suffer.
Risks Associated with Ownership of Our Common Stock ● We may issue shares of our common and /or preferred stock in the future which could reduce the equity interest of our stockholders and might cause a change in control of our ownership. ● Our management and their affiliates control a substantial interest in us and thus may influence certain actions requiring a stockholder vote. ● A robust public market for our common stock may not be sustained, which could affect your ability to sell our common stock or depress the market price of our common stock. ● Our stock price may be volatile, and purchasers of our securities could incur substantial losses. ● Our outstanding warrants and other convertible securities may have an adverse effect on the market price of our common stock. ● We do not intend to pay any cash dividends on our common stock at this time. ● We have made distributions of shares of Lucid common stock to our shareholders in the past, but there is no assurance we will do so in the future. ● We are subject to evolving corporate governance and public disclosure expectations and regulations that impact compliance costs and risks of noncompliance. ● We incur significant costs as a result of our and Lucid Diagnostics operating as a public company, and our management will be required to devote substantial time to compliance initiatives. ● If we experience material weaknesses in our internal control over financial reporting in the future, our business may be harmed. ● If securities or industry analysts do not publish research, or publish inaccurate or unfavorable research, about our business, our stock price and trading volume could decline. ● Provisions in our corporate charter documents and under Delaware law could make an acquisition of us more difficult and may prevent attempts by our stockholders to replace or remove our current management. 17 Risks Related to Financial Position and Capital Resources We have incurred operating losses since our inception and may not be able to achieve profitability.
Risks Associated with Ownership of Our Common Stock ● We may issue shares of our common and /or preferred stock in the future which could reduce the equity interest of our stockholders and might cause a change in control of our ownership. ● The holder of our convertible debt and the holder of our Series C Preferred Stock have certain rights with respect to the shares in Lucid Diagnostics that we own, which may have a material impact on the return on any investment in shares of our common stock. ● Our management and their affiliates control a substantial interest in us and thus may influence certain actions requiring a stockholder vote. ● A robust public market for our common stock may not be sustained, which could affect your ability to sell our common stock or depress the market price of our common stock. ● Our stock price may be volatile, and purchasers of our securities could incur substantial losses. ● Our outstanding warrants and other convertible securities may have an adverse effect on the market price of our common stock and the value of your investment in us. ● We do not intend to pay any cash dividends on our common stock at this time. ● We have made distributions of shares of Lucid common stock to our shareholders in the past, but there is no assurance we will do so in the future. ● We are subject to evolving corporate governance and public disclosure expectations and regulations that impact compliance costs and risks of noncompliance. ● We incur significant costs as a result of our and Lucid Diagnostics operating as a public company, and our management will be required to devote substantial time to compliance initiatives. ● If we experience material weaknesses in our internal control over financial reporting in the future, our business may be harmed. ● If securities or industry analysts do not publish research, or publish inaccurate or unfavorable research, about our business, our stock price and trading volume could decline. ● Provisions in our corporate charter documents and under Delaware law could make an acquisition of us more difficult and may prevent attempts by our stockholders to replace or remove our current management. 21 Risks Related to Financial Position and Capital Resources We have incurred operating losses since our inception and may not be able to achieve profitability.
In addition, under certain circumstances, convertible debt instruments (such as the Senior Convertible Notes) that may be settled entirely or partially in cash are currently accounted for utilizing the treasury stock method, the effect of which is that the shares issuable upon conversion of the Senior Convertible Notes are not included in the calculation of diluted earnings per share except to the extent that the conversion value of the Senior Convertible Notes exceeds their principal amount.
In addition, under certain circumstances, convertible debt instruments (such as the September 2022 Senior Convertible Note) that may be settled entirely or partially in cash are currently accounted for utilizing the treasury stock method, the effect of which is that the shares issuable upon conversion of the September 2022 Senior Convertible Note are not included in the calculation of diluted earnings per share except to the extent that the conversion value of the September 2022 Senior Convertible Note exceeds their principal amount.
Risks Associated with Our Business ● We will need substantial additional funding and may be unable to raise capital when needed, which could force us to delay, reduce, eliminate or abandon growth initiatives or product development programs. ● The markets in which we operate are highly competitive, and we may not be able to effectively compete against other providers of medical devices, particularly those with greater resources. ● We have finite resources, which may restrict our success in commercializing our current products and other products we may develop, and we may be unsuccessful in entering into or maintaining third-party arrangements to support our internal efforts. ● If we are unable to deploy and maintain effective sales, marketing and medical affairs capabilities, we will have difficulty achieving market awareness and selling our tests and other products. ● Our products may never achieve market acceptance. ● Recommendations, guidelines and quality metrics issued by various organizations may significantly affect payors’ willingness to cover, and healthcare providers’ willingness to prescribe, our products. ● We or our third-party manufacturers may not have the manufacturing and processing capacity to meet the production requirements of clinical testing or consumer demand in a timely manner. ● We currently perform our EsoGuard test in one laboratory facility.
Risks Associated with Our Business ● We will need substantial additional funding and may be unable to raise capital when needed, which could force us to delay, reduce, eliminate or abandon growth initiatives or product development programs. ● The markets in which we operate are highly competitive, and we may not be able to effectively compete against other providers of medical devices, particularly those with greater resources. ● We have finite resources, which may restrict our success in commercializing our current products and other products we may develop, and we may be unsuccessful in entering into or maintaining third-party arrangements to support our internal efforts. ● If we are unable to deploy and maintain effective sales, marketing and medical affairs capabilities, we will have difficulty achieving market awareness and selling our tests and other products. ● Our products may never achieve market acceptance. ● Recommendations, guidelines and quality metrics issued by various organizations may significantly affect payors’ willingness to cover, and healthcare providers’ willingness to prescribe, our products. ● We or our third-party manufacturers may not have the manufacturing and processing capacity to meet the production requirements of clinical testing or consumer demand in a timely manner. ● If demand for our EsoGuard test grows, we may lack adequate facility space and capabilities to meet increased processing requirements.
The manufacturing processes for our products have not yet been tested at commercial levels, and it may not be possible to manufacture or process these materials in a cost-effective manner. We currently perform our EsoGuard test in one laboratory facility. If demand for our EsoGuard test grows, we may lack adequate facility space and capabilities to meet increased processing requirements.
The manufacturing processes for our products have not yet been tested at commercial levels, and it may not be possible to manufacture or process these materials in a cost-effective manner. If demand for our EsoGuard test grows, we may lack adequate facility space and capabilities to meet increased processing requirements.
Despite our right to pay the interest and principal balance of the Senior Convertible Notes by issuing shares of our common stock, we may be required to repay such indebtedness in cash, if we do not meet certain customary equity conditions (including minimum price and volume thresholds) or in certain other circumstances.
Despite our right to pay the interest and principal balance of the September 2022 Senior Convertible Note by issuing shares of our common stock, we may be required to repay such indebtedness in cash, if we do not meet certain customary equity conditions (including minimum price and volume thresholds) or in certain other circumstances.
In our December 31, 2023 consolidated financial statements, we have concluded and stated that our recurring losses from operations, recurring cash flows used in operations and the requirement that we will need to raise additional capital in order to fund our ongoing operations beyond March 2025 raise substantial doubt regarding our ability to continue as a going concern.
In our December 31, 2024 consolidated financial statements, we have concluded and stated that our recurring losses from operations, recurring cash flows used in operations and the requirement that we will need to raise additional capital in order to fund our ongoing operations beyond March 2026 raise substantial doubt regarding our ability to continue as a going concern.
Our certificate of incorporation authorizes the issuance of up to 50,000,000 shares of common stock, par value $.001 per share, and 20,000,000 shares of preferred stock, par value $.001 per share.
Our certificate of incorporation authorizes the issuance of up to 250,000,000 shares of common stock, par value $.001 per share, and 20,000,000 shares of preferred stock, par value $.001 per share.
The effect of ASC 470-20 on the accounting for the Senior Convertible Notes is that the equity component is required to be included in the additional paid-in capital section of stockholders’ equity on our consolidated balance sheet and the value of the equity component would be treated as original issue discount for purposes of accounting for the debt component of the Senior Convertible Notes.
The effect of ASC 470-20 on the accounting for the September 2022 Senior Convertible Note is that the equity component is required to be included in the additional paid-in capital section of stockholders’ equity on our consolidated balance sheet and the value of the equity component would be treated as original issue discount for purposes of accounting for the debt component of the September 2022 Senior Convertible Note.
We cannot be sure that the accounting standards in the future will continue to permit the use of the treasury stock method. If we are unable to use the treasury stock method in accounting for the shares issuable upon conversion of the Senior Convertible Notes, then our diluted earnings per share would be adversely affected.
We cannot be sure that the accounting standards in the future will continue to permit the use of the treasury stock method. If we are unable to use the treasury stock method in accounting for the shares issuable upon conversion of the September 2022 Senior Convertible Note, then our diluted earnings per share would be adversely affected.
There is also no assurance that the holders will be willing to waive any future non-compliance with this or any other provision under the Senior Convertible Notes, or if they are willing to do so, if the terms on which they are so willing will be acceptable to us.
There is also no assurance that the holders will be willing to waive any future non-compliance with this or any other provision under the September 2022 Senior Convertible Note, or if they are willing to do so, if the terms on which they are so willing will be acceptable to us.
In addition, we may not prevail in such proceedings given the complex technical issues and inherent uncertainties in intellectual property litigation. 23 Any claims of patent or other intellectual property infringement against us, even those without merit, could: ● increase the cost of our products; ● be expensive and/or time consuming to defend; ● result in our being required to pay significant damages to third parties; ● force us to cease making or selling products that incorporate the challenged intellectual property; ● require us to redesign, reengineer or rebrand our products and technologies; ● require us to enter into royalty or licensing agreements in order to obtain the right to use a third party’s intellectual property on terms that may not be favorable or acceptable to us; ● require us to develop alternative non-infringing technology, which could require significant effort and expense; ● require us to indemnify third parties pursuant to contracts in which we have agreed to provide indemnification for intellectual property infringement claims; and, ● result in our customers or potential customers deferring or limiting their purchase or use of the affected products impacted by the claims until the claims are resolved.
Any claims of patent or other intellectual property infringement against us, even those without merit, could: ● increase the cost of our products; ● be expensive and/or time consuming to defend; ● result in our being required to pay significant damages to third parties; ● force us to cease making or selling products that incorporate the challenged intellectual property; ● require us to redesign, reengineer or rebrand our products and technologies; ● require us to enter into royalty or licensing agreements in order to obtain the right to use a third party’s intellectual property on terms that may not be favorable or acceptable to us; ● require us to develop alternative non-infringing technology, which could require significant effort and expense; ● require us to indemnify third parties pursuant to contracts in which we have agreed to provide indemnification for intellectual property infringement claims; and, ● result in our customers or potential customers deferring or limiting their purchase or use of the affected products impacted by the claims until the claims are resolved.
We have incurred net losses since our inception. To date, since our inception in June 2014, we have financed our operations principally through issuances of common stock, preferred stock, warrants, and debt, in both private placements and public offerings of our securities.
We have incurred net losses since our inception. To date, since our inception in June 2014, we have financed our operations principally through issuances (by us or by our subsidiaries) of common stock, preferred stock, warrants, and debt, in both private placements and public offerings of our securities.
