What changed in this filing

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Item 1. Business

2026-03-27 compared with 2025-03-24 · 441 added, 1198 removed, 30 unchanged (98% of the section changed)

Unless the context otherwise requires, “we”,

“us”, and “our”, the “Company” and “PAVmed” refer to PAVmed Inc.

and its subsidiaries,

including its subsidiary Lucid Diagnostics Inc.

(Nasdaq:LUCD) (“Lucid Diagnostics” or “Lucid”) and its majority-owned

subsidiary Veris Health Inc.

Unless the context otherwise requires, “ we ” , “ us ” , and “ our ” , the “ Company ” and “ PAVmed ” refer to PAVmed Inc.

and its subsidiaries, including its subsidiary Lucid Diagnostics Inc.

(Nasdaq:LUCD) ( “ Lucid Diagnostics ” or “ Lucid ” ) and its majority-owned subsidiary Veris Health Inc.

( “ Veris Health ” or “ Veris ” ).

is structured to be a multi-product life sciences company organized to advance a pipeline of innovative healthcare technologies.

by a team of highly skilled personnel with a track record of bringing innovative products to market, PAVmed is focused on innovating,

developing, acquiring, and commercializing novel products that target unmet medical needs with large addressable market opportunities.

Leveraging our corporate structure—a parent company that will establish distinct subsidiaries for each financed asset—we

have the flexibility to raise capital at the PAVmed level to fund product development, or to structure financing directly into each subsidiary

in a manner tailored to the applicable product.

current focus is multi-fold.

We continue to support the commercial expansion and execution of EsoGuard, which is the flagship

product of our subsidiary Lucid Diagnostics, of which we remain the shareholder with the largest voting interest.

through a separate majority-owned subsidiary, Veris Health, we offer the Veris Cancer Care Platform.

We are focused in the immediate

term on entering into strategic partnership opportunities with leading academic oncology systems to expand access to the Veris

Cancer Care Platform, while concurrently developing an implantable physiological monitor, designed to be implanted alongside a

chemotherapy port, which will interface with the Veris Cancer Care Platform.

In terms of other existing products and technologies,

we have adopted an incubator-type platform where we are looking to obtain financing on a product-by-product basis as necessary to

advance each asset to a meaningful inflection point along its path to commercialization.

Finally, as resources permit, we will

continue to explore external innovations that fulfill our project selection criteria without limiting ourselves to any target

sector, specialty or condition.

believe that Lucid’s flagship product, the EsoGuard Esophageal DNA Test, performed on samples collected with the EsoCheck Esophageal

Cell Collection Device, constitutes the first and only commercially available diagnostic test capable of serving as a widespread testing

tool with the goal of preventing esophageal adenocarcinoma (“EAC”) deaths, through early detection of esophageal precancer

in at-risk gastroesophageal reflux disease (“GERD,” also commonly known as chronic heartburn, acid reflux or simply reflux)

is a bisulfite-converted next-generation sequencing (NGS) DNA assay performed on surface esophageal cells collected with EsoCheck.

quantifies methylation at 31 sites on two genes, Vimentin (VIM) and Cyclin A1 (CCNA1).

The assay was evaluated in a 408-patient multicenter

case-control study published in Science Translational Medicine and showed greater than 90% sensitivity and specificity at detecting esophageal

precancer and all conditions along the BE-EAC spectrum, including on samples collected with EsoCheck (Moinova, et al.

Sci Transl Med.

2018 Jan 17;10(424):

EsoGuard is commercially available in the U.S.

as a Laboratory Developed Test (LDT) performed at our

CLIA-certified laboratory.

Cell samples, including those collected with EsoCheck, as discussed below, are sent to our laboratory for

testing and analyses using our proprietary EsoGuard NGS DNA assay.

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 five-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”).

EsoCheck have been developed to provide accurate, non-invasive, patient-friendly testing for the early detection of EAC and Barrett’s

Esophagus (“BE”), including dysplastic BE and related pre-cursors to EAC in patients with chronic GERD.

2024, approximately 22,000 U.S.

GERD patients are projected to be diagnosed with EAC and approximately 16,000 will die from it.

80% of EAC patients will die within five years of diagnosis, making it the second most lethal cancer in the U.S.

EAC has increased 500% over the past four decades, while the incidences of other common cancers have declined or remained flat.

all cases, EAC silently progresses until it manifests itself with new symptoms of advanced disease.

EAC is nearly always invasive at

diagnosis, and, unlike other common cancers, mortality rates are high even in its earlier stages.

discussed below under the heading “Clinical Guidelines for At-Risk Population”, in July 2022, the American Gastroenterology

Association (“AGA”) significantly expanded the target population for esophageal precancer screening, recommending screening

in at-risk patients without symptoms of GERD.

Based on this revision, we believe the cohort recommended for screening consists of an

estimated 30 million U.S.

Background and Overview

PAVmed is a diversified commercial-stage life sciences company operating in the medical device, diagnostics, and digital health sectors.

It operates through multiple independently financed subsidiaries under a shared services model.

The Company’s strategy is to advance and commercialize innovative healthcare technologies through its subsidiaries while maintaining flexibility to structure financing at either the PAVmed level or within its subsidiaries.

The Company’s subsidiaries include Lucid Diagnostics, a commercial-stage cancer prevention medical diagnostics company that markets the EsoGuard® Esophageal DNA Test and EsoCheck® Esophageal Cell Collection Device, of which the Company is the largest voting stockholder, and Veris Health, a majority-owned digital health company focused on improving personalized cancer care during treatment and throughout survivorship through digital health tools and the development of an implantable physiological monitor designed to interface with the Veris Cancer Care Platform.

PAVmed continues to support the commercial expansion of EsoGuard through Lucid Diagnostics and to pursue strategic partnerships to expand adoption of the Veris Cancer Care Platform.

In addition, PAVmed is developing a medical device portfolio, including its PortIO implantable intraosseous vascular access device and recently licensed endoscopic imaging technology from Duke University.

The Company continues to evaluate opportunities to expand its portfolio through internal development and external licensing.

Lucid Diagnostics

Lucid Diagnostics is a commercial-stage cancer prevention medical diagnostics technology company focused on patients with gastroesophageal reflux disease (“GERD”), who are at risk of developing esophageal precancer and cancer, including esophageal adenocarcinoma (“EAC”).

We believe that Lucid's flagship product, the EsoGuard Esophageal DNA Test, performed on samples collected with the EsoCheck Esophageal Cell Collection Device, constitutes the first and only commercially available diagnostic test capable of serving as a widespread testing tool with the goal of preventing EAC deaths, through early detection of esophageal precancer in at-risk GERD patients.

EsoGuard is a bisulfite-converted targeted next-generation sequencing (NGS) DNA assay performed on esophageal cells collected with the EsoCheck device.

It measures methylation at sites on the VIM and CCNA1 genes.

In clinical studies, EsoGuard demonstrated high sensitivity and specificity, with a negative predictive value of approximately 99% for the detection of Barrett’s esophagus (“BE”) and EAC in screening populations.

EsoCheck is an FDA 510(k)-cleared and CE Mark certified noninvasive, swallowable balloon capsule catheter designed for in-office collection of esophageal cell samples in a brief procedure.

The device enables targeted sampling of esophageal cells while minimizing contamination during retrieval.

EsoGuard and EsoCheck are based on patented technology licensed from Case Western Reserve University and are intended to provide accurate, non-invasive, patient-friendly testing for the early detection of BE and EAC, including dysplastic BE and related precursors to EAC in patients with chronic GERD.

Market Opportunity

In 2025, approximately 22,000 U.S.

GERD patients were diagnosed with EAC and approximately 16,250 died from the disease.

Over 80% of EAC patients will die within five years of diagnosis, making it the second most lethal cancer in the U.S.

incidence of EAC has increased 500% over the past four decades, while the incidences of other common cancers have declined or remained flat.

Based on current guidelines published by the American Gastroenterology Association (“AGA”), we believe the cohort recommended for screening consists of an estimated 30 million U.S.

individuals with at least 3 established risk factors for BE.

Accordingly, we believe EsoGuard’s total

addressable U.S.

market opportunity approximates $60 billion based on an effective Medicare payment of $1,938 and the estimated 30 million

Accordingly, we believe EsoGuard’s total addressable U.S.

market opportunity approximates $60 billion based on an effective Medicare payment of $1,938 and the estimated 30 million U.S.

patients recommended for screening by clinical practice guidelines.

(In December 2019, Lucid secured “gapfill” determination

for EsoGuard’s PLA code 0114U through the CMS CLFS process.

This allowed Lucid to engage directly with Medicare contractor Palmetto

GBA and its MolDx Program on CMS payment and coverage.

As discussed below under the heading “Reimbursement and Market Access”,

in October 2020, CMS granted EsoGuard final Medicare payment determination of $1,938.01, effective January 1, 2021.)

Unfortunately,

for a variety of reasons, less than 10% of at-risk patients who are recommended for screening undergo traditional invasive upper gastrointestinal

endoscopy (EGD).

We believe that the profound tragedy of an EAC diagnosis is that likely death could have been prevented if the at-risk

patient had been screened and then undergone surveillance and curative endoscopic esophageal ablation of dysplastic BE.

mortality rates are high even in early stage EAC, preventing EAC deaths requires detection and intervention at the precancer stage.

of the necessary elements for such an early detection program are already well established—an at-risk population (at-risk GERD

patients), a precancer (BE), and an intervention which can halt progression to EAC (endoscopic esophageal ablation).

Until recently,

the only missing element for such an early detection program is a widespread screening tool that can detect BE prior to EAC.

believe EsoGuard, used with EsoCheck, constitutes that missing element—the first and only commercially available diagnostic test

capable of serving as a widespread testing tool with the goal of preventing EAC deaths through early detection of esophageal precancer

and cancer in patients with 3 or more risk factors.

Guidelines for At-Risk Population

subgroup of long-standing or severe GERD patients at-risk for BE and progression to EAC is well defined in clinical practice guidelines,

including the American College of Gastroenterology (“ACG”) BE Guidelines.

In its Recommendation 5, the ACG suggests a single

screening endoscopy in patients with chronic GERD symptoms and 3 or more additional risk factors for BE, including male sex, age greater

than 50 years, White race, tobacco smoking, obesity, and family history of BE or EAC in a first-degree relative.

ACG clinical guideline entitled “ Diagnosis and Management of Barrett’s Esophagus:

An Updated ACG Guideline ,”

the first such update since 2016, was published online in April 2022 in the American Journal of Gastroenterology.

The clinical guideline

reiterates the ACG’s long-standing recommendation for esophageal precancer screening in at-risk patients with GERD.

For the first

time, however, the clinical guideline also endorses non-endoscopic biomarker screening as an acceptable alternative to costly and invasive

endoscopy stating that “a swallowable non-endoscopic capsule device combined with a biomarker is an acceptable alternative to endoscopy

for BE.” The clinical guideline specifically mentions EsoCheck, as such swallowable, non-endoscopic esophageal cell collection

devices, as well as methylated DNA biomarkers such as EsoGuard.

The summary of evidence for this recommendation includes a reference

to the seminal NIH-funded, multicenter, case-control study published in 2018 in Science Translational Medicine , which demonstrated

that EsoGuard is highly accurate at detecting esophageal precancer and cancer, including on samples collected with EsoCheck.

July 2022, the AGA published in their “Clinical Practice Update on New Technology

and Innovation for Surveillance and Screening in Barrett’s Esophagus” updated clinical guidance that mirrors the same furnished

by the ACG as described above, endorsing the use of non-endoscopic cell collection tools to screen for BE like our EsoCheck Cell Collection

Device, which is cited in the update, as an acceptable alternative to endoscopy to directly address the need for noninvasive screening

tools that are easy to administer, patient friendly, and cost-effective for the detection of BE.

The clinical practice update by the

AGA also significantly expands the target population for esophageal precancer screening, including for EsoGuard and EsoCheck, by recommending,

for the first time, screening in at-risk patients without symptoms of GERD.

The AGA does so by adding a history of chronic GERD as merely

an additional, seventh risk factor to the six risk factors for BE and EAC that have traditionally identified at-risk symptomatic patients

recommended for screening.

In March 2025, Lucid announced that a recent update to the National Comprehensive Cancer Network® (NCCN) Clinical

Practice Guidelines in Oncology (NCCN Guidelines®) focused on Esophageal and Esophagogastric Junction Cancers (Version 1.2025) has

added a new section on BE screening.

The NCCN Guidelines® now reference professional society guidelines on BE screening, including

the most recent ACG clinical guideline discussed above, which recommends non-endoscopic biomarker testing, such as EsoGuard performed

on samples collected with EsoCheck, as an acceptable alternative to invasive upper endoscopy to detect esophageal precancer.

Unfortunately, for a variety of reasons, less than 5% of at-risk patients who are recommended for screening undergo traditional invasive upper gastrointestinal endoscopy ("EGD").

We believe that the profound tragedy of an EAC diagnosis is that likely death could have been prevented if the at-risk patient had been screened and then undergone surveillance and curative endoscopic esophageal ablation of dysplastic BE.

Since mortality rates are high even in early stage EAC, preventing EAC deaths requires detection and intervention at the precancer stage.

Most of the necessary elements for such an early detection program are already well established—an at-risk population (at-risk GERD patients), a precancer (BE), and an intervention which can halt progression to EAC (endoscopic esophageal ablation).

Until recently, the only missing element for such an early detection program is a widespread screening tool that can detect BE prior to EAC.

We believe EsoGuard, used with EsoCheck, constitutes that missing element—the first and only commercially available diagnostic test capable of serving as a widespread testing tool with the goal of preventing EAC deaths through early detection of esophageal precancer and cancer in patients with 3 or more risk factors.

Commercialization

EsoGuard commercialization efforts span multiple channels including targeting primary care and GI physicians, who have generally embraced

our message that EsoGuard has the potential to expand the funnel of BE-EAC patients who will need long term EGD surveillance and, potentially,

treatment with endoscopic esophageal ablation.

assure sufficient testing capacity and geographic coverage, Lucid has undertaken multiple ways for patients to have access to its test.

Initially, Lucid built a limited network of its own physical Lucid Test Centers, staffed by Lucid-employed clinical personnel, where

patients can undergo the EsoCheck procedure and have the sample sent for EsoGuard testing at Lucid’s CLIA-certified laboratory.

Our current test center network currently includes locations in metropolitan areas in Arizona, California, Colorado, Florida, Georgia,

Idaho, Michigan, Nevada, Texas and Utah.

addition to our own test center locations, Lucid has broadened patient access to its test by establishing a satellite test center program,

whereby it is making its personnel available to perform cell collection services inside physician offices or in certain geographies,

closely nearby physician offices (in Florida, for the time being) by way of our Lucid Mobile Testing Unit.

in January 2023, Lucid completed its first #CheckYourFoodTube Precancer Testing Event, with the San Antonio Fire Department (the “SAFD”)

during Firefighter Cancer Awareness Month as designated by the International Association of Fire Fighters (IAFF).

A total of 391 members

who were deemed to be at-risk for esophageal precancer, underwent a brief, on-site, noninvasive cell collection procedure, performed

by Lucid’s clinical personnel using EsoCheck.

Since then, additional testing events have been hosted with the SAFD, and many similar

events have been held with fire departments throughout the country.

These events are ongoing and are an extension of Lucid’s satellite

test center program, which brings Lucid’s precancer testing directly to patients—at their physician’s office and now

at testing day events.

March 2023, Lucid launched a direct contracting strategic initiative to engage directly with large Administrative Services Only (“ASO”)

self-insured employers, unions and other entities, seeking to replicate the successes of other cancer screening diagnostic companies

that have deployed similar strategies.

January 2025, Lucid expanded on its direct contracting initiative by launching a cash-pay program targeting concierge medicine, as an

important component of its strategic efforts to expand its contractually-guaranteed revenue.

Lucid has already contracted with several

concierge medicine practices under this initiative.

has also established an EsoGuard Telemedicine Program, in partnership with UpScript, LLC, an independent third-party telemedicine provider,

that accommodates EsoGuard self-referrals from direct-to-consumer marketing.

Reimbursement

and Market Access

noted above, in December 2019, Lucid secured “gapfill” determination for EsoGuard’s PLA code 0114U through the CMS

CLFS process.

This allowed Lucid to engage directly with Medicare contractor Palmetto GBA and its MolDx Program on CMS payment and coverage.

In October 2020, CMS granted EsoGuard final Medicare payment determination of $1,938.01, effective January 1, 2021.

final Local Coverage Determination (“LCD”) L39256, entitled “ Molecular Testing for Detection of Upper Gastrointestinal

Metaplasia, Dysplasia, and Neoplasia ” became effective in May 2023 on the Center for Medicare and Medicaid Services (“CMS”)

website by MAC Palmetto GBA.

(A substantially identical LCD was published by Noridian Healthcare Solutions, the MAC whose geographic

jurisdiction covers our CLIA laboratory in Lake Forest, CA.) The LCD outlines criteria for future coverage that MolDX expects upper gastrointestinal

precancer and cancer molecular diagnostic tests to meet.

These criteria include active GERD with at least two risk factors, as well as

evidence of analytic validity, clinical validity, and clinical utility.

