PAVmed Inc. Q2 FY2024 earnings call

Management Statement and Operational Highlights

• Lucid Progress: Test volume growth, positive meeting with MolDX, and successful #CheckYourFoodTube event as key highlights.
• Veris Health Initiatives: Pilot program with Ohio State showing positive results, close to securing financing, and plan to relaunch implantable monitor development.
• PMX Incubator Focus: Active capital raising for PortIO, leveraging its first in-human study and clear FDA path.
• Corporate Structure: Utilizes shared services model with subsidiaries (Lucid, Veris, PMX) each seeking independent financing to enhance long-term stability.

Segment Performance

• Lucid Diagnostics: Second quarter EsoGuard revenue was flat, but test volume increased approximately 31% quarter-on-quarter and 44% year-on-year, marking a record quarter. Had a productive meeting with CMS Medicare Contractor MolDX program. Held first large #CheckYourFoodTube event with upfront contracted payments.
• Veris Health: Focused on pilot program with the Ohio State James Cancer Center, with ~26 patients onboarded to-date and first patient success story. Close to securing an independent financing round and preparing to relaunch development of implantable monitoring once financing is secured.
• PMX Incubator: Focused on raising capital for PortIO, which is a direct long-term access to the bone marrow with a clear path to FDA clearance. Completed first in-human study and actively seeking financing to fund PortIO's IDE study and second generation version.

Guidance

• Lucid: Revenue ramp dependent on reimbursement landscape improvement for EsoGuard, direct contracting efforts with employers also important.
• Veris Health: Expect first tranche of financing for Veris to close soon, plan to relaunch implantable monitor development, targeting mid-2025 for FDA submission of the implantable monitor.
• PMX Incubator: Actively raising capital for PortIO to fund IDE study and second generation version, targeting mid-2025 for FDA submission of PortIO.

Risks

• Reimbursement Uncertainty: Fluctuations in government and private health insurer reimbursement for EsoGuard can impact revenue recognition.
• Financing Dependence: Difficulty in securing financing for subsidiaries (Veris, PMX) could slow progress of their respective initiatives.
• Regulatory Hurdles: Delays or issues in FDA clearance for products like the implantable monitor and PortIO may delay commercialization.

Question and Answer

Q: Provide more color in terms of the scale of the pilot launch, and timeline to full launch and when we should start to see revenue coming from Veris Health A: The pilot is on pace, expected to wrap up in several months. Upon pilot success, will transition to full commercial engagement and seek strategic partnerships, with revenue expected to follow from these engagements Q: Walk us through your pipeline of additional contracts and any conversations you guys are having right now with large centers A: Have a pipeline of about a dozen large centers with active conversations, expecting to accelerate these after the pilot's completion Q: Turning to the implantable monitor, pending additional financing, have you guys provided longer-term guidance on when you expect to submit the monitor for approval? And I guess the steps that you guys need to take to get there A: Target mid-2025 for FDA submission. Have had multiple FDA meetings, preclinical studies at FDA's request, and if financing is secured soon, will relaunch development with a predictable path to clearance Q: Have you seen valuations change significantly in terms of when you're going out trying to raise funding for the incubator as well as for Veris Health A: Valuations vary by asset. Veris is further along, but PortIO has been advanced, and we've been pleasantly surprised by the interest and valuations we believe we can close transactions at