What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2025-11-12 compared with 2025-08-12 · 229 added, 202 removed, 205 unchanged (68% of the section changed)

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factors that may affect our actual results include:

limited operating history;

financial performance, including our ability to generate revenue;

ability to obtain regulatory approval for the commercialization of our products;

risk that the FDA will cease to exercise enforcement discretion with respect to LDTs, like

ability of our products to achieve market acceptance;

success in retaining or recruiting, or changes required in, our officers, key employees or

potential ability to obtain additional financing when and if needed;

ability to protect our intellectual property;

ability to complete strategic acquisitions;

ability to manage growth and integrate acquired operations;

potential liquidity and trading of our securities;

regulatory and operational risks;

● cybersecurity

related to the COVID-19 pandemic and other health-related emergencies;

related to our relationship with PAVmed;

estimates regarding expenses, future revenue, capital requirements and needs for additional

our limited operating history;

our financial performance, including our ability to generate

our ability to obtain regulatory approval for the commercialization

of our products;

the ability of our products to achieve market acceptance;

our success in retaining or recruiting, or changes required

in, our officers, key employees or directors;

our potential ability to obtain additional financing when and

our ability to protect our intellectual property;

our ability to complete strategic acquisitions;

our ability to manage growth and integrate acquired operations;

the potential liquidity and trading of our securities;

our regulatory and operational risks;

cybersecurity risks;

risks related to health-related

risks related to our relationship with PAVmed;

our estimates regarding expenses, future revenue, capital requirements

and needs for additional financing.

addition, our forward-looking statements do not reflect the potential impact of any future financings, acquisitions, mergers, dispositions,

joint ventures or investments we may make.

may not actually achieve the results, plans and/or objectives disclosed in our forward-looking statements, and the intended or

expected results, developments and/or other events disclosed in our forward-looking statements may not actually occur, and

accordingly you should not place undue reliance on our forward-looking statements.

You should read this Quarterly Report on Form

10-Q and the documents we have filed as exhibits to this Form 10-Q and the Form 10-K completely and with the understanding our

actual future results may be materially different from what we expect.

We do not assume any obligation to update any forward-looking

statements, whether as a result of new information, future events or otherwise, except as required by applicable law.

may not actually achieve the results, plans and/or objectives disclosed in our forward-looking statements, and the intended or expected

results, developments and/or other events disclosed in our forward-looking statements may not actually occur, and accordingly you should

not place undue reliance on our forward-looking statements.

You should read this Quarterly Report on Form 10-Q and the documents we have

filed as exhibits to this Form 10-Q and the Form 10-K completely and with the understanding our actual future results may be materially

different from what we expect.

We do not assume any obligation to update any forward-looking statements, whether as a result of new information,

future events or otherwise, except as required by applicable law.

are a commercial-stage, cancer prevention medical diagnostics technology company focused on the millions of patients who are at risk

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diagnostic test .

is an FDA 510(k) and CE Mark cleared noninvasive swallowable balloon capsule catheter device capable of sampling surface esophageal

cells in a less than two minute office procedure.

It consists of a vitamin pill-sized rigid plastic capsule tethered to a thin

silicone catheter from which a soft silicone balloon with textured ridges emerges to gently swab surface esophageal cells.

vacuum suction is applied, the balloon and sampled cells are pulled into the capsule, protecting them from contamination and

dilution by cells outside of the targeted region during device withdrawal.

We believe this proprietary Collect+Protect™

technology makes EsoCheck the only noninvasive esophageal cell collection device capable of such anatomically targeted and protected

is an FDA 510(k) and CE Mark cleared noninvasive swallowable balloon capsule catheter device capable of sampling surface esophageal cells

in a less than two minute office procedure.

It consists of a vitamin pill-sized rigid plastic capsule tethered to a thin silicone catheter

from which a soft silicone balloon with textured ridges emerges to gently swab surface esophageal cells.

When vacuum suction is applied,

the balloon and sampled cells are pulled into the capsule, protecting them from contamination and dilution by cells outside of the targeted

region during device withdrawal.