As a result, we will be required to record a greater amount of non-cash interest expense in current periods presented as a result of the amortization of the discounted carrying value of the Senior Convertible Notes to their face amount over the term of the Senior Convertible Notes.
As a result, we will be required to record a greater amount of non-cash interest expense in current periods presented as a result of the amortization of the discounted carrying value of the September 2022 Senior Convertible Note to their face amount over the term of the September 2022 Senior Convertible Note.
If Lucid Diagnostics is unable to continue to make any such cash payments we elect to receive, or determines to terminate the management services agreement (i.e., because it retains its own management team to oversee its operations), and PAVmed is unable to raise sufficient capital itself, it may not have sufficient capital to fund its operations, which in turn could have a material adverse effect on our business.
If Lucid Diagnostics is unable to continue to make any such cash payments we elect to receive, or if we are so required to reserve 50% of the management services agreement fees we receive, or if Lucid Diagnostics determines to terminate the management services agreement (i.e., because it retains its own management team to oversee its operations), and PAVmed is unable to raise sufficient capital itself, it may not have sufficient capital to fund its operations, which in turn could have a material adverse effect on our business.
We have not generated material revenue from operations to date, and our business may not generate cash flow from operations in the future sufficient to service our indebtedness and make necessary capital expenditures. In addition, the Senior Convertible Notes contain, and any future indebtedness may contain, restrictive covenants, including financial covenants.
We have not generated material revenue from operations to date, and our business may not generate cash flow from operations in the future sufficient to service our indebtedness and make necessary capital expenditures. In addition, the September 2022 Senior Convertible Note contains, and any future indebtedness may contain, restrictive covenants, including financial covenants.
However, even if Lucid does submit EsoGuard for Technical Assessment as currently planned, there can be no assurance that MolDx will determine that EsoGuard meets the criteria for coverage as specified in the LCD. If Lucid is not granted coverage, or if a determination is substantially delayed, that could have a material adverse effect on Lucid’s ability to commercialize EsoGuard.
However, there can be no assurance that MolDx will determine that EsoGuard meets the criteria for coverage as specified in the LCD. If Lucid is not granted coverage, or if a determination is substantially delayed, that could have a material adverse effect on Lucid’s ability to commercialize EsoGuard.
Due to challenging market conditions, we have found it difficult to raise capital directly into PAVmed. As a result, we have become highly dependent on the ability of each of our subsidiaries to raise capital to fund their own operations.
Due to challenging market conditions, we have found it difficult to raise capital directly into PAVmed (notwithstanding our recent $2.37 million capital raise at PAVmed). As a result, we have become highly dependent on the ability of each of our subsidiaries to raise capital to fund their own operations.
Servicing our indebtedness may require a significant amount of cash, and the restrictive covenants contained in our indebtedness could adversely affect our business plan, liquidity, financial condition, and results of operations.
Servicing our indebtedness may require a significant amount of cash, and the restrictive covenants contained in the documents that govern our indebtedness and preferred stock could adversely affect our business plan, liquidity, financial condition, and results of operations.
The number of shares of common stock to be issued under the Senior Convertible Notes may be substantially greater than the estimate set forth in this paragraph, if we pay the interest and the installments of principal in shares of our common stock, because in such cases (and in certain other cases as described elsewhere in this Annual Report on Form 10-K) the number of shares issued will be determined based on the then current market price (but in any event not more than fixed conversion price per share or less than a floor price specified in the notes).
The number of shares of common stock to be issued under the September 2022 Senior Convertible Note may be substantially greater than the estimate set forth in this paragraph, if we pay the interest and the installments of principal in shares of our common stock, because in such cases (and in certain other cases as described elsewhere in this Annual Report on Form 10-K) the number of shares issued will be determined based on the then current market price (but in any event not more than fixed conversion price per share or less than a floor price specified in the notes), or if we agree to voluntarily reduce the conversion price under the note (for example, in consideration of any waiver or consent we might need).
In addition, because of the challenges PAVmed has faced in terms of raising capital, we are highly dependent on our subsidiaries, including Lucid Diagnostics, as resources for funding our operations (notably, PAVmed may elect that Lucid Diagnostics satisfy its obligations under our management services agreement through cash payment).
In addition, because of the challenges PAVmed has faced in terms of raising capital, we are highly dependent on our subsidiaries, including Lucid Diagnostics, as resources for funding our operations (notably, PAVmed may elect that Lucid Diagnostics satisfy its obligations under our management services agreement through cash payment and, under the terms of our outstanding convertible debt, we are required to elect to receive such payments in cash).
Risks Associated with Our Business We will need substantial additional funding and may be unable to raise capital when needed, which could force us to delay, reduce, eliminate or abandon growth initiatives or product development programs. We intend to continue to try to raise capital through each of our subsidiaries to support our business growth.
Risks Associated with Our Business We will need substantial additional funding and may be unable to raise capital when needed, which could force us to delay, reduce, eliminate or abandon growth initiatives or product development programs.
We and our subsidiaries may be required to repay or redeem, or to pay interest on, the April 2022 Senior Convertible Note, the September 2022 Senior Convertible Note and the March 2023 Lucid Senior Convertible Note (collectively, the “Senior Convertible Notes”) or any future permitted indebtedness incurred by us or our subsidiaries, in cash.
We and our subsidiaries may be required to repay or redeem, or to pay interest on, the September 2022 Senior Convertible Note or any future permitted indebtedness incurred by us or our subsidiaries, in cash.
We are limited in shares available for issuance under our long-term incentive plan, which could limit our ability to attract and retain key personnel, until such amount is increased. An inability to attract and retain key personnel may impact our ability to continue and grow our operations.
We are limited in shares available for issuance under our long-term incentive plan, which could limit our ability to attract and retain key personnel, until such amount is increased.
The payment of cash dividends on our common stock in the future will be dependent upon our revenues and earnings, if any, capital requirements and general financial condition and will be within the discretion of our Board of Directors.
We have not paid any cash dividends on our shares of common stock to date. The payment of cash dividends on our common stock in the future will be dependent upon our revenues and earnings, if any, capital requirements and general financial condition and will be within the discretion of our Board of Directors.
We are confident that the proposed policy will not have a commercial impact as Lucid already has a robust QS management platform for medical devices and EsoGuard will be able to transition to the platform to fulfill the QS requirements, if and when required by FDA.
We are confident that the proposed final rule will not have a commercial impact as the Company already has a robust QS management platform for medical devices and EsoGuard will be able to easily transition to the platform to fulfill the QS requirements, as required by the FDA.
No recalls of the Company’s medical products have been reported to the FDA. 29 If the Company’s medical products cause or contribute to a death or a serious injury, or malfunction in certain ways, we will be subject to medical device reporting regulations, which can result in voluntary corrective actions or agency enforcement actions.
If the Company’s medical products cause or contribute to a death or a serious injury, or malfunction in certain ways, we will be subject to medical device reporting regulations, which can result in voluntary corrective actions or agency enforcement actions.
These competitors have significantly greater financial, technical, marketing and other resources than we have and may be better able to: ● respond to new technologies or technical standards; ● react to changing customer requirements and expectations; ● acquire other companies to gain new technologies or products may displace our products; ● manufacture, market and sell products; ● acquire, prosecute, enforce and defend patents and other intellectual property; ● devote resources to the development, production, promotion, support and sale of products; and ● deliver a broad range of competitive products at lower prices.
These competitors have significantly greater financial, technical, marketing and other resources than we have and may be better able to: ● respond to new technologies or technical standards; ● react to changing customer requirements and expectations; ● acquire other companies to gain new technologies or products may displace our products; ● manufacture, market and sell products; ● acquire, prosecute, enforce and defend patents and other intellectual property; ● devote resources to the development, production, promotion, support and sale of products; and ● deliver a broad range of competitive products at lower prices. 24 We expect competition in the markets in which we participate to continue to increase as existing competitors improve or expand their product offerings.
If the maximum amount of common stock underlying such securities were issued (including shares of Lucid common stock issued as a dividend thereon), the percentage of shares of Lucid common stock held by PAVmed would be reduced from approximately [●]% to approximately [●]%.
As of the date hereof, if the maximum amount of common stock underlying Lucid’s outstanding convertible securities were issued (including shares of Lucid common stock issued as a dividend thereon), the percentage of shares of Lucid common stock held by PAVmed would be reduced from approximately 34% to approximately 18%.
As the Company’s clinical trials are completed as planned, it cannot be certain that study results will support product candidate claims or that the FDA or foreign regulatory authorities will agree with our conclusions regarding them.
The results of the Company’s clinical trials may not support our product candidate claims or may result in the discovery of adverse side effects. As the Company’s clinical trials are completed as planned, it cannot be certain that study results will support product candidate claims or that the FDA or foreign regulatory authorities will agree with our conclusions regarding them.
Successful commercialization of Lucid’s EsoGuard test and EsoCheck device, and of any other product or service we develop, license or acquire depends, in large part, on the availability of adequate reimbursement from private or governmental third-party payors.
Despite our initiative to establish a robust cash pay program, successful commercialization of Lucid’s EsoGuard test and EsoCheck device, and of any other product or service we develop, license or acquire depends, in large part, on the availability of adequate reimbursement from private or governmental third-party payors.
If we do not have, or are not able to obtain, sufficient funds, we may have to delay product development initiatives or license to third parties the rights to commercialize products or technologies we would otherwise seek to market.
If we do not have, or are not able to obtain, sufficient funds, we may have to delay product development initiatives or license to third parties the rights to commercialize products or technologies we would otherwise seek to market. We also may have to reduce marketing, customer support or other resources devoted to our products.
These risks are described more fully below and include, but are not limited to, risks relating to the following: Risks Related to Financial Position and Capital Resources ● We have incurred operating losses since our inception and may not be able to achieve profitability. ● We have concluded there is substantial doubt of our ability to continue as a going concern and our independent registered public accounting firm’s report on our financial statements contains an explanatory paragraph describing our ability to continue as a going concern. ● We have faced significant challenges raising capital under the current market conditions, and therefore are highly dependent on the ability of each of our subsidiaries to raise capital to fund its own and our operations. ● There can be no assurance that our common stock will continue to trade on the Nasdaq Capital Market or another national securities exchange. ● Our subsidiary Lucid may issue shares of its common and/or preferred stock in the future which could reduce the equity interest of PAVmed in Lucid and might cause us to cease to control a majority of the voting stock of Lucid. ● Servicing our indebtedness may require a significant amount of cash, and the restrictive covenants contained in our indebtedness could adversely affect our business plan, liquidity, financial condition, and results of operations. ● The accounting method for convertible debt securities that may be settled in cash, such as the Senior Convertible Notes, could have a material effect on our reported financial results.
These risks are described more fully below and include, but are not limited to, risks relating to the following: Risks Related to Financial Position and Capital Resources ● We have incurred operating losses since our inception and may not be able to achieve profitability. ● We have concluded there is substantial doubt of our ability to continue as a going concern and our independent registered public accounting firm’s report on our financial statements contains an explanatory paragraph describing our ability to continue as a going concern. ● We have faced significant challenges raising capital under the current market conditions, and therefore are highly dependent on the ability of each of our subsidiaries to raise capital to fund its own and our operations. ● There can be no assurance that our common stock will continue to trade on the Nasdaq Capital Market or another national securities exchange. ● Our subsidiary Lucid may issue shares of its common and/or preferred stock in the future, and the holder of our convertible debt may exchange such debt for our shares of Lucid common stock.
