Conference call to be held today at 4:30 PM
EDT
PAVmed Inc. (Nasdaq: PAVM, PAVMZ) (“PAVmed”), a highly
differentiated, multi-product, commercial-stage medical device
company, and its majority-owned subsidiary Lucid Diagnostics
Inc. (Nasdaq: LUCD) (“Lucid”), a commercial-stage cancer
prevention diagnostics company today provided a joint business
update for the companies and discussed preliminary financial
results for the six and nine months ended September 30, 2021.
This press release features multimedia. View
the full release here:
https://www.businesswire.com/news/home/20211116006357/en/
“The third quarter and recent weeks have proved to be an
exciting time for our companies—almost certainly the most important
in PAVmed’s corporate history,” said Lishan Aklog, M.D., PAVmed’s
Chairman and Chief Executive Officer and Lucid’s Chairman and Chief
Executive Officer. “Lucid is now a Nasdaq-listed public company
having raised sufficient capital to execute on its growth strategy
and drive commercialization in a $25 billion-dollar addressable
company. PAVmed’s equity stake in Lucid actually increased from
approximately 73% to 76% post-IPO as a result of PAVmed converting
debt into equity immediately prior to consummation of the IPO.”
“PAVmed and Lucid are both in a very strong financial position
with over $90 million in cash between them. With Lucid now fully
financed and self-sufficient, PAVmed no longer has to raise and
spend capital, and dilute its shareholders, to finance Lucid’s
operations. We can deploy PAVmed’s capital to advance and
commercialize its other key products and expand our portfolio. As
the majority shareholder PAVmed will continue to consolidate
Lucid’s financials. I am also excited that we have crossed another
small but important milestone. PAVmed and Lucid are no longer
pre-revenue companies, with both for the first time recognizing
modest revenue for the third quarter.”
Conference Call and Webcast
A conference call and webcast for today’s business update and
third quarter 2021 financial results will take place at 4:30 PM
EDT. To access the conference call, listeners should dial
877-407-3982 toll-free in the U.S. or 201-493-6780, and ask to join
the “PAVmed, Inc. Business Update Conference Call”. The conference
call will be available live via webcast and for replay at the
investor relations section of the Company’s website at
www.pavmed.com. Following the conclusion of the conference call, a
replay will be available for one week and can be accessed by
dialing 844-512-2921 toll-free in the U.S. or 412-317-6671,
followed by the PIN number: 13724402.
Business Update Highlights
- PAVmed subsidiary Lucid Diagnostics completed an initial public
offering of 5,000,000 shares of common stock at a price to the
public of $14.00 per share for total gross proceeds of $70 million,
before deducting underwriting discounts and commissions and
estimated offering expenses. PAVmed converted convertible debt into
equity prior to the consummation of the IPO and now holds
approximately 76% of Lucid’s outstanding shares of common stock.
PAVmed and Lucid entered into an updated management services
agreement pursuant to which PAVmed will continue to manage Lucid’s
operations.
- PAVmed and Lucid collectively expanded their head count to over
70 employees, with the bulk of the increase in Lucid’s commercial
sales team.
- Lucid continued to expand its network of Lucid Test Centers in
cities across the Western U.S. with the launch of test centers in
Denver, Salt Lake City and Las Vegas. Lucid is proceeding with the
next phase in the program’s growth, which will focus on the Pacific
Northwest, and steady expansion nationwide thereafter
- PAVmed and Lucid are expanding their physical infrastructure to
support both companies’ growth. This quarter, PAVmed will launch
its own dedicated product research and development facility in
Foxborough, Massachusetts. Early next quarter Lucid expects to
launch its own CLIA-certified diagnostic laboratory facility in
Irvine, California. And PAVmed is currently securing space to
launch its own dedicated low to medium volume medical device
manufacturing facility in Salt Lake City.
- Lucid and UpScript, its independent telemedicine partner, are
finalizing the Lucid-branded telemedicine platform which will
accommodate self-referrals for EsoGuard testing from
direct-to-consumer marketing. The EsoGuard Telemedicine program
with direct-to-consumer marketing will launch as a pilot program in
Phoenix in the coming weeks.