We believe this proprietary Collect+Protect™ technology makes EsoCheck the only noninvasive esophageal

cell collection device capable of such anatomically targeted and protected sampling.

and EsoCheck are based on patented technology licensed by Lucid from Case Western Reserve University (“CWRU”).

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November 2024, we submitted to MolDx our complete clinical evidence package in support of a request for reconsideration of the non-coverage

language in the LCD to secure Medicare coverage for EsoGuard.

language in the local coverage determination, or “LCD,” to secure Medicare coverage for EsoGuard.

The EsoGuard clinical evidence package included six new peer-reviewed publications:

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validation study.

The current LCD provides clear coverage criteria consistent with the American College of Gastroenterology (ACG) guidelines

The current LCD provides clear coverage criteria consistent with the American College of Gastroenterology, or “ACG,” guidelines

for esophageal precancer testing.

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the LCD to secure Medicare coverage for EsoGuard.

part of the LCD reconsideration process, MolDX-participating Medicare Administrative Contractors are scheduled to convene a Contractor

Advisory Committee (CAC) Meeting regarding the LCD on September 4, 2025.

part of the LCD reconsideration process, MolDx-participating Medicare Administrative Contractors convened a Contractor

Advisory Committee, or “CAC,” Meeting regarding the LCD on September 4, 2025.

At the meeting, eleven experts, including physicians across multiple specialties (GI, primary care, pathology), major

society guideline co-authors (ACG, AGA (as defined below)) and industry leaders (American Foregut Society, American Society for Gastrointestinal

Endoscopy), participated in this extensive discussion of the unmet clinical need with respect to early detection of esophageal precancer

and the strength of the EsoGuard clinical validity and clinical utility data.

Board Appointment

September 22, 2025, the board of directors of the Company appointed John R.

Palumbo as a Class B director of the Company.

Palumbo was designated for appointment by certain of the holders of 2024 Convertible Notes.

Study Publications

In April 2025, the Company’s

fifth peer-reviewed clinical utility manuscript, “ Enhancing the Diagnostic Yield of EGD for Diagnosis of Barrett’s Esophagus

Through Methylated DNA Biomarker Triage ,” was published in Gastroenterology & Hepatology .

This manuscript presents

clinical utility data from the ENVET-BE study, which is the second to assess the clinical utility of EsoGuard in a real-world screening

The ENVET-BE study analyzed 209 EsoGuard-positive patients who underwent biomarker triage and confirmatory EGD in the 2023

calendar year, to test the hypothesis that EGDs performed on patients who first triage positive on EsoGuard have higher diagnostic yield

than screening EGDs alone.

The yield of screening EGDs was estimated by literature-established disease prevalence (10.6%).

increase in BE detection compared with the performance goal was observed for the full study population.

In the cohort meeting American

College of Gastroenterology (ACG) criteria for BE screening, the diagnostic yield was increased by 2.7-fold.

On August 1, 2025, the American

Journal of Gastroenterology e-published (ahead of printing) the manuscript “Nonendoscopic Detection of Barrett’s Esophagus

in Patients Without GERD Symptoms.” This investigator-initiated pilot study evaluated EsoGuard in 120 patients without GERD

symptoms, but who met American Gastroenterological Association (AGA) BE screening criteria.

Of 34 EsoGuard-positive patients, 27 underwent

EGD, confirming BE in 9 cases (PPV:

April 2025, the Company’s fifth peer-reviewed clinical utility manuscript, “ Enhancing the Diagnostic Yield of EGD for

Diagnosis of Barrett’s Esophagus Through Methylated DNA Biomarker Triage ,” was published in Gastroenterology &

This manuscript presents clinical utility data from the ENVET-BE study, which is the second to assess the clinical utility

of EsoGuard in a real-world screening population.

The ENVET-BE study analyzed 209 EsoGuard-positive patients who underwent biomarker

triage and confirmatory EGD in the 2023 calendar year, to test the hypothesis that EGDs performed on patients who first triage positive

on EsoGuard have higher diagnostic yield than screening EGDs alone.

The yield of screening EGDs was estimated by literature-established

disease prevalence (10.6%).

