PAVmed Inc. (Nasdaq: PAVM, PAVMZ) (the “Company”
or “PAVmed”), a highly differentiated, multiproduct medical device
company, today reported preliminary financial results for the three
months ended March 31, 2020 and provided a business update.
“We have continued to aggressively advance our
strategic plan during the first quarter and recent weeks, including
securing marketing clearance for our CarpX™ device,” said Lishan
Aklog, M.D., PAVmed’s Chairman and Chief Executive Officer. “Our
team has successfully confronted the challenges of the Covid-19
pandemic with minimal short-term and no anticipated long-term
disruptions to our activities. We are encouraged that medical
facilities are beginning to re-open with elective procedures
restarting and look forward to achieving important milestones and
accelerating commercial activities in the coming months.”
RECENT ACCOMPLISHMENTS
- The Company received 510(k) marketing clearance from the U.S.
Food and Drug Administration (FDA) for its CarpX™ minimally
invasive carpal tunnel device.
- PAVmed successfully recruited and engaged a CarpX™ National
Sales Manager with over 20 years of commercial experience in the
orthopedic space.
- The Company’s majority-owned
subsidiary Lucid Diagnostics (“Lucid”) enrolled its first three
patients in its international multi-center IVD clinical trials
(ESOGUARD-BE-1 and 2) comparing EsoGuard™/EsoCheck™ to endoscopy.
These trials include over 60 sites in the U.S. and Europe. Nicholas
J. Shaheen MD, MPH, Professor and Chief of the Division of
Gastroenterology and Hepatology at UNC HealthCare, and lead author
of the most recent American College of Gastroenterology (ACG)
guidelines, serves as principal investigator of both trials.
- Lucid submitted its final insurance reimbursement payment
dossier to Medicare contractor Palmetto GBA and its molecular
diagnostics program Mol Dx.
- The Company successfully completed
an acute animal study of a working prototype of its EsoCure™
Esophageal Ablation Device, a disposable single-use thermal balloon
ablation catheter designed to use its patented Caldus Technology to
treat dysplastic Barrett’s Esophagus (BE) before it can progress to
highly lethal esophageal cancer and to do so without the need for
complex and expensive capital equipment. The EsoCure balloon
catheter inserted through the working channel of a standard
endoscope circumferentially ablated the esophageal lining
consistently and cleanly with ablation times far less than existing
radiofrequency and cryoablation devices.
- Both PAVmed and Lucid received firm
dates for the stage 1 audit of their quality systems by the EU
notified body, which will allow them to restart efforts to pursue
EU CE Mark clearance of EsoCheck, EsoGuard, CarpX and PortIO™ after
delays related to a regulatory backlog in Europe due to systematic
changes.
- PAVmed’s majority-owned subsidiary,
Solys Diagnostics (“Solys”), completed initial bench-top testing of
its NDIR laser based non-invasive blood glucose diagnostic device
demonstrating a linear response across a wide range of glucose
concentrations.
- The Company continued to expand and
advance its extensive intellectual property portfolio, which now
includes over 130 issued and pending, owned, assigned or licensed
patents across PAVmed and its subsidiaries.
UPCOMING KEY ACTIVITIES AND
MILESTONES
- Commercially launch CarpX and
assemble a world-class Medical Advisory Board of hand surgeons to
provide critical procedural development and professional education
support.
- Accelerate and expand EsoGuard and
EsoCheck commercial activities, including existing virtual sales
and professional education, as well as aggressive marketing until
clinical procedures can resume from Covid-19 limitations.
- Accelerate enrollment in ESOGUARD-BE-1 and 2 trials and
initiate two additional clinical trials involving EsoCheck when
clinical activities resume.
- Launch clinical trial of EsoCheck in Eosinophilic Esophagitis
at the University of Pennsylvania.
- Launch clinical trial of EsoCheck with BE progression markers
at Fred Hutchinson Cancer Research Center in Seattle.
- Submit final coverage dossier to
Medicare contractor Palmetto GBA and its molecular diagnostics
program Mol Dx. Continue discussions to secure payment and coverage
decision for EsoGuard’s CPT code.
- Complete ongoing formal M&A
process seeking to secure a strategic partner or to license or
acquire the Company’s NextFlo™ technology for one or more clinical
applications while simultaneously advancing NextFlo toward an
initial FDA 510(k) submission later in 2020.
- Complete additional ongoing partnership discussions involving
EsoGuard, EsoCheck and DisappEAR.
- Submit response to FDA comments
following successful pre-submission meeting with the FDA on PortIO™
focused on the design of a clinical safety study in support of a de
novo application and the target population of its proposed label.
Submit PortIO Breakthrough Device application.
- Initiate a PortIO clinical safety
study to support its FDA de novo application and long-term clinical
study in Colombia, South America to demonstrate up to 60-day
maintenance free implant durations in humans.
- Complete benchtop, human and animal
testing seeking to achieve accuracy milestone based on established
FDA and ISO 15197 standards for Solys Diagnostics’ NDIR laser based
non-invasive blood glucose diagnostic device. Initiate commercial
development of inpatient device.