If we or a third party discover previously unknown problems with a product, such as adverse events of unanticipated severity or frequency, or problems with the facility where the product is manufactured, a regulatory authority may impose restrictions on that product, the manufacturer or us, including requiring withdrawal of the product from the market or suspension of manufacturing.
If we or a third party discover previously unknown problems with a product, such as adverse events of unanticipated severity or frequency, or problems with the facility where the product is manufactured, a regulatory authority may impose restrictions on that product, the manufacturer or us, including requiring withdrawal of the product from the market or suspension of manufacturing. 33 Healthcare reform measures, including those targeting Medicare or Medicaid, could hinder or prevent our products’ commercial success.
Delays in patient enrollment or failure of patients to continue to participate in a clinical trial may cause an increase in costs and delays in the approval and attempted commercialization of our products or result in the failure of the clinical trial.
Delays in patient enrollment or failure of patients to continue to participate in a clinical trial may cause an increase in costs and delays in the approval and attempted commercialization of our products or result in the failure of the clinical trial. Such increased costs and delays or failures could adversely affect our business, operating results and prospects.
A future recall announcement could harm the Company’s reputation with customers and negatively affect its sales. In addition, the FDA could take enforcement action for failing to report the recalls when they were conducted.
A future recall announcement could harm the Company’s reputation with customers and negatively affect its sales. In addition, the FDA could take enforcement action for failing to report the recalls when they were conducted. No recalls of the Company’s medical products that we are seeking to commercialize have been reported to the FDA.
Any judgments or settlements in any pending litigation or future claims, litigation or investigation could have a material adverse effect on our business, financial condition, results of operations and price of our common stock. 25 Risks Associated with Healthcare Regulation, Billing and Reimbursement, and Product Safety and Effectiveness If private or governmental third-party payors do not maintain reimbursement for our products at adequate reimbursement rates, we may be unable to successfully commercialize our products which would limit or slow our revenue generation and likely have a material adverse effect on our business.
Risks Associated with Healthcare Regulation, Billing and Reimbursement, and Product Safety and Effectiveness If private or governmental third-party payors do not maintain reimbursement for our products at adequate reimbursement rates, we may be unable to successfully commercialize our products which would limit or slow our revenue generation and likely have a material adverse effect on our business.
In October 2023, FDA proposed a policy under which FDA intends to phase out its general enforcement discretion approach for LDTs so that IVDs (like EsoGuard) manufactured by a laboratory would generally fall under the same enforcement approach as other IVDs.
FDA has proposed a policy under which it would phase out its general enforcement discretion approach for LDTs so that IVDs manufactured at a laboratory would generally fall under the same enforcement approach as other IVDs.
As a result, a potential business opportunity may be presented by certain members of our board or management team to another entity prior to its presentation to us and we may not be afforded the opportunity to engage in such a transaction. 24 Our business, financial condition and results of operations could be adversely affected by the political and economic conditions of the countries in which we conduct business.
As a result, a potential business opportunity may be presented by certain members of our board or management team to another entity prior to its presentation to us and we may not be afforded the opportunity to engage in such a transaction.
As of December 31, 2023, there were 8,578,505 shares of our common stock issued and outstanding, and, as of such date, we also had issued and outstanding: (i) stock options to purchase 1,192,458 shares of our common stock at a weighted average exercise price of $26.18 per share, with such total number inclusive of both stock options granted under the PAVmed Inc. 2014 Long-Term Incentive Equity Plan (“PAVmed 2014 Equity Plan”); 77,518 shares of our common stock reserved for issuance, but not subject to outstanding stock-based equity awards under the PAVmed 2014 Equity Plan; and 7,528 shares of our common stock reserved for issuance under the PAVmed Inc.
As of December 31, 2024, there were 11,198,977 shares of our common stock issued and outstanding, and, as of such date, we also had issued and outstanding: (i) stock options to purchase 1,065,319 shares of our common stock at a weighted average exercise price of $25.50 per share, with such total number inclusive of both stock options granted under the PAVmed Inc. 2014 Long-Term Incentive Equity Plan (“PAVmed 2014 Equity Plan”); 247,109 shares of our common stock reserved for issuance, but not subject to outstanding stock-based equity awards under the PAVmed 2014 Equity Plan; and 139,863 shares of our common stock reserved for issuance under the PAVmed Inc.
Healthcare reform measures could hinder or prevent our products’ commercial success. There likely will be legislative and regulatory proposals at the federal and state levels directed at containing or lowering the cost of health care. We cannot predict the initiatives that may be adopted in the future or their full impact.
There likely will be legislative and regulatory proposals at the federal and state levels directed at containing or lowering the cost of health care, including those targeting Medicare or Medicaid. We cannot predict the initiatives that may be adopted in the future or their full impact.
The continuing efforts of the government, insurance companies, managed care organizations and other payors of healthcare services to contain or reduce costs of health care may adversely affect: ● our ability to set a price that we believe is fair for our products; ● our ability to generate revenue and achieve or maintain profitability; and ● the availability of capital. 28 Further, changes in regulatory requirements and guidance may occur, both in the United States and in foreign countries, and we may need to amend clinical study protocols to reflect these changes.
The continuing efforts of the government, insurance companies, managed care organizations and other payors of healthcare services to contain or reduce costs of health care may adversely affect: ● our ability to set a price that we believe is fair for our products; ● our ability to generate revenue and achieve or maintain profitability; and ● the availability of capital.
We believe that the incubator financing structure will provide us with future benefits. These expected benefits are not guaranteed and may not be obtained if market conditions or other circumstances prevent us from taking advantage of the investment, financing and structuring flexibility we expect to gain as a result of the incubator financing structure.
These expected benefits are not guaranteed and may not be obtained if market conditions or other circumstances prevent us from taking advantage of the investment, financing and structuring flexibility we expect to gain as a result of the incubator financing structure (to date, we have been unsuccessful in our efforts to raise capital through this structure).
Our plans to address this going concern risk include pursuing further financings at Lucid in addition to the recently completed offering of Lucid Series B Preferred Stock (Lucid has recently raised over $18 million in such offering), seeking to restructure our and Lucid Diagnostics’ outstanding indebtedness and pursuing additional offerings of debt and/or equity securities.
Our plans to address this going concern risk include pursuing further financings at PAVmed in addition to the recently completed Series C Preferred Stock Debt Exchange and the PAVmed and Veris Common Stock Offering (we recently raised over $2.4 million in such offering) and pursuing additional offerings of debt and/or equity securities.
We expect competition in the markets in which we participate to continue to increase as existing competitors improve or expand their product offerings. We have finite resources, which may restrict our success in commercializing our current products and other products we may develop, and we may be unsuccessful in entering into or maintaining third-party arrangements to support our internal efforts.
We have finite resources, which may restrict our success in commercializing our current products and other products we may develop, and we may be unsuccessful in entering into or maintaining third-party arrangements to support our internal efforts.
Any claims that our products or processes infringe these rights, regardless of their merit or resolution, could be costly, time consuming and may divert the efforts and attention of our management and technical personnel.
Any claims that our products or processes infringe these rights, regardless of their merit or resolution, could be costly, time consuming and may divert the efforts and attention of our management and technical personnel. In addition, we may not prevail in such proceedings given the complex technical issues and inherent uncertainties in intellectual property litigation.
Moreover, if these or any future facilities or our equipment were damaged or destroyed, or if we experience a significant disruption in our operations for any reason, our ability to continue to operate our business could be materially harmed. We currently perform the EsoGuard test in a single laboratory facility in Lake Forest, CA.
Moreover, if these or any future facilities or our equipment were damaged or destroyed, or if we experience a significant disruption in our operations for any reason, our ability to continue to operate our business could be materially harmed. Lucid currently has adequate capacity to process EsoGuard tests, based on current test volumes.
Accordingly, these individuals would have considerable influence regarding the outcome of any transaction that requires stockholder approval. Furthermore, our Board of Directors is and will be divided into three classes, each of which will generally serve for a term of three years with only one class of directors being elected in each year.
Furthermore, our Board of Directors is and will be divided into three classes, each of which will generally serve for a term of three years with only one class of directors being elected in each year.
Such litigation, if instituted against us, could result in substantial costs and diversion of management’s attention and resources, which could materially and adversely affect our business, financial condition, results of operations and growth prospects. Our outstanding warrants and other convertible securities may have an adverse effect on the market price of our common stock.
Such litigation, if instituted against us, could result in substantial costs and diversion of management’s attention and resources, which could materially and adversely affect our business, financial condition, results of operations and growth prospects.
If we were so delisted, that could have a material adverse effect on your investment in the Company, including without limitation by substantially reducing the liquidity of our common stock, and by further limiting our access to capital markets for fundraising.
In any event, there can be no assurance that the Company will be able to regain compliance by the current or any extended deadline, in which case, the Company’s stock would be delisted. 22 If we were delisted, that could have a material adverse effect on your investment in the Company, including without limitation by substantially reducing the liquidity of our common stock, and by further limiting our access to capital markets for fundraising.
Even where a third-party payor agrees to cover EsoGuard and EsoCheck or any other product or service we develop at an adequate reimbursement rate, other factors may have a significant impact on the actual reimbursement we receive from that payor.
Healthcare providers may be reluctant to prescribe our products if they believe that reimbursement for the test will not be available for a significant number of their patients. 31 Even where a third-party payor agrees to cover EsoGuard and EsoCheck or any other product or service we develop at an adequate reimbursement rate, other factors may have a significant impact on the actual reimbursement we receive from that payor.
We may become the subject of various claims, threats of litigation, litigation or investigations which could have a material adverse effect on our business, financial condition, results of operations or price of our common stock.
Failure to adequately protect and maintain the integrity of our information systems issues and data may result in a material adverse effect on our financial position, results of operations and cash flows. 30 We may become the subject of various claims, threats of litigation, litigation or investigations which could have a material adverse effect on our business, financial condition, results of operations or price of our common stock.
In addition, the number of shares issued under these notes may be substantially greater if we voluntarily lower the conversion price, which we are permitted to do pursuant to the terms thereof. The issuance of these shares will dilute our other equity holders, which could cause the price of our common stock to decline.
In addition, the number of shares issued under this note may be substantially greater if we voluntarily lower the conversion price, which we are permitted to do pursuant to the terms thereof.
There can be no assurance that our common stock will continue to trade on the Nasdaq Capital Market or another national securities exchange. There can be no assurance that we will be able to continue to meet Nasdaq Capital Market listing standards.
There can be no assurance that we will be able to continue to meet Nasdaq Capital Market listing standards.
Our officers and directors have fiduciary obligations to other companies and, accordingly, may have conflicts of interest in determining to which entity a particular business opportunity should be presented. Certain of our officers and directors have fiduciary obligations to other companies engaged in medical device business activities.
An inability to attract and retain key personnel may impact our ability to continue and grow our operations. 29 Our officers and directors have fiduciary obligations to other companies and, accordingly, may have conflicts of interest in determining to which entity a particular business opportunity should be presented.
Payment rates also may vary according to the use of the product and the clinical setting in which it is used, may be based on payments allowed for lower cost products that are already reimbursed and may be incorporated into existing payments for other services. 26 FDA has proposed a policy under which it would phase out its general enforcement discretion approach for LDTs so that IVDs manufactured at a laboratory would generally fall under the same enforcement approach as other IVDs.
