Conference call to be held August 17, 2017
at 4:30 p.m. Eastern time
PAVmed Inc. (Nasdaq: PAVM, PAVMW), a highly
differentiated, multiproduct medical device company, today
announced financial results for the three and six months ended June
30, 2017 and provided a business update.
“During this past quarter and in recent weeks PAVmed has
continued to grow stronger as a company, moving steadily towards
major developmental, regulatory and commercialization milestones,
while exploring all opportunities to enhance shareholder value,”
said Lishan Aklog, M.D., PAVmed’s Chairman and Chief Executive
Officer.
“We significantly strengthened our balance sheet raising $5.5
million in gross proceeds from seasoned and well-known healthcare
investors,” Dr. Aklog noted. “These funds provide us with
sufficient capital to reach our key milestones well into 2018.”
“Our development and commercialization strategy has been to
focus our resources on three products in our pipeline with the
greatest and nearest-term commercial opportunities – PortIO™,
CarpX™ and DisappEAR™,” Dr. Aklog stated.
PortIO is PAVmed’s implantable intraosseous vascular access
device which is designed to provide short or long-term access to
the bone marrow cavity for the delivery of medications, fluids or
other substances, eliminating many of the shortcomings of existing
devices, especially in patients with poor veins. “PortIO was
submitted to the U.S. Food and Drug Administration (FDA) for 510(k)
clearance for short-term use and we continue to work with the FDA
to demonstrate substantial equivalence to our selected predicate,
with the de novo 510(k) pathway available to us as an alternative,”
said Brian deGuzman, MD, PAVmed’s Chief Medical Officer. CarpX is
PAVmed’s percutaneous device to treat carpal tunnel syndrome, which
is designed to eliminate the need for invasive carpal surgery,
performed in 600,000 patients annually, resulting in decreased
costs, reduced pain, accelerated recovery and a lower the threshold
for intervention. “CarpX is undergoing verification and validation
testing and we are on schedule for FDA 510(k) submission by the end
of this quarter,” Dr. deGuzman added. DisappEAR is PAVmed’s
re-absorbable, antibiotic-eluting pediatric ear tube device which
is designed to eliminate many of the shortcomings of currently
available plastic ear tubes inserted in over one million children
annually. The device utilizes a propriety aqueous silk technology
licensed from Tufts University. “DisappEAR’s development is
progressing well and on schedule as we target FDA submission in
2018,” Dr. deGuzman noted.
“These are exciting times for PAVmed,” Dr. Aklog concluded. “Our
recent financings have put us in a sound capital position, our lead
products are advancing towards important milestones and we remain
nimble, creative and resourceful as opportunities to enhance
shareholder value present themselves. We greatly appreciate the
strong commitment of our long-term shareholders and remain
laser-focused on enhancing the value of the company for the benefit
of all of our shareholders.”
Financial Results
Research and development expenses for the three months ended
June 30, 2017 were $701,740. General and administrative expenses
for the three months ended June 30, 2017 were $1,319,692.
PAVmed reported an operating loss for the three months ended
June 30, 2016 of $2,021,432 and a GAAP net loss of $989,707.
Included in the GAAP net loss were non-cash gains totaling
$1,031,725 related to a change in the fair value of Series A
warrant liability plus a related change in fair value of a Series A
Convertible Preferred Stock conversion option embedded derivative
liability, stock-based compensation expense of $254,300 and
depreciation of $1,803.
For the three months ended June 30, 2017, GAAP net loss
attributable to common stockholders was $1,040,978, or $0.08 per
common share. As illustrated below and for the purpose of helping
the reader to understand the effect of derivative accounting for
non-cash income and expenses on the Company’s financial results,
the Company reported a non-GAAP adjusted loss for the three months
ended June 30, 2017 of $1,765,329, or $0.13 per common share.
Research and development expenses for the six months ended June
30, 2017 were $1,358,453. General and administrative expenses for
the six months ended June 30, 2017 were $2,819,244.
PAVmed reported an operating loss for the six months ended June
30, 2017 of $4,177,697 and a GAAP net loss of $5,259,795. Included
in the net loss was a non-cash charge of $3,124,285 related to the
issuance of Series A Preferred Stock Units, non-cash gains totaling
$2,042,187 related to a change in the fair value of Series A
warrant liability plus a related change in fair value of a Series A
Convertible Preferred stock conversion option embedded derivative
liability, stock-based compensation expense of $526,980 and
depreciation of $3,505.
For the six months ended June 30, 2017, GAAP net loss
attributable to common stockholders was $5,337,506, or $0.40 per
common share. The Company reported a non-GAAP adjusted loss for the
six months ended June 30, 2017 of $3,647,212, or $0.27 per common
share, as illustrated below.
PAVmed had cash and cash equivalents of $82,052 as of June 30,
2017, compared with $585,680 as of December 31, 2016. Subsequent to
June 30, 2017, the Company completed two separate financings
resulting in gross cash proceeds of $5,500,000.