PRELIMINARY FINANCIAL
RESULTS
For the three months ended March 31, 2020,
research and development expenses were approximately $2.6 million
and general and administrative expenses were approximately $2.6
million. GAAP net loss attributable to common stockholders was
approximately $14.5 million, or $(0.33) per common share. As
illustrated below and for the purpose of helping the reader
understand 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, 2020 of $4.5 million, or $(0.10) per common share.
PAVmed had cash and cash equivalents of $8.7
million as of March 31, 2020, compared with $6.2 million as of
December 31, 2019. Subsequently, in late April 2020, the Company
received approximately $3.6 million in proceeds from a private
placement with an institutional investor for the sale of a Senior
Secured Convertible Note.
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, 2020 and 2019 is
as follows:
|
|
Three Months Ended March 31, |
|
(ooo's
except per-share amounts) |
|
2020 |
|
|
2019 |
|
|
|
|
|
|
|
|
Net income (loss) per
common share, basic and diluted |
|
|
$ |
(0.33 |
) |
|
|
$ |
(0.13 |
) |
Net loss attributable
to common stockholders |
|
|
|
(14,545 |
) |
|
|
|
(3,600 |
) |
Preferred Stock dividends and
deemed dividends |
|
|
|
70 |
|
|
|
|
65 |
|
Net income (loss) as reported |
|
|
|
(14,475 |
) |
|
|
|
(3,535 |
) |
Adjustments: |
|
|
|
|
|
|
|
|
Depreciation expense1 |
|
|
|
4 |
|
|
|
|
3 |
|
Interest expense, net3 |
|
|
|
52 |
|
|
|
|
- |
|
EBITDA |
|
|
|
(14,419 |
) |
|
|
|
(3,532 |
) |
|
|
|
|
|
|
|
|
|
Other non-cash or
financing related expenses: |
|
|
|
|
|
|
|
|
Stock-based compensation expense2 |
|
|
|
344 |
|
|
|
|
459 |
|
Debt extinguishment3 |
|
|
|
1,188 |
|
|
|
|
1 |
|
Change in FV convertible debt3 |
|
|
|
8,008 |
|
|
|
|
559 |
|
Offering costs convertible debt3 |
|
|
|
410 |
|
|
|
|
- |
|
Non-GAAP adjusted
(loss) |
|
|
|
(4,469 |
) |
|
|
|
(2,513 |
) |
Basic and Diluted shares outstanding |
|
|
|
43,500 |
|
|
|
|
27,149 |
|
Non-GAAP adjusted (loss) income per share |
|
|
|
($0.10 |
) |
|
|
|
($0.09 |
) |
1 |
Included in general and administrative expenses in the financial
statements |
|
|
2 |
For the three months ended March 31, 2020 includes $277 of stock
based compensation expense reported as general and administrative
expenses and $67 reported as research and development expense. For
the three months ended March 31, 2019 includes $285 of stock based
compensation expense reported as general and administrative
expenses and $174 reported as research and development
expense. |
|
|
3 |
Included in other income and expenses |
Conference Call and Webcast
The Company will hold a conference call and
webcast today at 4:30 p.m. Eastern time. During the call, Lishan
Aklog, M.D., Chairman and Chief Executive Officer of the Company,
will provide a business update including an overview of the
Company’s near-term milestones and growth strategy. In addition,
Dennis McGrath, President and Chief Financial Officer, will review
first quarter 2020 financial results.
To access the conference call, U.S.-based
listeners should dial (877) 407-3982 and international listeners
should dial (201) 493-6780. All listeners should provide the
operator with the conference call name “PAVmed, Inc. Business
Update Conference Call” to join. Individuals interested in
listening to the live conference call via webcast may do so by
visiting 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 from within the U.S. or (412) 317-6671 from
outside the U.S. To access the replay, all listeners should provide
the following pin number: 13703671. The webcast will be available
for replay on the investor relations section of the Company’s
website at www.pavmed.com.
About PAVmed
PAVmed Inc. is a highly differentiated,
multiproduct commercial stage medical device company employing a
unique business model designed to advance innovative products to
commercialization rapidly and with 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 while seeking to further expand its
pipeline through relationships with its network of clinician
innovators at leading academic centers. PAVmed’s diversified
product pipeline addresses unmet clinical needs encompassing a
broad spectrum of clinical areas with attractive regulatory
pathways and market opportunities. Its four operating divisions
include GI Health (EsoGuard™ Esophageal DNA Test, EsoCheck™
Esophageal Cell Collection Device, and EsoCure™ Esophageal Ablation
Device with Caldus™ Technology), Minimally Invasive Interventions
(CarpX™ Minimally Invasive Device for Carpal Tunnel Syndrome),
Infusion Therapy (PortIO™ Implantable Intraosseus Vascular Access
Device and NextFlo™ Highly Accurate Infusion Platform Technology),
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.
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, 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
Reports 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
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