Although the LCD indicated that it found that no currently existing

test has fulfilled all these criteria, it indicated that it will “monitor the evidence and may revise this determination based

on the pertinent literature and society recommendations.” In November 2024, Lucid submitted to MolDx its 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.

parallel with our request for reconsideration of the LCD, Lucid is aggressively pursuing EsoGuard commercial insurer coverage and payment.

Although the claim adjudication cycle can be prolonged during the early commercialization of a new test, Lucid has received and continues

to receive out-of-network commercial insurance payments for the EsoGuard test, which accounts for the vast majority of our revenue to

Additionally,

the legislatures in a number of states have passed laws mandating coverage of comprehensive biomarker testing over the past several years.

Lucid believes that EsoGuard falls within the definition of a biomarker test and thus Lucid is reviewing how to leverage legislation

in those states to expand access to and reimbursement of EsoGuard.

Utility and Clinical Trials

Demonstrating

EsoGuard’s clinical utility, which requires providing evidence that the test has a meaningful impact on clinical practice, is very

important for a variety of purposes, including, importantly, for Medicare and private payor payment and coverage.

It has been established

that one of the most important factors to private payors in deciding whether to grant payment and coverage will be demonstration that

the EsoGuard test, when ordered by physicians, provides information that can be used to identify or exclude patients who would benefit

from additional management and/or treatment.

Clinical utility studies are also important for general EsoGuard commercialization by facilitating

physician understanding of test indications and potential benefit to the patients.

continues to expand the EsoGuard and EsoCheck evidence portfolio with additional clinical utility and clinical validity data from a range

of ongoing studies and those that will be completed in the upcoming year.

These efforts include completion of the ESOGUARD-BE2 study,

a large multi-center case control study recruiting patients from large academic institutions in the Netherlands and across the U.S.,

in the first half of the year and submission for peer review of a publication of the results in the second half of 2025.

This data will

further supplement what has previously been published from the four earlier clinical validation studies from Moinova et.

(2024), Greer et.

al., (2024), and Shaheen et.

A large, nearly 12,000 patient real-world experience of EsoCheck

and EsoGuard from 18 months of commercial data is expected to be submitted for peer review publication in the first half of the year.

Finally, data accrual from the PREVENT and PREVENT-FF registries remains ongoing.

Both registries capture information on the diagnostic

and/or therapeutic journey of subjects following EsoGuard testing, and in addition to provider decision impact, will contribute differing

levels of clinical outcomes data to the Lucid evidence portfolio.

Manufacturing

is currently manufactured for Lucid by Coastline International (“Coastline”), a high-volume device manufacturer, and Sage

Product Development.

Lucid’s current line at Coastline can produce up to 25,000 units per year.

With Coastline’s improvement

and expansion, there is capacity to scale exponentially.

Lucid’s EsoGuard specimen kits are currently manufactured by Path-Tec.

Path-Tec also manages warehousing, logistics, fulfillment and customer support of Lucid’s products.

the terms of Lucid’s license agreement with CWRU (as amended to date, the “Amended CWRU License Agreement”), Lucid

acquired an exclusive worldwide right to use the intellectual property rights to the EsoGuard and EsoCheck technology for the detection

of changes in the esophagus and on sample preservation.

Lucid is required to pay CWRU royalties on net sales of licensed products as

5% of net sales of less than $100 million per year;

and 8% of net sales greater than $100 million per year.

Lucid is also required

to pay CWRU minimum annual royalty payments as follows:

$50,000 per year, beginning January 1 following the first anniversary of a commercial

sale of a licensed product;

$150,000 per year, if net sales of a licensed product exceed $25 million in a year;

$300,000 per year, if

net sales of a licensed product exceed $50 million in a year;

and $600,000 per year, if net sales of a licensed product exceed $100 million

Minimum yearly royalty amounts are subject to increase based on the percentage change in the CPI-W Consumer Price Index and

are credited against the royalties otherwise due.

The license agreement was subject to four regulatory and commercialization milestones,

of which one remains unachieved and unpaid.

The remaining milestone is the FDA PMA submission of a licensed product, upon the achievement

of which we will pay CWRU a milestone payment of $200,000.

The license agreement terminates upon the expiration of the last-to-expire

licensed patent, or on May 12, 2038, in countries where no such patents exist, or upon expiration of any exclusive marketing rights for

a licensed product that have been granted by FDA or other U.S.

government agency, whichever comes later.

June 2019, Lucid received FDA 510(k) clearance to market EsoCheck in the U.S.

as a device indicated for use in the collection and retrieval

of surface cells of the esophagus in adults followed by FDA 510(k) clearance in 2022, expanding the use of EsoCheck in adults and pediatric

populations in the U.S.

In December 2019, Lucid’s CLIA-certified then-laboratory partner, completed documentation of EsoGuard analytical

validity allowing Lucid to commercialize it as a LDT.

February 2020, Lucid received FDA “Breakthrough Device Designation” for EsoGuard as an in-vitro diagnostic (“IVD”)

medical device.

The FDA Breakthrough Device Program was created to offer patients more timely access to breakthrough technologies which

provide for more effective treatment or diagnosis of life-threatening or irreversibly debilitating human disease or conditions by expediting

their development, assessment and review through enhanced communications and more efficient and flexible clinical study design, including

more favorable pre/post market data collection balance.

May 2021, Lucid received CE Mark certification for EsoCheck (under the Medical Devices Directive 93/42/EEC), and in June 2021, Lucid

completed CE Mark self-certification for EsoGuard (under the European In-Vitro Diagnostic Devices Directive (IVDD 98/79/EC)), indicating

both may be marketed in CE Mark European countries.

October 2023, FDA proposed a policy under which FDA intends to phase out its general enforcement discretion approach for LDTs so that

IVDs manufactured by a laboratory would generally fall under the same enforcement approach as other IVDs.

On May 6, 2024, the FDA issued

a final rule aimed at helping to ensure the safety and effectiveness of LDTs.

The rule amends the FDA’s regulations to make explicit

that IVDs are devices under the Federal Food, Drug, and Cosmetic Act (“FDCA”), including when the manufacturer of the IVD

is a laboratory.

Along with this amendment, the FDA is finalizing a policy under which the FDA will provide greater oversight of IVDs

offered as LDTs through a phaseout of its general enforcement discretion approach for LDTs over the course of four years, as well as

targeted enforcement discretion policies for certain categories of IVDs manufactured by laboratories.

phaseout policy contains the following five stages:

Beginning on May 6, 2025, which is one year after the publication date of the final LDT rule, FDA will expect compliance with

medical device reporting (MDR) requirements, correction and removal reporting requirements, and quality system (QS) requirements

regarding complaint files.

Beginning on May 6, 2026, which is 2 years after the publication date of the final LDT rule, FDA will expect compliance with requirements

not covered during other stages of the phaseout policy, including registration and listing requirements, labeling requirements, and

investigational use requirements.

Beginning on May 6, 2027, which is 3 years after the publication date of the final LDT rule, FDA will expect compliance with QS

requirements (other than requirements regarding complaint files which are already addressed in stage 1).

Beginning on November 6, 2027, which is 3½ years after the publication date of the final LDT rule, FDA will expect compliance

with premarket review requirements for high-risk IVDs offered as LDTs (IVDs that may be classified into class III or that are subject

to licensure under section 351 of the Public Health Service Act), unless a premarket submission has been received by the beginning

of this stage in which case FDA intends to continue to exercise enforcement discretion for the pendency of its review.

Beginning on May 6, 2028, which is 4 years after the publication date of the final LDT rule, FDA will expect compliance with premarket

review requirements for moderate-risk and low-risk IVDs offered as LDTs (that require premarket submissions), unless a premarket

submission has been received by the beginning of this stage in which case FDA intends to continue to exercise enforcement discretion

for the pendency of its review.

FDA also intends to exercise enforcement discretion and generally not enforce some or all applicable requirements for certain categories

of IVDs manufactured by a laboratory.

The categories of enforcement discretion that are applicable to EsoGuard are summarized in the

4 & 5 (Premarket Review)

marketed IVDs offered as LDTs first marketed prior to rule publication date and not modified beyond scope described in preamble Section

V.B.3 of preamble

generally expected beginning May 6, 2025

generally expected beginning May 6, 2026

with 21 CFR 820.180-820.186 generally expected beginning May 6, 2027;

generally not expected with other QS requirements (except for complaint files)

generally not expected

approved by NYS CLEP Section V.B.2 of preamble

generally expected beginning May 6, 2025

generally expected beginning May 6, 2026

generally expected beginning May 6, 2027

generally not expected

EsoGuard was marketed prior to rule publication and is also NYS CLEP approved, hence, enforcement discretion is applicable for

compliance with Stages 4 and 5.

We will be implementing compliance with MDR requirements, correction and removal reporting

requirements, and quality system (QS) requirements regarding complaint files by March 31, 2025, well before the deadline of May 6,

Gap analysis has been completed and we are expecting our compliance activities to be completed for Stages 2 and 3 before the FDA’s expected timeframes in 2026 and 2027, respectively.

confident that the proposed final rule will not have a commercial impact as the Company already has a robust QS management platform

for medical devices and EsoGuard will be able to easily transition to the platform to fulfill the QS requirements, as required by

longer-term strategy is to secure a specific indication, based on published guidelines, for BE testing in certain at-risk populations

using EsoGuard on samples collected with EsoCheck.

This use of EsoGuard together with EsoCheck as a testing system must be cleared or

approved by the FDA as an IVD device.

February 25, 2022, a newly-formed wholly owned subsidiary of Lucid, LucidDx Labs Inc.

(“LucidDx Labs”), acquired from ResearchDx

(“RDx”), certain licenses and other related assets necessary for LucidDx Labs to operate its own new

CLIA-certified, CAP-accredited clinical laboratory located in Lake Forest, CA.

Since March 2022, Lucid has conducted EsoGuard

testing at its own laboratory.

November 2023, LucidDx Labs launched EsoGuard 2.0, which uses multiplexing thereby allowing both genes to be interrogated on a single

The next-generation assay underwent rigorous analytical and clinical validation studies, including head-to-head comparisons

of multiplexed triplicate consensus versus singleplex techniques, consistent with CLIA standards.

Clinical validation analysis demonstrated

improved sensitivity and specificity for the detection of esophageal precancer, having demonstrated enhanced assay performance and lower

costs in extensive validation studies.

market for esophageal cancer (i.e., EAC) and pre-cancer (i.e., BE, with or without dysplasia) testing is large, consisting of more

than 30 million at-risk individuals over the age of 50.

Given the large market for pre-cancer testing, Lucid likely will face numerous

competitors, some of which possess significantly greater financial and other resources and development capabilities than Lucid.

test faces competition from procedure-based detection technologies such as upper endoscopy, and other testing technologies such as multi-cancer

early detection products.

The EsoCheck device faces competition from other manufacturers with devices designed to collect cell samples

from targeted regions of the esophagus.

For example, EndoSign, commercialized by Cyted, and much like Cytosponge, is a small mesh sponge

within a soluble gelatin capsule that needs to reside in the stomach and then is pulled thru the targeted region brushing the lining

of the esophagus and then later retrieved, although, unlike EsoCheck, it is unprotected from sample contamination as the brush later

passes regions of the upper esophagus and mouth.

Lucid’s competitors may also be developing additional methods of detecting esophageal

cancer and pre-cancer that have not yet been announced.

of Lucid’s existing and potential competitors have substantially greater financial, marketing, sales, distribution, manufacturing

and technological resources.

Lucid may be unable to compete effectively against our competitors either because their products and services

are superior or more cost efficient, or because they have access to greater resources than Lucid.

These competitors may have greater

name recognition than Lucid does.

Many of these competitors have obtained all desirable FDA or other regulatory approvals, and superior

patent protection, for their products.

Certain of Lucid’s competitors have already commercialized their products, and others may

commercialize their products in advance of Lucid’s products.

In addition, Lucid’s competitors may make technical advances

that render Lucid’s products obsolete.

Lucid may be unable to respond to such technical advances.

May 2021, we formed Veris Health, a majority-owned subsidiary, focused on digital health technology.

In connection with its formation,

Veris Health acquired Oncodisc, a digital health company with groundbreaking tools to improve personalized cancer care through remote

patient monitoring.

Oncodisc’s core technologies include designs and patents that would be the foundation for the first intelligent

implantable vascular access port with biologic sensors and wireless communication, combined with an oncologist-designed remote digital

healthcare platform that provides patients and physicians with new tools to improve outcomes and optimize the delivery of cost-effective

care through remote monitoring and data analytics.

Health’s lead product, the Veris Cancer Care Platform, is a comprehensive digital cancer care platform with remote physiological

data collection, symptom reporting, telehealth capability and electronic health record (“EHR”) integration.

The platform offers enhanced

personalized cancer care through the early detection of complications, reduced unplanned hospitalizations, the provision of longitudinal

trends of physiological and clinical data, data-driven risk management tools, and increased patient and provider satisfaction.

patients enrolled on the platform receive a VerisBox™ of Veris-branded connected health care devices which transmit physiologic

data to the cloud-based clinician portal via embedded cellular connections.

A complementary patient portal enables patients to report

symptoms, as well as general health and quality of life parameters, to their cancer care team through the Veris patient smartphone app.

Our EsoGuard commercialization efforts span multiple channels including targeting primary care and GI physicians, who have generally embraced our message that EsoGuard has the potential to expand the funnel of BE-EAC patients who will need long term EGD surveillance and, potentially, treatment with endoscopic esophageal ablation.

We also provide patient access through a limited network of our own physical Lucid Test Centers in key metropolitan areas, and a satellite test center program, whereby we are making our personnel available to perform cell collection services inside physician offices or in certain geographies.

We also regularly conduct testing events, which brings our precancer testing directly to patients.

We also have a direct contracting strategic initiative to engage directly with large Administrative Services Only (“ASO”) self-insured employers, unions and other entities, seeking to replicate the successes of other cancer screening diagnostic companies that have deployed similar strategies.

Other commercial channels include our cash-pay program targeting concierge medicine, arrangements with health systems for comprehensive, integrated esophageal precancer testing programs, and an EsoGuard Telemedicine Program, in partnership with UpScript, LLC, an independent third-party telemedicine provider, that accommodates EsoGuard self-referrals from direct-to-consumer marketing.

Reimbursement and Market Access

A final Local Coverage Determination (“LCD”) L39256, entitled “ Molecular Testing for Detection of Upper Gastrointestinal Metaplasia, Dysplasia, and Neoplasia ” became effective in May 2023 on the Center for Medicare and Medicaid Services (“CMS”) website by MAC Palmetto GBA.

(A substantially identical LCD was published by Noridian Healthcare Solutions, the MAC whose geographic jurisdiction covers our CLIA laboratory in Lake Forest, CA.) The LCD outlines criteria for future coverage that MolDX expects upper gastrointestinal precancer and cancer molecular diagnostic tests to meet.

These criteria include active GERD with at least three risk factors, as well as evidence of analytic validity, clinical validity, and clinical utility.

Although the LCD indicated that it found that no currently existing test has fulfilled all these criteria, it indicated that it will “monitor the evidence and may revise this determination based on the pertinent literature and society recommendations.” In 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.

The package was submitted as part of a request for reconsideration of the non-coverage language in the LCD to secure Medicare coverage for EsoGuard.

As part of the LCD reconsideration process, MolDx-participating Medicare Administrative Contractors convened a Contractor Advisory Committee ("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) 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.

In parallel with our request for reconsideration of the LCD, we are aggressively pursuing EsoGuard commercial insurer coverage and payment.

Although the claim adjudication cycle can be prolonged during the early commercialization of a new test, we have received and are continuing to receive out-of-network commercial insurance payments for the EsoGuard test, which accounts for the vast majority of our revenue to date.

Through these efforts, 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.

In addition, in January 2026, Lucid announced that it has been awarded a contract by the U.S.

Department of Veterans Affairs for EsoGuard, expanding access to esophageal precancer testing across the nation's largest integrated healthcare system, which serves more than nine million enrolled veterans annually.

The contract is issued under the VA Federal Supply Schedule and includes pre-negotiated pricing for EsoGuard that matches the established Medicare payment rate determined by the Centers for Medicare & Medicaid Services (CMS), enabling VA hospitals and healthcare facilities nationwide to access EsoGuard through a single, national VA procurement framework.

Additionally, the legislatures in a number of states have passed laws mandating coverage of comprehensive biomarker testing over the past several years.

We are reviewing how to leverage legislation in those states to expand access to and reimbursement of EsoGuard.

Clinical Utility and Clinical Trials

We continue to expand the EsoGuard and EsoCheck evidence portfolio with ongoing emphasis on demonstration of clinical utility to support medical policy and payer coverage.

These efforts include a large, nearly 12,000 patient real-world experience of EsoCheck and EsoGuard from 18 months of commercial data that is under journal review and expected to be published within the first half of the year.

Additionally, data accrual from the PREVENT and PREVENT-FF registries remains ongoing and has been expanded to collect additional longitudinal follow-up data.

Both registries capture information on the diagnostic and/or therapeutic journey of subjects following EsoGuard testing, including provider decision impact, patient compliance, and clinical outcomes data for the Lucid evidence portfolio.

In June 2019, we received FDA 510(k) clearance to market EsoCheck in the U.S.

as a device indicated for use in the collection and retrieval of surface cells of the esophagus in adults followed by FDA 510(k) clearance in 2022, expanding the use of EsoCheck in adults and pediatric populations in the U.S.