A 2.4-fold increase in BE detection compared with the performance goal was observed for the full study population.

In the cohort meeting American College of Gastroenterology (ACG) criteria for BE screening, the diagnostic yield was increased by 2.7-fold.

August 1, 2025, the American Journal of Gastroenterology e-published the manuscript “Nonendoscopic Detection of Barrett’s

Esophagus in Patients Without GERD Symptoms.” This investigator-initiated pilot study evaluated EsoGuard in 120 patients without

GERD symptoms, but who met American Gastroenterological Association (AGA) BE screening criteria.

Of 34 EsoGuard-positive patients, 27

underwent EGD, confirming BE in 9 cases (PPV:

Of 86 EsoGuard-negative patients, 22 volunteered for EGD, with zero BE cases (NPV:

is the first study to assess EsoGuard in this expanded risk group and informed the design of a larger, ongoing NIH R01-funded study.

May 30, 2025, the Company entered into an “at-the-market offering” (“ATM”) for up to $25.0 million of its common

stock that may be offered and sold under a Controlled Equity Offering Agreement between the Company and Maxim Group LLC.

This is the first study to assess EsoGuard in this expanded risk group and informed the design of a larger, ongoing NIH R01-funded

Developments - continued

2025 Confidentially Marketed Public Offering

September 11, 2025, the Company closed on the sale of 28,750,000 shares of its common stock at a price of $1.00 per share (the “September

2025 Offering”).

The net proceeds of the September 2025 Offering, after deducting the estimated placement agent’s fees and

other expenses of $1.8 million, was approximately $27.0 million.

The Company intends to use the net proceeds from the September 2025

Offering for working capital and other general corporate purposes.

2025 Confidentially Marketed Public Offering

April 11, 2025, the Company closed on the sale of 14,375,000 shares of its common stock at a price of $1.20 per share (the “April

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The Company intends to use the net proceeds from the Offering for working capital and other general corporate

Russell 2000® and 3000® Indexes

On June 27, 2025, the Company was added to the

Russell 2000® Index and the Russell 3000® Index, following the 2025 annual reconstitution by FTSE Russell.

Hoag Comprehensive Esophageal Precancer Testing

Program Using EsoGuard

On June 18, 2025, the Company announced that

Hoag, a nationally recognized regional healthcare delivery network, launched a comprehensive, integrated esophageal precancer testing

program using the Company’s EsoGuard® Esophageal DNA Test.

The Company will partner with Hoag to offer EsoGuard testing across

its digestive health, primary care, and concierge medicine programs.

On May 30, 2025, the Company

entered into an “at-the-market offering” (“ATM”) for up to $25.0 million of its common stock that may be offered

and sold under a Controlled Equity Offering Agreement between the Company and Maxim Group LLC.

2000® and 3000® Indexes

June 27, 2025, the Company was added to the Russell 2000® Index and the Russell 3000® Index, following the 2025 annual reconstitution

by FTSE Russell.

Comprehensive Esophageal Precancer Testing Program Using EsoGuard

June 18, 2025, the Company announced that Hoag, a nationally recognized regional healthcare delivery network, launched a comprehensive,

integrated esophageal precancer testing program using the Company’s EsoGuard® Esophageal DNA Test.

The Company will partner

with Hoag to offer EsoGuard testing across its digestive health, primary care, and concierge medicine programs.

Clinical Practice Guidelines Update

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Reimbursement Approval

March 13, 2025, the Company announced that Highmark Blue Cross Blue Shield, an independent licensee of the Blue Cross and Blue

Shield Association, has issued a positive coverage policy for non-invasive screening of esophageal precancer and cancer in New York

The new policy, which became effective as of May 26, 2025, covers EsoGuard in patients who meet established criteria for

esophageal precancer testing consistent with professional society guidelines.

March 13, 2025, the Company announced that Highmark Blue Cross Blue Shield, an independent licensee of the Blue Cross and Blue Shield

Association, has issued a positive coverage policy for non-invasive screening of esophageal precancer and cancer in New York state.

new policy, which became effective as of May 26, 2025, covers EsoGuard in patients who meet established criteria for esophageal precancer

testing consistent with professional society guidelines.