- Lucid continues to drive EsoGuard commercialization while
growing, training and fundamentally transforming its sales
infrastructure to a direct sales force increasingly focused on
primary care physician referrals to Lucid Test Centers. Test volume
during this transitional quarter was flat at 203 relative to the
prior quarter, but up over 300% annually.
- Medicare Administrative Contractor Palmetto GBA’s MolDx group
held a Contractor Advisor Committee (CAC) meeting last month which
included EsoGuard along with other tests in the gastroenterology
space, suggesting that, after a long delay, it is actively
reviewing coverage for EsoGuard. The expert panel voiced strong
support for esophageal precancer screening in high-risk chronic
heartburn patients.
- Lucid appointed highly accomplished molecular biologist Suman
M. Verma, M.D., Ph.D. as its Chief Scientific Officer. Dr. Verma
will also serve as PAVmed’s VP, Molecular Diagnostics.
- EsoGuard was awarded “Diagnostics Innovation of the Year” at
the BioTech Breakthrough’s annual awards program recognizing
innovation in the global life sciences and biotechnology
industry.
- PAVmed acquired CapNostics, LLC, which manufactures
EsophaCap®—a U.S. FDA 510(k)-cleared and European CE Mark
certified, non-endoscopic sponge-based esophageal cell collection
device which has been used in pre-commercial clinical research of
esophageal precancer biomarkers at major academic medical centers
including Mayo Clinic and Johns Hopkins.
- PAVmed trained seven surgeons on the CarpX procedure and five
more are scheduled to undergo training. Eleven Carp X procedures
have been performed and eight have been scheduled.
- Veris Health was accepted into a Microsoft for global
partnership program and entered into a definitive services
agreement with leading full-service Silicon Valley-based full-stack
software development firm Loka Inc. to build its remote digital
healthcare platform.
- Veris appointed highly accomplished Silicon Valley technology
executive Sunny Webb as its Chief Technology Officer. Ms. Webb will
also serve as PAVmed’s VP, Molecular Diagnostics.
Summary and Preliminary Financial Results
The summary unaudited financial information provided herein
includes separate preliminary results for the consolidated entities
of PAVmed, Inc. as well as separate stand-alone summary and
preliminary financial results presented for Lucid Diagnostics, Inc.
PAVmed holds a majority ownership interest and has a controlling
financial interest in each of: Lucid Diagnostics Inc., Solys
Diagnostics Inc. and Veris Health Inc., with the corresponding
noncontrolling interest recognized in the unaudited net loss
attributable to the noncontrolling interest based on the respective
minority interest equity ownership of each majority-owned
subsidiary. Noncontrolling interest is also required by GAAP to be
presented as a separate component of consolidated stockholders’
equity.
Lucid Diagnostics completed its IPO on October 14, 2021. Prior
to this offering, PAVmed owned approximately 72.6% of the Lucid
common stock. Concurrent with the offering, PAVmed converted its
$22.4 million promissory note into Lucid common shares and
purchased approximately 0.6 million shares in the offering.
Accordingly, following the offering PAVmed increased its ownership
and holds approximately 75.5% of the combined voting power of Lucid
common stock and will remain Lucid’s controlling shareholder for
the foreseeable future. Consequently, PAVmed’s financial statements
will continue to be presented on a consolidated basis including
incorporating Lucid Diagnostics results of operations with required
GAAP disclosures recognizing amounts attributable to the
noncontrolling interests similar to the same way it has
incorporated Lucid’s financial results prior to the IPO and from
the commencement of Lucid operations in 2018.
PAVmed (Nasdaq: PAVM) Preliminary Consolidated Financial
Results
For the three months ended September 30, 2021, EsoGuard related
revenues were $0.2 million and gross profit was $56 thousand.
Operating expenses were approximately $13.7 million as detailed
below including $4.0 million in stock-based compensation expense.
GAAP net loss attributable to common stockholders was approximately
$12.3 million, or $(0.15) per common share. As shown below and for
the purpose of illustrating the effect of derivative accounting and
other non-cash income and expenses on the Company’s financial
results, the Company’s preliminary non-GAAP adjusted loss for the
three months ended September 30, 2021 was approximately $8.2
million or $(0.10) per common share.