In December 2019, our CLIA-certified then-laboratory partner, completed documentation of EsoGuard analytical validity allowing us to commercialize it as a LDT.

In February 2020, we received FDA “Breakthrough Device Designation” for EsoGuard as an in-vitro diagnostic (“IVD”) medical device.

The FDA Breakthrough Device Program was created to offer patients more timely access to breakthrough technologies which provide for more effective treatment or diagnosis of life-threatening or irreversibly debilitating human disease or conditions by expediting their development, assessment and review through enhanced communications and more efficient and flexible clinical study design, including more favorable pre/post market data collection balance.

In May 2021, we received CE Mark certification for EsoCheck (under the Medical Devices Directive 93/42/EEC), and in June 2021, we completed CE Mark self-certification for EsoGuard (under the European In-Vitro Diagnostic Devices Directive (IVDD 98/79/EC)), indicating both may be marketed in CE Mark European countries.

Our longer-term strategy is to secure a specific indication, based on published guidelines, for BE testing in certain at-risk populations using EsoGuard on samples collected with EsoCheck.

This use of EsoGuard together with EsoCheck as a testing system must be cleared or approved by the FDA as an IVD device.

market for EAC and pre-cancer (i.e., BE, with or without dysplasia) testing is large, consisting of more than 30 million at-risk individuals over the age of 50.

Given the large market for pre-cancer testing, we likely will face numerous competitors, some of which possess significantly greater financial and other resources and development capabilities than us.

Our EsoGuard test faces competition from procedure-based detection technologies such as upper endoscopy, and other testing technologies such as assays that incorporate biomarker multi-cancer early detection products.

Our EsoCheck device faces competition from other manufacturers with devices designed to collect cell samples from targeted regions of the esophagus.

For example, EndoSign, commercialized by Cyted, and much like Cytosponge, is a small mesh sponge within a soluble gelatin capsule that needs to reside in the stomach for some time until it fully dissolves and then is pulled thru the targeted region brushing the lining of the esophagus and then later retrieved, although, unlike EsoCheck, it is unprotected from sample contamination as the brush later passes regions of the upper esophagus and mouth.

Our competitors may also be developing additional methods of detecting esophageal cancer and pre-cancer that have not yet been announced.

We will also compete in the marketplace to recruit and retain qualified scientific, management and sales personnel, as well as in acquiring technologies and licenses complementary to our products or advantageous to our business.

We are aware of several companies that compete or are developing technologies in our current and future products areas.

In order to compete effectively, our products will have to achieve market acceptance, receive adequate insurance coverage and reimbursement, be cost effective and be simultaneously safe and effective.

Veris Health is a majority-owned digital health subsidiary focused on improving personalized cancer care during treatment and throughout survivorship by helping oncology teams maintain greater visibility into patient health between visits.

Through integrated digital tools, Veris enables oncology teams to remain connected with patients and monitor changes in their condition between visits, supporting earlier identification of emerging issues and more informed clinical decision-making.

Veris Health’s lead product, the Veris Cancer Care Platform, is a comprehensive digital cancer care platform designed to support personalized cancer care during treatment and throughout survivorship by enabling continuous monitoring of patient health between visits.

The platform includes remote physiological data collection, symptom reporting, telehealth capability and electronic health record (“EHR”) integration.

The platform offers enhanced personalized cancer care through the early detection of complications, reduced unplanned hospitalizations, the provision of longitudinal trends of physiological and clinical data, data-driven risk management tools, and increased patient and provider satisfaction.

Cancer patients enrolled on the platform receive a VerisBox™ of Veris-branded connected health care devices which transmit physiologic data to the cloud-based clinician portal via embedded cellular connections.

A complementary patient portal enables patients to report symptoms, as well as general health and quality of life parameters, to their cancer care team through the Veris patient smartphone app.

The app also allows caretakers and family members to follow along on the patient’s cancer care journey.

Veris is developing an

implantable physiological monitor, designed to be implanted alongside a vascular access port, which will interface with the Veris Cancer

Care Platform.

The implantable monitor will further enhance the clinical and commercial value of the platform by providing remote physiologic

data independent of patient compliance.

2024, approximately 2.0 million people in the U.S.

Veris is also developing an implantable physiological monitor, designed to be implanted alongside a vascular access port, which will interface with the Veris Cancer Care Platform.

The implantable monitor is intended to further enhance the clinical and commercial value of the platform by providing remote physiologic data independent of patient compliance.

Market Opportunity

In 2024, approximately 2 million people in the U.S.

were newly diagnosed with cancer, and cancer incidence in the U.S.

is expected to

continue to increase.

Cancer patients face high rates of complications during the courses of their treatment which drive poor patient

outcomes and healthcare costs.

is expected to continue to increase.

Cancer patients face high rates of complications during the courses of their treatment which drive poor patient outcomes and healthcare costs.

One driver of these issues is avoidable hospitalizations.

We believe Veris Health’s offerings can

help drive costs down and improve outcomes through providing care teams with better, more continuous data.

on the aforementioned cancer prevalence in the U.S.

and our current business model, we believe Veris Health’s total addressable

We believe Veris Health’s offerings can help drive costs down and improve outcomes through providing care teams with better, more continuous data.

Based on the aforementioned cancer prevalence in the U.S.

and our current business model, we believe Veris Health’s total addressable U.S.

market opportunity exceeds $2 billion.

In the future, we believe this will only expand through the implantable physiologic monitor,

as well as other opportunities or enhancements Veris may pursue as resources permit, such as data commercialization, incorporating additional

AI-based features and the expansion into other markets aside from oncology.

In the future, we believe this will only expand through the implantable physiological monitor, as well as other opportunities or enhancements Veris may pursue as resources permit, such as data commercialization, incorporating additional AI-based features and the expansion into other markets aside from oncology.

Commercialization/Sales

are currently pursuing strategic partnerships with leading academic oncology systems, whereby we would become the exclusive digital health

solution for these institutions’ oncology departments.

To this end, Veris and The Ohio State University Comprehensive Cancer Center

- The James Cancer Hospital and Solove Research Institute (OSUCCC – The James), a National Cancer Institute-Designated Comprehensive

Cancer Center, executed a memorandum of understanding to implement a pilot program where cancer patients would be enrolled on the Veris

Cancer Care Platform™.

The pilot program was launched in June 2024, and has been extended through the end of March 2025.

This collaboration

represents a significant step forward in Veris Health’s commercialization strategy, allowing the company to demonstrate the value

of its platform and gather data on its effectiveness in improving personalized cancer care.

is continuing to pursue similar partnerships with other leading institutions.

Veris has a software-as-a-service recurring-revenue business

model, where it seeks to generate recurring revenue through oncology practice and hospital-based subscriptions.

These entities pay monthly

fees for each patient on the platform, through which they are able to derive revenues from remote physiologic monitoring (and, in the

future, device implantation) under existing CPT codes.

Veris also plans to build a commercialization model around the oncology data it

is collecting, as resources permit.

We have identified multiple potential use cases across a number of verticals, including clinical

trials, commercial use cases, and as a means to improve patient care.

We are currently pursuing strategic partnerships with leading academic oncology systems, whereby we would become the exclusive digital health solution for these institutions’ oncology departments.

To this end, in October 2025, we announced that Veris and The Ohio State University Comprehensive Cancer Center - The James Cancer Hospital and Solove Research Institute ("OSUCCC – The James"), a National Cancer Institute-Designated Comprehensive Cancer Center, launched the commercial phase of their long-term strategic partnership agreement.

This transition to a commercial phase follows successful completion of a pilot program conducted at the OSUCCC -- The James.

Veris is continuing to pursue similar partnerships with other leading institutions.

Veris has a software-as-a-service recurring-revenue business model, where it seeks to generate recurring revenue through oncology practice and hospital-based subscriptions.

These entities pay monthly fees for each patient on the platform, through which they are able to derive revenues from remote physiologic monitoring (and, in the future, device implantation) under existing CPT codes.

We have identified multiple potential use cases across a number of verticals, including clinical trials, commercial use cases, and as a means to improve patient care.

Manufacturing

components comprising the Veris Cancer Care Platform are currently supplied to us by our partners TransTek and their U.S.-based

subsidiary, Mio Labs.

Each has passed a SOC-2 audit by an outside auditor.

The final packaging of the overall box and order

fulfillment is managed by PAVmed at its Foxborough, MA location.

Customer support is currently managed internally, while partnering

with Zendesk for customer service management.

Veris Cancer Care Platform qualifies as a Non-Device Clinical Decision Software (“CDS”) that is excluded from the

definition of a medical device under the FDCA, as amended by the 21st Century Cures Act, and therefore is not subject to the

FDA’s regulatory requirements for devices, as confirmed in the FDA’s Clinical Decision Support Software

Health is also developing an implantable cardiac monitor and is currently interacting with the FDA via pre-submission process, seeking

agreement on regulatory strategy and required testing to seek clearance of the monitor.

We plan to make our 510(k) submission for the

implantable monitor, which could happen as early as late 2025, if and to the extent resources permit us to do so.

The components comprising the VerisBox™ kit are currently supplied to us by a third part manufacturer.

The final packaging of the overall box and order fulfillment is managed by PAVmed at its Foxborough, MA location.

Customer support is currently managed internally, while partnering with Salesforce for customer service management.

The Veris Cancer Care Platform qualifies as a Non-Device Clinical Decision Software (“CDS”) that is excluded from the definition of a medical device under the FDCA, as amended by the 21st Century Cures Act, and therefore is not subject to the FDA’s regulatory requirements for devices, as confirmed in the FDA’s Clinical Decision Support Software Guidance.

Veris Health is also developing an implantable physiological monitor and completed multiple interactions with the FDA via pre-submission process, seeking agreement on regulatory strategy and required testing to seek clearance of the monitor.

We plan to make our 510(k) submission for the implantable monitor, which could happen as early as late 2026, if and to the extent resources permit us to do so.

market for cancer patient care is large.

There are many existing competitors in the remote physiological monitoring space, some

of which possess significantly greater financial and other resources and development capabilities than us.

Our Veris Cancer Care

Platform faces competition from other digital care platforms providing many of the same features, including EHR integration and

remote patient monitoring capabilities.

While we are not aware of other implantable physiologic monitors containing biologic

sensors, our competitors may also be developing similar devices that have not yet been announced.

March 21, 2024, PAVmed announced that it had launched a wholly owned incubator, PMX, to complete development and commercialization

of existing portfolio technologies, including PortIO, EsoCure and CarpX.

Although PMX may seek to expand its portfolio with internal

or externally sourced technologies in the future, its initial assets will include the following products:

PortIO implantable intraosseous vascular access device is being developed as a means for infusing fluids, medications and other substances

directly into the bone marrow cavity and from there into the central venous circulation.

The intraosseous route provides a means for

infusing fluids, medications and other substances directly into the bone marrow cavity which communicates with the central venous circulation

via nutrient and emissary veins.

This route is well established, having been used for decades in a variety of settings including trauma,

especially military trauma, and pediatric emergencies.

It has been shown to be bioequivalent to the intravenous route.

Complication rates

are low and there are few contraindications.

Currently available intraosseous devices pass through the skin into the bone and are therefore

limited to short term use.

PortIO is a novel, implantable intraosseous vascular access device which does not require accessing the central

venous system and does not have an indwelling intravascular component.

It is designed to be highly resistant to occlusion and, we believe,

may not require regular flushing.

It features simplified, near-percutaneous insertion and removal, without the need for surgical dissection

or radiographic confirmation.

connection with our efforts to expand our presence in the EAC diagnostic market, we were developing the EsoCure Esophageal Ablation Device,

with the intent to allow a clinician to treat dysplastic BE before it can progress to EAC, a highly lethal esophageal cancer, and to

do so without the need for complex and expensive capital equipment.

We have successfully completed a pre-clinical feasibility animal

study of EsoCure demonstrating excellent, controlled circumferential ablation of the esophageal mucosal lining.

An acute and survival

animal study of EsoCure Esophageal Ablation Device has also been completed, demonstrating successful direct thermal balloon catheter

ablation of esophageal lining through the working channel of a standard endoscope.

When resources permit, we plan to conduct additional

development work and animal testing of EsoCure to support a future FDA 510(k) submission.

is a patented, single-use, disposable, minimally invasive surgical device for use in the treatment of carpal tunnel syndrome.

is designed to allow the physician to relieve the compression on the median nerve without an open incision or the need for

endoscopic or other imaging equipment, and therefore we believe it will be significantly less invasive than existing treatments.

use CarpX, the operator first advances a guidewire through the carpal tunnel under the ligament, and then advanced over the wire and

positioned in the carpal tunnel under ultrasonic and/or fluoroscopic guidance.

When the CarpX balloon is inflated it creates tension

in the ligament positioning the cutting electrodes underneath it and creates space within the tunnel, providing anatomic separation

between the target ligament and critical structures such as the median nerve.

Radiofrequency energy is briefly delivered to the

electrodes, rapidly cutting the ligament, and relieving the pressure on the nerve.

We believe CarpX will be significantly less

invasive than existing treatments.

received FDA 510(k) marketing clearance in April 2020, with the first commercial procedure successfully performed in December 2020.

May 2021 European CE Mark Certification was received for CarpX.

Our limited-release commercialization efforts through 2022 were focused

on engaging key opinion hand surgeons designed to solicit input for ergonomic improvements to the device, procedure development and surgical-time

optimization, and ease of use.

As a result of this clinical input, we have initiated a product development project to incorporate intraluminal

ultrasound into the device to include real time imaging of the ligament to be cut together with critical anatomic structures, and will

continue to pursue that project, as resources permit.

Medicare Coverage

November 2024, Lucid submitted to MolDx its 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.

There are many existing competitors in the remote physiological monitoring space, some of which possess significantly greater financial and other resources and development capabilities than us.

Our Veris Cancer Care Platform faces competition from other digital care platforms providing many of the same features, including EHR integration and remote patient monitoring capabilities.

While we are not aware of other implantable physiologic monitors containing biologic sensors, our competitors may also be developing similar devices that have not yet been announced.

Medical Device Pipeline

PAVmed is developing a portfolio of medical device technologies.

This portfolio currently includes the Company’s PortIO implantable intraosseous vascular access device and endoscopic imaging technology licensed from Duke University.

The Company continues to evaluate opportunities to expand its medical device portfolio through internal development and external licensing.

Our PortIO implantable intraosseous vascular access device is being developed as a means for infusing fluids, medications and other substances directly into the bone marrow cavity and from there into the central venous circulation.

The intraosseous route provides a means for infusing fluids, medications and other substances directly into the bone marrow cavity, which communicates with the central venous circulation via nutrient and emissary veins.

This route is well established and has been used for decades in a variety of clinical settings, including trauma and pediatric emergencies, and has been shown to be bioequivalent to the intravenous route.

Currently available intraosseous devices pass through the skin into the bone and are therefore limited to short-term use.

PortIO is a novel, implantable intraosseous vascular access device that does not require accessing the central venous system and does not have an indwelling intravascular component.

It is designed to be highly resistant to occlusion and may not require regular flushing.

It also features simplified, near-percutaneous insertion and removal, without the need for surgical dissection or radiographic confirmation.

Endoscopic Imaging Technology

In February 2026, PAVmed entered into a definitive license agreement with Duke University, through a newly formed subsidiary, for the exclusive worldwide rights to endoscopic imaging technology involving a multi-modality probe combining angle-resolved low coherence interferometry (“a/LCI”) with optical coherence tomography (“OCT”).

This technology may be used to identify and facilitate treatment of advanced esophageal precancer (“dysplasia”) during upper endoscopy.

The platform is designed to integrate with standard endoscopic procedures and may enable real-time assessment of esophageal tissue to guide clinical decision-making during the procedure.

Additionally, as the diagnosis of dysplasia currently relies on biopsy-based approaches, which require tissue sampling and subsequent pathological review, this technology may provide a complementary approach to streamline the evaluation and treatment process.

Recent Events

Medicare Coverage (Lucid)

In November 2024, Lucid submitted to MolDx its 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.

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

three clinical validation studies (two in the intended use population, one case control), two clinical utility studies, and one analytical

validation study.

The current LCD provides clear coverage criteria consistent with the ACG guidelines

for esophageal precancer testing.

The package was submitted as part of a request for reconsideration of the non-coverage language in

the LCD to secure Medicare coverage for EsoGuard.

NCCN Clinical Practice Guidelines Update

In March 2025, Lucid announced that

a recent update to the National Comprehensive Cancer Network® (NCCN) Clinical Practice Guidelines in Oncology (NCCN Guidelines®)

focused on Esophageal and Esophagogastric Junction Cancers (Version 1.2025) has added a new section on BE screening.

The NCCN Guidelines®

now reference professional society guidelines on BE screening, including the most recent ACG clinical guideline discussed above, which

recommends non-endoscopic biomarker testing, such as EsoGuard performed on samples collected with EsoCheck, as an acceptable alternative

to invasive upper endoscopy to detect esophageal precancer.

Clinical Study Publications

On March 18, 2025, Lucid announced

that its ENVET-BE clinical utility study has been accepted for publication in Gastroenterology & Hepatology—the fifth peer-reviewed

publication of clinical utility data for Lucid’s EsoGuard® Esophageal DNA Test, and the second to present findings from a real-world

screening population.

