PAVmed Inc. (Nasdaq: PAVM, PAVMZ) (the “Company”
or “PAVmed”), a highly differentiated, multi-product,
commercial-stage medical device company, today provided a business
update for the Company and its major subsidiary, Lucid Diagnostics
Inc. (“Lucid”), and discussed financial results for the three
months ended March 31, 2021.
“I am delighted with the solid momentum we have
experienced during the first quarter of 2021 and in subsequent
weeks,” said Lishan Aklog, M.D., PAVmed’s Chairman and Chief
Executive Officer. “We continue to expand our commercial
infrastructure and drive EsoGuard commercialization, while
advancing products across our portfolio. We have strengthened our
balance sheet, with $49 million in cash as of March 31, 2021,
sufficient to fund our current operations into 2023, and no debt.
We also continue to take important steps to support an expanded
strategic vision to enhance shareholder value, including seeking to
take Lucid public, adding deep commercial experience to our Board
of Directors, and exploring exciting new opportunities to partner
on groundbreaking innovations.”
Conference Call and Webcast
A conference call and webcast for today’s
business update and first 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: 13719121.
Business Update Highlights
- Lucid
significantly expanded its full-time commercial team to accelerate
execution of a pillar of its growth strategy, commercializing its
EsoGuard® Esophageal DNA Test across multiple channels. Hired four
industry veterans into senior leadership roles – Director of Sales,
VP of Market Access & Reimbursement, National Sales Training
Manager and Strategic Accounts Manager.
- EsoGuard
testing accelerated as pandemic-related healthcare facility
limitations eased. Lucid processed 78 EsoGuard tests in Q1 and 96
in the first half of Q2. Clinicians have been trained, and
EsoCheck® Cell Collection Devices and EsoGuard Specimen Kits are in
stock, at approximately 180 U.S. accounts. Lucid began to submit
EsoGuard claims in Q1, once CMS payment became effective on January
1st, and has recently begun to receive out-of-network private
insurance payments.
- Preparatory
work completed on Lucid’s pilot program to expand EsoGuard
commercialization to primary care physicians and consumers. Lucid
hired clinical personnel and leased medical office space to launch
three Lucid Test Centers in Phoenix, Arizona. Centers expected to
be ready to accept physician referrals for EsoGuard testing in the
coming weeks, once necessary regulatory and compliance
infrastructure finalized in consultation with Lucid Board’s new
Compliance & Quality Committee. Direct-to-consumer marketing to
commence once contractual arrangements with telemedicine company
finalized.
- Lucid announced
intent to go public as a stand-alone medical diagnostics company,
assuming market conditions remain favorable, with PAVmed retaining
a controlling majority equity interest in Lucid. Seeks to raise own
capital to drive growth strategy to expand EsoGuard
commercialization as well as its base of clinical evidence to
support inclusion in clinical guidelines. Lucid’s Board determined
that the best interests of shareholders are served by going public
through an initial public offering (“IPO”).
- Lucid’s new
full-time VP of Market Access and Reimbursement working with two
consulting firms to assemble strongest possible data package to
support securing contracts with private payors for EsoGuard
coverage and payment. First meeting with medical directors of major
insurers to be held later this week. Await notification of CMS
local coverage determination, as Medicare Administrative Contractor
works through a pandemic and transition-related backlog.
- Lucid passed
final Stage 2 Audit of the quality management systems by EU-based
Notified Body. Recently notified that review of EsoCheck Technical
File complete and final summary report submitted. EsoCheck CE Mark
approval under MDD, and completion of EsoGuard IVDD
self-certification expected prior to the EU’s May 26th transition
to new MDR regulatory regime.
- Lucid is
actively enrolling U.S. patients in two international multi-center
clinical studies, ESOGUARD-BE-1 and ESOGUARD-BE-2, to support a PMA
application for FDA IVD registration of EsoGuard on samples
collected using EsoCheck. European sites expected to begin
enrolling patients this summer. Completion of study enrollment and
PMA application submission expected in 2022.
- Lucid contacted
FDA to begin discussions pursuant to its FDA Breakthrough Device
designation for EsoGuard on samples collected using EsoCheck. Will
seek FDA input on an extension of ESOGUARD-BE-1 screening study,
sufficiently powered for an expanded indication to detect
dysplastic Barrett’s Esophagus, to support inclusion in clinical
guidelines.
- Lucid working
to transfer EsoCheck manufacturing to Coastline International Inc.,
a high-volume manufacturer based in San Diego, CA with production
facilities in Mexico, by the end of 2021, which will increase
EsoCheck manufacturing capacity up to one million units per
year.
- PAVmed hired
full-time CarpX National Sales Manager with over a decade of
experience in orthopedic sales, including successful launch and
commercialization of a minimally invasive carpal tunnel release
device. Tasked with reorganizing the CarpX advisory panel to
accelerate procedural volume consistent with the steady and
deliberate initial commercialization plan, focused on optimizing
the procedural steps and safety prior to broader commercialization
effort later this year.
- PAVmed informed
by its EU-based Notified Body that review of CarpX Technical File
is complete. Await final summary report submission. CarpX CE Mark
approval under MDD expected prior to the EU’s May 26th transition
to new MDR regulatory regime.
- PAVmed
completed in-person site initiation visits for PortIO study at four
medical centers in Colombia, South America. Awaiting IRB approval
and expect to begin enrollment this summer. Completing additional
long-term animal studies while awaiting FDA re-opening of non-COVID
pre-submission processes to discuss protocol for U.S. PortIO IDE
study.