PAVmed had cash and cash equivalents of $37.3 million as of
September 30, 2021, compared with $17.3 million as of December 31,
2020. On a proforma basis, had the Lucid Diagnostics IPO occurred
on September 30, 2021, cash would have been approximately $93.7
million after giving effect to underwriting commissions and
financial advisory fees.
The unaudited financial results for the three and six months
ended September 30, 2021, will be filed with the SEC on Form 10-Q
in the coming days and will be available at www.pavmed.com or
www.sec.gov. PAVmed has elected the automatic 5-day extension for
filing its Form 10-Q for the third quarter. If filed on or before
November 22, 2021, the SEC report will be considered timely filed.
The Lucid Diagnostics Form 10-Q is due 45 days from the effective
date of the IPO registration, or November 29, 2021. We intend to
file both 10-Q’s concurrently during the PAVmed extension
period.
PAVmed Non-GAAP Measures
To supplement our unaudited financial results presented in
accordance with U.S. generally accepted accounting principles
(GAAP), management provides certain non-GAAP financial measures of
the Company’s financial results. These non-GAAP financial measures
include net loss before interest, taxes, depreciation, and
amortization (EBITDA) and non-GAAP adjusted loss, which further
adjusts EBITDA for stock-based compensation expense, loss on the
issuance or modification of convertible securities, the periodic
change in fair value of convertible securities, and loss on debt
extinguishment. The foregoing non-GAAP financial measures of EBITDA
and non-GAAP adjusted loss are not recognized terms under U.S.
GAAP.
Non-GAAP financial measures are presented with the intent of
providing greater transparency to information used by us in our
financial performance analysis and operational decision-making. We
believe these non-GAAP financial measures provide meaningful
information to assist investors, shareholders, and other readers of
our unaudited financial statements in making comparisons to our
historical financial results and analyzing the underlying
performance of our results of operations. These non-GAAP financial
measures are not intended to be, and should not be, a substitute
for, considered superior to, considered separately from or as an
alternative to, the most directly comparable GAAP financial
measures.
Non-GAAP financial measures are provided to enhance readers’
overall understanding of our current financial results and to
provide further information for comparative purposes. Management
believes the non-GAAP financial measures provide useful information
to management and investors by isolating certain expenses, gains
and losses that may not be indicative of our core operating results
and business outlook. Specifically, the non-GAAP financial measures
include non-GAAP adjusted loss and its presentation is intended to
help the reader understand the effect of the loss on the issuance
or modification of convertible securities, the periodic change in
fair value of convertible securities, the loss on debt
extinguishment and the corresponding accounting for non-cash
charges on financial performance. In addition, management believes
non-GAAP financial measures enhance the comparability of results
against prior periods.
A reconciliation to the most directly comparable GAAP measure of
all non-GAAP financial measures included in this press release for
the three and six months ended September 30, 2021, and 2020 is as
follows:
For the three months ended
September 30,
For the nine months ended
September 30,
(ooo's except per-share
amounts)
2021
2020
2021
2020
Revenue
$
200
$
-
$
200
$
-
Gross profit
56
-
56
-
Operating expenses
13,724
5,528
34,770
15,795
Loss from operations
(13,668
)
(5,528
)
(34,714
)
(15,795
)
Net income (loss) per common
share, basic and diluted
$
(0.15
)
$
(0.11
)
$
(0.42
)
$
(0.57
)
Net loss attributable to
common stockholders
(12,294
)
(5,557
)
(33,345
)
(25,751
)
Preferred Stock dividends and
deemed dividends
67
74
216
215
Net income (loss) as
reported
(12,227
)
(5,483
)
(33,129
)
(25,536
)
Adjustments:
Depreciation and amortization
expense1
38
8
60
17
Interest expense, net2
-
-
-
53
EBITDA
(12,189
)
(5,475
)
(33,069
)
(25,466
)
Other non-cash or financing
related expenses:
Stock-based compensation