The manuscript, entitled “Enhancing the Diagnostic Yield of EGD for Diagnosis of Barrett’s Esophagus Through

Methylated DNA Biomarker Triage,” demonstrates that confirmatory upper endoscopy (EGD) performed in EsoGuard-positive patients had

a substantially higher diagnostic yield for detecting esophageal precancer (Barrett’s Esophagus or BE) than the expected yield of screening

EGD alone in at-risk patients.

The ENVET-BE study reviewed real-world data from a cohort of 199 EsoGuard-positive patients who completed

confirmatory EGD.

The overall positive diagnostic yield for BE was 2.4-fold higher than the expected yield of screening EGD alone, based

on disease prevalence within an at-risk population.

The yield was nearly three-fold higher in patients meeting American College of Gastroenterology

(ACG) screening criteria.

On November 7, 2024, Lucid announced that its

manuscript for its multi-center ESOGUARD BE-1 study has been accepted for publication in The American Journal of Gastroenterology,

the official journal of the American College of Gastroenterology (ACG).

This is the fourth publication presenting clinical

validation data for Lucid’s EsoGuard® Esophageal DNA Test, and the second to demonstrate its performance in an

intended-use screening population.

Consistent with previous studies, EsoGuard showed high sensitivity and negative predictive value

in detecting esophageal precancer (Barrett’s Esophagus or BE).

The prospective, multi-center study presented data from a cohort of

patients who met ACG guideline criteria for esophageal precancer screening and underwent non-endoscopic EsoGuard testing followed by

traditional upper endoscopy.

EsoGuard sensitivity and negative predictive value for detecting BE were approximately 88% and 99%,

respectively.

Specificity and positive predictive value were approximately 81% and 30%, respectively.

No serious adverse events were

Reimbursement Approval

March 13, 2025, Lucid 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.

The new policy

will cover EsoGuard in patients who meet established criteria for esophageal precancer testing consistent with professional society guidelines.

NIH Grant Related to EsoGuard and EsoCheck

On February 27, 2025, Lucid announced that principal investigators from CWRU and University Hospitals (“UH”),

were awarded an $8 million National Institutes of Health (“NIH”) R01 grant to conduct a five-year clinical study designed

to evaluate esophageal precancer detection using EsoCheck and EsoGuard among at-risk individuals without symptoms of chronic GERD.

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

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.

October 10, 2024, PAVmed announced that Veris has been awarded a $1.8 million grant from the National Institute on Minority Health and

Health Disparities (NIMHD), an institute of NIH.

The two-year grant will fund research to optimize

and validate the Veris Cancer Care Platform for the needs of medically underserved cancer patients, in partnership with an academic cancer

The research project, “Bridging the Gap:

Enhancing Cancer Care for Underserved Populations with the Veris Health Cancer

Care Platform,” will focus on patients facing language barriers, limited access to technology, and socioeconomic disparities.

to Board Composition

as of September 10, 2024, James L.

Cox, M.D., and Joan B.

Harvey resigned from the Company’s board of directors.

Harvey’s resignation was due to any disagreement with the Company on any matter relating to its operations, policies or

effective as of September 10, 2024, the Company’s board of directors appointed Sundeep Agrawal, M.D.

as a Class B director.

to being appointed to the Company’s board of directors, Dr.

Agrawal had entered into a strategic advisory agreement with the Company

to provide certain M&A advisory services.

Such agreement remains in effect.

Pursuant to the

agreement, Dr.

Agrawal will receive a monthly consulting fee of $3,333.

The agreement is terminable by the Company on 10 days’

written notice.

Except for the foregoing, Dr.

Agrawal has not engaged in any transactions with the Company that are required to be reported

pursuant to Item 404(a) of Regulation S-K.

Agreements with Lucid

August 6, 2024, the Company and Lucid entered into a ninth amendment to the management services agreement between them (“MSA”)

to increase the monthly fee thereunder from $0.83 million per month to $1.05 million per month, effective as of July 1, 2024.

under the terms of our convertible debt (as amended as of January 17, 2025), we are required to elect that these payments be made in cash.

Cancer Care Platform

June 13, 2024, we announced that Veris and a National Cancer Institute-Designated Comprehensive Cancer Center launched a pilot program

and has enrolled the first patients from such center in such program on the Veris Cancer Care Platform.

Common Stock Offering

February 18, 2025, the Company and Veris entered into subscription agreements (each, a “Subscription Agreement”) with certain

accredited investors (collectively, the “Investors”), pursuant to which the Company agreed to sell and the Investors agreed

to purchase (the “Offering”) 2,574,350 shares of the Company’s common stock and pre-funded warrants to purchase 756,734

shares of the Company’s common stock (the “Pre-Funded Warrants”), at a purchase price of $0.7115 per share or warrant

share (as applicable).

In addition, Veris agreed to issue to each Investor approximately 0.2033 shares of Veris’ common stock for

each share or warrant share (as applicable) purchased by such Investor, for an aggregate of 677,143 shares of Veris’ common stock.

three clinical validation studies (two in the intended use population, one case control), two clinical utility studies, and one analytical validation study.

The current LCD provides clear coverage criteria consistent with the ACG guidelines for esophageal precancer testing.

The package was submitted as part of a request for reconsideration of the non-coverage language in the LCD to secure Medicare coverage for EsoGuard.

As part of the LCD reconsideration process, MolDx-participating Medicare Administrative Contractors convened a CAC Meeting regarding the LCD on September 4, 2025.

Medical Device Developments

In March 2026, PAVmed hired industry-veteran Joseph Virgilio to serve as PAVmed's Chief Business Officer for Medical Devices.

Prior to joining PAVmed, Mr.

Virgilio held leadership roles at a diverse group of medical device companies over the course of his 25-year career.

In this capacity, Mr.

Virgilio will oversee the development and commercialization of PAVmed's current and future medical device portfolio.

Such portfolio includes at this time the Company's PortIO implantable intraosseous vascular access device, which is being developed as a means for infusing fluids, medications and other substances directly into the bone marrow cavity and from there into the central venous circulation.

The portfolio also includes technology licensed by PAVmed from Duke University that involves a multi-modality probe combining ("a/LCI") with optical coherence tomography ("OCT"), as more fully described below.

Endoscopic Imaging Technology

In February 2026, PAVmed entered into a definitive license agreement with Duke University, through a newly formed subsidiary, for the exclusive worldwide rights to technology involving a multi-modality probe combining angle-resolved low coherence interferometry (“a/LCI”) with endoscopic imaging.

This technology may be used to identify and facilitate treatment of advanced esophageal precancer (“dysplasia”) during upper endoscopy.

The platform is designed to integrate with standard endoscopic procedures and may enable real-time assessment of esophageal tissue to guide clinical decision-making during the procedure.

Department of Veteran Affairs (Lucid)

In January 2026, Lucid announced that it has been awarded a contract by the U.S.

Department of Veterans Affairs for EsoGuard expanding access to esophageal precancer testing across the nation's largest integrated healthcare system, which serves more than nine million enrolled veterans annually.

Real-World Experience Data (Lucid)

In December 2025, Lucid announced results from an 18-month real-world experience evaluating EsoGuard and EsoCheck in approximately 12,000 patients.

The analysis demonstrated high technical success rates, rapid procedure times, and appropriate physician utilization in routine clinical practice, consistent with previously reported clinical studies.

The data are currently under peer review for publication.

Strategic Commercial Partnership (Veris)

In October 2025, we announced that Veris and The Ohio State University Comprehensive Cancer Center - The James Cancer Hospital and Solove Research Institute ("OSUCCC – The James"), a National Cancer Institute-Designated Comprehensive Cancer Center, launched the commercial phase of their long-term strategic partnership agreement.

This transition to a commercial phase follows successful completion of a pilot program conducted at the OSUCCC -- The James.

Clinical Study Publications (Lucid)

In September 2025, a case series published in Gastroenterology & Hepatology highlighted four real-world cases in which EsoGuard facilitated the timely detection of either high-grade dysplasia ("HGD") or intramucosal carcinoma ("IMC";

T1a esophageal adenocarcinoma).

In all four cases, the patients had no prior history of EGD, including one individual who had previously declined multiple EGD referrals.

Following positive in-office EsoGuard results, each patient proceeded with endoscopic evaluation, which led to successful identification and eradication of disease in all cases.

This case series underscores both the clinical utility of EsoGuard in detecting early-stage neoplasia and the ease with which the test can be integrated into standard office workflows to enhance screening uptake and early disease detection.

Russell 2000® and 3000® Indexes (Lucid)

On June 27, 2025, Lucid was added to the Russell 2000® Index and the Russell 3000® Index, following the 2025 annual reconstitution by FTSE Russell.

NCCN Clinical Practice Guidelines Update (Lucid)

In March 2025, Lucid announced that a recent update to the NCCN Guidelines® focused on Esophageal and Esophagogastric Junction Cancers (Version 1.2025) has added a new section on BE screening.

The NCCN Guidelines® now reference professional society guidelines on BE screening, including the most recent ACG clinical guideline discussed above, which recommends non-endoscopic biomarker testing, such as EsoGuard performed on samples collected with EsoCheck, as an acceptable alternative to invasive upper endoscopy to detect esophageal precancer.

Highmark Reimbursement Approval (Lucid)

On March 13, 2025, Lucid 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.

Series D Offering and Recapitalization;

Series D Conversion

On February 3, 2026, PAVmed entered into subscription agreements (the “Subscription Agreements”) with certain accredited investors (the “Investors”) and, pursuant to and concurrently with the execution of the Subscription Agreements, sold to the Investors, for an aggregate purchase price of $30 million, (i) 30,000 shares of the Company’s newly designated Series D Convertible Preferred Stock, par value $0.001 per share (the “Series D Preferred Stock”), and (ii) warrants (the “Warrant”) to purchase an additional 30,000 shares of Series D Preferred Stock, with each investor receiving 100 shares of Series D Preferred Stock and a warrant to purchase 100 shares of Series D Preferred Stock for each $100,000 of its investment (the “Offering”).

The initial conversion price of the Series D Preferred Stock is $6.50 per share, subject to adjustment in the event of stock splits, stock dividends, and similar transactions.

Concurrently with the Offering, the Company redeemed all 16,962 shares of Series C Preferred Stock outstanding and refinanced all $8.4 million in principal and interest of its Senior Secured Convertible Note issued in September (the “2022 Note”), in consideration of a cash payment to the holder thereof (the “Holder”) of approximately $22.3 million (which was made using proceeds from the sale of the Series D Preferred Stock), and the issuance to the Holder of an amended and restated 2022 Note (the “2026 Note”) with a principal amount of $15.0 million.

The net proceeds of the Offering, taking into account the cash payments made in respect of the redemption of the Series C Preferred Stock and the 2022 Note, were approximately $7.6 million.

On March 27, 2026, PAVmed's shareholders approved the conversion of the Series D Preferred Stock into shares of our common stock.

Promptly following such approval, 100% of the Series D Preferred Stock was converted in full into 4,615,393 shares of our common stock.

Reverse Stock Split;

Reduction in Authorized Shares

At a special meeting of the Company’s stockholders held on December 5, 2025, the Company’s stockholders approved a reverse stock split of the Company’s outstanding shares of common stock (the “Reverse Split”) at a specific ratio, ranging from 1-for-10 to 1-for-30, to be determined by the Company’s board of directors (the “Board”) in its sole discretion, as well as an associated reduction in the number of shares of common stock the Company is authorized to issue (the “Reduction in Authorized Common Stock”) from 250,000,000 shares to 25,000,000 shares.

Following the special meeting, the Board approved a ratio of 1-for-30 for the Reverse Split.

On December 30, 2025, in order to effect the Reverse Split and the Reduction in Authorized Common Stock, the Company filed a certificate of amendment to its certificate of incorporation, as amended, pursuant to which the Reverse Split and the Reduction in Authorized Common Stock became effective on Friday, January 2, 2026.

The purpose of the Reverse Split was to help the Company regain compliance with the $1 minimum bid requirement for continued listing on the Capital Market of the Nasdaq Stock Market LLC ("Nasdaq"), which it did, as discussed below.

All shares and per share amounts set forth herein give effect to the reverse stock split.

NASDAQ Compliance

On January 21, 2026, the Company received a notification letter from the Nasdaq Listing Qualifications department stating that the Company had regained compliance with the $1 minimum bid price requirement for continued listing on the Nasdaq Capital Market.

As previously reported, on January 23, 2025, the Company had received a notification letter from the Listing Qualifications department stating that, for the prior 30 consecutive business days (through January 22, 2025), the closing bid price of the Company’s common stock had been below the minimum of $1 per share required for continued listing on the Nasdaq Capital Market under Nasdaq Listing Rule 5550(a)(2).

Subsequently, Nasdaq determined that, from January 2, 2026 to January 19, 2026, the closing bid price of the Company’s common stock had been at $1 per share or greater.

Accordingly, the Company had regained compliance with Nasdaq Listing Rule 5550(a)(2).

Veris Financing (June 2025)

On June 23, 2025, Veris entered into subscription agreements (each, a “Veris June 2025 Subscription Agreement”) with certain accredited investors (collectively, the “June 2025 Investors”), pursuant to which Veris agreed to sell and the June 2025 Investors agreed to purchase (the “June 2025 Offering”) 1,800,000 shares of common stock, par value $0.001 per share, of Veris (“Veris Common Stock”) and warrants to purchase 1,800,000 shares of Veris Common Stock (“Veris Warrants”), at a purchase price of $1.40 per share of Veris Common Stock.

On the same day, Veris consummated the June 2025 Offering, generating gross proceeds to Veris of approximately $2.5 million.

The proceeds of the offering will be used to continue development activities related to Veris’ implantable physiological monitor and for general working capital purposes.

The Veris Warrants become exercisable six months after issuance and expire on the earlier of (i) the five-year anniversary of the initial exercise date and (ii) the 60th day following receipt by Veris of FDA approval of its implantable physiological monitor.

The Veris Warrants have an exercise price of $1.40 per share, subject to adjustment under certain circumstances.

PAVmed/Veris Financing (February 2025)

On February 18, 2025, the Company and Veris, entered into subscription agreements (each, a “Subscription Agreement”) with certain accredited investors (collectively, the “Investors”), pursuant to which the Company agreed to sell and the Investors agreed to purchase (the “Offering”) 85,812 shares of the Company’s common stock and pre-funded warrants to purchase 25,225 shares of the Company’s common stock (the “Pre-Funded Warrants”), at a purchase price of $21.345 per share or warrant share (as applicable).

In addition, Veris agreed to issue to each Investor approximately 6.098 shares of Veris Common Stock for each share or warrant share (as applicable) purchased by such Investor, for an aggregate of 677,143 shares of Veris Common Stock.

On February 21, 2025, the Company consummated the Offering, generating gross proceeds to the Company of $2.37 million.

The proceeds of

the offering will be used to resume development activities related to Veris’ implantable physiological monitor and for general

working capital purposes.

Subscription Agreement contains customary representations, warranties, covenants and indemnities of the Company and the Investors,

as well as a covenant by the Company to provide the Investors with protection against subsequent equity raises by the Company or

Veris at a lower purchase price (solely to the extent the Investors continue to hold the shares issued in the Offering), with such

protection to be effected through the issuance of additional shares of Veris’ common stock.

In addition, the Company (i)

agreed to solicit the affirmative vote of its stockholders by no later than its next meeting of stockholders, which will be held no

later than June 30, 2025, for approval, for the purposes of the rules of The Nasdaq Stock Market LLC (“Nasdaq”), of the issuance of all of the

shares underlying the Pre-Funded Warrants, and to hold additional meetings quarterly thereafter to the extent such approval is not

obtained, (ii) granted the Investors a 100% participation right in future offerings of equity securities of the Company or its

majority-owned subsidiaries, subject to existing participation rights of the Company’s debt holder, and (iii) agreed not to

incur, and not to permit its majority-owned subsidiaries to incur, any indebtedness until August 18, 2026, subject to certain

In accordance with the Subscription Agreement, the Company also entered into a registration rights agreement (the

“Registration Rights Agreement”) with the Investors, pursuant to which the Company agreed to file a registration

statement covering the resale of the shares of the Company’s common stock issued in the Offering, including the shares

underlying the Pre-Funded Warrants.

Pre-Funded Warrants become exercisable upon the receipt of the stockholder approval described above, expire on February 18, 2030, and

have an exercise price of $0.001 per share, subject to adjustment as described below.

The Pre-Funded Warrants may be exercised for cash,

or on a cashless basis.

In the event the Pre-Funded Warrants are exercised on a cashless basis, the holder will be entitled to receive

a number of shares of the Company’s common stock equal to (x) the excess of the market value of the Company’s common stock

over the exercise price, multiplied by (y) the number of shares as to which the Pre-Funded Warrant is being exercised, divided by (z)

the market value of the Company’s common stock.

The exercise price and number and type of securities or other property issuable

on exercise of the Pre-Funded Warrants may be adjusted in certain circumstances, including in the event of a stock split or combination,

stock dividend, or a recapitalization, reorganization, merger or similar transaction.

In addition, a holder of the Pre-Funded Warrants

will be entitled to participate in rights offerings or pro rata distributions by the Company.

However, there will be no adjustment for

issuances of shares of common stock at a price below the exercise price.

lead investor in the Offering also agreed with the Company that it would, with respect to the election of the Company’s directors,

vote its shares of the Company’s common stock (including those exercisable in respect of their Pre-Funded Warrants) in

accordance with the Company’s board’s recommendations.

Nasdaq Compliance with Stockholders’ Equity

Continued Listing Standard

On February 14, 2025, the Company

received a notification letter from the Nasdaq Listing Qualifications Department, stating that the Company had regained compliance with

the Nasdaq continued listing standard under Nasdaq Listing Rule 5550(b)(1), which requires, among other things, that the Company maintain

at least $2.5 million in stockholders’ equity.

As previously disclosed, on March

7, 2024, the Company received a notice from the Nasdaq Listing Qualifications Department stating that, for the prior 30 consecutive business

days (through March 6, 2024), the market value of the Company’s listed securities had been below the minimum of $35 million required

for continued inclusion on the Nasdaq Capital Market under Nasdaq Listing Rule 5550(b)(2).

The Company did not regain compliance with

the rule during the time period originally allotted under Nasdaq rules.

Accordingly, the Company timely requested a hearing before a Nasdaq

Hearings Panel (the “Panel”), which took place on October 29, 2024.

On November 8, 2024, the Panel granted the Company an

extension, until January 31, 2025, to regain compliance with the Nasdaq continued listing standards under Nasdaq Listing Rule 5550(b)(1),

in lieu of Nasdaq Listing Rule 5550(b)(2).

The Company achieved compliance through (1) the exchange of secured convertible notes with a principal amount outstanding

of $22.3 million for shares of Series C convertible preferred stock, par value $0.001 (the “Series C Preferred Stock”), which

was consummated on January 17, 2025, (2) the issuance of additional shares of Series C Preferred Stock for an aggregate purchase price

of $2.653 million, which was consummated on January 24, 2025, and (3) a reduction in operating expenses as a result of the Company’s

completed deconsolidation of Lucid from its balance sheet, each of which transactions was previously disclosed and is outlined in more

detail below.

As a result, the Company met the terms of the Panel’s decision.

C Preferred Stock Debt Exchange ;

Amendments to September 2022 Convertible Note.

Under a Securities Purchase Agreement

dated March 31, 2022, the Company issued a Senior Secured Convertible Note dated April 4, 2022, referred to herein as the “April

2022 Senior Convertible Note”, and a Senior Secured Convertible Note dated September 8, 2022, referred to herein as the “September

2022 Senior Convertible Note”.

November 15, 2024, the Company entered into an Exchange Agreement (the “Debt Exchange Agreement”) with the holder (the “Holder”)

of the April 2022 Senior Convertible Note and the September 2022 Senior Convertible Note.

The Debt Exchange Agreement provided for the

exchange of $22.3 million in principal amount of the April 2022 Senior Convertible Note and the September 2022 Senior Convertible Note

and interest thereon for 22,347 shares of Series C Preferred Stock.

January 17, 2025, after satisfaction of all conditions to closing the Exchange, the parties consummated the Exchange.

consummation of the Exchange, the April 2022 Senior Convertible Note was satisfied in full, and the outstanding principal balance of

the remaining September 2022 Senior Convertible Note was approximately $6.6 million.

the Debt Exchange Agreement discussed above, effective as of consummation on the Exchange as of January 17, 2025, the Company also

agreed to certain amendments and modifications to the September 2022 Convertible Note, including, without limitation, that the

conversion price thereunder was reset to $1.068;

that the maturity date was extended to December 31, 2025;

that any change of

control or disposition by the Company of its shares of Lucid common stock would require the prior written consent of the Required

Holders (as defined in the September 2022 Convertible Note);

certain other terms and conditions regarding payments under the MSA and

the application of the same (including that all MSA payments from Lucid must be made in cash);

that the Company waives its right to redeem the September 2022 Convertible Note so long as any shares

of Series C Preferred Stock are outstanding;

that the Holder waives, until December 31, 2025, the financial covenants under the

September 2022 Convertible Note requiring that (i) the amount of the Company’s available cash equal or exceed $8.0 million at

all times, (ii) the ratio of (a) the outstanding principal amount of the September 2022 Convertible Note, accrued and unpaid

interest thereon and accrued and unpaid late charges to (b) the Company’s average market capitalization over the prior ten

trading days, not exceed 30%, and (iii) that the Company’s market capitalization shall at no time be less than $75 million;

and that so long as any shares of Series C Preferred Stock remain outstanding, the Holder will be entitled to exchange all, or any

portion, of the September 2022 Convertible Note (including any interest that would accrue thereon through the maturity date thereof)

into shares of Lucid common stock held by the Company, at an exchange price per share of Lucid common stock equal to $0.85 per share

(as adjusted for stock splits, stock dividends, stock combinations, recapitalizations and similar events), subject to certain

beneficial ownership limitations.

The key terms of the Series C Preferred Stock can be found on Exhibit 4.1 to this Form 10-K.

C Preferred Stock Security Purchase Agreement.

On November 20, 2024, the Company entered into a Securities Purchase

Agreement (the “Series C Securities Purchase Agreement”) with the Holder.

The Series C Securities Purchase Agreement

provides for the purchase of 2,653 shares of Series C Preferred Stock at a price of $1,000 per share, with the purchase price to be

satisfied through the cancellation of $2.6 million of certain unsecured debt obligations owed by the Company to the Holder (the

January 24, 2025, after satisfaction of all conditions to closing the Purchase, the parties consummated the Purchase.

Lucid Deconsolidation.

On September 10,

2024, the Company determined that Lucid and its subsidiaries will be deconsolidated from the Company’s financial statements as of

September 10, 2024, as a result of the changes in the composition of the Company’s board of directors discussed above, in combination

with the Company ceasing to have control over a majority of the voting power of Lucid.

As a result of these events, the Company is considered

to cease to have control over Lucid for the purposes of U.S.

generally accepted accounting principles, even though it continues to own,

and has not disposed any of its, 31,302,444 shares of common stock of Lucid.

Nasdaq Notice of Noncompliance

with the Minimum Bid Price Requirement

January 23, 2025, the Company received a notice from the Listing Qualifications Department of Nasdaq stating that, for the prior 30

consecutive business days (through January 22, 2025), the closing bid price of the Company’s common stock had been below the

minimum of $1 per share required for continued listing on the Nasdaq Capital Market under Nasdaq Listing Rule 5550(a)(2).

notification letter stated that the Company would be afforded 180 calendar days (until July 22, 2025) to regain compliance.

to regain compliance, the closing bid price of the Company’s common stock must be at least $1 for a minimum of ten consecutive

business days.

The notification letter also stated that, in the event the Company does not regain compliance within the initial

180-day period, the Company may be eligible for an additional 180-day period.

If the Company is not eligible for the additional

180-day period, or if it appears to the Nasdaq staff that the Company will not be able to cure the deficiency, the Nasdaq Listing

Qualifications Department will provide notice after the end of the initial 180-day period that the Company’s securities will

be subject to delisting.

The Nasdaq notification has no effect at this time on the listing of the Company’s common stock or

Series Z warrants, and the common stock and Series Z warrants will continue to trade uninterrupted under the symbol

“PAVM” and “PAVMZ,” respectively.

Long-Term Incentive Plan

January 2025, the Company accepted from employees the voluntary forfeiture of approximately 494,202 of previously granted Company stock

options, each with an exercise price greater than $4.00 per share and collectively with a weighted average exercise price of $23.38 per

None of the forfeitures were from Section 16 officers or board members.

Share Increase

January 15, 2025, the Company received shareholder approval to amend its certificate of incorporation, as amended, to increase the total

number of shares of common stock the Company is authorized to issue by 200 million shares from 50 million shares to 250 million shares.

An amendment effecting such change was filed with the Secretary of State of Delaware on January 15, 2025.

Diagnostics — Registered Direct Offering

March 5, 2025, Lucid closed on the sale of 13,939,331 shares of its common stock, pursuant to its previously announced offering of shares

of common stock at a price of $1.10 per share (the “Lucid Offering”).

net proceeds of the Lucid Offering, after deducting the estimated placement agent’s fees and other expenses of the Lucid Offering,

was approximately $14.5 million.

Lucid intends to use the net proceeds from the Lucid Offering for working capital and other general

corporate purposes.

connection with the Lucid Offering, Lucid suspended its “at the market offering” program.

In November 2022, Lucid

entered into a Controlled Equity Offering℠ Sales Agreement (the “Lucid Sales Agreement”) with Cantor Fitzgerald

Pursuant to the Sales Agreement, from time to time, Lucid may offer and sell shares of its common

stock to or through Cantor, acting as sales agent or principal.

Sales of Lucid’s common stock by Cantor, if any, under the

Sales Agreement may be made by any method permitted by law and deemed to be an “at the market offering” as defined in

Rule 415(a)(4) promulgated under the Securities Act (the “Lucid ATM Offering”).

Lucid filed a prospectus supplement

dated December 6, 2022 (the “Lucid ATM Prospectus Supplement”), for the offer and sale of shares of its common stock

having an aggregate offering price of up to $6,500,000 in the Lucid ATM Offering.

Effective as of March 4, 2025, Lucid terminated

the Lucid ATM Prospectus Supplement.

Lucid will not make any sales of common stock in the Lucid ATM Offering unless and until a new

prospectus or prospectus supplement is filed.

Other than the termination of the Lucid ATM Prospectus Supplement, the Lucid Sales

Agreement remains in full force and effect.

Diagnostics — Debt Refinancing

November 22, 2024, Lucid closed on the sale of $21.975 million in principal amount of 12.0% Senior Secured Convertible Notes due 2029

(collectively, the “Lucid 2024 Convertible Notes”), in a private placement, to certain accredited investors (the “Lucid

2024 Note Investors”).

The sale of the Lucid 2024 Convertible Notes was completed pursuant to the terms of the previously disclosed

Securities Purchase Agreement, dated as of November 12, 2024 (the “Lucid 2024 SPA”), between Lucid and the Lucid 2024 Note

Lucid realized gross proceeds of $21.95 million and, after giving effect to the repayment in full of the Lucid 2023 Convertible

Note (as defined below), net proceeds of $18.3 million from the sale of the Lucid 2024 Convertible Notes.

used a portion of the proceeds from the sale of the Lucid 2024 Convertible Notes to repay the Senior Convertible Note (the “Lucid

2023 Convertible Note”) issued pursuant to that certain Securities Purchase Agreement, dated as of March 13, 2023.

the terms of the Lucid 2023 Convertible Note, on November 22, 2024, Lucid redeemed the Lucid 2023 Convertible Note by paying the contractual

redemption price of approximately $3.7 million.

December 2021, we entered into an “at-the-market offering” for up to $50 million of our common stock that may be offered

and sold under a Controlled Equity Offering Agreement between us and Cantor.

In March 2023, the “at-the-market offering”

became subject to General Instruction I.B.6 of Form S-3, which limits sales of our securities under this instruction in any 12-month

period to one-third of the aggregate market value of our public float (unless our public float rises to $75 million or more, in which

case the instruction will cease to apply).

As a result of this limitation and our then-current public float, in May 2023, we amended

our “at-the-market offering” to cover up to an additional $18 million of our common stock.

In the year ended December 31,

2024, the Company sold 1,032,298 shares through its at-the-market equity facility for net proceeds of approximately $1.3 million, after

payment of 3% commissions.

Subsequent to December 31, 2024, as of March 20, 2025, the Company sold 1,210,704 shares through

their at-market equity facility for net proceeds of approximately $0.8 million, after payment of 3% commissions.

business will depend on proprietary medical device and diagnostic technologies to commercialize.

We own or have the right to use

intellectual property rights, such as patents, trademarks, copyrights, trade secrets and know-how, pertaining to our EsoCheck and

EsoGuard technology, our Veris technology and our EsoCure, CarpX and PortIO products, among other technologies and

intend to vigorously protect our proprietary technologies’ intellectual property rights in patents, trademarks and copyrights,

as available through registration in the United States and internationally.

Patent protection and other proprietary rights are thus essential

to our business.

We currently have applied for, license or own 55 domestic and foreign patents across 11 families of products, including

patents protecting our EsoCheck, EsoGuard and Veris technology.

Each of the technologies noted below is protected by multiple families.

The date the patents protecting certain of our owned and licensed technology will first begin to expire is as set forth in the table

below (although currently pending patent applications, both foreign and domestic, provide protection beyond such date in each instance).

For EsoGuard, additional patents have been issued that offer protection until at least 2037.

policy is to aggressively file patent applications to protect our proprietary technologies including inventions and improvements to inventions.

The proceeds of the offering will be used to resume development activities related to Veris’ implantable physiological monitor and for general working capital purposes.

The Pre-Funded Warrants were exercised as of June 19, 2025.

On April 17, 2025, the Company entered into a Sales Agreement (the “Sales Agreement”) with Maxim Group LLC, as sales agent (“Maxim”), pursuant to which the Company may offer and sell, from time to time through or to Maxim, shares of its common stock.

Under the Sales Agreement, the Company may not issue or sell through Maxim a dollar amount of shares that would exceed $2.88 million of shares.

The Company will pay Maxim a commission of 3.0% of the aggregate gross sales prices of the shares.

The Company intends to use the net proceeds from any such sales for working capital and general corporate purposes.

This facility replaced the “at the market” facility PAVmed previously maintained with Cantor (which facility was on substantially similar terms).

Lucid Diagnostics — Confidentially Marketed Public Offering (September 2025)

On September 11, 2025, Lucid closed on the sale of 28,750,000 shares of its common stock, pursuant to its previously announced offering of shares of common stock at a price of $1.00 per share (the “Lucid September CMPO”).

The net proceeds from the Lucid September CMPO, after deducting the underwriting discount and other expenses of the Lucid September CMPO, were approximately $27.0 million.

Lucid is using the net proceeds from the Lucid September CMPO for working capital and general corporate purposes.

Lucid ATM Facility

On May 30, 2025, Lucid entered into a Controlled Equity Offering Agreement (also “ATM” or “at-the-market” offering) between Lucid and Maxim Group LLC for up to $25 million of its common stock that may be offered and sold from time to time.

Subsequent to December 31, 2025 as of March 27, 2026, Lucid sold 4,161,747 shares through its at-the-market equity facility for net proceeds of approximately $5.3 million, after payment of 3% commissions.

Intellectual Property

Our business will depend on proprietary medical device and diagnostic technologies to commercialize.

We own or have the right to use intellectual property rights, such as patents, trademarks, copyrights, trade secrets and know-how, pertaining to our EsoCheck and EsoGuard technology, our Veris technology and PortIO, among other technologies and products.

We intend to vigorously protect our proprietary technologies’ intellectual property rights in patents, trademarks and copyrights, as available through registration in the United States and internationally.

Patent protection and other proprietary rights are thus essential to our business.

Each of our technologies is protected by multiple patent families.

For select technologies shown below, patents have been granted with protection extending to at least the date shown below (although currently pending patent applications, both foreign and domestic, provide protection beyond such date in each instance).

November 2038

November 2037

November 2035

Our policy is to aggressively file patent applications to protect our proprietary technologies including inventions and improvements to inventions.

We seek patent protection, as appropriate, on:

product itself including all embodiments with future commercial potential;

methods of using the product;

methods of manufacturing the product.

addition to filing and prosecuting patent applications in the United States, we intend to file counterpart patent applications in other

countries worldwide where there is a value in doing so.

Foreign filings can be cumbersome and expensive, and we will pursue such filings

when we believe they are warranted as we try to balance our international commercialization plans with our desire to protect the global

value of the technology.

term of individual patents depends upon the legal term of the patents in the countries in which they are obtained.

In most countries

in which we file, the patent term is 20 years from the earliest date of filing a non-provisional patent application.

In the United States,

a patent’s term may be shortened if a patent is terminally disclaimed over another patent or as a result of delays in patent prosecution

by the patentee, and a patent’s term may be lengthened by patent term adjustment (PTA), which compensates a patentee for administrative

delays by the U.S.

Patent and Trademark Office (“USPTO”) in granting a patent, or patent term extension, which restores time

lost due to regulatory delays.

intend to continuously reassess and fine-tune our intellectual property strategy in order to fortify our position in the United States

and internationally.

Prior to acquiring or licensing a technology from a third party, we will evaluate the existing proprietary rights,

our ability to adequately obtain and protect these rights and the likelihood or possibility of infringement upon competing rights of

also rely upon trade secrets, know-how, continuing technological innovation, and upon licensing opportunities, to develop and maintain

our competitive position.

We intend to protect our proprietary rights through a variety of methods, including confidentiality agreements

and/or proprietary information agreements with suppliers, employees, consultants, independent contractors and other entities who may

have access to proprietary information.

We will generally require employees to assign patents and other intellectual property to us as

a condition of employment with us.

All of our consulting agreements will pre-emptively assign to us all new and improved intellectual

property that arise during the term of the agreement.

also has (directly or through its subsidiaries) proprietary rights to a range of trademarks, including, among others, PAVmed™,

Lucid Diagnostics™, LUCID™, VERIS™, Oncodisc™, CarpX®, EsoCheck®, EsoGuard®, EsoCheck Cell Collection

Device®, Collect + Protect®, EsoCure Esophageal Ablation Device™, and PortIO™.

(Solely as a matter of convenience,

trademarks and trade names referred to herein may or may not be accompanied with the requisite marks of “™” or “®”.

the product itself including all embodiments with future commercial potential;

the methods of using the product;

the methods of manufacturing the product.

In addition to filing and prosecuting patent applications in the United States, we intend to file counterpart patent applications in other countries worldwide where there is a value in doing so.