NIH Grant Related to EsoGuard and EsoCheck

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disease (GERD).

The study, “A Clinical Trial of Cancer Prevention by Biomarker Based Detections of Barrett’s Esophagus and Its

Progression,” aims to evaluate the effectiveness of EsoCheck and EsoGuard in detecting esophageal precancer (Barrett’s Esophagus

or BE) to prevent esophageal cancer (EAC) within a non-GERD at-risk population.

To accomplish this aim, 800 patients without GERD symptoms

who meet the American Gastroenterological Association’s (AGA) risk criteria for screening will be recruited across five participating

research centers:

University Hospitals, University of Colorado, Johns Hopkins University, University of North Carolina, and Cleveland

The study, “A Clinical Trial of Cancer Prevention by Biomarker Based Detections of Barrett’s Esophagus and

Its Progression,” aims to evaluate the effectiveness of EsoCheck and EsoGuard in detecting esophageal precancer (Barrett’s

Esophagus or BE) to prevent esophageal cancer (EAC) within a non-GERD at-risk population.

To accomplish this aim, 800 patients without

GERD symptoms who meet the American Gastroenterological Association’s (AGA) risk criteria for screening will be recruited across

five participating research centers:

University Hospitals, University of Colorado, Johns Hopkins University, University of North Carolina,

and Cleveland Clinic.

of Operations

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and administrative expenses

and administrative expenses consist primarily of professional fees for accounting, tax, audit and legal services (including those

fees incurred as a result of our being a public company), consulting fees, employees costs involved in third-party payor

reimbursement contract negotiations and consulting fees, expenses associated with obtaining and maintaining patents within our

intellectual property portfolio, and certain employee costs, along with the portion of the MSA Fee allocated to general and

administrative expenses.

and administrative expenses consist primarily of professional fees for accounting, tax, audit and legal services (including those fees

incurred as a result of our being a public company), consulting fees, employees costs involved in third-party payor reimbursement, expenses associated with obtaining and maintaining patents within our intellectual property portfolio,

and certain employee costs, along with the portion of the MSA Fee allocated to general and administrative expenses.

anticipate our general and administrative expenses will increase in the future to the extent our business operations grow.

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for the development of our technologies and conducting clinical trials, including:

associated with submission of regulatory filings;

of laboratory supplies and acquiring, developing, and manufacturing preclinical prototypes;

portion of the MSA Fee allocated to research and development.

costs associated with submission of regulatory filings;

cost of laboratory supplies and acquiring, developing, and

manufacturing preclinical prototypes;

the portion of the MSA Fee allocated to research and development.

plan to incur research and development expenses for the foreseeable future as we continue the development of our existing products as

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of Operations - continued

three months ended June 30, 2025 as compared to the three months ended June 30, 2024

the three months ended June 30, 2025, revenue was $1.2 million as compared to $1.0 million for the corresponding period in the prior

The $0.2 million increase principally relates to the increase in the consideration received for the performance of the EsoGuard

Esophageal DNA Tests.

the three months ended June 30, 2025, the cost of revenue remained relatively level at approximately $1.6 million, as compared to the corresponding

period in the prior year.

three months ended September 30, 2025 as compared to the three months ended September 30, 2024

the three months ended September 30, 2025, revenue remained relatively level at $1.2 million as compared to the corresponding period

in the prior year.

the three months ended September 30, 2025, the cost of revenue remained relatively level at approximately $1.7 million, as compared to

the corresponding period in the prior year.

and marketing expenses

the three months ended June 30, 2025, sales and marketing costs were approximately $4.0 million as compared to $4.2 million for the

corresponding period in the prior year.

The net decrease of $0.2 million was principally related to a decrease in compensation

and administrative expenses

the three months ended June 30, 2025, general and administrative costs were approximately $5.6 million as compared to $4.9 million for

the three months ended September 30, 2025, sales and marketing costs were approximately $4.3 million as compared to $4.1 million for

the corresponding period in the prior year.