expense3
3,991
586
10,629
1,458
Debt extinguishment/debt
forgiveness2
-
663
3,415
4,600
Acquisition related1
-
-
133
-
Change in FV convertible
debt2
-
(367
)
(1,682
)
5,521
Offering costs convertible
debt2
-
50
-
660
Non-GAAP adjusted
(loss)
(8,198
)
(4,543
)
(20,574
)
(13,227
)
Basic and Diluted shares
outstanding
83,307
48,381
79,874
45,564
Non-GAAP adjusted (loss) income
per share
($
0.10
)
($
0.09
)
($
0.26
)
($
0.29
)
1 Included in
general and administrative expenses in the financial statements
2 Included in other
income and expenses
3 Stock-based
compensation ("SBC") expenses:
(ooo's except per-share
amounts)
For the three months ended
September 30,
For the nine months ended
September 30,
2021
2020
2021
2020
Commercial operations expense
total
2,432
687
5,792
1,532
Stock-based compensation
expense
(341
)
(85
)
(840
)
(183
)
Net commercial operations expense
excluding SBC
2,091
602
4,952
1,349
General and administrative
expense total
5,987
2,222
16,100
6,942
Stock-based compensation
expense
(3,339
)
(363
)
(9,062
)
(948
)
Net general and administrative
expense excluding SBC
2,648
1,859
7,038
5,994
Research and development
expense total
5,305
2,619
12,878
7,321
Stock-based compensation
expense
(310
)
(138
)
(727
)
(327
)
Net research and development
expense excluding SBC
4,995
2,481
12,151
6,994
Total operating
expenses
13,724
5,528
34,770
15,795
Stock-based compensation
expense
(3,990
)
(586
)
(10,629
)
(1,458
)
Net operating expenses excluding
SBC
9,734
4,942
24,141
14,337
Lucid Diagnostics (Nasdaq: LUCD) Preliminary Financial
Results
For the three months ended September 30, 2021, EsoGuard related
revenues were $0.2 million and gross profit was $56 thousand.
Operating expenses were approximately $6.6 million as detailed
below including $2.8 million in stock-based compensation expense.
GAAP net loss was approximately $7.0 million, or $(0.49) per common
share. As shown below and for the purpose of illustrating the
effect of stock-based compensation and other non-cash income and
expenses on the Company’s financial results, the Company’s
preliminary non-GAAP adjusted loss for the three months ended
September 30, 2021 was approximately $3.7 million or $(0.26) per
common share.
Lucid had cash and cash equivalents of $21 thousand as of
September 30, 2021, compared with $111 thousand as of December 31,
2020. On proforma basis had the Lucid Diagnostics IPO occurred on
September 30, 2021, cash would have been approximately $64.4
million after giving effect to underwriting commissions and
financial advisory fees.
The unaudited financial results for the three and six months
ended September 30, 2021, will be filed with the SEC on Form 10-Q
in the coming days and will be available at www.luciddx.com or
www.sec.gov. The Lucid Diagnostics Form 10-Q is due 45 days from
the effective date of the IPO registration, or November 29, 2021.
We intend to file Lucid’s 10-Q concurrently with PAVmed’s Form 10-Q
during the PAVmed extension period.
Lucid Non-GAAP Measures
To supplement our unaudited financial results presented in
accordance with U.S. generally accepted accounting principles
(GAAP), management provides certain non-GAAP financial measures of
the Company’s financial results. These non-GAAP financial measures
include net loss before interest, taxes, depreciation, and
amortization (EBITDA) and non-GAAP adjusted loss, which further
adjusts EBITDA for stock-based compensation expense and other
non-cash income and expenses, if any. The foregoing non-GAAP
financial measures of EBITDA and non-GAAP adjusted loss are not
recognized terms under U.S. GAAP.
Non-GAAP financial measures are presented with the intent of
providing greater transparency to information used by us in our
financial performance analysis and operational decision-making. We
believe these non-GAAP financial measures provide meaningful
information to assist investors, shareholders, and other readers of
our unaudited financial statements in making comparisons to our
historical financial results and analyzing the underlying
performance of our results of operations. These non-GAAP financial
measures are not intended to be, and should not be, a substitute
for, considered superior to, considered separately from or as an
alternative to, the most directly comparable GAAP financial
measures.