- PAVmed
initiated design freeze verification testing in preparation for
final verification and validation testing of NextFlo Intravenous
Infusion Set, to support FDA 510(k) submission with clearance
targeted for first half of 2022. Discussions and technologic
diligence engagement with large strategic partner to license
NextFlo technology for disposable infusion pumps continue while
PAVmed advances technology towards self-commercialization.
- PAVmed
completed acute and survival animal study of EsoCure™ Esophageal
Ablation Device, demonstrating successful direct thermal balloon
catheter ablation of esophageal lining through working channel of
standard endoscope using its proprietary Caldus™ Technology.
- PAVmed, in
close collaboration with research, development and manufacturing
partner, Canon USA, advancing DisappEAR resorbable silk pediatric
ear tubes to support FDA 510(k) submission targeted for late
2021.
- PAVmed and
subsidiary Solys Diagnostics terminated a third-party license
agreement and decided to advance own proprietary non-invasive
glucose monitoring technology. Expect prototype to be ready for
testing in human volunteers and a diabetic animal model later this
year.
- PAVmed raised
approximately $58 million in gross proceeds from common stock
equity offerings in Q1, including an underwritten $45 million
common stock public offering led by Cantor Fitzgerald & Co.
Used approximately $15 million to retire all outstanding
convertible debt.
- PAVmed
appointed prominent UK-based global industry executive, Debbie
White, to its Board of Directors. Ms. White providing valuable
guidance on strategy, operations, finance, and international
commercialization.
- Lucid appointed
nationally recognized healthcare executive Dr. Jacque Sokolov to
its Board of Directors. Dr. Sokolov established and serves as the
inaugural Chair of the Board’s new Compliance & Quality
Committee.
FINANCIAL RESULTS
For the three months ended March 31, 2021,
research and development expenses were $3.3 million and general and
administrative expenses were $4.8 million. GAAP net loss
attributable to common stockholders was $9.5 million, or $(0.13)
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
reported a non-GAAP adjusted loss for the three months ended March
31, 2021, of $5.9 million or $(0.08) per common share.
PAVmed had cash and cash equivalents of $48.5
million as of March 31, 2021, compared with $17.3 million as of
December 31, 2020.
The unaudited financial results for the three
months ended March 31, 2021, as reported to the SEC on Form 10-Q
can be obtained at www.pavmed.com or www.sec.gov.
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 months ended March 31, 2021, and 2020
is as follows:
|
|
For the three months ended March 31, |
|
(ooo's except per-share amounts) |
|
2021 |
|
|
2020 |
|
|
|
|
|
|
|
|
Net income (loss) per
common share, basic and diluted |
|
$ |
(0.13 |
) |
|
$ |
(0.33 |
) |
Net loss attributable
to common stockholders |
|
|
(9,506 |
) |
|
|
(14,545 |
) |
Preferred Stock dividends and
deemed dividends |
|
|
75 |
|
|
|
70 |
|
Net income (loss) as reported |
|
|
(9,431 |
) |
|
|
(14,475 |
) |
Adjustments: |
|
|
|
|
|
|
|
|
Depreciation expense1 |
|
|
12 |
|
|
|
3 |
|
Interest expense, net3 |
|
|
- |
|
|
|
52 |
|
EBITDA |
|
|
(9,419 |
) |
|
|
(14,420 |
) |
|
|
|
|
|
|
|
|
|
Other non-cash or
financing related expenses: |
|
|
|
|
|
|
|
|
Stock-based compensation expense2 |
|
|
1,436 |
|
|
|
344 |
|
Debt extinguishment3 |
|
|
3,715 |
|
|
|
1,188 |
|
Change in FV convertible debt3 |
|
|
(1,682 |
) |
|
|
8,008 |
|
Offering costs convertible debt3 |
|
|
- |
|
|
|
410 |
|
Non-GAAP adjusted
(loss) |
|
|
(5,950 |
) |
|
|
(4,470 |
) |
Basic and Diluted shares outstanding |
|
|
73,954 |
|
|
|
43,500 |
|
Non-GAAP adjusted (loss) income per share |
|
($ |
0.08 |
) |
|
($ |
0.10 |
) |
1 |
Included in general and administrative expenses in the financial
statements |
|
|
2 |
For the three months ended March 31, 2021 includes $1,118 of stock
based compensation expense reported as general and administrative
expenses, $202 as sales and marketing expenses, and $116 reported
as research and development expense. For the three months ended
March 31, 2020 includes $244 of stock based compensation expense
reported as general and administrative expenses, $33 as sales and
marketing expenses, and $67 reported as research and development
expenses. |
|
|
3 |
Included in other income and expenses |
About PAVmed and
LucidPAVmed 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., 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. Its Minimally Invasive Interventions markets its CarpX®
Minimally Invasive Device for Carpal Tunnel Syndrome. Other
divisions include Infusion Therapy (PortIO™ Implantable Intraosseus
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. For more information on our majority owned subsidiary,
Lucid Diagnostics Inc., please visit www.luciddx.com, follow Lucid
on Twitter, and connect with Lucid on LinkedIn. For detailed
information on EsoGuard, please visit www.EsoGuard.com and follow
us on Twitter, Facebook and Instagram.
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, our ability to
complete our strategic initiatives, 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; the
effectiveness of our marketing initiatives; the establishment of
government and private payment insurance coverage; 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.
Contacts:
InvestorsMike HavrillaDirector of Investor
Relations(814) 241-4138JMH@PAVmed.com
MediaShaun O’NeilChief Commercial Officer(518)
812-3087SMO@PAVmed.com
Jim Heins / Katie GallagherLaVoieHealthScience(646) 491-7042 /
(617) 792-3937PAVmed@lavoiehealthscience.com
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