The net increase of $0.2 million was principally related to an increase in third-party professional

services and consulting costs.

and administrative expenses

the three months ended September 30, 2025, general and administrative costs were approximately $5.6 million as compared to $5.4 million

for the corresponding period in the prior year.

The net increase of $0.2 million was principally related to:

● approximately

$0.4 million increase related to the amended MSA with PAVmed due to the growth and expansion

of our business and the services incurred through PAVmed;

● approximately

$0.3 million increase in stock-based compensation related costs.

approximately $0.6 million increase related to third-party

professional fees, primarily due to financing related costs;

approximately $0.2 million decrease in compensation costs;

approximately $0.2 million decrease in professional services

and consulting costs.

and development expenses

the three months ended June 30, 2025, research and development costs were approximately $1.3 million, compared to $1.4 million for

the three months ended September 30, 2025, research and development costs were approximately $1.3 million, compared to $1.7 million for

the corresponding period in the prior year.

The net decrease of $0.1 million was principally related to a decrease in development

costs, particularly in clinical trial activities and outside professional and consulting fees.

The net decrease of $0.4 million was principally related to a decrease in development costs,

particularly in clinical trial activities and outside professional and consulting fees.

of Acquired Intangible Assets

the three months ended June 30, 2025, the amortization of acquired intangible assets remained relatively level at approximately $0.1 million, as compared to the corresponding period in the prior year.

the three months ended September 30, 2025, the amortization of acquired intangible assets remained relatively level at approximately

$0.1 million, as compared to the corresponding period in the prior year.

Income and Expense

in fair value of convertible debt

the three months ended June 30, 2025, the change in the fair value of our convertible notes was approximately $6.8 million of income,

related to the 2024 Senior Convertible Notes (as defined in Note 10, Debt , to our accompanying unaudited condensed consolidated

financial statements).

The 2024 Senior Convertible Notes was initially measured at the notes’ issue-date estimated fair value and

is subsequently remeasured at estimated fair value as of each reporting period date.

the three months ended September 30, 2025, the sequential decrease in the fair value of our convertible notes of approximately $2.3

million is reflected as other income in the Statement of Operations, (see Note 10, Debt , to our accompanying unaudited

condensed consolidated financial statements).

The 2024 Convertible Notes were initially measured at the issue-date estimated fair

value and are subsequently remeasured at estimated fair value as of each reporting period end date.

of Operations - continued

three months ended June 30, 2025 as compared to three months ended June 30, 2024 - continued

three months ended September 30, 2025 as compared to three months ended September 30, 2024 - continued

on Debt Extinguishment

The Company did not incur debt extinguishment

loss in the three months ended June 30, 2025.

the three months ended June 30, 2024, a debt extinguishment loss in the aggregate of approximately $0.5 million was recognized in connection

with our March 2023 Senior Convertible Note as discussed below.

the three months ended June 30, 2024, approximately $1.1 million of principal repayments

along with approximately $0.2 million of interest expense thereon, were settled through the

issuance of 2,117,883 shares of common stock of the Company, with such shares having a fair

value of approximately $1.9 million (with such fair value measured as the quoted closing

price of the common stock of the Company on the respective conversion date).

The conversions

resulted in a debt extinguishment loss of $0.5 million in the three months ended June 30,

Company did not incur debt extinguishment loss in the three months ended September 30, 2025.

the three months ended September 30, 2024, a debt extinguishment loss in the aggregate of approximately $0.4 million was recognized in

connection with our March 2023 Senior Convertible Note as discussed below.

In the three months ended September 30, 2024, approximately

$1.1 million of principal repayments along with approximately $0.2 million of interest expense thereon, were settled through the issuance

of 2,116,717 shares of common stock of the Company, with such shares having a fair value of approximately $1.8 million (with such fair

value measured as the quoted closing price of the common stock of the Company on the respective conversion date).

The conversions resulted

in a debt extinguishment loss of $0.4 million in the three months ended September 30, 2024.