Non-GAAP financial measures are provided to enhance readers’
overall understanding of our current financial results and to
provide further information for comparative purposes. Management
believes the non-GAAP financial measures provide useful information
to management and investors by isolating certain expenses, gains
and losses that may not be indicative of our core operating results
and business outlook. Specifically, the non-GAAP financial measures
include non-GAAP adjusted loss and its presentation is intended to
help the reader understand the effect of the loss on the issuance
or modification of convertible securities, the periodic change in
fair value of convertible securities, the loss on debt
extinguishment and the corresponding accounting for non-cash
charges on financial performance. In addition, management believes
non-GAAP financial measures enhance the comparability of results
against prior periods.
A reconciliation to the most directly comparable GAAP measure of
all non-GAAP financial measures included in this press release for
the three and six months ended September 30, 2021, and 2020 is as
follows:
For the three months ended
September 30,
For the nine months ended
September 30,
(ooo's except per-share
amounts)
2021
2020
2021
2020
Revenue
$
200
$
-
$
200
$
-
Gross profit
56
-
56
-
Operating expenses
6,566
2,022
16,234
5,549
Interest expense
447
594
Net loss
(6,957
)
(2,022
)
(16,772
)
(5,549
)
Net income (loss) per common
share, basic and diluted
$
(0.49
)
$
(0.14
)
$
(1.19
)
$
(0.39
)
Adjustments:
Depreciation and amortization
expense1
-
-
3
-
Interest expense, net3
447
-
594
-
EBITDA
(6,510
)
(2,022
)
(16,175
)
(5,549
)
Other non-cash or financing
related expenses:
Stock-based compensation
expense3
2,772
16
6,157
49
Non-GAAP adjusted
(loss)
(3,738
)
(2,006
)
(10,018
)
(5,500
)
Basic and Diluted shares
outstanding
14,115
14,115
14,115
14,114
Non-GAAP adjusted (loss) income
per share
($0.26
)
($0.14
)
($0.71
)
($0.39
)
1 Included in
general and administrative expenses in the financial statements
2 Included in other
income and expenses
For the three months ended
September 30,
For the nine months ended
September 30,
2021
2020
2021
2020
3 Stock-based
compensation ("SBC") expenses:
Commercial operations expense
total
978
335
2,689
672
Stock-based compensation
expense
-
-
-
-
Net commercial operations expense
excluding SBC
978
335
2,689
672
General and administrative
expense total
3,398
471
7,731
1,260
Stock-based compensation
expense
(2,695
)
-
(5,988
)
-
Net general and administrative
expense excluding SBC
703
471
1,743
1,260
Research and development
expense total
2,190
1,216
5,814
3,617
Stock-based compensation
expense
(77
)
(16
)
(168
)
(49
)
Net research and development
expense excluding SBC
2,113
1,200
5,646
3,568
Total operating
expenses
6,566
2,022
16,234
5,549
Stock-based compensation
expense
(2,772
)
(16
)
(6,156
)
(49
)
Net operating expenses excluding
SBC
3,794
2,006
10,078
5,500
About PAVmed
PAVmed Inc. is a highly differentiated, multi-product,
commercial-stage medical technology company with a diversified
product pipeline addressing unmet clinical needs encompassing a
broad spectrum of clinical areas with attractive regulatory
pathways and market opportunities. Its major subsidiary, Lucid
Diagnostics Inc. (Nasdaq: LUCD), markets the first and only
commercial tools for widespread early detection of esophageal
precancer and cancer – the EsoGuard® Esophageal DNA Test and
EsoCheck® Esophageal Cell Collection Device. Its GI Health division
also includes the complementary EsoCure™ Esophageal Ablation Device
with Caldus™ Technology. Another major subsidiary, Veris Health
Inc., is a digital health company developing the first intelligent
implantable vascular access port with biologic sensors and wireless
communication to improve personalized cancer care through remote
patient monitoring. Its Minimally Invasive Interventions division
markets its CarpX® Minimally Invasive Device for Carpal Tunnel
Syndrome. Other divisions include Infusion Therapy (PortIO™
Implantable Intraosseous Vascular Access Device and NextFlo™
Intravenous Infusion Set), and Emerging Innovations (non-invasive
laser-based glucose monitoring, pediatric ear tubes, and mechanical
circulatory support). For more information, please visit
www.pavmed.com, follow us on Twitter, connect with us on LinkedIn,
and watch our videos on YouTube.