The unaudited financial results for the three and six months
ended June 30, 2017 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) in our Quarterly Report on Form 10-Q, 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 of the
Series A Preferred Stock Units, the change in fair value of the
Series A Warrant liability and the change in fair value of the
Series A Convertible Preferred Stock conversion option embedded
derivative liability. 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
of the Series A Preferred Stock Units and the corresponding
derivative 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 June 30, 2017 and 2016 is as
follows:
Three Months Ended June 30, Six
Months Ended June 30,
2017 2016 2017
2016
Net loss per common share, basic and
diluted ($0.08) ($0.10) ($0.40) ($0.16)
Net loss
attributable to common stockholders (1,040,978) (1,314,735)
(5,337,506) (2,011,615) Series A Convertible Preferred Stock
dividends 51,271 - $77,711
Net loss as reported
(989,707) (1,314,735) (5,259,795) (2,011,615) Adjustments:
Depreciation expense1 1,803 705 3,505 837 Interest expense, net - -
- - Income tax (benefit) expense - - - -
EBITDA (987,904)
(1,314,030) (5,256,290) (2,010,778)
Other non-cash
expenses: Stock-based compensation expense2 254,300 176,643
526,980 176,643 Loss from issuance of Preferred Stock Units3 - -
3,124,285 - Change in fair value of Series A Warrant Liabiity3
(748,423) - (1,534,820) -
Change in fair value of Series A Preferred
Stockconversion option embedded derivative liabiity3
(283,302) - (507,367) -
Non-GAAP adjusted (loss) (1,765,329)
(1,137,387) (3,647,212) (1,834,135) Basic and Diluted shares
outstanding 13,331,211 12,995,495 13,331,052 12,622,747 Non-GAAP
adjusted (loss) income per share ($0.13) ($0.09) ($0.27) ($0.15)
1 Included in general and administrative expenses in
the financial statements 2 For the three and six months ended June
30, 2017 includes $223,736 and $466,188, respectively, of
stock-based compensation expense reported as general and
administrative expenses and $30,564 and $60,792, respectively,
reported as research and development expense. For the three and six
months ended June 30, 2016 includes $155,147 of stock-based
compensation expense reported as general and administrative
expenses and $21,496 reported as research and development expense.
3 Included in other income and expenses in the financial
statements.
Conference Call and Webcast
The Company will hold a conference call and webcast on August
17, 2017 at 4:30 p.m. Eastern time. During this call, Dr. Aklog
will provide a business update, including an overview of the
Company’s near-term milestones and growth strategy. In addition,
Dennis McGrath, the Company’s Chief Financial Officer, will discuss
second quarter 2017 financial results.
To access the conference call, U.S.-based participants should
dial (888) 803-5993 and international participants should dial
(706) 634-5454. All participants should provide the following
passcode: 64738878. Individuals interested in listening to the live
conference call via the Internet may do so by visiting the
Company’s website at www.pavmed.com.
Following the conclusion of the conference call, a replay will
be available through August 23, 2017 and can be accessed by dialing
(855) 859-2056 from within the U.S. or (404) 537-3406 from outside
the U.S. All listeners should provide passcode: 64738878. The
webcast will be available for 90 days on the Company’s website at
www.pavmed.com.
About PAVmed
PAVmed Inc. is a highly differentiated, multiproduct medical
device company employing a unique business model designed to
advance products from concept to commercialization much more
rapidly and with significantly less capital than the typical
medical device company. This proprietary model enables PAVmed to
pursue an expanding pipeline strategy with a view to enhancing and
accelerating value creation. PAVmed’s diversified pipeline of
products address unmet clinical needs, have attractive regulatory
pathways and market opportunities and encompass a broad spectrum of
clinical areas including carpal tunnel syndrome (CarpX™), medical
infusions (NextFlo™ and NextCath™), interventional radiology
(PortIO™ and NextCath™), tissue ablation and cardiovascular
intervention (Caldus™) and pediatric ear infections (DisappEAR™).
The Company intends to further expand its pipeline through
engagements with clinician innovators and leading academic medical
centers. For further information, please visit www.pavmed.com.
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 the
Company’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 uncertainties inherent in research
and development, including the cost and time required advance our
products to regulatory submission; whether regulatory authorities
will be satisfied with the design of and results from our
preclinical studies; whether and when our products are cleared by
regulatory authorities; market acceptance of our 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 any of
its products. 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 our control. For a further list and description of these and
other important risks and uncertainties that may affect our future
operations, see Part I, Item IA, “Risk Factors,” in our 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 Reports on Form 10-Q filed by us after
our most recent Annual Report. We disclaim any intention or
obligation to publicly update or revise any forward-looking
statement to reflect any change in our 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.
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InvestorsLHAKim Sutton Golodetz, 212-838-3777kgolodetz@lhai.comorMediaRooneyPartnersKate
Barrette, 212-223-0561Kbarrette@rooneyco.com
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