Note 10 , Debt , to our accompanying unaudited condensed consolidated financial statements, for additional information with respect

to the 2024 Senior Convertible Notes.

six months ended June 30, 2025 as compared to six months ended June 30, 2024

the six months ended June 30, 2025, revenue remained relatively level at $2.0 million, as compared to the corresponding period in the

the six months ended June 30, 2025, the cost of revenue was approximately $3.1 million as compared to $3.3 million for the corresponding

to the 2024 Convertible Notes.

nine months ended September 30, 2025 as compared to nine months ended September 30, 2024

the nine months ended September 30, 2025, revenue was $3.2 million, as compared to $3.1 million for the corresponding period in the prior

The $0.1 million increase principally relates to the increase in the consideration received for the performance of the EsoGuard

Esophageal DNA Tests.

the nine months ended September 30, 2025, the cost of revenue was approximately $4.8 million as compared to $5.0 million for the corresponding

period in the prior year.

The net decrease of $0.2 million was principally related to:

● approximately

$0.4 million decrease in the manufacturing costs associated with the EsoCheck devices and

EsoGuard Esophageal DNA Tests;

● approximately

$0.2 million increase in compensation related costs.

approximately $0.4 million decrease in the manufacturing costs

associated with the EsoCheck devices and EsoGuard Esophageal DNA Tests;

approximately $0.2 million increase in compensation related

and marketing expenses

the six months ended June 30, 2025, sales and marketing costs were approximately $8.1 million as compared to $8.4 million for the corresponding

period in the prior year.

the nine months ended September 30, 2025, sales and marketing costs were approximately $12.4 million as compared to $12.5 million for

the corresponding period in the prior year.

The net decrease of $0.1 million was principally related to:

● approximately

$0.2 million decrease in stock-based compensation;

● approximately

$0.1 million decrease related to third-party facility related expenses.

approximately $0.4 million increase in third-party professional

services and consulting costs;

approximately $0.3 million decrease in stock-based compensation;

approximately $0.2 million decrease related to third-party facility related expense.

and administrative expenses

the six months ended June 30, 2025, general and administrative costs were approximately $11.8 million as compared to $8.9 million for

the corresponding period in the prior year.

the nine months ended September 30, 2025, general and administrative costs were approximately $17.4 million as compared to $14.3 million

for the corresponding period in the prior year.

The net increase of $3.1 million was principally related to:

● approximately

$1.6 million increase related to third-party professional fees, primarily due to financing related costs;

● approximately

$0.9 million increase related to the amended MSA with PAVmed due to the growth and expansion

of our business and the services incurred through PAVmed;

● approximately

$0.4 million increase in stock-based compensation costs.

approximately $2.2 million increase related to third-party

professional fees, primarily due to financing related costs;

approximately $0.9 million increase related to the amended

MSA with PAVmed due to the growth and expansion of our business and the services incurred through PAVmed.

and development expenses

the six months ended June 30, 2025, research and development costs were approximately $2.7 million, compared to $2.9 million for the

corresponding period in the prior year.

the nine months ended September 30, 2025, research and development costs were approximately $4.0 million, compared to $4.5 million for

the corresponding period in the prior year.

The net decrease of $0.5 million was principally related to:

● approximately

$0.3 million increase related to the amended MSA with PAVmed due to the growth and expansion

of our business and the services incurred through PAVmed;

● approximately

$0.3 million decrease in development costs, particularly in clinical trial activities;

● approximately

$0.2 million decrease in stock-based compensation.

approximately $0.7 million decrease in development costs, particularly

in clinical trial activities;

approximately $0.3 million increase related to the amended

MSA with PAVmed due to the growth and expansion of our business and the services incurred through PAVmed;

approximately $0.1 million decrease in stock-based compensation.

of Operations - continued

six months ended June 30, 2025 as compared to six months ended June 30, 2024 - continued

nine months ended September 30, 2025 as compared to nine months ended September 30, 2024 - continued

of Acquired Intangible Assets

amortization of acquired intangible assets was approximately $0.2 million in the six months ended June 30, 2025, as compared to $0.5

amortization of acquired intangible assets was approximately $0.3 million in the nine months ended September 30, 2025, as compared to

$0.6 million for the corresponding period in the prior year.