About Lucid Diagnostics
Lucid Diagnostics Inc. (Nasdaq: LUCD) is a commercial-stage,
cancer prevention medical diagnostics company, and subsidiary of
PAVmed Inc. (Nasdaq: PAVM). Lucid is focused on the millions of
patients with gastroesophageal disease (GERD), also known as
chronic heartburn, who are at risk of developing esophageal
precancer and cancer. Lucid’s EsoGuard® Esophageal DNA Test,
performed on samples collected in a brief, noninvasive office
procedure with its EsoCheck® Esophageal Cell Collection Device, is
the first and only commercially available diagnostic test capable
of serving as a widespread screening tool to prevent cancer and
cancer deaths through early detection of esophageal precancer in
at-risk GERD patients. EsoGuard is commercialized in the U.S. as a
Laboratory Developed Test (LDT). EsoCheck is commercialized in the
U.S. as a 510(k)-cleared esophageal cell collection device.
EsoGuard, used with EsoCheck, was granted FDA Breakthrough Device
designation and is the subject of two large, actively enrolling,
international multicenter clinical trials to support FDA PMA
approval. Lucid is building a network of Lucid Test Centers where
at-risk GERD patients can undergo the EsoCheck procedure for
EsoGuard testing.
Forward-Looking Statements
This press release includes forward-looking statements that
involve risks and uncertainties. Forward-looking statements are
statements that are not historical facts. Such forward-looking
statements, based upon the current beliefs and expectations of
PAVmed’s management, are subject to risks and uncertainties, which
could cause actual results to differ from the forward-looking
statements. Risks and uncertainties that may cause such differences
include, among other things, the ability to complete the initial
public offering of Lucid; volatility in the price of PAVmed’s
common stock, Series W Warrants and Series Z Warrants; general
economic and market conditions; the uncertainties inherent in
research and development, including the cost and time required
advance PAVmed’s products to regulatory submission; whether
regulatory authorities will be satisfied with the design of and
results from PAVmed’s preclinical studies; whether and when
PAVmed’s products are cleared by regulatory authorities; market
acceptance of PAVmed’s products once cleared and commercialized;
our ability to raise additional funding and other competitive
developments. PAVmed has not yet received clearance from the FDA or
other regulatory body to market many of its products. The Company
has been monitoring the COVID-19 pandemic and its impact on our
business. The Company expects the significance of the COVID-19
pandemic, including the extent of its effect on the Company’s
financial and operational results, to be dictated by, among other
things, the success of efforts to contain it and the impact of
actions taken in response. New risks and uncertainties may arise
from time to time and are difficult to predict. All of these
factors are difficult or impossible to predict accurately and many
of them are beyond PAVmed’s control. For a further list and
description of these and other important risks and uncertainties
that may affect PAVmed’s future operations, see Part I, Item IA,
“Risk Factors,” in PAVmed’s most recent Annual Report on Form 10-K
filed with the Securities and Exchange Commission, as the same may
be updated in Part II, Item 1A, “Risk Factors” in any Quarterly
Report on Form 10-Q filed by PAVmed after its most recent Annual
Report. PAVmed disclaims any intention or obligation to publicly
update or revise any forward-looking statement to reflect any
change in its expectations or in events, conditions, or
circumstances on which those expectations may be based, or that may
affect the likelihood that actual results will differ from those
contained in the forward-looking statements.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20211116006357/en/
Investors Lisa DeScenza
LaVoieHealthScience (617) 351-0243
ldescenza@lavoiehealthscience.com
Media Kristi Bruno
LaVoieHealthScience (617) 865-3940
PAVmed@lavoiehealthscience.com
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