Payment rates also may vary according to the use of the product and the clinical setting in which it is used, may be based on payments allowed for lower cost products that are already reimbursed and may be incorporated into existing payments for other services.
The notification letter stated that the Company would be afforded 180 calendar days (until September 3, 2024) to regain compliance. In order to regain compliance, the Company’s MVLS must close at $35 million or more for a minimum of ten consecutive business days.
The notification letter stated that the Company would be afforded 180 calendar days (until July 22, 2025) to regain compliance. In order to regain compliance, the closing bid price of the Company’s common stock must be at least $1 for a minimum of ten consecutive business days.
Accordingly, they may participate in transactions and have obligations that may be in conflict or competition with our business.
Certain of our officers and directors have fiduciary obligations to other companies engaged in medical device business activities. Accordingly, they may participate in transactions and have obligations that may be in conflict or competition with our business.
While we are confident that the proposed policy will not have a material impact on our business, there can be no assurance that will be the case.
While we are confident that the proposed policy will not have a material impact on our business, there can be no assurance that will be the case. On May 6, 2024, the FDA issued a final rule aimed at helping to ensure the safety and effectiveness of LDTs.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeWe retain Techneto, Inc. d/b/a CyberTeam (“CyberTeam”), a third party vendor that reports directly to our Chief Operating Officer, to be responsible for identifying, assessing and managing the Company’s risks from cybersecurity threats. CyberTeam has been with the Company since its inception and has over 25 years of experience in cybersecurity.
Biggest changeWe retain Techneto, Inc. d/b/a CyberTeam (“CyberTeam”), a third party vendor that reports directly to our Chief Operating Officer, to be responsible for identifying, assessing and managing the Company’s risks from cybersecurity threats. CyberTeam has been with the Company since the Company’s inception and has over 25 years of experience in cybersecurity.

Item 2. Properties

Properties — owned and leased real estate

2 edited+0 added−1 removed1 unchanged
Biggest changeThe Company or its subsidiaries also have entered into leases for a research and development facility in Massachusetts with 7,375 square feet, which has a remaining term expiring April 30, 2027, a CLIA laboratory in California with 21,019 square feet, which has a remaining term expiring December 31, 2024, and an office space in Pennsylvania with 4,300 square feet, which has a remaining term expiring October 31, 2027.
Biggest changeThe Company or its subsidiaries also have entered into leases for a research and development facility in Massachusetts with 7,375 square feet, which has a remaining term expiring April 30, 2027 and an office space in Pennsylvania with 4,300 square feet, which has a remaining term expiring October 31, 2027.
Notwithstanding, we may obtain additional space in the future, as warranted by our business operations.
At this time, we consider our facility space to be commensurate with our current operations. Notwithstanding, we may obtain additional space in the future, as warranted by our business operations.
Removed
We also have lease agreements for our Lucid Test Centers in various locations in Arizona, California, Colorado, Florida, Idaho, Illinois, Nevada, Ohio, Oregon, Texas and Utah that in the aggregate approximate 15,048 square feet. At this time, we consider our facility space to be commensurate with our current operations.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

2 edited+0 added−0 removed2 unchanged
Biggest changeAdditionally, although the Company has specific insurance for certain potential risks, the Company may in the future incur judgments or enter into settlements of claims which may have a material adverse impact on the Company’s business, financial position, results of operations, and /or cash flows.
Biggest changeAdditionally, although the Company has specific insurance for certain potential risks, the Company may in the future incur judgments or enter into settlements of claims which may have a material adverse impact on the Company’s business, financial position, results of operations, and /or cash flows. Item 4. Mine Safety Disclosures Not applicable. 40 Part II
Item 3. Legal Proceedings In the ordinary course of PAVmed business, particularly as it begins commercialization of its products, the Company may be subject to legal actions and claims, including product liability, consumer, commercial, tax and governmental matters, which may arise from time to time.
Item 3. Legal Proceedings In the ordinary course of the Company’s business, particularly as it begins commercialization of its products, the Company may be subject to legal actions and claims, including product liability, consumer, commercial, tax and governmental matters, which may arise from time to time.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

9 edited+2 added−2 removed6 unchanged
Biggest changeSubsequent to December 31, 2023, the Company’s board of directors declared a Series B Convertible Preferred Stock dividend, earned as of December 31, 2023, of $78, to be settled by the issue of 26,123 additional shares of Series B Convertible Preferred Stock.
Biggest changeSubsequent to December 31, 2024, the Company’s board of directors declared a Series B Convertible Preferred Stock dividend, earned as of December 31, 2024, of $85,000, to be settled by the issue of 28,270 additional shares of Series B Convertible Preferred Stock. 41 Series C Convertible Preferred Stock Subsequent to December 31, 2024, on January 17, 2025, the Company issued 25,000 of Series C Convertible Preferred Stock.
During the year ended December 31, 2023, the Company’s board of directors declared an aggregate of approximately $298 of Series B Convertible Preferred Stock dividends, earned as of December 31, 2022; March 31, 2023; June 30, 2023; and September 30, 2023, which have been settled by the issue of an additional aggregate 99,454 shares of Series B Convertible Preferred Stock.
During the year ended December 31, 2023, the Company’s board of directors declared an aggregate of approximately $298,000 of Series B Convertible Preferred Stock dividends, earned as of December 31, 2022; March 31, 2023; June 30, 2023; and September 30, 2023, which have been settled by the issue of an additional aggregate 99,454 shares of Series B Convertible Preferred Stock.
Furthermore, our common stock is junior to the Series B Convertible Preferred Stock with respect to dividends. We have paid one in-kind dividend on our common stock to date. On February 15, 2024, we distributed by special dividend to our stockholders 3,331,747 shares of Lucid common stock held by us.
Furthermore, our common stock is junior to the Series B Convertible Preferred Stock and the Series C Convertible Preferred Stock with respect to dividends. We have paid one in-kind dividend on our common stock to date. On February 15, 2024, we distributed by special dividend to our stockholders 3,331,747 shares of Lucid common stock held by us.
Our shares of common stock are held by an estimated 225 holders of record and we believe our shares of common stock are held by significantly more beneficial owners. Dividends Common Stock We have not paid any cash dividends on our common stock to date. Any future decisions regarding cash dividends will be made by our board of directors.
Our shares of common stock are held by an estimated 227 holders of record and we believe our shares of common stock are held by significantly more beneficial owners. Dividends Common Stock We have not paid any cash dividends on our common stock to date. Any future decisions regarding cash dividends will be made by our board of directors.
Recent Sales of Unregistered Securities Except as previously disclosed in our current reports on Form 8-K and quarterly reports on Form 10-Q or as described under the heading “ Recent Developments—Financing ” in Item 7 below, we did not sell any unregistered securities or repurchase any of our securities during the fiscal year ended December 31, 2023.
Recent Sales of Unregistered Securities Except as previously disclosed in our current reports on Form 8-K and quarterly reports on Form 10-Q or as described under the heading “ Recent Developments—Financing ” in Item 7 below, we did not sell any unregistered securities or repurchase any of our equity securities registered under Section 12 of the Exchange Act during the fiscal year ended December 31, 2024.
As long as the Senior Convertible Notes (see “ Liquidity and Capital Resources ” in Item 7 below) are outstanding, we may not, directly or indirectly, redeem, or declare or pay any cash dividend or cash distribution on, any of our securities without the prior express written consent of the purchasers of the Senior Convertible Notes (other than as required by the Series B Convertible Preferred Stock).
As long as the Series C Convertible Preferred Stock or the September 2022 Senior Convertible Note (see “ Liquidity and Capital Resources ” in Item 7 below) is outstanding, we may not, directly or indirectly, redeem, or declare or pay any cash dividend or cash distribution on, any of our securities without the prior express written consent of the holders thereof (other than as required by the Series B Convertible Preferred Stock).
During the year ended December 31, 2022, the Company’s board of directors declared an aggregate of approximately $276 of Series B Convertible Preferred Stock dividends, earned as of December 31, 2021; March 31, 2022; June 30, 2022; and September 30, 2022, which have been settled by the issue of an additional aggregate 91,885 shares of Series B Convertible Preferred Stock.
During the year ended December 31, 2024, the Company’s board of directors declared an aggregate of approximately $323,000 of Series B Convertible Preferred Stock dividends, earned as of December 31, 2023; March 31, 2024; June 30, 2024; and September 30, 2024, which have been settled by the issue of an additional aggregate 107,652 shares of Series B Convertible Preferred Stock.
Market for Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market for Common Equity Our common stock is traded on the Nasdaq Capital Market under the symbol “PAVM” and our Series Z Warrants are traded on the Nasdaq Capital Market under the symbol “PAVMZ.” On March 7, 2024, the Company received a notice from the Nasdaq Listing Qualifications Department stating that, for the preceding 30 consecutive business days (through March 6, 2024), the market value of the Company’s listed securities had been below the minimum of $35 million required for continued inclusion on the Nasdaq Capital Market under Nasdaq Listing Rule 5550(b)(2).
Market for Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market for Common Equity Our common stock is traded on the Nasdaq Capital Market under the symbol “PAVM” and our Series Z Warrants are traded on the Nasdaq Capital Market under the symbol “PAVMZ.” On January 23, 2025, the Company received a notice from the Listing Qualifications Department of Nasdaq stating that, for the prior 30 consecutive business days (through January 22, 2025), the closing bid price of the Company’s common stock had been below the minimum of $1 per share required for continued listing on the Nasdaq Capital Market under Nasdaq Listing Rule 5550(a)(2).
The notification letter stated that the Company would be afforded 180 calendar days (until September 3, 2024) to regain compliance. See “ Recent Developments—Business—Nasdaq Notice ” in Item 7 below for more information. Holders As of March 21, 2024, there were 9,172,331 shares of our common stock outstanding.
The notification letter stated that the Company would be afforded 180 calendar days (until July 22, 2025) to regain compliance. The Series Z Warrants expire by their terms on April 30, 2025. See “ Recent Developments—Business—Nasdaq Notice ” in Item 7 below for more information. Holders As of March 20, 2025, there were 16,787,173 shares of our common stock outstanding.
Removed
During the period ended December 31, 2022 at each of the respective holders’ election, a total of 45 shares of Series B Convertible Preferred Stock were converted into 3 shares of common stock of PAVmed Inc, adjusted for the 1-for-15 reverse stock split effective December 7, 2023, as disclosed in Note 3, Summary of Significant Accounting Policies .
Added
Each share of Series C Preferred Stock has a stated value of $1,000, and entitles the holder thereof to a preferred dividend at a rate of 7.875% per annum, payable quarterly in arrears.
Removed
There were no Series B Convertible Preferred Stock converted during the year ended December 31, 2023.
Added
Dividends on each share of Series C Convertible Preferred Stock may be settled in shares of the Company’s common stock (subject to satisfaction of certain equity-related conditions) or by capitalizing the dividend by increasing the stated value of such share.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

72 edited+93 added−71 removed25 unchanged
Biggest changeSee our accompanying consolidated financial statements Note 13, Debt , for further discussion of the SPA dated March 31, 2022 and the senior convertible notes. 38 Financing - continued Lucid Diagnostics - Preferred Stock Offerings On March 13, 2024, Lucid entered into subscription agreements (each, a “Series B Subscription Agreement”) and exchange agreements (each, an “Exchange Agreement”) with certain accredited investors (collectively, the “Series B Investors”), which agreements provided for (i) the sale to the Series B Investors of 12,495 shares of Lucid’s newly designated Series B Convertible Preferred Stock, par value $0.001 per share (the “Lucid Series B Preferred Stock”), at a purchase price of $1,000 per share, and (ii) the exchange by the Series B Investors of 13,625 shares of Lucid’s Series A Convertible Preferred Stock, par value $0.001 per share (the “Lucid Series A Preferred Stock”), and 10,670 shares of Lucid’s Series A-1 Convertible Preferred Stock, par value $0.001 per share (the “Lucid Series A-1 Preferred Stock”), held by them for 31,790 shares of Lucid Series B Preferred Stock (collectively, the “Lucid Series B Offering and Exchange”).
Biggest changeLucid Diagnostics - Preferred Stock Offerings On March 13, 2024, Lucid entered into Lucid Series B Subscription Agreements and Lucid Series B Exchange Agreements with the Lucid Series B Investors, which agreements provided for (i) the sale to the Lucid Series B Investors of 12,495 shares of newly designated Lucid Series B Preferred Stock, at a purchase price of $1,000 per share, and (ii) the exchange by the Lucid Series B Investors of 13,625 shares of Lucid Series A Preferred Stock, and 10,670 shares of Lucid Series A-1 Preferred Stock held by them for 31,790 shares of Lucid Series B Preferred Stock.
Unless the context otherwise requires, (i) “we”, “us”, and “our”, and the “Company” and “PAVmed” refer to PAVmed Inc. and its subsidiaries, including its majority-owned subsidiary Lucid Diagnostics Inc. (“Lucid Diagnostics” or “Lucid”) and its majority-owned subsidiary Veris Health Inc.
Unless the context otherwise requires, (i) “we”, “us”, and “our”, and the “Company” and “PAVmed” refer to PAVmed Inc. and its subsidiaries, including its subsidiary Lucid Diagnostics Inc. (“Lucid Diagnostics” or “Lucid”) and its majority-owned subsidiary Veris Health Inc.
Prior to the execution of the Series B Subscription Agreements and the Exchange Agreements, Lucid entered into subscription agreements with certain of the Series B Investors providing for the sale to such investors of 5,670 shares of Lucid Series A-1 Preferred Stock, at a purchase price of $1,000 per share, which shares the investors immediately agreed to exchange for shares of Lucid Series B Preferred Stock pursuant to the Exchange Agreements (and are included in the 10,670 shares of Lucid Series A-1 Preferred Stock set forth above).
Prior to the execution of the Lucid Series B Subscription Agreements and the Lucid Series B Exchange Agreements, Lucid entered into subscription agreements with certain of the Lucid Series B Investors providing for the sale to such investors of 5,670 shares of Lucid Series A-1 Preferred Stock, at a purchase price of $1,000 per share, which shares the investors immediately agreed to exchange for shares of Lucid Series B Preferred Stock pursuant to the Lucid Series B Exchange Agreements (and are included in the 10,670 shares of Lucid Series A-1 Preferred Stock set forth above).
Loss on Debt Extinguishment In the year ended December 31, 2023, a debt extinguishment loss in the aggregate of approximately $3.8 million was recognized in connection with our April 2022 Senior Convertible Note and September 2022 Senior Convertible Note as discussed below. ● In the year ended December 31, 2023, approximately $6.1 million of principal repayments along with $0.4 million of interest expense thereon, were settled through the issuance of 1,745,824 shares of common stock of the Company, with such shares having a fair value of approximately $10.0 million (with such fair value measured as the respective conversion date quoted closing price of the common stock of the Company).
In comparison, in the year ended December 31, 2023, a debt extinguishment loss in the aggregate of approximately $3.8 million was recognized in connection with our April 2022 Senior Convertible Note and the September 2022 Senior Convertible Note as discussed below. ● In the year ended December 31, 2023, approximately $6.1 million of principal repayments along with $0.4 million of interest expense thereon, were settled through the issuance of 1,745,824 shares of common stock of the Company, with such shares having a fair value of approximately $10.0 million (with such fair value measured as the quoted closing price of the common stock of the Company on the respective conversion date).
However, if the SEC has not removed the related disclosure from its regulations by June 30, 2027, the amendments will be removed from the Codification and not become effective. Early adoption is prohibited. We are currently evaluating the potential impact of this guidance on its consolidated financial statements. Off-Balance sheet arrangements We do not have any off-balance sheet arrangements.
However, if the SEC has not removed the related disclosure from its regulations by June 30, 2027, the amendments will be removed from the Codification and not become effective. Early adoption is prohibited. We are currently evaluating the potential impact of this guidance on its consolidated financial statements. 54 Off-Balance sheet arrangements We do not have any off-balance sheet arrangements.
Critical Accounting Policies and Estimates The discussion and analysis of our financial condition and results of operations is based on our consolidated financial statements, which have been prepared in accordance with generally accepted accounting principles in the United States of America, or U.S. GAAP.
Critical Accounting Estimates The discussion and analysis of our financial condition and results of operations is based on our consolidated financial statements, which have been prepared in accordance with generally accepted accounting principles in the United States of America, or U.S. GAAP.
Cost of revenue Cost of revenues recognized from the delivery of patient EsoGuard test results includes costs related to EsoCheck device usage, shipment of test collection kits, royalties and the cost of services to process tests and provide results to physicians.
Cost of revenue Cost of revenues recognized primarily from the delivery of patient EsoGuard test results includes costs related to EsoCheck device usage, shipment of test collection kits, royalties and the cost of services to process tests and provide results to physicians.
In terms of other existing products and technologies, we have created an incubator-type platform where we are looking to obtain financing on a product-by-product basis as necessary to advance each asset to a meaningful inflection point along its path to commercialization.
In terms of other existing products and technologies, we have adopted an incubator-type platform where we are looking to obtain financing on a product-by-product basis as necessary to advance each asset to a meaningful inflection point along its path to commercialization.
PAVmed Inc. ATM Facility In December 2021, we entered into an “at-the-market offering” for up to $50 million of our common stock that may be offered and sold under a Controlled Equity Offering Agreement between us and Cantor.
ATM Facility In December 2021, we entered into an “at-the-market offering” for up to $50 million of our common stock that may be offered and sold under a Controlled Equity Offering Agreement between us and Cantor.
See Part I, Item 1, Business above for a more detailed summary of the medical device, diagnostics, and digital health sectors and our key products, including in particular EsoGuard and the Veris Platform, which are currently our two leading products.
See Part I, Item 1, Business above for a more detailed summary of the medical device, diagnostics, and digital health sectors and our key products, including in particular EsoGuard and the Veris Cancer Care Platform, which are currently our two leading products.
On September 8, 2022, we completed an additional closing under the SPA, in which we sold to the investor an additional Senior Secured Convertible Note with a face value principal of $11.25 million (referred to as the “September 2022 Senior Convertible Note”).
On September 8, 2022, we completed an additional closing under the SPA, in which we sold to the investor an additional Senior Secured Convertible Note with a face value principal of $11.25 million (the “September 2022 Senior Convertible Note”).
Securities Purchase Agreement - March 31, 2022 - Senior Secured Convertible Notes - April 4, 2022 and September 8, 2022 Effective as of March 31, 2022, we entered into the SPA with an accredited investor, pursuant to which we agreed to sell, and the investor agreed to purchase an aggregate of $50.0 million face value principal of Senior Secured Convertible Notes.
Securities Purchase Agreement - March 31, 2022 - Senior Secured Convertible Notes - April 4, 2022 and September 8, 2022 Effective as of March 31, 2022, we entered into a Securities Purchase Agreement (the “SPA”) with an accredited investor, pursuant to which we agreed to sell, and the investor agreed to purchase an aggregate of $50.0 million face value principal of Senior Secured Convertible Notes.
Further, as required by ASC 825-10-45-5, to the extent a portion of the fair value adjustment is attributed to a change in the instrument-specific credit risk, such portion would be recognized as a component of other comprehensive income (“OCI”) (for which there was no such adjustment with respect to the April 2022 Senior Convertible Note, the September 2022 Senior Convertible Note or the Lucid March 2023 Senior Convertible Note).
Further, as required by ASC 825-10-45-5, to the extent a portion of the fair value adjustment is attributed to a change in the instrument-specific credit risk, such portion would be recognized as a component of other comprehensive income (“OCI”) (for which there was no such adjustment with respect to the April 2022 Senior Convertible Note, the September 2022 Senior Convertible Note or (through September 10, 2024, Lucid’s deconsolidation date) the Lucid March 2023 Senior Convertible Note).
Lucid Diagnostics - Securities Purchase Agreement - March 13, 2023 - Senior Secured Convertible Note - March 21, 2023 Effective as of March 13, 2023, Lucid Diagnostics entered into the Lucid SPA with an accredited institutional investor, pursuant to which Lucid Diagnostics agreed to sell, and the investor agreed to purchase the Lucid March 2023 Senior Convertible Note with a face value principal of $11.1 million.
Lucid Diagnostics - Securities Purchase Agreement - March 13, 2023 - Senior Secured Convertible Note - March 21, 2023 Effective as of March 13, 2023, Lucid Diagnostics entered into a Securities Purchase Agreement (the “Lucid SPA”) with an accredited institutional investor, pursuant to which Lucid Diagnostics agreed to sell, and the investor agreed to purchase a Senior Convertible Note (the “Lucid March 2023 Senior Convertible Note”) with a face value principal of $11.1 million.
As a result of this limitation and our then-current public float, in May 2023, we amended our “at-the-market offering” to cover up to an additional $18 million of our common stock. In the year ended December 31, 2023, the Company sold 321,288 shares through its at-the-market equity facility for net proceeds of approximately $1.8 million, after payment of 3% commissions.
As a result of this limitation and our then-current public float, in May 2023, we amended our “at-the-market offering” to cover up to an additional $18 million of our common stock. In the year ended December 31, 2024, the Company sold 1,032,298 shares through its at-the-market equity facility for net proceeds of approximately $1.3 million, after payment of 3% commissions.
The estimated fair value adjustment of the April 2022 Senior Convertible Note, the September 2022 Senior Convertible Note and the Lucid March 2023 Senior Convertible Note are presented in a single line item within other income (expense) in the accompanying consolidated statement of operations (as provided for by ASC 825-10-50-30(b)).
The estimated fair value adjustment of the April 2022 Senior Convertible Note, the September 2022 Senior Convertible Note and (through September 10, 2024, Lucid’s deconsolidation date) the Lucid March 2023 Senior Convertible Note are presented in a single line item within other income (expense) in the accompanying consolidated statement of operations (as provided for by ASC 825-10-50-30(b)).
In addition, the Company paid $0.2 million in cash related to acceleration floor payments on these notes related to the conversion price being below $2.70, recorded as debt extinguishment loss. The conversions resulted in a debt extinguishment loss of $3.8 million in the year ended December 31, 2023.
In addition, the Company agreed to pay $0.2 million in cash related to acceleration floor payments on these notes related to the conversion price being below the conversion floor price specified in the notes, recorded as debt extinguishment loss. The conversions and cash paid resulted in a debt extinguishment loss of $3.8 million in the year ended December 31, 2023.
Nasdaq Notice On March 7, 2024, the Company received a notice from the Nasdaq Listing Qualifications Department stating that, for the preceding 30 consecutive business days (through March 6, 2024), the market value of the Company’s listed securities (“MVLS”) had been below the minimum of $35 million required for continued inclusion on the Nasdaq Capital Market under Nasdaq Listing Rule 5550(b)(2).
As previously disclosed, on March 7, 2024, the Company received a notice from the Nasdaq Listing Qualifications Department stating that, for the prior 30 consecutive business days (through March 6, 2024), the market value of the Company’s listed securities had been below the minimum of $35 million required for continued inclusion on the Nasdaq Capital Market under Nasdaq Listing Rule 5550(b)(2).
(“Veris Health” or “Veris”), (ii) “FDA” refers to the Food and Drug Administration, (iii) “510(k)” refers to a premarket notification, submitted to the FDA by a manufacturer pursuant to § 510(k) of the Food, Drug and Cosmetic Act and 21 CFR § 807 subpart E, (iv) “CLIA” refers to the Clinical Laboratory Improvement Amendments of 1988 and associated regulations set forth in 42 CFR § 493, and (v) “LDT” refers to a diagnostic test, defined by the FDA as “an IVD that is intended for clinical use and designed, manufactured and used within a single laboratory,” which is generally subject only to self-certification of analytical validity under the CMS CLIA program.
(“Veris Health” or “Veris”), (ii) “FDA” refers to the Food and Drug Administration, (iii) “510(k)” refers to a premarket notification, submitted to the FDA by a manufacturer pursuant to § 510(k) of the Food, Drug and Cosmetic Act and 21 CFR § 807 subpart E, (iv) “CLIA” refers to the Clinical Laboratory Improvement Amendments of 1988 and associated regulations set forth in 42 CFR § 493, and (v) “LDT” refers to a diagnostic test, defined by the FDA as “an IVD that is intended for clinical use and designed, manufactured and used within a single laboratory,” which is generally subject only to self-certification of analytical validity under the CMS CLIA program. 42 Overview PAVmed is a multi-product life sciences company organized to advance a pipeline of innovative healthcare technologies.
Research and development expenses Research and development expenses are recognized in the period they are incurred and consist principally of internal and external expenses incurred for the development of our products, including: ● consulting costs for engineering design and development; ● salary and benefit costs associated with our medical research personnel and engineering personnel; ● costs associated with regulatory filings; ● patent license fees; ● cost of laboratory supplies and acquiring, developing, and manufacturing preclinical prototypes; ● product design engineering studies; and ● expenses for facilities maintained solely for research and development purposes.
Research and development expenses Research and development expenses are recognized in the period they are incurred and consist principally of internal and external expenses incurred for the development of our products, including: ● consulting costs for engineering design and development; ● salary and benefit costs associated with our medical research personnel and engineering personnel; ● costs associated with submission of regulatory filings; ● cost of laboratory supplies and acquiring, developing, and manufacturing preclinical prototypes; and ● product design engineering studies.
We incur expenses for tests in the period in which the activities occur, therefore, gross margin as a percentage of revenue may vary from quarter to quarter due to costs being incurred in one period that relate to revenues recognized in a later period.
We have incurred expenses for tests in the period in which the activities occur, therefore, gross margin as a percentage of revenue has varied from quarter to quarter due to costs being incurred in one period that relate to revenues recognized in a later period.
From time to time from and after December 1, 2023 through March 12, 2024, the Company was not in compliance with the Financial Tests. As of March 12, 2024, the investor agreed to waive any such non-compliance during such time period and thereafter through August 31, 2024.
From time to time from and after September 1, 2024 through November 11, 2024, the Company was not in compliance with the Financial Tests. As of November 11, 2024, the investor agreed to waive any such non-compliance during such time period and thereafter through December 31, 2024.
ATM Facility In December 2021, we entered into an “at-the-market offering” for up to $50 million of our common stock that may be offered and sold under a Controlled Equity Offering Agreement between us and Cantor as described under the heading “ Recent Developments—Financing ” in Item 7 above.
ATM Facility In December 2021, we entered into an “at-the-market offering” for up to $50 million of our common stock that may be offered and sold under a Controlled Equity Offering Agreement between us and Cantor.
In comparison, in the year ended December 31, 2022, a debt extinguishment loss in the aggregate of approximately $5.4 million was recognized in connection with our April 2022 Senior Convertible Note as discussed below. ● In August 2022, approximately $6.0 million of principal repayments along with $0.4 million of interest expense thereon, were settled through the issuance of 479,291 shares of common stock of the Company, with such shares having a fair value of approximately $11.8 million (with such fair value measured as the respective conversion date quoted closing price of the common stock of the Company).
Loss on Debt Extinguishment In the year ended December 31, 2024, a debt extinguishment loss in the aggregate of approximately $2.5 million was recognized in connection with our April 2022 Senior Convertible Note and September 2022 Senior Convertible Note as discussed below. ● In the year ended December 31, 2024, approximately $1.4 million of principal repayments along with $0.1 million of interest expense thereon, were settled through the issuance of 1,084,366 shares of common stock of the Company, with such shares having a fair value of approximately $2.0 million (with such fair value measured as the quoted closing price of the common stock of the Company on the respective conversion date).
Under the April 2022 Senior Convertible Note, the September 2022 Senior Convertible Note and the SPA, we are subject to certain customary affirmative and negative covenants regarding the incurrence of indebtedness, the existence of liens, the repayment of indebtedness and the making of investments, the payment of cash in respect of dividends, distributions or redemptions, the transfer of assets, the maturity of other indebtedness, and transactions with affiliates, among other customary matters.
Under the Lucid March 2023 Senior Convertible Note, Lucid Diagnostics is subject to certain customary affirmative and negative covenants regarding the incurrence of indebtedness, the existence of liens, the repayment of indebtedness and the making of investments, the payment of cash in respect of dividends, distributions or redemptions, the transfer of assets, the maturity of other indebtedness, and transactions with affiliates, among other customary matters.
This update modifies the disclosure or presentation requirements of a variety of topics in the Accounting Standards Codification to conform with certain SEC amendments in Release No. 33-10532, Disclosure Update and Simplification.
In October 2023, the FASB issued ASU No. 2023-06, Disclosure Improvements: Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative. This update modifies the disclosure or presentation requirements of a variety of topics in the Accounting Standards Codification to conform with certain SEC amendments in Release No. 33-10532, Disclosure Update and Simplification.
Under a Securities Purchase Agreement dated March 13, 2023, Lucid Diagnostics issued a Senior Secured Convertible Note dated March 21, 2023, referred to herein as the “Lucid March 2023 Senior Convertible Note”, which is accounted under the “fair value option election” as discussed below.
Under a Securities Purchase Agreement dated March 13, 2023, Lucid Diagnostics issued a Senior Secured Convertible Note dated March 21, 2023, referred to herein as the “Lucid March 2023 Senior Convertible Note”, which is accounted under the “fair value option election”, through September 10, 2024, the date of Lucid’s deconsolidation from PAVmed’s results of operations, as discussed below.
Overview PAVmed is structured to be a multi-product life sciences company organized to advance a pipeline of innovative healthcare technologies. Led by a team of highly skilled personnel with a track record of bringing innovative products to market, PAVmed is focused on innovating, developing, acquiring, and commercializing novel products that target unmet needs with large addressable market opportunities.
Led by a team of highly skilled personnel with a track record of bringing innovative products to market, PAVmed is focused on innovating, developing, acquiring, and commercializing novel products that target unmet needs with large addressable market opportunities.
Research and development expenses In the year ended December 31, 2023, research and development costs were approximately $14.3 million as compared to $25.3 million in the prior year.
Research and development expenses In the year ended December 31, 2024, research and development costs were approximately $5.9 million as compared to $14.3 million for the corresponding period in the prior year.
We experienced a net loss before noncontrolling interests of approximately $79.3 million and used approximately $52.0 million of cash in operations for the year ended December 31, 2023. Financing activities provided $31.2 million of cash during the year ended December 31, 2023. We ended the year with cash on-hand of $19.6 million as of December 31, 2023.
We experienced net income before noncontrolling interests of approximately $28.4 million and used approximately $33.6 million of cash in operations for the year ended December 31, 2024. Financing activities provided $31.3 million of cash during the year ended December 31, 2024. We ended the year with cash on-hand of $1.2 million as of December 31, 2024.
We have financed our operations principally through the public and private issuances of our common stock, preferred stock, common stock purchase warrants, and debt.
We have financed our operations principally through the public and private issuances of our common stock, preferred stock, common stock purchase warrants, and debt, both at the PAVmed level and, in the case of Lucid, at the subsidiary level.
The April 2022 Senior Convertible Note, the September 2022 Senior Convertible Note, and the Lucid March 2023 Senior Convertible Note were initially measured at their issue-date estimated fair value and subsequently remeasured at estimated fair value as of each reporting period date. The Company initially recognized an aggregate of $4.3 million of fair value non-cash expense on the issue dates.
The April 2022 Senior Convertible Note, the September 2022 Senior Convertible Note, and the Lucid March 2023 Senior Convertible Note were initially measured at their issue-date estimated fair value and subsequently remeasured at estimated fair value as of each reporting period date.
Our current research and development activities, including our clinical trials, are focused principally on the acceleration of EsoGuard and Veris Cancer Care Platform commercialization. We will resume research and development activities with respect to other products in our pipeline as well as applicable new technologies, as resources permit.
The reported research and development activities, including our clinical trials, were focused principally on the acceleration of EsoGuard and Veris Cancer Care Platform commercialization. In the future, the research and development activities will focus on the Veris Cancer Care Platform, the PMX incubator program and other products in our pipeline as well as applicable new technologies, as resources permit.
General and administrative expenses In the year ended December 31, 2023, general and administrative costs were approximately $30.9 million as compared to $41.4 million in the prior year.
General and administrative expenses In the year ended December 31, 2024, general and administrative costs were approximately $24.5 million as compared to $30.9 million for the corresponding period in the prior year.
In the year ended December 31, 2023, Lucid Diagnostics sold 230,068 shares through its at-the-market equity facility for net proceeds of approximately $0.3 million, after payment of 3% commissions. 39 Results of Operations Overview Revenue The Company recognized revenue resulting from the delivery of patient EsoGuard test results when the Company considered the collection of such consideration to be probable to the extent that it is unconstrained.
Subsequent to December 31, 2024, as of March 20, 2025, the Company sold 1,210,704 shares through their at-market equity facility for net proceeds of approximately $0.8 million, after payment of 3% commissions. 46 Results of Operations Overview Revenue The Company recognized revenue primarily resulting from the delivery of patient EsoGuard test results when the Company considered the collection of such consideration to be probable to the extent that it is unconstrained.
We anticipate our general and administrative expenses will increase in the future to the extent our business operations grow. Furthermore, we anticipate continued expenses related to being a public company, including fees and expenses for audit, legal, regulatory, tax-related services, insurance premiums and investor relations costs associated with maintaining compliance as a public company.
In the future, general and administrative expenses will include those expenses related to being a public company, including fees and expenses for audit, legal, regulatory, tax-related services, insurance premiums and investor relations costs associated with maintaining compliance as a public company for PAVmed and its majority-owned subsidiaries.
As of December 31, 2023, Lucid Diagnostics was in compliance with the Lucid Financial Tests. In addition, Lucid Diagnostics presently is in compliance with the Lucid Financial Tests. PAVmed Inc.
As of December 31, 2024, Lucid Diagnostics was in compliance with the Lucid Financial Tests.
Cost of revenue In the year ended December 31, 2023, cost of revenue was approximately $6.4 million as compared to $3.6 million in the prior year.
Cost of revenue In the year ended December 31, 2024, cost of revenue was $4.8 million as compared $6.4 million for the corresponding period in the prior year.
Liquidity and Capital Resources Our current financing strategy is to obtain capital directly into Lucid, Veris and other subsidiaries to fund any product development or other related activities. There are no assurances, however, we will be able to obtain an adequate level of financial resources required for the short-term or long-term commercialization and development of our products and services.
There are no assurances, however, we will be able to obtain an adequate level of financial resources required for the short-term or long-term commercialization and development of our products and services.
The SPA provided for the sale of the initial Senior Secured Convertible Note with a face value principal of $27.5 million, which closed on April 4, 2022 (referred to as the “April 2022 Senior Convertible Note”).
On April 4, 2022, we completed an initial closing under the SPA, in which we sold to the investor a Senior Secured Convertible Note with a face value principal of $27.5 million (the “April 2022 Senior Convertible Note”).
In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280)—Improvements to Reportable Segment Disclosures (“ASU 2023-07”), which require public companies disclose significant segment expenses and other segment items on an annual and interim basis and to provide in interim periods all disclosures about a reportable segment’s profit or loss and assets that are currently required annually.
See Note 12, Financial Instruments Fair Value Measurements , with respect to the FVO election; and Note 13, Debt , for a discussion of the April 2022 Senior Convertible Note, the September 2022 Senior Convertible Note and the Lucid March 2023 Senior Convertible Note. 53 Recent Accounting Standards Updates Adopted In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280)—Improvements to Reportable Segment Disclosures (“ASU 2023-07”), which require public companies disclose significant segment expenses and other segment items on an annual and interim basis and to provide in interim periods all disclosures about a reportable segment’s profit or loss and assets that are currently required annually.
Our current focus is multi-fold. We continue to pursue commercial expansion and execution of EsoGuard, which is the flagship product of our majority-owned subsidiary Lucid Diagnostics Inc. (Nasdaq: LUCD) (“Lucid” or “Lucid Diagnostics”). In addition, through a separate majority-owned subsidiary, Veris Health Inc.
Our current focus is multi-fold. We continue to support commercial expansion and execution of EsoGuard, which is the flagship product of our subsidiary, Lucid Diagnostics, of which we remain the shareholder with the largest voting interest. In addition, through a separate majority-owned subsidiary, Veris Health, we offer the Veris Cancer Care Platform.
The increase of $0.2 million in the current period was due to the timing of the acquired intangible assets in 2022. 41 Results of Operations - continued The year ended December 31, 2023 as compared to year ended December 31, 2022 - continued Other Income and Expense Change in fair value of convertible debt In the year ended December 31, 2023, the change in the fair value of our convertible notes was approximately $6.0 million of expense, related to the April 2022 Senior Convertible Note, the September 2022 Senior Convertible Note, and the Lucid March 2023 Senior Convertible Note.
Other Income and Expense Change in fair value of convertible debt In the years ended December 31, 2024 and December 31, 2023, the change in the fair value of our convertible notes was approximately $0.5 million of income and $6.0 million of expense, respectively, related to the April 2022 Senior Convertible Note, the September 2022 Senior Convertible Note, and the Lucid March 2023 Senior Convertible Note.
The conversions resulted in a debt extinguishment loss of $5.4 million in the year ended December 31, 2022. See Note 13 , Debt , to the Financial Statements, for additional information with respect to the April 2022 Senior Convertible Note, the September 2022 Senior Convertible Note, and the Lucid March 2023 Senior Convertible Note.
See Note 13 , Debt , to the Financial Statements, for additional information with respect to the April 2022 Senior Convertible Note, the September 2022 Senior Convertible Note, and the Lucid March 2023 Senior Convertible Note.
Recent Accounting Standards Updates Not Yet Adopted In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740)—Improvements to Income Tax Disclosures (“ASU 2023-09”), which is intended to enhance the transparency and decision usefulness of income tax disclosures.
In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740)—Improvements to Income Tax Disclosures (“ASU 2023-09”), which is intended to enhance the transparency and decision usefulness of income tax disclosures. The amendments in ASU 2023-09 provide for enhanced income tax information primarily through changes to the rate reconciliation and income taxes paid information.
Cumulatively a total of 680,263 shares of Lucid Diagnostics’ common stock were issued for net proceeds of approximately $1.8 million, after a 4% discount, as of December 31, 2023.
Lucid Diagnostics Inc. - Committed Equity Facility and ATM Facility In March 2022, Lucid Diagnostics entered into a committed equity facility with a Cantor affiliate. Cumulatively, a total of 680,263 shares of Lucid Diagnostics’ common stock were issued for net proceeds of approximately $1.8 million, after a 4% discount, as of December 31, 2024.
In the year ended December 31, 2023, Lucid Diagnostics sold 230,068 shares through its at-the-market equity facility for net proceeds of approximately $0.3 million, after payment of 3% commissions.
Cumulatively, a total of 230,068 shares of Lucid Diagnostics’ common stock were issued through its at-the-market equity facility for net proceeds of approximately $0.3 million, after payment of 3% commissions, as of December 31, 2024.
The notification letter stated that the Company would be afforded 180 calendar days (until September 3, 2024) to regain compliance. In order to regain compliance, the Company’s MVLS must close at $35 million or more for a minimum of ten consecutive business days.
The notification letter stated that the Company would be afforded 180 calendar days (until July 22, 2025) to regain compliance. In order to regain compliance, the closing bid price of the Company’s common stock must be at least $1 for a minimum of ten consecutive business days.
Sales and marketing expenses Sales and marketing expenses consist primarily of salaries and related costs for employees engaged in sales, sales support and marketing activities, as well as advertising and promotion expenses.
We expect that gross margin for our services will fluctuate based on the commercialization efforts of our subsidiaries. Sales and marketing expenses Sales and marketing expenses consist primarily of salaries and related costs for employees engaged in sales, sales support and marketing activities, as well as advertising and promotion expenses.
Loss on Issue and Offering Costs - Senior Secured Convertible Note In the year ended December 31, 2023, in connection with the issue of the Lucid March 2023 Senior Convertible Note, we recognized a total of approximately $1.2 million of lender fees and offering costs paid by us.
The Company initially recognized an aggregate of $4.3 million of fair value non-cash expense on the issue dates. 48 Results of Operations - continued The year ended December 31, 2024 as compared to year ended December 31, 2023 - continued Other Income and Expense - continued Loss on Issue and Offering Costs - Senior Secured Convertible Note In the year ended December 31, 2023, in connection with the issue of the Lucid March 2023 Senior Convertible Note, we recognized a total of approximately $1.2 million of lender fees and offering costs.
The guidance is effective for public entities for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. The guidance is applied retrospectively to all periods presented in the financial statements, unless it is impracticable.
The guidance is effective for public entities for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. The guidance was adopted by the Company on January 1, 2024.
Based on the waiver, as of December 31, 2023, the Company was in compliance with the Financial Tests. In addition, based on the waiver, the Company presently is in compliance with the Financial Tests.
Based on the waiver, as of December 31, 2024, the Company was in compliance with the Financial Tests. In addition, based on a separate waiver granted effective as of the consummation of the Exchange that extended the waiver period to continue through December 31, 2025, the Company presently is in compliance with the Financial Tests.
Practical Expedients —We do not adjust the transaction price for the effects of a significant financing component, as at contract inception, we expect the collection cycle to be one year or less. 45 Fair Value Option (“FVO”) Election Under a Securities Purchase Agreement dated March 31, 2022, the Company issued a Senior Secured Convertible Note dated April 4, 2022, referred to herein as the “April 2022 Senior Convertible Note”, and a Senior Secured Convertible Note dated September 8, 2022, referred to herein as the “September 2022 Senior Convertible Note”, which are accounted under the “fair value option election” as discussed below.
While our significant accounting policies are described in more detail in our consolidated financial notes, we believe the following accounting estimates to be critical to the judgments and estimates used in the preparation of our consolidated financial statements. 52 Fair Value Option (“FVO”) Election Under a Securities Purchase Agreement dated March 31, 2022, the Company issued a Senior Secured Convertible Note dated April 4, 2022, referred to herein as the “April 2022 Senior Convertible Note”, and a Senior Secured Convertible Note dated September 8, 2022, referred to herein as the “September 2022 Senior Convertible Note”, which are accounted under the “fair value option election” as discussed below.
The year ended December 31, 2023 as compared to year ended December 31, 2022 Revenue In the year ended December 31, 2023, revenue was $2.5 million as compared to $0.4 million in the prior year. The $2.1 million increase principally relates to the revenue for our EsoGuard Esophageal DNA Test performed in our own CLIA laboratory.
The $0.5 million increase principally relates to the revenue for our EsoGuard Esophageal DNA Test performed in our own CLIA laboratory for the period and the consideration received for the performance of the EsoGuard Esophageal DNA Tests.
Sales and marketing expenses In the year ended December 31, 2023, sales and marketing costs were approximately $17.6 million as compared to $19.3 million in the prior year. The net decrease of $1.7 million was principally related to: ● approximately $1.9 million decrease in third party marketing expenses; and ● approximately $0.2 million increase in facility-related costs.
The net decrease of $6.0 million was principally related to: ● approximately $5.1 million decrease related to Lucid’s results only being including in the Company’s operating results through September 10, 2024 in the year ended December 31, 2024, as compared to the prior year, during which all twelve months of Lucid’s operating results were so included; ● approximately $0.7 million decrease in compensation related costs, including stock-based compensation; and ● approximately $0.2 million decrease in third party sales and marketing costs.
Amortization of Acquired Intangible Assets The amortization of acquired intangible assets increased to $2.0 million in the year ended December 31, 2023, as compared to $1.8 million in the prior year.
Amortization of Acquired Intangible Assets The amortization of acquired intangible assets was approximately $0.6 million in the year ended December 31, 2024, as compared to $2.0 million for the corresponding period in the prior year. The decrease of $1.4 million in the current period was due to certain acquired intangible assets being fully amortized in February 2024.
In the year ended December 31, 2023, the Company sold 321,288 shares through its at-the-market equity facility for net proceeds of approximately $1.8 million, after payment of 3% commissions. Lucid Diagnostics Inc. - Committed Equity Facility and ATM Facility In March 2022, Lucid Diagnostics entered into a committed equity facility with a Cantor affiliate.
In the year ended December 31, 2024, the Company sold 1,032,298 shares through its at-the-market equity facility for net proceeds of approximately $1.3 million, after payment of 3% commissions. Subsequent to December 31, 2024, as of March 20, 2025, the Company sold 1,210,704 shares through its at-market equity facility for net proceeds of approximately $837, after payment of 3% commissions.
Other Income and Expense, net Other income and expense, net, consists principally of changes in fair value of our convertible notes and losses on extinguishment of debt upon repayment of such convertible notes. 40 Results of Operations - continued Presentation of Dollar Amounts All dollar amounts in this Management’s Discussion and Analysis of Financial Condition and Results of Operations are presented as dollars in millions, except for share and per share amounts.
Other Income and Expense, net Other income and expense, net, consists principally of changes in fair value of our convertible notes and losses on extinguishment of debt upon repayment of such convertible notes.
See Note 16, Common Stock and Common Stock Purchase Warrants for additional discussion. ● We issued 1,745,824 shares of our common stock in satisfaction of approximately $6.1 million of principal repayments along with approximately $0.4 million of interest expense thereon under the April 2022 Senior Convertible Note and September 2022 Senior Convertible Note.
See below for more information. ● We issued 1,084,366 shares of our common stock in satisfaction of approximately $1.4 million of principal repayments along with $0.1 million of interest expense thereon under the April 2022 Senior Convertible Note and September 2022 Senior Convertible Note. ● We issued 333,380 shares of our common stock to vendors in exchange for $0.35 million of agreed upon services, which is included in general and administrative operating expenses on the Company’s consolidated statement of operations.
Indeed, on January 7, 2024, the Company received a letter from the Listing Qualifications Department of Nasdaq, stating the Company had regained compliance with such requirement. 37 Management Services Agreement/Payroll Benefits and Expense Reimbursement Agreement with Lucid Diagnostics On March 22, 2024, PAVmed and Lucid entered into an eighth amendment to the the management services agreement between PAVmed and Lucid (“MSA”) to increase the monthly fee thereunder from $0.75 million per month to $0.83 million per month, effective as of January 1, 2024.
Intercompany Agreements with Lucid On August 6, 2024, the Company and Lucid entered into a ninth amendment to the management services agreement between them (“MSA”) to increase the monthly fee thereunder from $0.83 million per month to $1.05 million per month, effective as of July 1, 2024.
(“Veris” or “Veris Health”), we are focused on entering into strategic partnership opportunities with leading academic oncology systems to expand access to the Veris Platform.
We are focused in the immediate term on entering into strategic partnership opportunities with leading academic oncology systems to expand access to the Veris Cancer Care Platform, while concurrently developing an implantable physiological monitor, designed to be implanted alongside a chemotherapy port, which will interface with the Veris Cancer Care Platform.
The amendments in ASU 2023-09 provide for enhanced income tax information primarily through changes to the rate reconciliation and income taxes paid information. ASU 2023-09 is effective for the Company prospectively to all annual periods beginning after December 15, 2024. Early adoption is permitted.
ASU 2023-09 is effective for the Company prospectively to all annual periods beginning after December 15, 2024. Early adoption is permitted. The Company does not expect the standard to have a significant impact on its consolidated financial statements.
The Nasdaq notification has no effect at this time on the listing of the Company’s common stock or Series Z warrants, and the stock and warrants will continue to trade uninterrupted under the symbol “PAVM” and “PAVMZ”, respectively.
The Nasdaq notification has no effect at this time on the listing of the Company’s common stock or Series Z warrants, and the common stock and Series Z warrants will continue to trade uninterrupted under the symbol “PAVM” and “PAVMZ,” respectively. 2014 Long-Term Incentive Plan In January 2025, the Company accepted from employees the voluntary forfeiture of approximately 494,202 of previously granted Company stock options, each with an exercise price greater than $4.00 per share and collectively with a weighted average exercise price of $23.38 per share.
The notification letter also states that in the event the Company does not regain compliance prior to the expiration of the 180-day period, the Company will receive written notification that its securities are subject to delisting.
The notification letter also stated that, in the event the Company does not regain compliance within the initial 180-day period, the Company may be eligible for an additional 180-day period.
The Lucid March 2023 Senior Convertible Note proceeds were $9.925 million after deducting a $1.186 million lender fee and offering costs as described under the heading “ Recent Developments—Financing ” in Item 7 above, Under the Lucid March 2023 Senior Convertible Note, Lucid Diagnostics is subject to certain customary affirmative and negative covenants regarding the incurrence of indebtedness, the existence of liens, the repayment of indebtedness and the making of investments, the payment of cash in respect of dividends, distributions or redemptions, the transfer of assets, the maturity of other indebtedness, and transactions with affiliates, among other customary matters.
The September 2022 Senior Convertible Note may be converted into or otherwise paid in shares of our common stock as described in Note 13, Debt . 50 Liquidity and Capital Resources - continued Under the April 2022 Senior Convertible Note (until it was satisfied in full on January 17, 2025 upon consummation of the Exchange), the September 2022 Senior Convertible Note and the SPA, we are subject to certain customary affirmative and negative covenants regarding the incurrence of indebtedness, the existence of liens, the repayment of indebtedness and the making of investments, the payment of cash in respect of dividends, distributions or redemptions, the transfer of assets, the maturity of other indebtedness, and transactions with affiliates, among other customary matters.
The net decrease of $10.5 million was principally related to: ● approximately $8.1 million decrease in stock-based compensation, primarily related to decreases at Lucid, partially offset by increases at PAVmed; ● approximately $3.5 million decrease in third-party professional fees and expenses related to legal services, consulting fees and professional recruiting services; ● approximately $1.3 million increase in compensation related costs; and ● approximately $0.2 million decrease related to facility related costs at Lucid, partially offset by an increase in facility related costs at PAVmed.
The net decrease of $6.4 million was principally related to: ● approximately $4.3 million decrease related to Lucid’s results only being including in the Company’s operating results through September 10, 2024 in the year ended December 31, 2024, as compared to the prior year, during which all twelve months of Lucid’s operating results were so included; ● approximately $3.1 million decrease in stock-based compensation, related to decreases at both PAVmed and Lucid; and ● approximately $1.0 million increase in third-party professional fees, including expenses related to investor relations.
Financing Securities Purchase Agreement - March 31, 2022 - Senior Secured Convertible Note - April 4, 2022 and Senior Secured Convertible Note - September 8, 2022 Effective as of March 12, 2024, the Company entered into an amendment and waiver (the “Note Amendment and Waiver”) with the holder of the April 2022 Senior Convertible Note and the September 2022 Senior Convertible Note (each such term as defined below).
On November 15, 2024, the Company entered into an Exchange Agreement (the “Debt Exchange Agreement”) with the holder (the “Holder”) of the April 2022 Senior Convertible Note and the September 2022 Senior Convertible Note.
The April 2022 Senior Convertible Note may be converted into or otherwise paid in shares of our common stock as described in Note 13, Debt . The April 2022 Senior Convertible Note proceeds were $24.4 million after deducting a $2.5 million lender fee and the Company’s offering costs of approximately $0.6 million, inclusive primarily of $0.5 million placement agent fees.
The April 2022 Senior Secured Convertible Note had an initial contractual maturity date of April 4, 2024, which maturity date the investor agreed to extend by one year, to April 4, 2025. The April 2022 Senior Convertible Note may be converted into or otherwise paid in shares of our common stock as described in Note 13, Debt .
We anticipate our sales and marketing expenses will increase in the future, to the extent we expand our commercial sales and marketing operations as resources permit and insurance reimbursement coverage for our EsoGuard test expands.
We anticipate our sales and marketing expenses to decrease in the future compared to historical periods due to the deconsolidation of Lucid, as the sales and marketing operations for the Lucid EsoGuard test is no longer recorded within the Company’s operating results.
The net decrease of $11.0 million was principally related to: ● approximately $10.1 million decrease in development costs, particularly in clinical trial activities and outside professional and consulting fees; and ● approximately $0.9 million decrease in third party professional fees and expenses related to consulting.
The net decrease of $8.4 million was principally related to: ● approximately $5.3 million decrease in development costs, particularly in clinical trials activities and outside professional and consulting fees; ● approximately $1.8 million decrease related to Lucid’s results only being including in the Company’s operating results through September 10, 2024 in the year ended December 31, 2024, as compared to the prior year, during which all twelve months of Lucid’s operating results were so included; and ● approximately $1.3 million decrease in compensation related costs and stock-based compensation.
These factors raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date the accompanying consolidated financial statements are issued. 42 Liquidity and Capital Resources - continued Issue of Shares of Our Common Stock During the year ended December 31, 2023 ● We issued 58,483 shares of our common stock for proceeds of approximately $0.3 million under the PAVmed Employee Stock Purchase Plan (“ESPP”), as such plan is discussed in Note 14, Stock-Based Compensation, to the Financial Statements. ● We issued 321,288 shares of our common stock for net proceeds of approximately $1.8 million, after payment of 3% commissions, from the sale of shares through PAVmed’s at-the-market equity facility through Cantor.
For more information about the ESPP, see Note 14, Stock-Based Compensation, to the Financial Statements. ● We issued 1,032,298 shares of our common stock for net proceeds of approximately $1.3 million, after payment of 3% commissions, through our at-the-market equity facility with Cantor.
In November 2022, Lucid Diagnostics also entered into an “at-the-market offering” for up to $6.5 million of its common stock that may be offered and sold under a Controlled Equity Offering Agreement between Lucid Diagnostics and Cantor.
In November 2022, Lucid entered into a Controlled Equity Offering℠ Sales Agreement (the “Lucid Sales Agreement”) with Cantor Fitzgerald & Co. (“Cantor”). Pursuant to the Sales Agreement, from time to time, Lucid may offer and sell shares of its common stock to or through Cantor, acting as sales agent or principal.
Removed
Recent Developments Business Series Z Warrant Modification On December 4, 2023, the Company announced the extension of the Company’s Series Z Warrants, by 12 months, to April 30, 2025.
Added
Recent Developments Business EsoGuard Medicare Coverage In November 2024, Lucid submitted to MolDx its complete clinical evidence package in support of a request for reconsideration of the non-coverage language in the LCD to secure Medicare coverage for EsoGuard.
Removed
In addition, as a result of the reverse stock split, described below, the Series Z Warrants became exercisable to purchase one whole share of common stock of the Company at an exercise price of $24.00, which exercise price per whole share was further reduced to $23.48 as described below under the heading “ PAVmed Distribution of Lucid Diagnostics Common Stock to Shareholders ”.
Added
The EsoGuard clinical evidence package included six new peer-reviewed publications: three clinical validation studies (two in the intended use population, one case control), two clinical utility studies, and one analytical validation study. The current LCD provides clear coverage criteria consistent with the American College of Gastroenterology (ACG) guidelines for esophageal precancer testing.
Removed
The Company recognized the incremental value associated with the Series Z Warrants modification for the term extension as a deemed dividend charge of $1.8 million and as an increase of net loss available to common stockholders on the consolidated statements of operations in 2023.
Added
The package was submitted as part of a request for reconsideration of the non-coverage language in the LCD to secure Medicare coverage for EsoGuard.
Removed
Reverse Stock Split On December 7, 2023, the Company implemented a 1-for-15 reverse stock split of its common stock and reduced its authorized shares from 250,000,000 to 50,000,000, each in accordance with shareholder approval granted at a March 31, 2023 special meeting of the Company’s stockholders. The Company filed an amended Certificate of Incorporation reflecting the reduction in authorized shares.
Added
NCCN Clinical Practice Guidelines Update In March 2025, Lucid announced that a recent update to the National Comprehensive Cancer Network® (NCCN) Clinical Practice Guidelines in Oncology (NCCN Guidelines®) focused on Esophageal and Esophagogastric Junction Cancers (Version 1.2025) has added a new section on BE screening.

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