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in fair value of convertible debt

the six months ended June 30, 2025 and 2024, the change in the fair value of our convertible note was approximately $7.6 million of expense

and $0.9 million of income, respectively, related to the 2024 Convertible Notes and the March 2023 Senior Convertible Note (as defined

in Note 10 , Debt , to our accompanying unaudited condensed consolidated financial statements).

The 2024 Convertible Notes and March

2023 Senior Convertible Note were initially measured at their respective issue date estimated fair value and subsequently remeasured at estimated

fair value as of each reporting period date.

The Company initially recognized a $0.8 million fair value remeasurement as a non-cash expense

on the issue date.

the nine months ended September 30, 2025 and 2024, the change in the fair value of our convertible note was approximately $5.3 million

of expense and $0.6 million of income, respectively, related to the 2024 Convertible Notes and the March 2023 Senior Convertible Note

(as defined in Note 10 , Debt , to our accompanying unaudited condensed consolidated financial statements).

The 2024 Convertible

Notes and March 2023 Senior Convertible Note were initially measured at their respective issue date estimated fair value and subsequently

remeasured at estimated fair value as of each reporting period date.

on Debt Extinguishment

The Company did not incur debt

extinguishment loss in the six months ended June 30, 2025.

the six months ended June 30, 2024, a debt extinguishment loss in the aggregate of approximately $0.7 million was recognized in connection

with our March 2023 Senior Convertible Note as discussed below.

the six months ended June 30, 2024, approximately $1.2 million of principal repayments along with approximately $0.7 million of interest

expense thereon, were settled through the issuance of 2,661,181 shares of common stock of the Company, with such shares having a fair value

of approximately $2.5 million (with such fair value measured as the quoted closing price of the common stock of the Company on the respective

conversion date).

The conversions resulted in a debt extinguishment loss of $0.7 million in the six months ended June 30, 2024.

Company did not incur debt extinguishment loss in the nine months ended September 30, 2025.

the nine months ended September 30, 2024, a debt extinguishment loss in the aggregate of approximately $1.1 million was recognized in

connection with our March 2023 Senior Convertible Note as discussed below.

In the nine months ended September 30, 2024, approximately

$2.4 million of principal repayments along with approximately $0.8 million of interest expense thereon, were settled through the issuance

of 4,777,898 shares of common stock of the Company, with such shares having a fair value of approximately $4.3 million (with such fair

value measured as the quoted closing price of the common stock of the Company on the respective conversion date).

The conversions resulted

in a debt extinguishment loss of $1.1 million in the nine months ended September 30, 2024.

Note 10 , Debt , to our accompanying unaudited condensed consolidated financial statements, for additional information with respect

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sheet on March 13, 2024, with such deemed dividend included as a component of net loss attributable to common stockholders, summarized

Series B Convertible Preferred Stock Issuance and Series A/A-1 Exchange Offer ($ in

March 13, 2024

Series B Convertible Preferred Stock Issuance and Series A/A-1 Exchange Offer ($ in thousands)

Nine Months Ended September 30, 2024

Fair Value - 31,790 shares of Series B Preferred Stock issued in exchange for Series A and Series A-1 Preferred Stock

16 unchanged sentences

expanding insurance reimbursement coverage.

There are no assurances, however, we will be able to obtain an adequate level of financial resources required

for the long-term commercialization and development of our products and services.

There are no assurances, however, we will be able to obtain an adequate level of financial

resources required for the long-term commercialization and development of our products and services.

are subject to all of the risks and uncertainties typically faced by medical device and diagnostic companies that devote substantially

all of their efforts to the commercialization of their initial products and services.

We experienced a net loss of approximately $31.3 million and used approximately $23.0 million of cash

in operations during the six months ended June 30, 2025.

Financing activities provided $31.9 million of cash during the six months ended June

We ended the quarter with cash on-hand of $31.1 million as of June 30, 2025.

We expect to continue to experience recurring

losses and negative cash flow from operations, and will continue to fund our operations with debt and/or equity financing transactions,

which in accordance with management’s plans may include conversions of our existing debt to equity and refinancing our existing

debt obligations to extend the maturity date.