Foreign filings can be cumbersome and expensive, and we will pursue such filings when we believe they are warranted as we try to balance our international commercialization plans with our desire to protect the global value of the technology.

The term of individual patents depends upon the legal term of the patents in the countries in which they are obtained.

In most countries in which we file, the patent term is 20 years from the earliest date of filing a non-provisional patent application.

In the United States, a patent’s term may be shortened if a patent is terminally disclaimed over another patent or as a result of delays in patent prosecution by the patentee, and a patent’s term may be lengthened by patent term adjustment (PTA), which compensates a patentee for administrative delays by the U.S.

Patent and Trademark Office (“USPTO”) in granting a patent, or patent term extension, which restores time lost due to regulatory delays.

We intend to continuously reassess and fine-tune our intellectual property strategy in order to fortify our position in the United States and internationally.

Prior to acquiring or licensing a technology from a third party, we will evaluate the existing proprietary rights, our ability to adequately obtain and protect these rights and the likelihood or possibility of infringement upon competing rights of others.

We also rely upon trade secrets, know-how, continuing technological innovation, and upon licensing opportunities, to develop and maintain our competitive position.

We intend to protect our proprietary rights through a variety of methods, including confidentiality agreements and/or proprietary information agreements with suppliers, employees, consultants, independent contractors and other entities who may have access to proprietary information.

We will generally require employees to assign patents and other intellectual property to us as a condition of employment with us.

All of our consulting agreements will pre-emptively assign to us all new and improved intellectual property that arise during the term of the agreement.

PAVmed also has (directly or through its subsidiaries) proprietary rights to a range of trademarks, including, among others, PAVmed™, Lucid Diagnostics™, LUCID™, VERIS™, EsoCheck®, EsoGuard®, EsoCheck Cell Collection Device®, Collect + Protect®, and PortIO™.

(Solely as a matter of convenience, trademarks and trade names referred to herein may or may not be accompanied with the requisite marks of “™” or “®”.

However, the absence of such marks is not intended to indicate, in any way, PAVmed Inc.

or its subsidiaries will not assert, to the fullest

extent possible under applicable law, their respective rights to such trademarks and trade names.)

Insurance Coverage and Reimbursement

ability to successfully commercialize our products will depend in part on the extent to which governmental authorities, private health

insurers and other third-party payors provide coverage for and establish adequate reimbursement levels for the procedures during which

our products are used.

the United States, third-party payors continue to implement initiatives that restrict the use of certain technologies to those that meet

certain clinical evidentiary requirements.

In addition to uncertainties surrounding coverage policies, there are periodic changes to

reimbursement.

Third-party payors regularly update reimbursement amounts and also from time to time revise the methodologies used to

determine reimbursement amounts.

This includes annual updates to payments to physicians, hospitals and ambulatory surgery centers for

procedures during which our products are used.

An example of payment updates is the Medicare program’s updates to hospital and

physician payments, which are done on an annual basis using a prescribed statutory formula.

In the past, when the application of the

formula resulted in lower payment, Congress has passed interim legislation to prevent the reductions.

product’s reimbursement profile, both in the U.S.

and internationally, is an important component of the product’s commercial

We prefer projects with existing reimbursement codes, the opportunity to seek reimbursement under higher-value surgical

procedure codes or the potential to seek reimbursement under narrow, product-specific codes as opposed to bundled procedure codes.

those products that have high strategic value, but with less defined reimbursement, we have engaged reimbursement experts and support

from industry associations to accelerate the acquisition of satisfactory reimbursement levels.

“ EsoGuard and EsoCheck—Reimbursement and Market Access ” above for a fuller discussion of the reimbursement status

for EsoCheck and EsoGuard.

for New Medical Device Innovation

and commercializing new products is highly competitive.

The market is characterized by extensive research and clinical efforts and rapid

technological change.

We face intense competition worldwide from medical device, biomedical technology and medical products and combination

products companies, including major medical products companies.

We may be unable to respond to technological advances through the development

and introduction of new products.

Most of our existing and potential competitors have substantially greater financial, marketing, sales,

distribution, manufacturing and technological resources.

These competitors may also be in the process of seeking FDA or other regulatory

approvals, or patent protection, for new products.

or its subsidiaries will not assert, to the fullest extent possible under applicable law, their respective rights to such trademarks and trade names.)

Health Insurance Coverage and Reimbursement

Our ability to successfully commercialize our products will depend in part on the extent to which governmental authorities, private health insurers and other third-party payors provide coverage for and establish adequate reimbursement levels for the procedures during which our products are used.

In the United States, third-party payors continue to implement initiatives that restrict the use of certain technologies to those that meet certain clinical evidentiary requirements.

In addition to uncertainties surrounding coverage policies, there are periodic changes to reimbursement.

Third-party payors regularly update reimbursement amounts and also from time to time revise the methodologies used to determine reimbursement amounts.

This includes annual updates to payments to physicians, hospitals and ambulatory surgery centers for procedures during which our products are used.

An example of payment updates is the Medicare program’s updates to hospital and physician payments, which are done on an annual basis using a prescribed statutory formula.

In the past, when the application of the formula resulted in lower payment, Congress has passed interim legislation to prevent the reductions.

A product’s reimbursement profile, both in the U.S.

and internationally, is an important component of the product’s commercial opportunity.

We prefer projects with existing reimbursement codes, the opportunity to seek reimbursement under higher-value surgical procedure codes or the potential to seek reimbursement under narrow, product-specific codes as opposed to bundled procedure codes.

For those products that have high strategic value, but with less defined reimbursement, we have engaged reimbursement experts and support from industry associations to accelerate the acquisition of satisfactory reimbursement levels.

Competition for New Medical Device Innovation

Developing and commercializing new products is highly competitive.

The market is characterized by extensive research and clinical efforts and rapid technological change.

We face intense competition worldwide from medical device, biomedical technology and medical products and combination products companies, including major medical products companies.

We may be unable to respond to technological advances through the development and introduction of new products.

Most of our existing and potential competitors have substantially greater financial, marketing, sales, distribution, manufacturing and technological resources.

These competitors may also be in the process of seeking FDA or other regulatory approvals, or patent protection, for new products.

Our competitors may commercialize new products in advance of our products.

also face competition from numerous existing products and procedures, some of which currently are considered part of the standard of

Our products also face competition from numerous existing products and procedures, some of which currently are considered part of the standard of care.

We believe the principal competitive factors in our markets are:

quality of outcomes for medical conditions;

by surgeons and the medical device market generally;

of use and reliability;

leadership and superiority;

marketing and distribution;

price and qualification for coverage and reimbursement.

will also compete in the marketplace to recruit and retain qualified scientific, management and sales personnel, as well as in acquiring

technologies and licenses complementary to our products or advantageous to our business.

We are aware of several companies that compete

or are developing technologies in our current and future products areas.

In order to compete effectively, our products will have to achieve

market acceptance, receive adequate insurance coverage and reimbursement, be cost effective and be simultaneously safe and effective.

“ EsoGuard and EsoCheck—Competition ” and “ Veris Cancer Care Platform—Competition ” above

for a fuller discussion of the competitive environment for our key products, EsoCheck, EsoGuard and the Veris Cancer Care Platform.

and after approval or clearance in the United States, our products are subject to extensive regulation by the FDA under the FDCA and/or

the Public Health Service Act, as well as by other regulatory bodies.

FDA regulations govern, among other things, the development, testing,

manufacturing, labeling, safety, storage, recordkeeping, market clearance or approval, advertising and promotion, import and export,

marketing and sales, and distribution of medical devices and products.

the United States, medical devices are subject to varying degrees of regulatory control and are classified in one of three classes depending

on the extent of controls the FDA determines are necessary to reasonably ensure their safety and efficacy:

the quality of outcomes for medical conditions;

acceptance by surgeons and the medical device market generally;

ease of use and reliability;

technical leadership and superiority;

effective marketing and distribution;

speed to market;

product price and qualification for coverage and reimbursement.

We are aware of several companies that compete or are developing technologies in our current and future products areas.

Government Regulation

FDA Regulation

Before and after approval or clearance in the United States, our products are subject to extensive regulation by the FDA under the FDCA and/or the Public Health Service Act, as well as by other regulatory bodies.

FDA regulations govern, among other things, the development, testing, manufacturing, labeling, safety, storage, recordkeeping, market clearance or approval, advertising and promotion, import and export, marketing and sales, and distribution of medical devices and products.

In the United States, medical devices are subject to varying degrees of regulatory control and are classified in one of three classes depending on the extent of controls the FDA determines are necessary to reasonably ensure their safety and efficacy:

general controls, such as labeling and adherence to quality system regulations;

special controls, pre-market notification (often referred to as a 510(k) application), specific controls such as performance

standards, patient registries, post-market surveillance, additional controls such as labeling and adherence to quality system regulations;

special controls, pre-market notification (often referred to as a 510(k) application), specific controls such as performance standards, patient registries, post-market surveillance, additional controls such as labeling and adherence to quality system regulations;

special controls and approval of a de novo request or PMA application, likely with clinical data requirements.

general, the higher the classification, the greater the time and cost to obtain approval to market.

There are no “standardized”

requirements for approval, even within each class.

For example, FDA could grant 510(k) status, but require a human clinical trial, a

typical requirement of a PMA.

They could also initially assign a device Class III status but end up clearing a device as a 510(k) device

or under a de novo classification pathway if certain requirements are met.

The range of the number and expense of the various requirements

is significant.

In general, the higher the classification, the greater the time and cost to obtain approval to market.

There are no “standardized” requirements for approval, even within each class.

For example, FDA could grant 510(k) status, but require a human clinical trial, a typical requirement of a PMA.

They could also initially assign a device Class III status but end up clearing a device as a 510(k) device or under a de novo classification pathway if certain requirements are met.

The range of the number and expense of the various requirements is significant.

The quickest and least expensive pathway would be 510(k) clearance with a review of existing bench and animal data.

de novo classification pathway would have a similar cost to seeking 510(k) clearance, but with a slightly longer review timeline.

longest and most expensive path would be a PMA with extensive randomized human clinical trials.

We cannot predict fully how FDA will

classify our products, nor predict what requirements will be placed upon us to obtain market clearance or approve our products at all.

request marketing authorization by means of a 510(k) clearance, we must submit a pre-market notification demonstrating the proposed

device is substantially equivalent to another currently legally marketed medical device, has the same intended use, and is as safe

and effective as a currently legally marketed device and does not raise different questions of safety and effectiveness than does a

currently legally marketed device.

510(k) submissions generally include, among other things, a description of the device and its

manufacturing, device labeling, medical devices to which the device is substantially equivalent, safety and biocompatibility

information, and the results of performance testing.

In some cases, a 510(k) submission must include data from human clinical

A de novo classification pathway would have a similar cost to seeking 510(k) clearance, but with a slightly longer review timeline.

The longest and most expensive path would be a PMA with extensive randomized human clinical trials.

We cannot predict fully how FDA will classify our products, nor predict what requirements will be placed upon us to obtain market clearance or approve our products at all.

To request marketing authorization by means of a 510(k) clearance, we must submit a pre-market notification demonstrating the proposed device is substantially equivalent to another currently legally marketed medical device, has the same intended use, and is as safe and effective as a currently legally marketed device and does not raise different questions of safety and effectiveness than does a currently legally marketed device.

510(k) submissions generally include, among other things, a description of the device and its manufacturing, device labeling, medical devices to which the device is substantially equivalent, safety and biocompatibility information, and the results of performance testing.

In some cases, a 510(k) submission must include data from human clinical studies.

Marketing may commence only when the FDA issues a clearance letter finding substantial equivalence.

After a device receives

510(k) clearance, any product modification that could significantly affect the safety or effectiveness of the product, or would

constitute a significant change in intended use, requires a new 510(k) clearance or, if the device would no longer be substantially

equivalent, would require PMA, or possibly, a de novo pathway under section 513(f)(2) of the FDCA.

In addition, any additional

claims the Company wished to make at a later date may require a PMA.

If the FDA determines the product does not qualify for 510(k)

clearance, they will issue a Not Substantially Equivalent (“NSE”) letter, at which point the Company must submit and the

FDA must approve a PMA or issue premarket clearance using the de novo before marketing can begin.

1997, the Food and Drug Administration Modernization Act (“FDAMA”) added the de novo classification pathway under section 513(f)(2) of

the FDCA, establishing an alternate pathway to classify new devices into Class I or II that had automatically been placed in Class III

after receiving an NSE determination in response to a 510(k) submission.

In this process, a sponsor who

receives an NSE determination may, within 30 days of receiving notice of the NSE determination, request FDA to make a risk-based classification

of the device under section 513(a)(1) of the Act.

2012, section 513(f)(2) of the FDCA was amended by section 607 of the Food and Drug Administration Safety and Innovation Act (“FDASIA”),

to provide a second option for de novo classification.

In this second pathway, a sponsor who determines there is no legally marketed

device upon which to base a determination of substantial equivalence may request FDA to make a risk-based classification of the device

under section 513(a)(1) of the Act without first submitting a 510(k).

the review of a 510(k) submission, the FDA may request more information or additional studies and may decide the indications for which

we seek approval or clearance should be limited.

In addition, laws and regulations and the interpretation of those laws and regulations

by the FDA may change in the future.

After a device receives 510(k) clearance, any product modification that could significantly affect the safety or effectiveness of the product, or would constitute a significant change in intended use, requires a new 510(k) clearance or, if the device would no longer be substantially equivalent, would require PMA, or possibly, a de novo pathway under section 513(f)(2) of the FDCA.

In addition, any additional claims the Company wished to make at a later date may require a PMA.

If the FDA determines the product does not qualify for 510(k) clearance, they will issue a Not Substantially Equivalent (“NSE”) letter, at which point the Company must submit and the FDA must approve a PMA or issue premarket clearance using the de novo before marketing can begin.

In 1997, the Food and Drug Administration Modernization Act (“FDAMA”) added the de novo classification pathway under section 513(f)(2) of the FDCA, establishing an alternate pathway to classify new devices into Class I or II that had automatically been placed in Class III after receiving an NSE determination in response to a 510(k) submission.

In this process, a sponsor who receives an NSE determination may, within 30 days of receiving notice of the NSE determination, request FDA to make a risk-based classification of the device under section 513(a)(1) of the Act.

In 2012, section 513(f)(2) of the FDCA was amended by section 607 of the Food and Drug Administration Safety and Innovation Act (“FDASIA”), to provide a second option for de novo classification.

In this second pathway, a sponsor who determines there is no legally marketed device upon which to base a determination of substantial equivalence may request FDA to make a risk-based classification of the device under section 513(a)(1) of the Act without first submitting a 510(k).

During the review of a 510(k) submission, the FDA may request more information or additional studies and may decide the indications for which we seek approval or clearance should be limited.

In addition, laws and regulations and the interpretation of those laws and regulations by the FDA may change in the future.

We cannot foresee what effect, if any, such changes may have on us.

Trials of Medical Technology

or more clinical trials may be necessary to support an FDA submission.

Clinical studies of unapproved or uncleared medical devices

or devices being studied for uses for which they are not approved or cleared (investigational devices) must be conducted in

compliance with FDA requirements.

If an investigational device could pose a significant risk to patients, the sponsor company must

submit an Investigational Device Exemption (“IDE”) application to the FDA prior to initiation of the clinical study.

An IDE application

must be supported by appropriate data, such as animal and laboratory test results, showing it is safe to test the device on humans

and the testing protocol is scientifically sound.

The IDE will automatically become effective 30 days after receipt by the FDA

unless the FDA notifies the company the investigation may not begin.

Clinical studies of investigational devices may not begin until

an institutional review board (“IRB”) has approved the study.

any study, the sponsor must comply with the FDA’s IDE requirements.

These requirements include investigator selection, trial monitoring,

adverse event reporting, and record keeping.

The investigators must obtain patient informed consent, rigorously follow the investigational

plan and study protocol, control the disposition of investigational devices, and comply with reporting and record keeping requirements.

We, the FDA, or the IRB at each institution at which a clinical trial is being conducted may suspend a clinical trial at any time for

various reasons, including a belief the subjects are being exposed to an unacceptable risk.

During the approval or clearance process,

the FDA typically inspects the records relating to the conduct of one or more investigational sites participating in the study supporting

the application.

Post-Approval

Regulation of Medical Devices and Diagnostic Tests

a device is cleared or approved for marketing, numerous regulatory requirements continue to apply.

Clinical Trials of Medical Technology

One or more clinical trials may be necessary to support an FDA submission.

Clinical studies of unapproved or uncleared medical devices or devices being studied for uses for which they are not approved or cleared (investigational devices) must be conducted in compliance with FDA requirements.

If an investigational device could pose a significant risk to patients, the sponsor company must submit an Investigational Device Exemption (“IDE”) application to the FDA prior to initiation of the clinical study.

An IDE application must be supported by appropriate data, such as animal and laboratory test results, showing it is safe to test the device on humans and the testing protocol is scientifically sound.

The IDE will automatically become effective 30 days after receipt by the FDA unless the FDA notifies the company the investigation may not begin.

Clinical studies of investigational devices may not begin until an institutional review board (“IRB”) has approved the study.

During any study, the sponsor must comply with the FDA’s IDE requirements.

These requirements include investigator selection, trial monitoring, adverse event reporting, and record keeping.

The investigators must obtain patient informed consent, rigorously follow the investigational plan and study protocol, control the disposition of investigational devices, and comply with reporting and record keeping requirements.

We, the FDA, or the IRB at each institution at which a clinical trial is being conducted may suspend a clinical trial at any time for various reasons, including a belief the subjects are being exposed to an unacceptable risk.

During the approval or clearance process, the FDA typically inspects the records relating to the conduct of one or more investigational sites participating in the study supporting the application.

Post-Approval Regulation of Medical Devices and Diagnostic Tests

After a device is cleared or approved for marketing, numerous regulatory requirements continue to apply.

These include:

FDA Quality Systems Regulation (QSR), which governs, among other things, how manufacturers design, test manufacture, exercise quality

control over, and document manufacturing of their products;

and claims regulations, which prohibit the promotion of products for unapproved or “off-label” uses and impose other

restrictions on labeling;

Medical Device Reporting regulation, which requires reporting to FDA of certain adverse experience associated with use of the product.

will continue to be subject to inspection by FDA to determine our compliance with regulatory requirements.

Manufacturing

cGMP Requirements

Manufacturers

of medical devices are required to comply with FDA manufacturing requirements contained in the FDA’s current Good Manufacturing

Practices (“cGMP”) set forth in the quality system regulations promulgated under section 520 of the FDCA.

cGMP regulations require, among

other things, quality control and quality assurance as well as the corresponding maintenance of records and documentation.

comply with statutory and regulatory requirements subjects a manufacturer to possible legal or regulatory action, including the seizure

or recall of products, injunctions, consent decrees placing significant restrictions on or suspending manufacturing operations, and civil

and criminal penalties.

Adverse experiences with the product must be reported to the FDA and could result in the imposition of marketing

restrictions through labeling changes or in product withdrawal.

Product approvals may be withdrawn if compliance with regulatory requirements

is not maintained or if problems concerning safety or efficacy of the product occur following the approval.

We expect to use contract

manufacturers to manufacture our products for the foreseeable future we will therefore be dependent on their compliance with these requirements

to market our products.

the FDA Quality Systems Regulation (QSR), which governs, among other things, how manufacturers design, test manufacture, exercise quality control over, and document manufacturing of their products;

labeling and claims regulations, which prohibit the promotion of products for unapproved or “off-label” uses and impose other restrictions on labeling;

the Medical Device Reporting regulation, which requires reporting to FDA of certain adverse experience associated with use of the product.

We will continue to be subject to inspection by FDA to determine our compliance with regulatory requirements.

Manufacturing cGMP Requirements

Manufacturers of medical devices are required to comply with FDA manufacturing requirements contained in the FDA’s current Good Manufacturing Practices (“cGMP”) set forth in the quality system regulations promulgated under section 520 of the FDCA.

cGMP regulations require, among other things, quality control and quality assurance as well as the corresponding maintenance of records and documentation.

Failure to comply with statutory and regulatory requirements subjects a manufacturer to possible legal or regulatory action, including the seizure or recall of products, injunctions, consent decrees placing significant restrictions on or suspending manufacturing operations, and civil and criminal penalties.

Adverse experiences with the product must be reported to the FDA and could result in the imposition of marketing restrictions through labeling changes or in product withdrawal.

Product approvals may be withdrawn if compliance with regulatory requirements is not maintained or if problems concerning safety or efficacy of the product occur following the approval.

We expect to use contract manufacturers to manufacture our products for the foreseeable future we will therefore be dependent on their compliance with these requirements to market our products.

We work closely with our contract manufacturers to assure our products are in strict compliance with these regulations.

Certification, Accreditation and Licensing

CLIA-certified laboratory is subject to U.S.

and state laws and regulations regarding the operation of clinical laboratories.

CLIA requirements

and laws of certain states, including those of California, New York, Maryland, Pennsylvania, Rhode Island and Florida, impose certification

requirements for clinical laboratories, and establish standards for quality assurance and quality control, among other things.

CLIA provides

that a state may adopt different or more stringent regulations than federal law and permits states to apply for exemption from CLIA if

the state’s laboratory laws are equivalent to, or more stringent than, CLIA.

For example, the State of New York’s clinical

laboratory regulations, which have received an exemption from CLIA, contain provisions that are in certain respects more stringent than

Therefore, as long as New York maintains a licensure program that is CLIA-exempt, Lucid will need to comply with New York’s

clinical laboratory regulations in order to offer Lucid clinical laboratory products and services in New York.

has current certificates to perform clinical laboratory testing.

Clinical laboratories are subject to inspection by regulators and to

sanctions for failing to comply with applicable requirements.

Sanctions available under CLIA and certain state laws include prohibiting

a laboratory from running tests, requiring a laboratory to implement a corrective plan, and imposing civil monetary penalties.

CLIA-certified laboratory fails to meet any applicable requirements of CLIA or state law, that failure could adversely affect any future

CMS consideration of its technologies, prevent their approval entirely, and/or interrupt the commercial sale of any products and services

and otherwise cause Lucid to incur significant expense.

Laboratory Certification, Accreditation and Licensing

Lucid's CLIA-certified laboratory is subject to U.S.

federal and state laws and regulations governing the operation of clinical laboratories.

CLIA requirements establish certification requirements and standards relating to quality systems, quality control, personnel qualifications, and operational requirements.

We are accredited by the College of American Pathologists ("CAP"), a CMS approved accrediting organization under CLIA’s authority.

As a CAP accredited laboratory, Lucid is subject to periodic inspections conducted by CAP and, in certain circumstances, by CMS.

CAP accreditation is designed to meet or exceed CLIA requirements;

however, failure to maintain CAP accreditation could result in loss of our ability to operate under CLIA.

In addition to CLIA, certain states, including California, New York, Maryland, Pennsylvania, New Jersey, Rhode Island and Florida, impose separate certification and/or licensure requirements for clinical laboratories operating within or offering testing services to patients in those states.

CLIA allows states to adopt laboratory regulations that are equal to or more stringent than federal requirements, and allows states to apply for exemption from CLIA oversight if CMS determines that the state’s requirements are at least as stringent as or more stringent than, CLIA.

For example, the State of New York’s clinical laboratory regulations received such an exemption, and in certain respects, imposes requirements more stringent than those under federal CLIA standards.

Accordingly, to the extent Lucid offers testing services in New York or for New York patients, it must comply with these applicable New York State Department of Health requirements.

Lucid currently holds the certificates, licenses, and accreditations required to perform its clinical laboratory testing.

Clinical laboratories are subject to periodic inspection by federal and state regulators and accrediting bodies, and may be subject to sanctions for noncompliance.

Sanctions available under CLIA and applicable state laws include suspending, limiting, or revoking certificates or licenses;

prohibiting a laboratory from running tests;

requiring a laboratory to implement a corrective action plan;

imposing civil monetary penalties;

and, in certain cases, exclusion from participation in federal healthcare programs.

Failure to comply with applicable CLIA or state laboratory requirements could result in enforcement action, interruption of our laboratory operations, and increased cost.

It could also adversely affect the commercialization of Lucid's products and services or future regulatory determinations by CMS or other governmental authorities.

Healthcare Regulation

addition to FDA restrictions on marketing and promotion of drugs and devices, other federal and state laws restrict our business practices.

These laws include, without limitation, anti-kickback and false claims laws, data privacy and security laws, as well as transparency

laws regarding payments or other items of value provided to healthcare providers.

of the breadth of these laws and the narrowness of the statutory exceptions and safe harbors available under such laws, it is possible

that some of our business activities, including certain sales and marketing practices and the provision of certain items and services

to our customers, could be subject to challenge under one or more of such laws.

If our operations are found to be in violation of any

of the health regulatory laws described above or any other laws that apply to us, we may be subject to penalties, including potentially

significant criminal and civil and administrative penalties, damages, fines, disgorgement, imprisonment, exclusion from participation

in government healthcare programs, contractual damages, reputational harm, administrative burdens, diminished profits and future earnings,

and the curtailment or restructuring of our operations, any of which could adversely affect our ability to operate our business and our

results of operations.

To the extent that any of our products are sold in a foreign country, we may be subject to similar foreign laws,

which may include, for instance, applicable post-marketing requirements, including safety surveillance, anti-fraud and abuse laws and

implementation of corporate compliance programs and reporting of payments or transfers of value to healthcare professionals.

any event, we have established a substantial regulatory and compliance infrastructure that is designed to ensure compliance with these

Payment Sunshine Act

February 8, 2013, the Centers for Medicare & Medicaid Services, or CMS, released its final rule implementing section 6002 of the

Affordable Care Act known as the Physician Payment Sunshine Act that imposes annual reporting requirements on device manufacturers for

payments and other transfers of value provided by them, directly or indirectly, to physicians and teaching hospitals, as well as ownership

and investment interests held by physicians and their family members.

A manufacturer’s failure to submit timely, accurately and

completely the required information for all payments, transfers of value or ownership or investment interests may result in civil monetary

penalties of up to an aggregate of $150,000 per year, and up to an aggregate of $1 million per year for “knowing failures.”

Manufacturers that produce at least one product reimbursed by Medicare, Medicaid, or Children’s Health Insurance Program and (i)

if the product is a drug or biological, and it requires a prescription (or physician’s authorization) to administer;

the product is a device or medical supply, and it requires premarket approval or premarket notification by the FDA are required to comply

with the Open Payments (commonly referred to as the Sunshine Act) filing requirements under CMS.

We currently do not have any products

covered by Medicare, Medicaid, or Children’s Health Insurance Program as none of our products have premarket approval or clearance

notification.

We expect once our products receive regulatory clearance, we will be required to comply with the Sunshine Act provisions.

states, also mandate implementation of commercial compliance programs, and other states impose restrictions on device manufacturer marketing

practices and require tracking and reporting of gifts, compensation and other remuneration to healthcare professionals and entities.

The shifting commercial compliance environment and the need to build and maintain robust and expandable systems to comply with different

compliance or reporting requirements in multiple jurisdictions increase the possibility a healthcare company may fail to comply fully

with one or more of these requirements.

Anti-Kickback Statute

Federal Anti-Kickback Statute prohibits, among other things, knowingly and willfully offering, paying, soliciting or receiving any remuneration

(including any kickback, bribe or rebate), directly or indirectly, overtly or covertly, to induce or in return for purchasing, leasing,

ordering or arranging for or recommending the purchase, lease or order of any good, facility, item or service reimbursable, in whole

or in part, under Medicare, Medicaid or other federal healthcare programs.

The term “remuneration” has been broadly interpreted

to include anything of value.

Although there are a number of statutory exceptions and regulatory safe harbors protecting some common

activities from prosecution, the exceptions and safe harbors are drawn narrowly.

Practices that involve remuneration that may be alleged

to be intended to induce prescribing, purchases or recommendations may be subject to scrutiny if they do not qualify for an exception

or safe harbor.

Failure to meet all of the requirements of a particular applicable statutory exception or regulatory safe harbor does

not make the conduct per se illegal under the Anti-Kickback Statute.

Instead, the legality of the arrangement will be evaluated on a

case-by-case basis based on a cumulative review of all its facts and circumstances.

Several courts have interpreted the statute’s

intent requirement to mean that if any one purpose of an arrangement involving remuneration is to induce referrals of federal healthcare

covered business, the Anti-Kickback Statute has been violated.

Additionally,

the intent standard under the Anti-Kickback Statute was amended by the Patient Protection and Affordable Care Act of 2010, as amended

by the Health Care and Education Reconciliation Act of 2010, collectively the Affordable Care Act, to a stricter standard such that a

person or entity no longer needs to have actual knowledge of the statute or specific intent to violate it in order to have committed

In addition, the Affordable Care Act codified case law that a claim including items or services resulting from a violation

of the federal Anti-Kickback Statute constitutes a false or fraudulent claim for purposes of the federal civil False Claims Act.

False Claims Act

False Claims Act prohibits, among other things, any person or entity from knowingly presenting, or causing to be presented, a false or

fraudulent claim for payment or approval to the federal government or knowingly making, using or causing to be made or used a false record

or statement material to a false or fraudulent claim to the federal government.

A claim includes “any request or demand”

for money or property presented to the U.S.

The False Claims Act also applies to false submissions that cause the government

to be paid less than the amount to which it is entitled, such as a rebate.

Intent to deceive is not required to establish liability under

the False Claims Act.

Several pharmaceutical, device and other healthcare companies have been prosecuted under these laws for, among

other things, allegedly providing free product to customers with the expectation that the customers would bill federal programs for the

Other companies have been prosecuted for causing false claims to be submitted because of the companies’ marketing of products

for unapproved, and thus noncovered uses.

government may further prosecute, as a crime, conduct constituting a false claim under the False Claims Act.

The False Claims Act prohibits

the making or presenting of a claim to the government knowing such claim to be false, fictitious, or fraudulent and, unlike civil claims

under the False Claims Act, requires proof of intent to submit a false claim.

Foreign Corrupt Practices Act

Foreign Corrupt Practices Act, or the FCPA, prohibits any U.S.

individual or business from paying, offering, or authorizing payment or

offering of anything of value, directly or indirectly, to any foreign official, political party or candidate for the purpose of influencing

any act or decision of the foreign entity in order to assist the individual or business in obtaining or retaining business.

also obligates companies whose securities are listed in the United States to comply with accounting provisions requiring the company

to maintain books and records that accurately and fairly reflect all transactions of the corporation, including international subsidiaries,

and to devise and maintain an adequate system of internal accounting controls for international operations.

Activities that violate the

FCPA, even if they occur wholly outside the United States, can result in criminal and civil fines, imprisonment, disgorgement, oversight,

and debarment from government contracts.

and future legislative proposals to further reform healthcare or reduce healthcare costs may result in lower reimbursement for our products,

or for the procedures associated with the use of our products, or limit coverage of our products.

The cost containment measures that

payors and providers are instituting and the effect of any healthcare reform initiative implemented in the future could significantly

reduce our revenues from the sale of our products.

Alternatively, the shift away from fee-for-service agreements to capitated payment

models may support the value of our products which can be shown to decrease resource utilization and lead to cost savings for both payors

and providers.

and Other Privacy Laws

Health Insurance Portability and Accountability Act of 1996, as amended by the Health Information Technology for Economic and Clinical

Health Act (“HIPAA”) established comprehensive protection for the privacy and security of health information.

The HIPAA standards

apply to three types of organizations, or “Covered Entities”:

health plans, healthcare clearinghouses, and healthcare providers

that conduct certain healthcare transactions electronically.

Covered Entities and their business associates must have in place administrative,

physical, and technical standards to guard against the misuse of individually identifiable health information.

Some of our activities,

including at our Lucid Test Centers and within our clinical trials, involve interactions with patients and their health information which

implicate HIPAA.

Our activities also involve us entering into specific kinds of relationships with Covered Entities and business associates

of Covered Entities, which also implicate HIPAA.

In addition to FDA restrictions on marketing and promotion of drugs and devices, other federal and state laws restrict our business practices.

These laws include, without limitation, anti-kickback and false claims laws, data privacy and security laws, as well as transparency laws regarding payments or other items of value provided to healthcare providers.

Because of the breadth of these laws and the narrowness of the statutory exceptions and safe harbors available under such laws, it is possible that some of our business activities, including certain sales and marketing practices and the provision of certain items and services to our customers, could be subject to challenge under one or more of such laws.

If our operations are found to be in violation of any of the health regulatory laws described above or any other laws that apply to us, we may be subject to penalties, including potentially significant criminal and civil and administrative penalties, damages, fines, disgorgement, imprisonment, exclusion from participation in government healthcare programs, contractual damages, reputational harm, administrative burdens, diminished profits and future earnings, and the curtailment or restructuring of our operations, any of which could adversely affect our ability to operate our business and our results of operations.

To the extent that any of our products are sold in a foreign country, we may be subject to similar foreign laws, which may include, for instance, applicable post-marketing requirements, including safety surveillance, anti-fraud and abuse laws and implementation of corporate compliance programs and reporting of payments or transfers of value to healthcare professionals.

In any event, we have established a substantial regulatory and compliance infrastructure that is designed to ensure compliance with these regulations.

Physician Payment Sunshine Act

On February 8, 2013, the Centers for Medicare & Medicaid Services, or CMS, released its final rule implementing section 6002 of the Affordable Care Act known as the Physician Payment Sunshine Act that imposes annual reporting requirements on device manufacturers for payments and other transfers of value provided by them, directly or indirectly, to physicians and teaching hospitals, as well as ownership and investment interests held by physicians and their family members.

A manufacturer’s failure to submit timely, accurately and completely the required information for all payments, transfers of value or ownership or investment interests may result in civil monetary penalties of up to an aggregate of $150,000 per year, and up to an aggregate of $1 million per year for “knowing failures.” Manufacturers that produce at least one product reimbursed by Medicare, Medicaid, or Children’s Health Insurance Program and (i) if the product is a drug or biological, and it requires a prescription (or physician’s authorization) to administer;

or (ii) if the product is a device or medical supply, and it requires premarket approval or premarket notification by the FDA are required to comply with the Open Payments (commonly referred to as the Sunshine Act) filing requirements under CMS.

Certain states, also mandate implementation of commercial compliance programs, and other states impose restrictions on device manufacturer marketing practices and require tracking and reporting of gifts, compensation and other remuneration to healthcare professionals and entities.

The shifting commercial compliance environment and the need to build and maintain robust and expandable systems to comply with different compliance or reporting requirements in multiple jurisdictions increase the possibility a healthcare company may fail to comply fully with one or more of these requirements.

Federal Anti-Kickback Statute

The Federal Anti-Kickback Statute prohibits, among other things, knowingly and willfully offering, paying, soliciting or receiving any remuneration (including any kickback, bribe or rebate), directly or indirectly, overtly or covertly, to induce or in return for purchasing, leasing, ordering or arranging for or recommending the purchase, lease or order of any good, facility, item or service reimbursable, in whole or in part, under Medicare, Medicaid or other federal healthcare programs.

The term “remuneration” has been broadly interpreted to include anything of value.

Although there are a number of statutory exceptions and regulatory safe harbors protecting some common activities from prosecution, the exceptions and safe harbors are drawn narrowly.

Practices that involve remuneration that may be alleged to be intended to induce prescribing, purchases or recommendations may be subject to scrutiny if they do not qualify for an exception or safe harbor.

Failure to meet all of the requirements of a particular applicable statutory exception or regulatory safe harbor does not make the conduct per se illegal under the Anti-Kickback Statute.

Instead, the legality of the arrangement will be evaluated on a case-by-case basis based on a cumulative review of all its facts and circumstances.

Several courts have interpreted the statute’s intent requirement to mean that if any one purpose of an arrangement involving remuneration is to induce referrals of federal healthcare covered business, the Anti-Kickback Statute has been violated.

Additionally, the intent standard under the Anti-Kickback Statute was amended by the Patient Protection and Affordable Care Act of 2010, as amended by the Health Care and Education Reconciliation Act of 2010, collectively the Affordable Care Act, to a stricter standard such that a person or entity no longer needs to have actual knowledge of the statute or specific intent to violate it in order to have committed a violation.

In addition, the Affordable Care Act codified case law that a claim including items or services resulting from a violation of the federal Anti-Kickback Statute constitutes a false or fraudulent claim for purposes of the federal civil False Claims Act.

We are subject to comparable state laws, including those pertaining to fee splitting, some of which apply to all payors regardless of source of payment, and do not contain identical safe harbors.

Federal False Claims Act

The False Claims Act prohibits, among other things, any person or entity from knowingly presenting, or causing to be presented, a false or fraudulent claim for payment or approval to the federal government or knowingly making, using or causing to be made or used a false record or statement material to a false or fraudulent claim to the federal government.

A claim includes “any request or demand” for money or property presented to the U.S.

The False Claims Act also applies to false submissions that cause the government to be paid less than the amount to which it is entitled, such as a rebate.

Intent to deceive is not required to establish liability under the False Claims Act.

Several pharmaceutical, device and other healthcare companies have been prosecuted under these laws for, among other things, allegedly providing free product to customers with the expectation that the customers would bill federal programs for the product.

Other companies have been prosecuted for causing false claims to be submitted because of the companies’ marketing of products for unapproved, and thus noncovered uses.

The government may further prosecute, as a crime, conduct constituting a false claim under the False Claims Act.

The False Claims Act prohibits the making or presenting of a claim to the government knowing such claim to be false, fictitious, or fraudulent and, unlike civil claims under the False Claims Act, requires proof of intent to submit a false claim.

The Foreign Corrupt Practices Act

The Foreign Corrupt Practices Act, or the FCPA, prohibits any U.S.

individual or business from paying, offering, or authorizing payment or offering of anything of value, directly or indirectly, to any foreign official, political party or candidate for the purpose of influencing any act or decision of the foreign entity in order to assist the individual or business in obtaining or retaining business.

The FCPA also obligates companies whose securities are listed in the United States to comply with accounting provisions requiring the company to maintain books and records that accurately and fairly reflect all transactions of the corporation, including international subsidiaries, and to devise and maintain an adequate system of internal accounting controls for international operations.

Activities that violate the FCPA, even if they occur wholly outside the United States, can result in criminal and civil fines, imprisonment, disgorgement, oversight, and debarment from government contracts.

Healthcare Reform

Current and future legislative proposals to further reform healthcare or reduce healthcare costs may result in lower reimbursement for our products, or for the procedures associated with the use of our products, or limit coverage of our products.

The cost containment measures that payors and providers are instituting and the effect of any healthcare reform initiative implemented in the future could significantly reduce our revenues from the sale of our products.

Alternatively, the shift away from fee-for-service agreements to capitated payment models may support the value of our products which can be shown to decrease resource utilization and lead to cost savings for both payors and providers.

HIPAA and Other Privacy Laws

The Health Insurance Portability and Accountability Act of 1996, as amended by the Health Information Technology for Economic and Clinical Health Act (“HIPAA”) established comprehensive protection for the privacy and security of health information.

The HIPAA standards apply to three types of organizations, or “Covered Entities”:

health plans, healthcare clearinghouses, and healthcare providers that conduct certain healthcare transactions electronically.

Covered Entities and their business associates must have in place administrative, physical, and technical standards to guard against the misuse of individually identifiable health information.

Some of our activities involve interactions with patients and their health information which implicate HIPAA.

Our activities also involve us entering into specific kinds of relationships with Covered Entities and business associates of Covered Entities, which also implicate HIPAA.

Penalties for violations of HIPAA include civil money and criminal penalties.

activities must also comply with other applicable privacy laws, which impose restrictions on the access, use and disclosure of personal

Our activities must also comply with other applicable privacy laws, which impose restrictions on the access, use and disclosure of personal information.

More state and international privacy laws are being adopted.

Many state laws are not preempted by HIPAA because they are

more stringent or are broader in scope than HIPAA.

Since 2020 we have also had to comply with the California Consumer Privacy Act of

2018, which protects personal information other than health information covered by HIPAA.

In the E.U., the General Data Protection Regulation

(“GDPR”) took effect in May 2018 and imposes increasingly stringent data protection and privacy rules.

All of these laws

may impact our business and may change periodically, which could have an effect on our business operations if compliance becomes substantially

costlier than under current requirements.

Our failure to comply with these privacy laws or significant changes in the laws restricting

our ability to obtain patient samples and associated patient information could significantly impact our business

and our future business plans.

Self-Referral

federal “self-referral” law, commonly referred to as the “Stark” law, provides that physicians who, personally

or through a family member, have ownership interests in or compensation arrangements with a laboratory are prohibited from making a referral

to that laboratory for laboratory tests reimbursable by Medicare, and also prohibits laboratories from submitting a claim for Medicare

payments for laboratory tests referred by physicians who, personally or through a family member, have ownership interests in or compensation

arrangements with the testing laboratory.

The Stark law contains a number of specific exceptions which, if met, permit physicians who

have ownership or compensation arrangements with a testing laboratory to make referrals to that laboratory and permit the laboratory

to submit claims for Medicare payments for laboratory tests performed pursuant to such referrals.

We are subject to comparable state

laws, some of which apply to all payors regardless of source of payment, and do not contain identical exceptions to the Stark law.

International

order to market any of our products outside of the United States, we would need to comply with numerous and varying regulatory requirements

of other countries and jurisdictions regarding quality, safety and efficacy and governing, among other things, clinical trials, marketing

authorization, commercial sales and distribution of our products.

We may be subject to regulations and product registration requirements

in the areas of product standards, packaging requirements, labeling requirements, import and export restrictions and tariff regulations,

duties and tax requirements.

Whether or not we obtain FDA approval for a product, we would need to obtain the necessary approvals by

the comparable foreign regulatory authorities before we can commence clinical trials or marketing of the product in foreign countries

and jurisdictions.

The time required to obtain clearance required by foreign countries may be longer or shorter than that required for

FDA clearance, and requirements for licensing a product in a foreign country may differ significantly from FDA requirements.

European Union (“EU”) will require a CE mark certification or approval in order to market our products in the various countries

of the European Union or other countries outside the United States.

To obtain CE mark certification of our products, we will be required

to work with an accredited European notified body organization to determine the appropriate documents required to support certification

in accordance with existing medical device directive.

The predictability of the length of time and cost associated with such a CE mark

may vary or may include lengthy clinical trials to support such a marking.

Once the CE mark is obtained, we may market our product in

the countries of the EU.

Good Manufacturing Practices

the European Union, the manufacture of medical devices is subject to good manufacturing practice (“GMP”), as set forth in

the relevant laws and guidelines of the European Union and its member states.

Compliance with GMP is generally assessed by the competent

regulatory authorities.

Typically, quality system evaluation is performed by a Notified Body, which also recommends to the relevant competent

authority for the European Community CE Marking of a device.

The Competent Authority may conduct inspections of relevant facilities,

and review manufacturing procedures, operating systems and personnel qualifications.

In addition to obtaining approval for each product,

in many cases each device manufacturing facility must be audited on a periodic basis by the Notified Body.

Further inspections may occur

over the life of the product.

Safety and Health

addition to its comprehensive regulation of health and safety in the workplace in general, the Occupational Safety and Health Administration

has established extensive requirements aimed specifically at laboratories and other healthcare-related facilities.

In addition, because

Lucid’s operations may require employees to use certain hazardous chemicals, Lucid also must comply with regulations on hazard

communication and hazardous chemicals in laboratories.

These regulations require Lucid, among other things, to develop written programs

and plans, which must address methods for preventing and mitigating employee exposure, the use of personal protective equipment, and

Transportation

commercialization activities for EsoGuard subject Lucid to regulations of the Department of Transportation, the United States Postal

Service, and the Centers for Disease Control and Prevention that apply to the surface and air transportation of clinical laboratory specimens.

Many state laws are not preempted by HIPAA because they are more stringent or are broader in scope than HIPAA.

Since 2020 we have also had to comply with the California Consumer Privacy Act of 2018, which protects personal information other than health information covered by HIPAA.

In the E.U., the General Data Protection Regulation (“GDPR”) took effect in May 2018 and imposes increasingly stringent data protection and privacy rules.

All of these laws may impact our business and may change periodically, which could have an effect on our business operations if compliance becomes substantially costlier than under current requirements.

Our failure to comply with these privacy laws or significant changes in the laws restricting our ability to obtain patient samples and associated patient information could significantly impact our business and our future business plans.

Self-Referral Law

The federal “self-referral” law, commonly referred to as the “Stark” law, provides that physicians who, personally or through a family member, have ownership interests in or compensation arrangements with a laboratory are prohibited from making a referral to that laboratory for laboratory tests reimbursable by Medicare, and also prohibits laboratories from submitting a claim for Medicare payments for laboratory tests referred by physicians who, personally or through a family member, have ownership interests in or compensation arrangements with the testing laboratory.

The Stark law contains a number of specific exceptions which, if met, permit physicians who have ownership or compensation arrangements with a testing laboratory to make referrals to that laboratory and permit the laboratory to submit claims for Medicare payments for laboratory tests performed pursuant to such referrals.

We are subject to comparable state laws, some of which apply to all payors regardless of source of payment, and do not contain identical exceptions to the Stark law.

International Regulation

In order to market any of our products outside of the United States, we would need to comply with numerous and varying regulatory requirements of other countries and jurisdictions regarding quality, safety and efficacy and governing, among other things, clinical trials, marketing authorization, commercial sales and distribution of our products.

We may be subject to regulations and product registration requirements in the areas of product standards, packaging requirements, labeling requirements, import and export restrictions and tariff regulations, duties and tax requirements.

Whether or not we obtain FDA approval for a product, we would need to obtain the necessary approvals by the comparable foreign regulatory authorities before we can commence clinical trials or marketing of the product in foreign countries and jurisdictions.

The time required to obtain clearance required by foreign countries may be longer or shorter than that required for FDA clearance, and requirements for licensing a product in a foreign country may differ significantly from FDA requirements.

European Union

The European Union (“EU”) will require a CE mark certification or approval in order to market our products in the various countries of the European Union or other countries outside the United States.

To obtain CE mark certification of our products, we will be required to work with an accredited European notified body organization to determine the appropriate documents required to support certification in accordance with existing medical device directive.

The predictability of the length of time and cost associated with such a CE mark may vary or may include lengthy clinical trials to support such a marking.

Once the CE mark is obtained, we may market our product in the countries of the EU.

European Good Manufacturing Practices

In the European Union, the manufacture of medical devices is subject to good manufacturing practice (“GMP”), as set forth in the relevant laws and guidelines of the European Union and its member states.

Compliance with GMP is generally assessed by the competent regulatory authorities.

Typically, quality system evaluation is performed by a Notified Body, which also recommends to the relevant competent authority for the European Community CE Marking of a device.

The Competent Authority may conduct inspections of relevant facilities, and review manufacturing procedures, operating systems and personnel qualifications.

In addition to obtaining approval for each product, in many cases each device manufacturing facility must be audited on a periodic basis by the Notified Body.

Further inspections may occur over the life of the product.

Occupational Safety and Health

In addition to its comprehensive regulation of health and safety in the workplace in general, the Occupational Safety and Health Administration has established extensive requirements aimed specifically at laboratories and other healthcare-related facilities.

In addition, because Lucid’s operations may require employees to use certain hazardous chemicals, Lucid also must comply with regulations on hazard communication and hazardous chemicals in laboratories.

These regulations require Lucid, among other things, to develop written programs and plans, which must address methods for preventing and mitigating employee exposure, the use of personal protective equipment, and training.

Specimen Transportation

Our commercialization activities for EsoGuard subject Lucid to regulations of the Department of Transportation, the United States Postal Service, and the Centers for Disease Control and Prevention that apply to the surface and air transportation of clinical laboratory specimens.

Environmental

cost of compliance with federal, state and local provisions related to the protection of the environment has had no material effect on

our business.

The cost of compliance with federal, state and local provisions related to the protection of the environment has had no material effect on our business.

There were no material capital expenditures for environmental control facilities in the years ended December 31, 2025 and 2024.

of March 20, 2025 we had 39 employees (all of whom were full-time employees), inclusive of our executive officers — our

Chairman of the Board of Directors and Chief Executive Officer (“CEO”), our President and Chief Financial Officer (“CFO”),

our Chief Operating Officer (“COO”), and our General Counsel and Secretary (“General Counsel”).

are covered by a collective bargaining agreement.

As of March 27, 2026 we had 41 employees (all of whom were full-time employees), inclusive of our executive officers — our Chairman of the Board of Directors and Chief Executive Officer (“CEO”), our President and Chief Financial Officer (“CFO”), our Chief Operating Officer (“COO”), our General Counsel and Secretary (“General Counsel”) and our Chief Medical Officer ("CMO").

No employees are covered by a collective bargaining agreement.

We consider our relationship with our employees to be good.

were incorporated in Delaware on June 26, 2014.

Our corporate headquarters address is 360 Madison Avenue, 25th Floor, New York, NY 10017,

and our main telephone number is (917) 813-1828.

make available free of charge through our website (www.pavmed.com) our periodic reports and registration statements filed with the United

States Securities and Exchange Commission (“SEC”), including our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q,

Current Reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Sections 13(a) and 15(d) of the Securities

Exchange Act of 1934, as amended, or the “Exchange Act.” We make these reports available through our website as soon as reasonably

practicable after we electronically file such reports with, or furnish such reports to the SEC.

also make available, free of charge on our website, the reports filed with the SEC by our named executive officers, directors, and 10%

stockholders pursuant to Section 16 under the Exchange Act as soon as reasonably practicable after those filings are provided to us by

those persons.

The public also may read and copy any materials we file with the SEC at the SEC’s Public Reference Room at 100 F

Street, NE., Washington, DC 20549, on official business days during the hours of 10 a.m.

The public may obtain information

on the operation of the Public Reference Room by calling the Commission at 1-800-SEC-0330.

The SEC also maintains an Internet site (http://www.sec.gov)

that contains reports, proxy and information statements, and other information regarding us that we file electronically with the SEC.

website address is www.pavmed.com.

The content of our website is not incorporated by reference into this Annual Report on Form 10-K,

nor in any other report or document we file or furnish with and /or submit to the SEC, and any reference to our website are intended

to be inactive textual references only.

Corporate Information

We were incorporated in Delaware on June 26, 2014.

Our corporate headquarters address is 360 Madison Avenue, 25th Floor, New York, NY 10017, and our main telephone number is (917) 813-1828.

Available Information

We file or furnish our current and periodic reports, proxy statements, registration statements and other information filed with the United States Securities and Exchange Commission (“SEC”) pursuant to Sections 13(a) and 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), including Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and amendments to those reports.

We make these reports available through our website (www.pavmed.com) as soon as reasonably practicable after we electronically file such reports with, or furnish such reports to, the SEC.

We also make available, free of charge on our website, the reports filed with the SEC by our named executive officers, directors, and 10% stockholders pursuant to Section 16 under the Exchange Act as soon as reasonably practicable after those filings are provided to us by those persons.

The public also may read and copy any materials we file with the SEC at the SEC’s Public Reference Room at 100 F Street, NE., Washington, DC 20549, on official business days during the hours of 10 a.m.

The public may obtain information on the operation of the Public Reference Room by calling the Commission at 1-800-SEC-0330.

The SEC also maintains an Internet site (http://www.sec.gov) that contains reports, proxy and information statements, and other information regarding us that we file electronically with the SEC.

Our website address is www.pavmed.com.

The content of our website is not incorporated by reference into this Annual Report on Form 10-K, nor in any other report or document we file or furnish with and /or submit to the SEC, and any reference to our website are intended to be inactive textual references only.

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-K

Item 1. Business