The Company’s ability to continue operations 12 months beyond the issuance of the

financial statements will depend upon generating substantial revenue that is conditioned on obtaining positive third-party reimbursement

coverage for its EsoGuard Esophageal DNA Test from both government and private health insurance providers, increasing revenue through

contracting directly with self-insured employers, and upon raising additional capital through various potential sources including equity

and/or debt financings or refinancing existing debt obligations.

These factors raise substantial doubt about the Company’s ability

to continue as a going concern within one year after the date the accompanying unaudited condensed consolidated financial statements

and Capital Resources - continued

We experienced a net loss of approximately $41.7

million and used approximately $33.9 million of cash in operations during the nine months ended September 30, 2025.

Financing activities

provided $59.0 million of cash during the nine months ended September 30, 2025.

We ended the quarter with cash on-hand of $47.3 million

as of September 30, 2025.

We expect to continue to experience recurring losses and negative cash flow from operations, and will continue

to fund our operations with debt and/or equity financing transactions, which in accordance with management’s plans may include

conversions of our existing debt to equity and refinancing our existing debt obligations to extend the maturity date.

The Company’s

ability to continue operations 12 months beyond the issuance of the financial statements will depend upon generating substantial revenue

that is conditioned on obtaining positive third-party reimbursement coverage for its EsoGuard Esophageal DNA Test from both government

and private health insurance providers, increasing revenue through contracting directly with self-insured employers, and upon raising

additional capital through various potential sources including equity and/or debt financings or refinancing existing debt obligations.

These factors raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date

the accompanying unaudited condensed consolidated financial statements are issued.

2025 Registered Direct Offering

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working capital and other general corporate purposes.

On May 30, 2025, the

Company entered into an “at-the-market offering” (“ATM”) for up to $25.0 million of its common stock that

may be offered and sold under a Controlled Equity Offering Agreement between the Company and Maxim Group LLC.

In the six months

ended June 30, 2025, the Company sold 215,421 shares through its at-the-market equity facility for net proceeds of

approximately $0.3 million, after payment of 3% commissions.

2025 Confidentially Marketed Public Offering

September 11, 2025, the Company closed on the sale of 28,750,000 shares of its common stock at a price of $1.00 per share (the “September

2025 Offering”).

The net proceeds of the September 2025 Offering, after deducting the estimated placement agent’s fees and

other expenses of $1.8 million, was approximately $27.0 million.

The Company intends to use the net proceeds from the September 2025

Offering for working capital and other general corporate purposes.

May 30, 2025, the Company entered into an “at-the-market offering” (“ATM”) for up to $25.0 million of its common

stock that may be offered and sold under a Controlled Equity Offering Agreement between the Company and Maxim Group LLC.

months ended September 30, 2025, the Company sold 215,421 shares through its at-the-market equity facility for net proceeds of approximately

$0.3 million, after payment of 3% commissions.

November 22, 2024, the Company closed on the sale of $21.975 million in principal amount of 2024 Convertible Notes.

Each 2024 Convertible

Note has a 12.0% annual stated interest rate, a contractual maturity date of five years from the date of issuance, and a contractual

conversion price of $1.00 per share of the Company’s common stock (subject to adjustment in certain circumstances).

Under the 2024

Convertible Notes, the Company is subject to certain customary affirmative and negative covenants, including certain financial covenants.

The Company was in compliance with all covenants as of September 30, 2025.

See Note 10, Debt , for more information.

Fee Obligation

Company’s daily operations are also managed in part by personnel employed by PAVmed, for which the Company incurs the MSA Fee.

The MSA Fee is charged on a monthly basis and is subject to periodic adjustment corresponding with changes in the services provided

by PAVmed personnel to the Company.

Currently, the MSA Fee is $1.05 million per month.

See Note 5, Related Party

Transactions , for more information.

Accounting Estimates

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There have been no material changes to our critical

accounting estimates in the six months ended June 30, 2025.

accounting estimates in the nine months ended September 30, 2025.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis