What changed in this filing

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Item 1A. Risk Factors

2023-03-14 compared with 2022-04-06 · 466 added, 665 removed, 771 unchanged (59% of the section changed)

12 unchanged sentences

have incurred operating losses since our inception and may not be able to achieve profitability.

our indebtedness may require a significant amount of cash, and the restrictive covenants contained in our indebtedness could adversely

affect our business plan, liquidity, financial condition, and results of operations.

The accounting method

for convertible debt securities that may be settled in cash, such as the March 2022 Notes, is the subject of recent changes that

could have a material effect on our reported financial results.

Related to Our Business

may need substantial additional funding and may be unable to raise capital when needed, which could force us to delay, reduce, eliminate

or abandon growth initiatives or product development programs.

we have a limited operating history and have not generated significant revenues, you will have little basis upon which to evaluate

our ability to achieve our business objective.

markets in which we operate are highly competitive, and we may not be able to effectively compete against other providers of medical

devices, particularly those with greater resources.

have finite resources, which may restrict our success in commercializing our current products and other products we may develop,

and we may be unsuccessful in entering into or maintaining third-party arrangements to support our internal efforts.

we are unable to deploy and maintain effective sales, marketing and medical affairs capabilities, we will have difficulty achieving

market awareness and selling our tests and other products.

may be dependent on the sales and marketing efforts of third parties if we choose not to develop an extensive sales and marketing

our indebtedness may require a significant amount of cash, and the restrictive covenants

contained in our indebtedness could adversely affect our business plan, liquidity, financial

condition, and results of operations.

● The March 2023 Senior Convertible Note has not been issued, and it may not be issued, including if certain closing

conditions to the issuance of such note are not satisfied.

accounting method for convertible debt securities that may be settled in cash, such as the

Senior Convertible Notes, is the subject of recent changes that could have a material effect

on our reported financial results.

Associated with Our Business

will need substantial additional funding and may be unable to raise capital when needed,

which could force us to delay, reduce, eliminate or abandon growth initiatives or product

development programs.

markets in which we operate are highly competitive, and we may not be able to effectively

compete against other providers of medical devices, particularly those with greater resources.

have finite resources, which may restrict our success in commercializing our current products

and other products we may develop, and we may be unsuccessful in entering into or maintaining

third-party arrangements to support our internal efforts.

we are unable to deploy and maintain effective sales, marketing and medical affairs capabilities,

we will have difficulty achieving market awareness and selling our tests and other products.

products may never achieve market acceptance.

● Recommendations,

guidelines and quality metrics issued by various organizations may significantly affect payers’ willingness to cover, and healthcare

providers’ willingness to prescribe, our products.

or our third-party manufacturers may not have the manufacturing and processing capacity to meet the production requirements of clinical

testing or consumer demand in a timely manner.

will be dependent on third-party manufacturers since we will not initially directly manufacture our products.

currently expect to perform our EsoGuard test in one laboratory facility.

If demand for our EsoGuard test grows, we may lack adequate

facility space and capabilities to meet increased processing requirements.

Moreover, if these or any future facilities or our equipment

were damaged or destroyed, or if we experience a significant disruption in our operations for any reason, our ability to continue

to operate our business could be materially harmed.

future performance will depend in part on the success of products we have not yet developed.

products and services may become subject to unfavorable pricing regulations, third-party reimbursement practices or healthcare reform

initiatives, thereby harming our business.

products and services may cause serious adverse side effects or even death or have other properties that could delay or prevent their

regulatory approval, limit the commercial desirability of an approved label or result in significant negative consequences following

any marketing approval.

liability lawsuits against us could cause us to incur substantial liabilities and to limit commercialization of any products that

we may develop.

may not be able to protect or enforce our intellectual property rights, which could impair our competitive position.

may be subject to intellectual property infringement claims by third parties which could be costly to defend, divert management’s

attention and resources, and may result in liability.

may violate our intellectual property rights, and we may bring litigation to protect and enforce our intellectual property rights,

which may result in substantial expense and may divert our attention from implementing our business strategy.

guidelines and quality metrics issued by various organizations may significantly affect payors’

willingness to cover, and healthcare providers’ willingness to prescribe, our products.

or our third-party manufacturers may not have the manufacturing and processing capacity to

meet the production requirements of clinical testing or consumer demand in a timely manner.

currently perform our EsoGuard test in one laboratory facility.

If demand for our EsoGuard

test grows, we may lack adequate facility space and capabilities to meet increased processing

requirements.

Moreover, if these or any future facilities or our equipment were damaged or

destroyed, or if we experience a significant disruption in our operations for any reason,

our ability to continue to operate our business could be materially harmed.

may make investments in products we have not yet developed, and those investments may not

products and services may become subject to unfavorable pricing regulations, third-party

reimbursement practices or healthcare reform initiatives, thereby harming our business.

products and services may cause serious adverse side effects or even death or have other

properties that could delay or prevent their regulatory approval, limit the commercial desirability

of an approved label or result in significant negative consequences following any marketing

liability lawsuits against us could cause us to incur substantial liabilities and to limit

commercialization of any products that we may develop.

may not be able to protect or enforce our intellectual property rights, which could impair

our competitive position.

may be subject to intellectual property infringement claims by third parties which could

be costly to defend, divert management’s attention and resources, and may result in

● Competitors

may violate our intellectual property rights, and we may bring litigation to protect and

enforce our intellectual property rights, which may result in substantial expense and may

divert our attention from implementing our business strategy.

business may suffer if we are unable to manage our growth.

officers will allocate their time to other businesses thereby potentially limiting the amount of time they devote to our affairs.

This conflict of interest could have a negative impact on our operations.

officers may allocate their time to other businesses thereby potentially limiting the amount

of time they devote to our affairs.

This conflict of interest could have a negative impact

on our operations.

ability to be successful will be totally dependent upon the efforts of our key personnel.

officers have fiduciary obligations to other companies and, accordingly, may have conflicts of interest in determining to which entity

a particular business opportunity should be presented.

business, financial condition and results of operations could be adversely affected by the political and economic conditions of the

countries in which we conduct business.

future products we may develop may not be approved for sale in the U.S.

or in any other country.

business may be adversely affected by health epidemics and or pandemics, including the pandemic resulting from the SARS-CoV-2 and

the resulting illness of COVID-19.

in our information technology or storage systems could significantly disrupt our operations and our research and development efforts,

which could adversely impact our revenues, as well as our research, development and commercialization efforts.

are and may become the subject of various claims, threats of litigation, litigation or investigations which could have a material

adverse effect on our business, financial condition, results of operations or price of our common stock.

Relating to Government Regulation

regulatory approval process is expensive, time consuming and uncertain, and may prevent us or our partners from obtaining approval

for the commercialization of any products we may develop.

Approval of products in the U.S.

or other territories may require that

we, or a partner, conduct randomized, controlled clinical trials.

if we receive regulatory approval for any product we may develop, we will be subject to ongoing regulatory requirements and continued

regulatory review, which may result in significant additional expense and subject us to penalties if we fail to comply with applicable

regulatory requirements.

to obtain regulatory approvals in foreign jurisdictions will prevent us from marketing our products internationally.

officers and directors have fiduciary obligations to other companies and, accordingly, may

have conflicts of interest in determining to which entity a particular business opportunity

should be presented.

business, financial condition and results of operations could be adversely affected by the

political and economic conditions of the countries in which we conduct business.

business may be adversely affected by health epidemics and or pandemics, including the COVID-19

in our information technology or storage systems could significantly disrupt our operations

and our research and development efforts, which could adversely impact our revenues, as well

as our research, development and commercialization efforts.

may become the subject of various claims, threats of litigation, litigation or investigations

which could have a material adverse effect on our business, financial condition, results

of operations or price of our common stock.

Related to Regulatory Matters

future products or services we may develop may not be approved for sale in the U.S.

any other country.

In order to obtain approval, we may need to conduct clinical trials necessary

to support a FDA 510(k) notice or PMA application will be expensive and will require the

enrollment of large numbers of patients, and suitable patients may be difficult to identify

results of the Company’s clinical trials may not support our product candidate claims

or may result in the discovery of adverse side effects.

In addition, delays or termination

of our clinical trials may have an adverse impact on our ability to commercialize our product

if we receive regulatory approval for any product we may develop, we will be subject to ongoing

regulatory obligations and continued regulatory review, which may result in significant additional

expense and subject us to penalties if we fail to comply with applicable regulatory requirements.

reform measures could hinder or prevent our products’ commercial success.

we fail to comply with healthcare regulations, we could face substantial penalties and our business, operations and financial condition

could be adversely affected.

required, clinical trials necessary to support a 501(k) notice or a PMA application will be expensive and will require the enrollment

of large numbers of patients, and suitable patients may be difficult to identify and recruit.

Delays or failures in our clinical

trials will prevent us from commercializing any modified or new products and will adversely affect our business, operating results

and prospects.

results of our clinical trials may not support our product candidate claims or may result in the discovery of adverse side effects.

medical products may in the future be subject to product recalls that could harm our reputation, business and financial results.

our medical products cause or contribute to a death or a serious injury, or malfunction in certain ways, we will be subject to medical

device reporting regulations, which can result in voluntary corrective actions or agency enforcement claims.

the effectiveness and safety of our devices are not supported by long-term data, our future revenues could decline.

we are found to be promoting the use of its devices for unapproved or “off-label” uses or engaging in other noncompliant

activities, we may be subject to recalls, seizures, fines, penalties, injunctions, adverse publicity, prosecution, or other adverse

we fail to comply with healthcare regulations, we could face substantial penalties and our

business, operations and financial condition could be adversely affected.

Company’s medical products may in the future be subject to product recalls that could

harm its reputation, business and financial results.

the Company’s medical products cause or contribute to a death or a serious injury,

or malfunction in certain ways, we will be subject to medical device reporting regulations,

which can result in voluntary corrective actions or agency enforcement actions.

the Company is found to be promoting the use of its devices for unapproved or “off-label”

uses or engaging in other noncompliant activities, the Company may be subject to recalls,

seizures, fines, penalties, injunctions, adverse publicity, prosecution, or other adverse

actions, resulting in damage to its reputation and business.

may be subject, directly or indirectly, to federal and state healthcare fraud and abuse laws and regulations and could face substantial

penalties if we are unable to fully comply with such laws.

failure or our subsidiaries’ failure to obtain or maintain necessary FDA clearances or approvals, or equivalents thereof in

and relevant foreign markets, could hurt our ability to distribute and market our products.

Associated with Ownership of Our Common Stock

may issue shares of our common stock and/or preferred stock in the future which could reduce the equity interest of our stockholders

and might cause a change in control of our ownership.

management and their affiliates control a substantial interest in us and thus may influence certain actions requiring a stockholder

can be no assurance that our common stock will continue to trade on the Nasdaq Capital Market or another national securities exchange.

robust public market for our common stock may not be sustained, which could affect your ability to sell our common stock or depress

the market price of our common stock.

may issue shares of our common and /or preferred stock in the future which could reduce the

equity interest of our stockholders and might cause a change in control of our ownership.

subsidiary Lucid may issue shares of its common and/or preferred stock in the future which

could reduce the equity interest of PAVmed in Lucid and might cause us to cease to control

a majority of the voting stock of Lucid.

management and their affiliates control a substantial interest in us and thus may influence

certain actions requiring a stockholder vote.

can be no assurance that our common stock will continue to trade on the Nasdaq Capital Market

or another national securities exchange.

robust public market for our common stock may not be sustained, which could affect your ability

to sell our common stock or depress the market price of our common stock.

stock price may be volatile, and purchasers of our securities could incur substantial losses.

outstanding warrants and other convertible securities may have an adverse effect on the market price of our common stock.

outstanding warrants and other convertible securities may have an adverse effect on the market

price of our common stock.

do not intend to pay any dividends on our common stock at this time.

are subject to evolving corporate governance and public disclosure expectations and regulations that impact compliance costs and

risks of noncompliance.

incur significant costs as a result of operating as a public company, and our management will be required to devote substantial time

to compliance initiatives.

identified a material weakness in our internal control over financial reporting, which we subsequently remediated.

If we experience

additional material weaknesses in the future, our business may be harmed.

securities or industry analysts do not publish research, or publish inaccurate or unfavorable research, about our business, our stock

price and trading volume could decline.

in our corporate charter documents and under Delaware law could make an acquisition of us more difficult and may prevent attempts

by our stockholders to replace or remove our current management.

are subject to evolving corporate governance and public disclosure expectations and regulations

that impact compliance costs and risks of noncompliance.

incur significant costs as a result of our and Lucid Diagnostics operating as a public company,

and our management will be required to devote substantial time to compliance initiatives.

we experience material weaknesses in our internal control over financial reporting in the

future, our business may be harmed.

securities or industry analysts do not publish research, or publish inaccurate or unfavorable

research, about our business, our stock price and trading volume could decline.

in our corporate charter documents and under Delaware law could make an acquisition of us

more difficult and may prevent attempts by our stockholders to replace or remove our current

Related to Financial Position and Capital Resources

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affect our business plan, liquidity, financial condition, and results of operations.

may be required to repay or redeem, or to pay interest on, the March 2022 Notes or any future permitted indebtedness incurred by us or

our subsidiaries, in cash.

Despite our right to pay the interest and principal balance of the March 2022 Notes by issuing shares of our

common stock, we may be required to repay such indebtedness in cash, if we do not meet certain customary equity conditions (including

minimum price and volume thresholds) or in certain other circumstances.

For example, we may be required to repay the outstanding principal

balance and accrued but unpaid interest, along with a premium, upon the occurrence of certain changes of control or an event of default.

may be required to repay or redeem, or to pay interest on, the April 2022 Senior Convertible Note and the September 2022 Senior Convertible

Note (collectively, the “Senior Convertible Notes”) or any future permitted indebtedness incurred by us or our subsidiaries,

Despite our right to pay the interest

and principal balance of the Senior Convertible Notes by issuing shares of our common stock, we may be required to repay such indebtedness

in cash, if we do not meet certain customary equity conditions (including minimum price and volume thresholds) or in certain other circumstances.

For example, we may be required to repay the outstanding principal balance and accrued but unpaid interest, along with a premium, upon

the occurrence of certain changes of control or an event of default.

ability to make payments of the principal of, to pay interest on, or to redeem our indebtedness in cash, depends on our future performance,

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and make necessary capital expenditures.

In addition, the March 2022 Notes contain, and any future indebtedness may contain, restrictive

covenants, including financial covenants.

These payment obligations and covenants could have important consequences on our business.

In addition, the Senior Convertible Notes contain, and any future indebtedness may contain,

restrictive covenants, including financial covenants.

These payment obligations and covenants could have important consequences on our

In particular, they could:

us to dedicate a substantial portion of our cash flow from operations to payments on our indebtedness;

among other things, our ability to borrow additional funds and otherwise raise additional capital, and our ability to conduct acquisitions,

joint, ventures or similar arrangements, as a result of our obligations to make such payments and comply with the restrictive covenants

us to dedicate a substantial portion of our cash flow from operations to payments on our

indebtedness;

among other things, our ability to borrow additional funds and otherwise raise additional

capital, and our ability to conduct acquisitions, joint, ventures or similar arrangements,

as a result of our obligations to make such payments and comply with the restrictive covenants

in the indebtedness;

our flexibility in planning for, or reacting to, changes in our businesses and the industries in which we operate;

our flexibility in planning for, or reacting to, changes in our businesses and the industries

in which we operate;

our vulnerability to general adverse economic and industry conditions;

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in the governing documents for any such indebtedness, could intensify these risks.

For example, while the Company is currently in compliance

with the financial covenants under the Senior Convertible Notes, from time to time since the date of issuance of such notes (including,

in the case of the indebtedness to market capitalization ratio test under such notes, as of June 30, 2022 and December 31, 2022), the

Company was not in compliance with certain financial covenants thereunder.

While the holders of such notes agreed to waive any such non-compliance

during such aforementioned time periods, there can be no assurance that it will do so in the future.

we are unable to make the required cash payments, there could be a default under one or more of the instruments governing our indebtedness.

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it could be dilutive to shareholders or impose onerous terms on us.

accounting method for convertible debt securities that may be settled in cash, such as the March 2022 Notes, is the subject of recent

changes that could have a material effect on our reported financial results.

March 2023 Senior Convertible Note has not been issued, and it may not be issued, including if certain closing conditions to the issuance

of such note are not satisfied.

March 13, 2023, Lucid entered into the Lucid SPA, pursuant to which Lucid anticipates issuing the March 2023 Lucid Senior

Convertible Note.

However, such issuance is subject to certain closing conditions, some of which are outside of Lucid’s

If any of the closing conditions to the issuance of the March 2023 Lucid Senior Convertible Note are not met, or if the

Lucid Investor fails to purchase the March 2023 Lucid Senior Convertible Note when required to do so under the Lucid SPA, the note

may not be issued.

accounting method for convertible debt securities that may be settled in cash, such as the Senior Convertible Notes, is the subject of

recent changes that could have a material effect on our reported financial results.

May 2008, the Financial Accounting Standards Board (“FASB”) issued FASB Staff Position No.

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as Accounting Standards Codification 470-20, Debt with Conversion and Other Options, or “ASC 470-20.” Under ASC 470-20, an

entity must separately account for the liability and equity components of the convertible debt instruments (such as the March 2022 Notes)

that may be settled entirely or partially in cash in a manner that reflects the issuer’s economic interest cost.

The effect of

ASC 470-20 on the accounting for the March 2022 Notes is that the equity component is required to be included in the additional paid-in

capital section of stockholders’ equity on our consolidated balance sheet and the value of the equity component would be treated

as original issue discount for purposes of accounting for the debt component of the March 2022 Notes.

As a result, we will be required

to record a greater amount of non-cash interest expense in current periods presented as a result of the amortization of the discounted

carrying value of the March 2022 Notes to their face amount over the term of the March 2022 Notes.

We will report lower net income in

our financial results because ASC 470-20 will require interest to include both the current period’s amortization of the debt discount

and the instrument’s coupon interest, which could adversely affect our reported or future financial results, and the market price

of our common stock.

addition, under certain circumstances, convertible debt instruments (such as the March 2022 Notes) that may be settled entirely or partially

in cash are currently accounted for utilizing the treasury stock method, the effect of which is that the shares issuable upon conversion

of the March 2022 Notes are not included in the calculation of diluted earnings per share except to the extent that the conversion value

of the March 2022 Notes exceeds their principal amount.

Under the treasury stock method, for diluted earnings per share purposes, the

transaction is accounted for as if the number of shares of our common stock that would be necessary to settle such excess, if we elected

to settle such excess in shares, are issued.

We cannot be sure that the accounting standards in the future will continue to permit the

use of the treasury stock method.

If we are unable to use the treasury stock method in accounting for the shares issuable upon conversion

of the March 2022 Notes, then our diluted earnings per share would be adversely affected.

entity must separately account for the liability and equity components of the convertible debt instruments (such as the Senior Convertible

Notes) that may be settled entirely or partially in cash in a manner that reflects the issuer’s economic interest cost.

of ASC 470-20 on the accounting for the Senior Convertible Notes is that the equity component is required to be included in the additional

paid-in capital section of stockholders’ equity on our consolidated balance sheet and the value of the equity component would be

treated as original issue discount for purposes of accounting for the debt component of the Senior Convertible Notes.

As a result, we

will be required to record a greater amount of non-cash interest expense in current periods presented as a result of the amortization

of the discounted carrying value of the Senior Convertible Notes to their face amount over the term of the Senior Convertible Notes.

We will report lower net income in our financial results because ASC 470-20 will require interest to include both the current period’s

amortization of the debt discount and the instrument’s coupon interest, which could adversely affect our reported or future financial

results, and the market price of our common stock.

addition, under certain circumstances, convertible debt instruments (such as the Senior Convertible Notes) that may be settled entirely

or partially in cash are currently accounted for utilizing the treasury stock method, the effect of which is that the shares issuable

upon conversion of the Senior Convertible Notes are not included in the calculation of diluted earnings per share except to the extent

that the conversion value of the Senior Convertible Notes exceeds their principal amount.

Under the treasury stock method, for diluted

earnings per share purposes, the transaction is accounted for as if the number of shares of our common stock that would be necessary

to settle such excess, if we elected to settle such excess in shares, are issued.

We cannot be sure that the accounting standards in

the future will continue to permit the use of the treasury stock method.

If we are unable to use the treasury stock method in accounting

for the shares issuable upon conversion of the Senior Convertible Notes, then our diluted earnings per share would be adversely affected.

Associated with Our Business

may need substantial additional funding and may be unable to raise capital when needed, which could force us to delay, reduce, eliminate

will need substantial additional funding and may be unable to raise capital when needed, which could force us to delay, reduce, eliminate

or abandon growth initiatives or product development programs.

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customer support or other resources devoted to our products.

we have a limited operating history, and have not generated significant revenues, you will have little basis upon which to evaluate

our ability to achieve our business objective.

we have a limited operating history, and have not generated significant revenues, you will have little basis upon which to evaluate

our ability to achieve our business objective.

We are subject to all of the problems, expenses, delays and other risks inherent in any

new business, as well as problems inherent in establishing a name and business reputation.

markets in which we operate are highly competitive, and we may not be able to effectively compete against other providers of medical

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arrangements for the manufacture and distribution of our tests and other products.

Also, we partner with CLIA-certified lab facilities

to process our tests and provide patient results.

have only three products, EsoGuard, EsoCheck and CarpX, that are commercially available for sale, and have not generated substantial

revenue from product sales to date.

We have limited experience managing a sales force, customer support operation, manufacturing and

clinical laboratory operations for multiple products in multiple locations with divergent regulatory requirements.

We may encounter difficulties

retaining and managing the specialized workforce these activities require.

We may seek to partner with others to assist us with any or

all of these functions.

Additionally, we may be unable to find appropriate third parties with whom to enter into these arrangements.

sales efforts are growing in size and complexity including recruiting and hiring selling resources throughout the United States, supporting

those efforts with marketing materials sufficient to attract physicians and patients to our products, and then duplicating those efforts

outside the United States either with distributor relationships or hired employees.

We must coordinate among our internal sales teams,

as well as our partners’, to ensure that we are effectively marketing our tests and other products while being fully compliant

with all relevant healthcare regulations.

have only two products, EsoGuard and the Veris Cancer Care Platform, that we are actively seeking to commercialize, and have not generated

substantial revenue from product sales to date.

We have limited experience managing a sales force, customer support operation, manufacturing

and clinical laboratory operations for multiple products in multiple locations with divergent regulatory requirements.

We may encounter

difficulties retaining and managing the specialized workforce these activities require.

We may seek to partner with others to assist

us with any or all of these functions.

Additionally, we may be unable to find appropriate third parties with whom to enter into these

arrangements.

we are unable to deploy and maintain effective sales, marketing and medical affairs capabilities, we will have difficulty achieving market

awareness and selling our tests and other products.

achieve commercial success for our EsoGuard test and our EsoCheck and CarpX products, as well as any products we commercialize

in the future, we must continue to develop and grow our sales, marketing and medical affairs organizations to effectively explain to

healthcare providers the reliability, effectiveness and benefits of our current and future tests and other products as compared to alternatives.

achieve commercial success for our EsoGuard test and the Veris Cancer Care Platform, as well as any products we commercialize in the

future, we must continue to develop and grow our sales, marketing and medical affairs organizations to effectively explain to healthcare

providers the reliability, effectiveness and benefits of our current and future tests and other products as compared to alternatives.

We may not be able to successfully manage our dispersed or inside sales forces or our sales force may not be effective.

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Our expenses associated with

maintaining our sales force may be disproportional compared to the revenues we may be able to generate on sales of our EsoGuard tests,

our EsoCheck and CarpX products or any future tests or other products.

may be dependent on the sales and marketing efforts of third parties if we choose not to develop an extensive sales and marketing staff.

we will depend on the efforts of third parties (including sales agents and distributors) to carry out the sales and marketing of our

We anticipate that each third party will control the amount and timing of resources generally devoted to these activities.

However, these third parties may not be able to generate demand for our products.

In addition, there is a risk that these third parties

will develop products competitive to ours, which would likely decrease their incentive to vigorously promote and sell our products.

we are unable to enter into co-promotion agreements or to arrange for third-party distribution of our products, we will be required to

expend time and resources to develop an effective internal sales force.

However, it may not be economical for us to market our own products

or we may be unable to effectively market our products.

Therefore, our business could be harmed if we fail to enter into arrangements

with third parties for the sales and marketing of our products or otherwise fail to establish sufficient marketing capabilities.

maintaining our sales force may be disproportional compared to the revenues we may be able to generate on sales of our EsoGuard test

and the Veris Cancer Care Platform or any future tests or other products, and in order to establish and maintain these capabilities may

required our raising additional capital, which we may be unable to do.

products may never achieve market acceptance.

date, we have not generated significant sales revenues from our products and services.

Our ability to generate sales revenues

from product and services, and to achieve profitability will depend upon our ability to successfully commercialize our products and services.

As we only recently began to market our first product and service for sale, we have no basis to predict whether our current product and

service (or potential future products and services) will achieve market acceptance.

A number of factors may limit the market acceptance

of any of our products, including:

Our ability to generate sales revenues from product

and services, and to achieve profitability will depend upon our ability to successfully commercialize our products and services.

only recently began to market our two products and services for sale, we have no basis to predict whether our current products and services

(or potential future products and services) will achieve market acceptance.

A number of factors may limit the market acceptance of any

of our products, including:

timing of regulatory approvals of our products and services and market entry compared to

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Recommendations,

guidelines and quality metrics issued by various organizations may significantly affect payers’ willingness to cover, and healthcare

guidelines and quality metrics issued by various organizations may significantly affect payors’ willingness to cover, and healthcare

providers’ willingness to prescribe, our products.

influential recommendations, inclusion in healthcare guidelines and inclusion in quality measures are keys to our healthcare provider

and payer engagement strategies.

These guidelines, recommendations and quality metrics may shape payers’ coverage decisions and

and payor engagement strategies.

These guidelines, recommendations and quality metrics may shape payors’ coverage decisions and

healthcare providers’ cancer screening procedures.

an example, the U.S.

Preventative Services Task Force (“USPSTF”), a panel of primary care providers and epidemiologists and

other national experts funded by the U.S.

Department of Health and Human Services’ Agency for Healthcare Research and Quality,

makes influential recommendations on clinical preventative services.

We intend to seek a USPSTF recommendation in the future for our

EsoGuard test.

The process of USPSTF recommendation development is lengthy, requires high quality supporting evidence for a positive

recommendation, and that the outcome of any USPSTF process is uncertain.

A USPSTF recommendations may have the effect of reducing screening,

may not include our test in a favorable manner, or may add new technologies could have a material adverse effect on our business.

to achieve a high USPSTF recommendation for our tests and other products may have certain other potentially significant collateral implications

For instance, the ACA mandates that certain non-grandfathered health insurers cover evidence-based items or services that have

in effect a rating of “A” or “B” in the current recommendations of USPSTF without imposing any patient cost-sharing.

Similarly, federal regulations require that Medicare Advantage plans cover “A” or “B” graded preventive services

without patient cost-sharing.

the healthcare industry in the United States has experienced a trend toward cost containment and value-based purchasing of healthcare

Some government and private payers are adopting pay-for-performance programs that differentiate payments for healthcare services

based on the achievement of documented quality metrics, cost efficiencies or patient outcomes.

Payers may look to quality measures such

as the National Committee for Quality Assurance (“NCQA”), Healthcare Effectiveness Data and Information Set (“HEDIS”)

and the CMS Medicare Advantage Star Ratings to assess quality of care.

These measures are intended to provide incentives to service providers

to deliver the same or better results while consuming fewer resources.

If our tests or other products are not included in HEDIS, the

Star Ratings or other quality metrics, payers may be less inclined to reimburse our tests or other products at adequate levels, if at

all, which could adversely impact our business.

Additionally, if our tests or other products are not included in HEDIS, the Star Ratings

or other quality metrics, healthcare providers may not earn quality credit for prescribing Cologuard and therefore may be less inclined

There can be no assurance that we will be able to secure such recommendations

or inclusion in healthcare guidelines and inclusion in quality measures.

Any such failures could have a material impact on our ability

to commercialize our products.

or our third-party manufacturers may not have the manufacturing and processing capacity to meet the production requirements of clinical

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conduct human clinical trials, to produce products for commercial sale at an acceptable cost.

We have no experience in large-scale product

manufacturing, nor do we have the resources or facilities to manufacture most of our products on a commercial scale.

We cannot guarantee

that we or our third-party manufacturers will be able to increase capacity in a timely or cost-effective manner, or at all.

providing or increasing production or processing capacity could result in additional expense or delays in our clinical trials, regulatory

submissions and commercialization of our products.

manufacturing processes for our products have not yet been tested at commercial levels, and it may not be possible to manufacture or

process these materials in a cost-effective manner.

will be dependent on third-party manufacturers since we will not initially directly manufacture our products.

We have limited experience in large-scale

product manufacturing, nor do we have the resources or facilities to manufacture most of our products on a commercial scale.

guarantee that we or our third-party manufacturers will be able to increase capacity in a timely or cost-effective manner, or at all.

we will not directly manufacture our products and will rely on third parties to do so for us.

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at one or more of their facilities.

As a result, the sale and marketing of our products could be delayed or we could be forced to develop

As a result, the sales and marketing of our products could be delayed or we could be forced to develop

our own manufacturing capacity, which could require substantial additional funds and personnel and compliance with extensive regulations.

currently expect to perform our EsoGuard test in one laboratory facility.

If demand for our EsoGuard test grows, we may lack adequate

facility space and capabilities to meet increased processing requirements.

Moreover, if these or any future facilities or our equipment

were damaged or destroyed, or if we experience a significant disruption in our operations for any reason, our ability to continue to

operate our business could be materially harmed.

manufacturing processes for our products have not yet been tested at commercial levels, and it may not be possible to manufacture or

process these materials in a cost-effective manner.

currently perform our EsoGuard test in one laboratory facility.

If demand for our EsoGuard test grows, we may lack adequate facility

space and capabilities to meet increased processing requirements.

Moreover, if these or any future facilities or our equipment were damaged

or destroyed, or if we experience a significant disruption in our operations for any reason, our ability to continue to operate our business

could be materially harmed.

currently perform the EsoGuard test in a single laboratory facility in Lake Forest, CA.

The laboratory facility, without purchasing

additional lab equipment applicable to our test, is expected to have an annual capacity of approximately 50,000 tests per year.

for the EsoGuard test outstrips this capacity, and we fail to add additional equipment and staff, or complete, or timely complete,

an expansion of its available laboratory facilities, it may significantly delay our EsoGuard processing times and limit the volume of

EsoGuard tests we can process, which may adversely affect our business, financial condition and results of operation.

In addition, our

financial condition may be adversely affected if they are unable to complete these expansion projects on budget and otherwise on terms

and conditions acceptable to us.

Finally, our financial condition will be adversely affected if demand for our products and services

does not materialize in line with our current expectations and if, as a result, we end up building excess capacity that does not yield

a reasonable return on our investment.

The laboratory facility, without purchasing additional

lab equipment applicable to our test, is expected to have an annual capacity of approximately 50,000 tests per year.

If demand for the

EsoGuard test outstrips this capacity, and we fail to add additional equipment and staff, or complete, or timely complete, an expansion

of its available laboratory facilities, it may significantly delay our EsoGuard processing times and limit the volume of EsoGuard tests

we can process, which may adversely affect our business, financial condition and results of operation.

In addition, our financial condition

may be adversely affected if they are unable to complete these expansion projects on budget and otherwise on terms and conditions acceptable

Finally, our financial condition will be adversely affected if demand for our products and services does not materialize in line

with our current expectations and if, as a result, we end up building excess capacity that does not yield a reasonable return on our

our present, or any future, laboratory facilities were to be damaged, destroyed or otherwise unable to operate, whether due to fire,

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to coverage under our insurance policies, we may not be able to cover our losses.

future performance will depend in part on the success of products we have not yet developed.

is an important component of our business and growth strategy, and our success depends on the development, implementation and acceptance

of our products.

To date, only our EsoCheck and EsoGuard products have reached the marketing stage.

Commitments to develop new products

must be made well in advance of any resulting sales, and technologies and standards may change during development, potentially rendering

our products outdated or uncompetitive before their introduction.

Our ability to develop products to meet evolving industry requirements

and at prices acceptable to our customers will be significant factors in determining our competitiveness.

We may expend considerable

funds and other resources on the development of our products without any guarantee these products will be successful.

If we are not successful

in bringing one or more products to market, whether because we fail to address marketplace demand, fail to develop viable technologies

or otherwise, we may not generate any revenues and our results of operations could be seriously harmed.

may make investments in products we have not yet developed, and those investments may not be realized.

we are currently focused on the commercialization of our EsoGuard test and the Veris Cancer Care Platform, technology remains an important

component of our business and growth strategy, and our success may depend on the development, implementation and acceptance of new products.

Commitments to develop new products must be made well in advance of any resulting sales, and technologies and standards may change during

development, potentially rendering our products outdated or uncompetitive before their introduction.

Our ability to develop products

to meet evolving industry requirements and at prices acceptable to our customers will be significant factors in determining our competitiveness.

We may expend considerable funds and other resources on the development of new products without any guarantee these products will be

If we are not successful in bringing one or more products to market, whether because we fail to address marketplace demand,

fail to develop viable technologies or otherwise, we may not generate any revenues and our results of operations could be seriously harmed.

products and services may become subject to unfavorable pricing regulations, third-party reimbursement practices or healthcare reform

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Patent and Trademark

Office (the “PTO”), may deny or require significant narrowing of claims in our pending patent applications, and patents

issued as a result of the pending patent applications, if any, may not provide us with significant commercial protection or be issued

in a form that is advantageous to us.

We could also incur substantial costs in proceedings before the PTO.

Patents that may be issued

to or licensed by us in the future may expire or may be challenged, invalidated or circumvented, which could limit our ability to stop

competitors from marketing related technologies.

Upon expiration of our issued or licensed patents, we may lose some of our rights to

exclude others from making, using, selling or importing products using the technology based on the expired patents.

There is no assurance

that competitors will not be able to design around our patents.

we may not be able to obtain patent protection or secure other intellectual property rights in all the countries in which we operate,

and under the laws of such countries, patents and other intellectual property rights may be unavailable or limited in scope.

our patents fails to protect our technology, it would make it easier for our competitors to offer similar products.

Our trade secrets

may be vulnerable to disclosure or misappropriation by employees, contractors and other persons.

Any inability on our part to adequately

protect our intellectual property may have a material adverse effect on our business, financial condition and results of operations.

Office (the “PTO”), or the applicable authorized in other countries in which we may seek to protect our intellectual property

rights, may deny or require significant narrowing of claims in our pending patent applications, and patents issued as a result of the

pending patent applications, if any, may not provide us with significant commercial protection or be issued in a form that is advantageous

We could also incur substantial costs in proceedings before the PTO, or foreign patent offices.

Patents that may be issued to

or licensed by us in the future may expire or may be challenged, invalidated or circumvented, which could limit our ability to stop competitors

from marketing related technologies.

Upon expiration of our issued or licensed patents, we may lose some of our rights to exclude others

from making, using, selling or importing products using the technology based on the expired patents.

There is no assurance that competitors

will not be able to design around our patents.

also rely on unpatented proprietary technology.

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vulnerable to disclosure or misappropriation by employees, contractors and other persons.

addition, we intend to rely on the use of registered and common law trademarks with respect to the brand names of some of our products.

Common law trademarks provide less protection than registered trademarks.

Loss of rights in our trademarks could adversely affect our

business, financial condition and results of operations.

may be subject to intellectual property infringement claims by third parties which could be costly to defend, divert management’s

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we fail to effectively manage our growth, our ability to execute our business strategy could be impaired.

The anticipated rapid growth

Any unanticipated rapid growth

of our business may place a strain on our management, operations and financial systems.

We need to improve existing systems and controls

or implement new systems and controls in response to anticipated growth.

officers will allocate their time to other businesses thereby potentially limiting the amount of time they devote to our affairs.

We need to ensure our existing systems and controls

are adequate to support our business and its anticipated growth.

officers may allocate their time to other businesses thereby potentially limiting the amount of time they devote to our affairs.

conflict of interest could have a negative impact on our operations.

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believe is necessary to our business.

All of our officers are engaged in several other business endeavors and are not obligated to devote

any specific number of hours to our affairs.

If our officers’ other business affairs require them to devote more substantial amounts

of time to such affairs, it could limit their ability to devote time to our affairs and could have a negative impact on our operations.

Certain of our officers are engaged in other business endeavors.

If our officers’ other business

affairs require them to devote more substantial amounts of time to such affairs, it could limit their ability to devote time to our affairs

and could have a negative impact on our operations.

We cannot assure you these conflicts will be resolved in our favor.

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We may also be unable to attract and retain additional key personnel in the future.

to do so may impact our ability to continue and grow our operations.

officers have fiduciary obligations to other companies and, accordingly, may have conflicts of interest in determining to which entity

a particular business opportunity should be presented.

of our officers have fiduciary obligations to other companies engaged in medical device business activities, namely Saphena Medical,

Kaleidoscope Medical and Cruzar Medsystems.

Accordingly, they may participate in transactions and have obligations that may be in conflict

or competition with our business.

As a result, a potential business opportunity may be presented by certain members of our management

team to another entity prior to its presentation to us and we may not be afforded the opportunity to engage in such a transaction.

As of March 9, 2023, we only

have 672,190 shares available for issuance under our long-term incentive plan, which could limit our ability to attract and retain

key personnel, until such amount is increased.

An inability to attract and retain key personnel may impact our ability to continue and

grow our operations.

officers and directors have fiduciary obligations to other companies and, accordingly, may have conflicts of interest in determining

to which entity a particular business opportunity should be presented.

of our officers and directors have fiduciary obligations to other companies engaged in medical device business activities.

they may participate in transactions and have obligations that may be in conflict or competition with our business.

As a result, a potential

business opportunity may be presented by certain members of our board or management team to another entity prior to its presentation

to us and we may not be afforded the opportunity to engage in such a transaction.

business, financial condition and results of operations could be adversely affected by the political and economic conditions of the countries

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burdensome taxation and changes in foreign tax.

future products or services we may develop may not be approved for sale in the U.S.

or in any other country.

only products for which we have obtained approval or clearance from the FDA or a comparable foreign regulatory authority is our

EsoCheck cell sample collection device and our CarpX minimally invasive surgical device.

In certain limited circumstances, we also may

market our products without such approval or clearance, as is the case for the EsoGuard LDT.

Generally, however, neither we nor any future

collaboration partner can commercialize any products we may develop in the U.S.

or in any foreign country without first obtaining regulatory

approval for the product from the FDA or comparable foreign regulatory authorities.

The approval route in the U.S.

for any products we

may develop may be either via the PMA process, a de novo 510(k) pathway, or traditional 510(k).

The PMA approval process is more complex,

costly and time consuming than the 510(k) process.

Additional randomized, controlled clinical trials may be necessary to obtain approval.

The approval process may take several years to complete and may never be obtained.

Before obtaining regulatory approvals for the commercial

sale of any product we may develop in the U.S., we must demonstrate with substantial evidence, gathered in preclinical and well-controlled

clinical studies, that the planned products are safe and effective for use for that target indication.

We may not conduct such a trial

or may not successfully enroll or complete any such trial.

Any products we may develop may not achieve the required primary endpoint

in the clinical trial and may not receive regulatory approval.

We must also demonstrate that the manufacturing facilities, processes

and controls for any products we may develop are adequate.

Moreover, obtaining regulatory approval in one country for marketing of any

products we may develop does not ensure we will be able to obtain regulatory approval in other countries, while a failure or delay in

obtaining regulatory approval in one country may have a negative effect on the regulatory process in other countries.

if we or any future collaboration partner were to successfully obtain a regulatory approval for any product we may develop, any approval

might contain significant limitations related to use restrictions for specified age groups, warnings, precautions or contraindications,

or may be subject to burdensome post-approval study or risk management requirements.

If we are unable to obtain regulatory approval for

any products, we may develop in one or more jurisdictions, or any approval contains significant limitations, we may not be able to obtain

sufficient revenue to justify commercial launch.

Also, any regulatory approval of a product, once obtained, may be withdrawn.

unable to successfully obtain regulatory approval to sell any products we may develop in the U.S.

or other countries, our business, financial

condition, results of operations and growth prospects could be adversely affected.

business may be adversely affected by health epidemics and or pandemics, including the pandemic resulting from the “Severe Acute

Respiratory Syndrome Coronavirus 2” - “SARS-CoV-2” - and the resulting illness of “Coronavirus Disease 2019”

- “COVID-19”.

in 2019, an outbreak of a novel strain of a coronavirus occurred, with such coronavirus designated by the United Nations World Health

Organization (“WHO”) as the “Severe Acute Respiratory Syndrome Coronavirus 2” - or “SARS-CoV-2” -

which spread on a global basis to other countries, including the United States.

On March 11, 2020, the WHO declared a pandemic resulting SARS-CoV-2, with such pandemic commonly referred

to as the “COVID-19 pandemic” after the resulting illness of “coronavirus disease-2019” (“COVID-19”),

and is thus referred to herein as the “COVID-19 pandemic”.

The COVID-19 pandemic is ongoing, and we continue to monitor the

ongoing impact of the COVID-19 pandemic on the United States national economy, the global economy, and our business.

business may be adversely affected by health epidemics and or pandemics, including the COVID-19 pandemic.

COVID-19 pandemic may have an adverse impact on our operations, supply chains, and distribution systems and /or those of our contractors

of our laboratory partner, and increase our expenses, including as a result of impacts associated with preventive and precautionary measures

being taken, restrictions on travel, quarantine polices, and social distancing.

Such adverse impact may include, for example, the inability

of our employees and /or those of our contractors or laboratory partner to perform their work or curtail their services provided to us.

expect the significance of the COVID-19 pandemic, including the extent of its effect on our consolidated financial condition and consolidated

operational results and cash flows, to be dictated by the success of United States and global efforts to mitigate the spread of and /or

to contain the SARS-CoV-2 and the impact of such efforts.

addition, the spread of the SARS-CoV-2 has disrupted the United States’ healthcare and healthcare regulatory systems which could

divert healthcare resources away from, or materially delay United States Food and Drug Administration (“FDA”) approval with

respect to our products.

being taken, restrictions on travel, quarantine polices.

Such adverse impact may include, for example, the inability of our employees

and /or those of our contractors or laboratory partner to perform their work or curtail their services provided to us.

addition, the COVID-19 pandemic has disrupted the United States’ healthcare and healthcare regulatory systems which could divert

healthcare resources away from, or materially delay United States Food and Drug Administration (“FDA”) approval with respect

to our products.

our clinical trials have been and may be further affected by the COVID-19 pandemic, as site initiation and patient enrollment may be

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imposed by governments, and the inability to access clinical test sites for initiation and monitoring.

COVID-19 pandemic may have an adverse impact on the economies and financial markets of many countries, including the United States,

resulting in an economic downturn that could adversely affect demand for our products and services and /or our product candidates.

COVID-19 pandemic may have an adverse impact on the economies and financial markets of many countries, including the United States, resulting

in an economic downturn that could adversely affect demand for our products and services and /or our product candidates.

we are continuing to monitor and assess the effects of the COVID-19 pandemic on our business, the ultimate impact of the COVID-19 pandemic

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in a material adverse effect on our financial position, results of operations and cash flows.

are and may become the subject of various claims, threats of litigation, litigation or investigations which could have a material adverse

effect on our business, financial condition, results of operations or price of our common stock.

are and may become subject to various claims, threats of litigation, litigation or investigations, including commercial disputes and

employee claims, and from time to time may be involved in governmental or regulatory investigations or similar matters.

Any claims asserted

against us or our management, regardless of merit or eventual outcome, could harm our reputation and have an adverse impact on our relationship

may become the subject of various claims, threats of litigation, litigation or investigations which could have a material adverse effect

on our business, financial condition, results of operations or price of our common stock.

may become subject to various claims, threats of litigation, litigation or investigations, including commercial disputes and employee

claims, and from time to time may be involved in governmental or regulatory investigations or similar matters.

Any claims asserted against

us or our management, regardless of merit or eventual outcome, could harm our reputation and have an adverse impact on our relationship

with our clients, distribution partners and other third parties and could lead to additional related claims.

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on our business, financial condition, results of operations and price of our common stock.

regulatory approval process is expensive, time consuming and uncertain, and may prevent us or our partners from obtaining approval for

the commercialization of any products we may develop.

Approval of products in the U.S.

or other territories may require that we, or a

partner, conduct randomized, controlled clinical trials.

many of the products we are currently developing, the regulatory pathway in the U.S.

for approval of the product has not been determined.

However, it is possible the FDA will require us to file for approval via the PMA pathway for one or more of our planned products.

this case, the FDA is likely to require that randomized, controlled clinical trials be conducted before an application for approval can

These are typically expensive and time consuming and require substantial commitment of financial and personnel resources from

the sponsoring company.

These clinical trials also entail significant risk, and the resulting data may not be sufficient to support approval

by the FDA or other regulatory bodies.

regulatory approval of a PMA or a 510(k) pathway is not guaranteed, and the filing and approval process itself is expensive and may take

several years.

The FDA also has substantial discretion in the approval process.

Despite the time and expense exerted, failure may occur

at any stage, and we could encounter problems that cause us to abandon or repeat clinical studies.

The FDA can delay, limit, or deny

approval of a future product for many reasons, including but not limited to:

future product may not be deemed to be safe and effective;

officials may not find the data from clinical and preclinical studies sufficient;

FDA may not approve our or our third-party manufacturer’s processes or facilities;

FDA may change its approval policies or adopt new regulations.

any products we may develop fail to demonstrate safety and efficacy in further clinical studies may be required, or do not gain regulatory

approval, our business and results of operations will be materially and adversely harmed.

Relating to Regulatory Matters

future products or services we may develop may not be approved for sale in the U.S.

or in any other country.

In order to obtain approval,

we may need to conduct clinical trials necessary to support a FDA 510(k) notice or PMA application will be expensive and will require

the enrollment of large numbers of patients, and suitable patients may be difficult to identify and recruit.

only products for which we have obtained approval or clearance from the FDA or a comparable foreign regulatory authority is our EsoCheck

cell sample collection device and our CarpX minimally invasive surgical device.

In certain limited circumstances, we also may market

our products without such approval or clearance, as is the case for the EsoGuard LDT.

Generally, however, neither we nor any future collaboration

partner can commercialize any products we may develop in the U.S.

or in any foreign country without first obtaining regulatory approval

for the product, where applicable, from the FDA or comparable foreign regulatory authorities.

The approval route in the U.S.

products we may develop may be either via the PMA process, a de novo 510(k) pathway, or traditional 510(k).

The PMA approval process

is more complex, costly and time consuming than the 510(k) process.

Additional randomized, controlled clinical trials may be necessary

to obtain approval.

The approval process may take several years to complete and may never be obtained.

Before obtaining regulatory approvals

for the commercial sale of any product we may develop in the U.S., we must demonstrate with substantial evidence, gathered in preclinical

and well-controlled clinical studies, that the planned products are safe and effective for use for that target indication.

conduct such a trial or may not successfully enroll or complete any such trial.

Any products we may develop may not achieve the required

primary endpoint in the clinical trial and may not receive regulatory approval.

We must also demonstrate that the manufacturing facilities,

processes and controls for any products we may develop are adequate.

Moreover, obtaining regulatory approval in one country for marketing

of any products we may develop does not ensure we will be able to obtain regulatory approval in other countries, while a failure or delay

in obtaining regulatory approval in one country may have a negative effect on the regulatory process in other countries.

Failure to obtain

regulatory approvals in foreign jurisdictions will prevent us from marketing our products internationally.

if we or any future collaboration partner were to successfully obtain a regulatory approval for any product we may develop, any approval

might contain significant limitations related to use restrictions for specified age groups, warnings, precautions or contraindications,

or may be subject to burdensome post-approval study or risk management requirements.

If we are unable to obtain regulatory approval for

any products, we may develop in one or more jurisdictions, or any approval contains significant limitations, we may not be able to obtain

sufficient revenue to justify commercial launch.

Also, any regulatory approval of a product, once obtained, may be withdrawn.

unable to successfully obtain regulatory approval to sell any products we may develop in the U.S.

or other countries, our business, financial

condition, results of operations and growth prospects could be adversely affected.

and completing clinical trials necessary to support a FDA 510(k) notice or a PMA application will be time-consuming and expensive and

the outcome uncertain.

Moreover, the results of early clinical trials are not necessarily predictive of future results, and any product

the Company advances into clinical trials may not have favorable results in early or later clinical trials.

Conducting successful clinical

studies will require the enrollment of large numbers of patients, and suitable patients may be difficult to identify and recruit.

enrollment in clinical trials and completion of patient participation and follow-up depend on many factors, including the size of the

patient population, the nature of the trial protocol, the attractiveness of, or the discomforts and risks associated with, the treatments

received by patients enrolled as subjects, the availability of appropriate clinical trial investigators, support staff, and proximity

of patients to clinical sites and ability to comply with the eligibility and exclusion criteria for participation in the clinical trial

and patient compliance.

For example, patients may be discouraged from enrolling in our clinical trials if the trial protocol requires

them to undergo extensive post-treatment procedures or follow-up to assess the safety and effectiveness of our products or if they determine

that the treatments received under the trial protocols are not attractive or involve unacceptable risks or discomforts.

also not participate in our clinical trials if they choose to participate in contemporaneous clinical trials of competitive products.

In addition, patients participating in clinical trials may die before completion of the trial or suffer adverse medical events unrelated

to investigational products.

Further, the FDA may require the Company to submit data on a greater number of patients than it originally

anticipated and/or for a longer follow-up period or change the data collection requirements or data analysis for any clinical trials.

Delays in patient enrollment or failure of patients to continue to participate in a clinical trial may cause an increase in costs and

delays in the approval and attempted commercialization of our products or result in the failure of the clinical trial.

Such increased

costs and delays or failures could adversely affect our business, operating results and prospects.

results of the Company’s clinical trials may not support our product candidate claims or may result in the discovery of adverse

side effects.

In addition, delays or termination of our clinical trials may have an adverse impact on our ability to commercialize our

product candidates.

of unanticipated delays, the Company has been unable to successfully complete its clinical trials related to the EsoGuard test to generate

clinical utility data showing that the results of the test influence’s provider decisionmaking in providing medical care.

clinical utility data is important to decisions by payor’s to provide reimbursement for the test, continued delays in such trials

will adversely impact our ability to commercialize the EsoGuard test and generate revenues from sales of the same.

if any of the Company’s clinical trials are completed as planned, it cannot be certain that study results will support product

candidate claims or that the FDA or foreign regulatory authorities will agree with our conclusions regarding them.

Success in pre-clinical

evaluation and early clinical trials does not ensure that later clinical trials will be successful, and we cannot be sure that the later

trials will replicate the results of prior trials and pre-clinical studies.

The clinical trial process may fail to demonstrate that our

product candidates are safe and effective for the proposed indicated uses or otherwise influence medical decisions in the manner we need

to show to evidence the clinical utility of our product candidates, which could cause us to abandon a product candidate and may delay

development of others.

In addition, if clinical data does not support our product candidate claims, the FDA could then bring legal or

regulatory enforcement actions against the Company and/or its products including, but not limited to, recalls or requirements for pre-market

510(k) authorizations.

The Company can give no assurance that its data will be substantiated in studies involving more patients.

a case, the Company may never achieve significant revenues or profitability.

Any delay or termination of our clinical trials will delay

the filing of any related product submissions and, ultimately, our ability to commercialize our product candidates and generate revenues

(in particular where evidence of clinical utility is a critical factor to payor’s decisions around reimbursement).

It is also possible

that patients enrolled in clinical trials will experience adverse side effects that are not currently part of the product candidate’s

if we receive regulatory approval for any product we may develop, we will be subject to ongoing regulatory obligations and continued

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or suspension of manufacturing.

to obtain regulatory approvals in foreign jurisdictions will prevent us from marketing our products internationally.

intend to seek distribution and marketing partners in foreign countries for our products and services and any we may develop in the future,

The approval procedures vary among countries and can involve additional clinical testing, and the time required to obtain approval

may differ from that required to obtain FDA approval.

Moreover, clinical studies or manufacturing processes conducted in one country

may not be accepted by regulatory authorities in other countries.

Approval by the FDA does not ensure approval by regulatory authorities

in other countries, and approval by one or more foreign regulatory authorities does not ensure approval by regulatory authorities in

other foreign countries or by the FDA.

However, a failure or delay in obtaining regulatory approval in one country may have a negative

effect on the regulatory process in others.

The foreign regulatory approval process may include all of the risks associated with obtaining

FDA approval.

We may not obtain foreign regulatory approvals on a timely basis, if at all.

We may not be able to file for regulatory

approvals and even if we file, we may not receive necessary approvals to commercialize our products in any market.

reform measures could hinder or prevent our products’ commercial success.

the U.S., there have been, and we expect there will continue to be, a number of legislative and regulatory changes to the healthcare

system in ways that could affect our future revenue and profitability and the future revenue and profitability of our potential customers.

Federal and state lawmakers regularly propose and, at times, enact legislation that could result in significant changes to the healthcare

system, some of which are intended to contain or reduce the costs of medical products and services.

For example, one of the most significant

healthcare reform measures in decades, the PPACA, was enacted in 2010.

The PPACA contains a number of provisions, including those governing

enrollment in federal healthcare programs, reimbursement changes and fraud and abuse measures, all of which will impact existing government

healthcare programs and will result in the development of new programs.

The PPACA, among other things, could result in the imposition

of injunctions.

Supreme Court upheld the constitutionality of most elements of the PPACA in June 2012, other legal challenges are still pending

final adjudication in several jurisdictions.

In addition, Congress has also proposed a number of legislative initiatives, including possible

repeal of the PPACA.

For instance, in December 2019, the 2.3% tax on sales of medical devices was repealed.

At this time, it remains

unclear whether there will be any changes made to the PPACA, whether to certain provisions or its entirety.

We cannot assure you that

the PPACA, as currently enacted or as amended in the future, will not adversely affect our business and financial results and we cannot

predict how future federal or state legislative or administrative changes relating to healthcare reform will affect our business.

addition, other legislative changes have been proposed and adopted since the PPACA was enacted.

For example, the Budget Control Act of

2011, among other things, created the Joint Select Committee on Deficit Reduction to recommend proposals for spending reductions to Congress.

The Joint Select Committee did not achieve a targeted deficit reduction of at least $1.2 trillion for the years 2013 through 2021, which

triggered the legislation’s automatic reduction to several government programs, including aggregate reductions to Medicare payments

to providers of up to 2.0% per fiscal year, starting in 2013.

In January 2013, President Obama signed into law the American Taxpayer

Relief Act of 2012, or the ATRA, which delayed for another two months the budget cuts mandated by the sequestration provisions of the

Budget Control Act of 2011.

The ATRA, among other things, also reduced Medicare payments to several providers, including hospitals, and

increased the statute of limitations period for the government to recover overpayments to providers from three to five years.

2013, President Obama signed an executive order implementing sequestration, and in April 2013, the 2.0% Medicare reductions went into

We cannot predict whether any additional legislative changes will affect our business.

likely will continue to be legislative and regulatory proposals at the federal and state levels directed at containing or lowering the

cost of health care.

likely will be legislative and regulatory proposals at the federal and state levels directed at containing or lowering the cost of health

We cannot predict the initiatives that may be adopted in the future or their full impact.

The continuing efforts

of the government, insurance companies, managed care organizations and other payors of healthcare services to contain or reduce costs

of health care may adversely affect:

The continuing efforts of the government,

insurance companies, managed care organizations and other payors of healthcare services to contain or reduce costs of health care may

adversely affect:

ability to set a price that we believe is fair for our products;

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commercial insurers.

PPACA, among other things, amends the intent requirement of the Federal Anti-Kickback Statute and criminal healthcare fraud statutes.

A person or entity no longer needs to have actual knowledge of this statute or specific intent to violate it.

In addition, the PPACA

provides that the government may assert 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 FCA.

our operations are found to be in violation of any of the laws described above or any other governmental regulations that apply to us,

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and sustaining compliance with applicable federal and state privacy, security and fraud laws may prove costly.

required, clinical trials necessary to support a FDA 510(k) notice or PMA application will be expensive and will require the enrollment

of large numbers of patients, and suitable patients may be difficult to identify and recruit.

Delays or failures in our clinical trials

will prevent us from commercializing any modified or new products and will adversely affect our business, operating results and prospects.

and completing clinical trials necessary to support a FDA 510(k) notice or a PMA application will be time-consuming and expensive and

the outcome uncertain.

Moreover, the results of early clinical trials are not necessarily predictive of future results, and any product

the Company advances into clinical trials may not have favorable results in early or later clinical trials.

successful clinical studies will require the enrollment of large numbers of patients, and suitable patients may be difficult to identify

Patient enrollment in clinical trials and completion of patient participation and follow-up depend on many factors, including

the size of the patient population, the nature of the trial protocol, the attractiveness of, or the discomforts and risks associated

with, the treatments received by patients enrolled as subjects, the availability of appropriate clinical trial investigators, support

staff, and proximity of patients to clinical sites and ability to comply with the eligibility and exclusion criteria for participation

in the clinical trial and patient compliance.

For example, patients may be discouraged from enrolling in our clinical trials if the trial

protocol requires them to undergo extensive post-treatment procedures or follow-up to assess the safety and effectiveness of our products

or if they determine that the treatments received under the trial protocols are not attractive or involve unacceptable risks or discomforts.

Patients may also not participate in our clinical trials if they choose to participate in contemporaneous clinical trials of competitive

In addition, patients participating in clinical trials may die before completion of the trial or suffer adverse medical events

unrelated to investigational products.

of sufficient and appropriate clinical protocols to demonstrate safety and efficacy may be required and the Company may not adequately

develop such protocols to support clearance and approval.

Further, the FDA may require the Company to submit data on a greater number

of patients than it originally anticipated and/or for a longer follow-up period or change the data collection requirements or data analysis

for any clinical trials.

Delays in patient enrollment or failure of patients to continue to participate in a clinical trial may cause

an increase in costs and delays in the approval and attempted commercialization of our products or result in the failure of the clinical

The FDA may not consider our data adequate to demonstrate safety and efficacy.

Such increased costs and delays or failures could

adversely affect our business, operating results and prospects.

results of the Company’s clinical trials may not support our product candidate claims or may result in the discovery of adverse

side effects.

if any of the Company’s clinical trials are completed as planned, it cannot be certain that study results will support product

candidate claims or that the FDA or foreign regulatory authorities will agree with our conclusions regarding them.

Success in pre-clinical

evaluation and early clinical trials does not ensure that later clinical trials will be successful, and we cannot be sure that the later

trials will replicate the results of prior trials and pre-clinical studies.

The clinical trial process may fail to demonstrate that our

product candidates are safe and effective for the proposed indicated uses, which could cause us to abandon a product candidate and may

delay development of others.

Any delay or termination of our clinical trials will delay the filing of our product submissions and, ultimately,

our ability to commercialize our product candidates and generate revenues.

It is also possible that patients enrolled in clinical trials

will experience adverse side effects that are not currently part of the product candidate’s profile.

Company’s medical products may in the future be subject to product recalls that could harm its reputation, business and financial

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and may harm its reputation and financial results.

the effectiveness and safety of the Company’s devices are not supported by long-term data, the Company’s future revenues

could decline.

Company’s products may not be accepted in the market if the Company does not produce clinical data supported by the independent

efforts of clinicians, and if that data indicates that treatment with the Company’s products does not provide patients with sustained

benefits or that treatment with the Company’s products is less effective or less safe than the Company’s current data suggests,

the Company’s future revenues could decline.

In addition, the FDA could then bring legal or regulatory enforcement actions against

the Company and/or its products including, but not limited to, recalls or requirements for pre-market 510(k) authorizations.

can give no assurance that its data will be substantiated in studies involving more patients.

In such a case, the Company may never achieve

significant revenues or profitability.

the Company is found to be promoting the use of its devices for unapproved or “off-label” uses or engaging in other noncompliant

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attention and result in substantial damage awards against the Company.

Company may be subject, directly or indirectly, to federal and state healthcare fraud and abuse laws and regulations and could face substantial

penalties if the Company is unable to fully comply with such laws.

the Company does not control referrals of healthcare services or bill directly to Medicare, Medicaid or other third-party payors, many

healthcare laws and regulations apply to the Company’s business.

For example, the Company could be subject to healthcare fraud

and abuse and patient privacy regulation and enforcement by both the federal government and the states in which the Company intends to

conduct its business.

The healthcare laws and regulations that may affect the Company’s ability to operate include:

federal healthcare programs’ Anti-Kickback Law, which prohibits, among other things,

persons or entities from soliciting, receiving, offering or providing remuneration, directly

or indirectly, in return for or to induce either the referral of an individual for, or the

purchase order or recommendation of, any item or service for which payment may be made under

a federal healthcare program such as the Medicare and Medicaid programs;

false claims laws which prohibit, among other things, individuals or entities from knowingly

presenting, or causing to be presented, claims for payment from Medicare, Medicaid, or other

third-party payors that are false or fraudulent, or are for items or services not provided

as claimed and which may apply to entities like the Company to the extent that the Company’s

interactions with customers may affect their billing or coding practices;

federal Health Insurance Portability and Accountability Act of 1996, or HIPAA, which established

new federal crimes for knowingly and willfully executing a scheme to defraud any healthcare

benefit program or making false statements in connection with the delivery of or payment

for healthcare benefits, items or services, as well as leading to regulations imposing certain

requirements relating to the privacy, security and transmission of individually identifiable

health information;

law equivalents of each of the above federal laws, such as anti-kickback and false claims

laws which may apply to items or services reimbursed by any third-party payor, including

commercial insurers, and state laws governing the privacy of health information in certain

circumstances, many of which differ from each other in significant ways and often are not

preempted by HIPAA, thus complicating compliance efforts.

the medical device industry has been under heightened scrutiny as the subject of government investigations and regulatory or legal enforcement

actions involving manufacturers who allegedly offered unlawful inducements to potential or existing customers in an attempt to procure

their business, including arrangements with physician consultants.

If the Company’s operations or arrangements are found to be

in violation of any of the laws described above or any other governmental regulations that apply to the Company, the Company may be subject

to penalties, including civil and criminal penalties, damages, fines, exclusion from the Medicare and Medicaid programs and the curtailment

or restructuring of its operations.

Any penalties, damages, fines, exclusions, curtailment or restructuring of the Company’s operations

could adversely affect its ability to operate its business and its financial results.

The risk of the Company being found in violation

of these laws is increased by the fact that many of these laws are broad and their provisions are open to a variety of interpretations.

Any action against the Company for violation of these laws, even if the Company successfully defends against that action and the underlying

alleged violations, could cause the Company to incur significant legal expenses and divert its management’s attention from the

operation of its business.

If the physicians or other providers or entities with whom the Company does business are found to be non-compliant

with applicable laws, they may be subject to sanctions, which could also have a negative impact on the Company’s business.

Company or its subsidiaries’ failure to obtain or maintain necessary FDA clearances or approvals, or equivalents thereof in the

and relevant foreign markets, could hurt our ability to distribute and market our products.

both the United States and foreign markets, the Company and its subsidiaries are affected by extensive laws, governmental regulations,

administrative determinations, court decisions and similar constraints.

Such laws, regulations and other constraints may exist at the

federal, state or local levels in the United States and at analogous levels of government in foreign jurisdictions.

example, as discussed above, certain of the Company’s planned product candidates may fall under the regulatory purview of various

centers at the FDA and in other countries by similar health and regulatory authorities.

Each medical device that the Company wishes to

market in the U.S.

must first receive either 510(k) clearance or premarket approval from the FDA unless an exemption applies.

process can be lengthy and expensive.

The FDA’s 510(k) clearance process may take from three to twelve months, or longer, and may

or may not require human clinical data.

The premarket approval process is much costlier and lengthier.

It may take from eleven months

to three years, or even longer, and will likely require significant supporting human clinical data.

Delays in obtaining regulatory clearance

or approval could adversely affect the Company’s revenues and profitability.

Although the Company has obtained 510(k) clearance

for EsoCheck, this clearance may be subject to revocation if post-marketing data demonstrates safety issues or lack of effectiveness.

Similar clearance processes may apply in foreign countries.

Further, more stringent regulatory requirements or safety and quality standards

may be issued in the future with an adverse effect on the Company’s business.

addition, the formulation, manufacturing, packaging, labeling, distribution, importation, sale and storage of the Company’s and

its subsidiaries’ products are subject to extensive regulation by various federal agencies, including, but not limited to, the

FDA, the FTC, State Attorneys General in the United States, the Ministry of Health, Labor and Welfare in Japan, as well as by various

other federal, state, local and international regulatory authorities in the countries in which its products are manufactured, distributed

If the Company or its manufacturers fail to comply with those regulations, the Company and its subsidiaries could become subject

to significant penalties or claims, which could harm its results of operations or its ability to conduct its business.

In addition, the

adoption of new regulations or changes in the interpretations of existing regulations may result in significant compliance costs or discontinuation

of product sales and may impair the marketing of its products, resulting in significant loss of net sales.

The Company’s failure

to comply with federal or state regulations, or with regulations in foreign markets that cover its product claims and advertising, including

direct claims and advertising by the Company or its subsidiaries, may result in enforcement actions and imposition of penalties or otherwise

harm the distribution and sale of its products.

Further, the Company and its subsidiaries’ businesses are subject to laws governing

our accounting, tax and import and export activities.

Failure to comply with these requirements could result in legal and/or financial

consequences that might adversely affect its sales and profitability.

Associated with Ownership of Our Common Stock

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adversely affect prevailing market prices for our common stock.

subsidiary Lucid may issue shares of its common and/or preferred stock in the future which could reduce the equity interest of PAVmed

in Lucid and might cause us to cease to control a majority of the voting stock of Lucid.

As of the date hereof, our subsidiary

Lucid has sold $13.625 million in shares of Series A Preferred Stock.

If the maximum amount of common stock underlying such securities

were issued, the percentage of shares of Lucid common stock held by PAVmed would be reduced from approximately 72% to approximately 59%.

This reduced percentage would be further diluted in the event of future convertible debt or stock issuances by Lucid or by issuances under

Lucid’s long-term incentive plan and employee stock purchase plan.

While PAVmed would still retain a large ownership interest in

Lucid in such event, it may cease to control the vote on matters requiring shareholder approval, including the election of Lucid’s

board of directors.

management and their affiliates control a substantial interest in us and thus may influence certain actions requiring a stockholder vote.

of December 31, 2021, our management and their affiliates collectively owned approximately 10% of our issued and outstanding

shares of common stock.

Accordingly, these individuals would have considerable influence regarding the outcome of any transaction that

requires stockholder approval.

Furthermore, our Board of Directors is and will be divided into three classes, each of which will generally

serve for a term of three years with only one class of directors being elected in each year.

of December 31, 2022, our management and their affiliates collectively owned approximately 10% of our issued and outstanding shares

of common stock.

Accordingly, these individuals would have considerable influence regarding the outcome of any transaction that requires

stockholder approval.

Furthermore, our Board of Directors is and will be divided into three classes, each of which will generally serve

for a term of three years with only one class of directors being elected in each year.

As a consequence of our “staggered”

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exchange and the liquidity and market price of our common stock may be adversely affected.

On December 29, 2022, the Company received

a notice from the Listing Qualifications Department of The Nasdaq Stock Market LLC stating that, for the prior 30 consecutive business

days (through December 28, 2022), 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.

The notification letter stated that the Company would be afforded 180 calendar

days (until June 27, 2023) to regain compliance.

The Company intends to regain compliance through a reverse stock split.

A special annual

meeting at which the reverse stock split will be voted on is scheduled for March 31, 2023.

However, there can be no assurance that the

Company will be able to obtain the requisite shareholder vote to approve such a transaction.

robust public market for our common stock may not be sustained, which could affect your ability to sell our common stock or depress the

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any reason, it may be difficult for you to sell your securities at the time you wish to sell them, at a price that is attractive to you,

If the proposed reverse stock split discussed above is completed, the related reduction in outstanding shares would likely

reduce the liquidity in our common stock.

stock price may be volatile, and purchasers of our securities could incur substantial losses.

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outstanding warrants and other convertible securities may have an adverse effect on the market price of our common stock.

of December 31, 2021, there were 86,367,845 shares of our common stock issued and outstanding, and, as of such date,

we also had issued and outstanding:

stock options to purchase 8,720,198 shares of our common stock at a weighted average exercise price of $3.39 per share,

with such total number inclusive of both stock options granted under the PAVmed Inc.

2014 Long-Term Incentive Equity Plan (“PAVmed

2014 Equity Plan”);and 1,160,573 shares of our common stock reserved for issuance, but not subject to outstanding stock-based

equity awards under the PAVmed Inc.

of December 31, 2022, there were 94,510,537 shares of our common stock issued and outstanding, and, as of such date, we also had issued

and outstanding:

options to purchase 11,568,655 shares of our common stock at a weighted average exercise price of $2.71 per share, with such total number

inclusive of both stock options granted under the PAVmed Inc.

2014 Long-Term Incentive Equity Plan (“PAVmed Inc.

2014 Equity Plan”);and

2,563,843 shares of our common stock reserved for issuance, but not subject to outstanding stock-based equity awards under the PAVmed

2014 Equity Plan;

and 626,081 shares of our common stock reserved for issuance under the PAVmed

Employee Stock Purchase Plan (“PAVmed Inc.

Series Z Warrants to purchase 11,937,455 shares of our common stock at an exercise price of $1.60 per share;

W Warrants to purchase 377,873 shares of our common stock at an exercise price of $5.00 per share, with all such Series W Warrants expiring

unexercised subsequent to December 31, 2021, as of January 29, 2022;

Series B Convertible Preferred Stock of 1,113,919 shares, convertible into the same number of shares of our common stock.

In addition, the March 2022

Notes with a principal amount of $27.5 million are convertible into 5,500,000 shares of our common stock (assuming the March 2022 Notes

were converted in full on such date at the initial fixed conversion price of $5.00 per share).

The number of shares of our common stock

underlying the March 2022 Notes may increase if we conduct additional closings under the March 2022 SPA, pursuant to which we may issue

March 2022 Notes with up to an additional $22,500,000 of principal amount.

Furthermore, the number of shares of common stock to be issued

under the March 2022 Notes may be substantially greater than the estimate set forth in this paragraph, if we pay the interest and the

installments of principal in shares of our common stock, because in such cases (and in certain other cases as described elsewhere in

this Annual Report on Form 10-K) the number of shares issued will be determined based on the then current market price (but in any event

not more than fixed conversion price per share or less than a floor price specified in the notes).

We cannot predict the market price

of our common stock at any future date, and therefore, we are unable to accurately forecast or predict the total amount of shares that

ultimately may be issued under these notes.

In addition, the number of shares issued under these notes may be substantially greater if

we voluntarily lower the conversion price, which we are permitted to do pursuant to the terms thereof.

and 626,081 shares of our common stock reserved for issuance under the PAVmed Inc.

Employee Stock Purchase Plan

(“PAVmed Inc.

Z Warrants to purchase 11,937,450 shares of our common stock at an exercise price of $1.60 per share;

B Convertible Preferred Stock of 1,205,759 shares, convertible into the same number of shares of our common stock.

addition, the Senior Convertible Notes have a current outstanding principal amount of $32.7 million, which are convertible into 6,549,400

shares of our common stock (assuming the Senior Convertible Notes were converted in full on such date at the initial fixed conversion

price of $5.00 per share).

The number of shares of our common stock underlying the Senior Convertible Notes may increase if we conduct

additional closings under the March 2022 SPA, pursuant to which we may issue Senior Convertible Notes with up to an additional $11,250,000

of principal amount.

Furthermore, the number of shares of common stock to be issued under the Senior Convertible Notes may be substantially

greater than the estimate set forth in this paragraph, if we pay the interest and the installments of principal in shares of our common

stock, because in such cases (and in certain other cases as described elsewhere in this Annual Report on Form 10-K) the number of shares

issued will be determined based on the then current market price (but in any event not more than fixed conversion price per share or

less than a floor price specified in the notes).

We cannot predict the market price of our common stock at any future date, and therefore,

we are unable to accurately forecast or predict the total amount of shares that ultimately may be issued under these notes.

the number of shares issued under these notes may be substantially greater if we voluntarily lower the conversion price, which we are

permitted to do pursuant to the terms thereof.

issuance of these shares will dilute our other equity holders, which could cause the price of our common stock to decline.

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evolving expectations, rules and regulations, as well as any risk of noncompliance, could adversely impact us.

incur significant costs as a result of operating as a public company, and our management will be required to devote substantial time

to compliance initiatives.

a public company, we incur significant legal, accounting and other expenses.

We are subject to the reporting requirements of the Exchange

Act, the other rules and regulations of the Securities and Exchange Commission, or SEC, and the rules and regulations of Nasdaq or any

other national securities exchange on which our securities are then trading.

Compliance with the various reporting and other requirements

applicable to public companies requires considerable time and attention of management.

For example, the Sarbanes-Oxley Act and the rules

of the SEC and Nasdaq have imposed various requirements on public companies, including requiring establishment and maintenance of effective

disclosure and financial controls.

Our management and other personnel devote a substantial amount of time to these compliance initiatives.

These rules and regulations result in significant legal and financial compliance costs and make some activities more time-consuming and

incur significant costs as a result of our and Lucid Diagnostics operating as a public company, and our management will be required to

devote substantial time to compliance initiatives.

a public company, with a majority-owned subsidiary that is also a public company, we incur significant legal, accounting and other expenses.

We are subject to the reporting requirements of the Exchange Act, the other rules and regulations of the Securities and Exchange Commission,

or SEC, and the rules and regulations of Nasdaq or any other national securities exchange on which our securities are then trading.

with the various reporting and other requirements applicable to public companies requires considerable time and attention of management.

For example, the Sarbanes-Oxley Act and the rules of the SEC and Nasdaq have imposed various requirements on public companies, including

requiring establishment and maintenance of effective disclosure and financial controls.

Our management and other personnel devote a substantial

amount of time to these compliance initiatives.

These rules and regulations result in significant legal and financial compliance costs

and make some activities more time-consuming and costlier.

Sarbanes-Oxley Act requires, among other things, that we maintain effective internal control over financial reporting and disclosure

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we are no longer a smaller reporting company.

Our compliance with Section 404 of the Sarbanes-Oxley Act requires that we incur

substantial accounting expense and expend significant management efforts.

We currently do not have an internal audit group, and as our

business expands, we will need to hire additional accounting and financial staff with appropriate public company experience and technical

accounting knowledge.

If we are not able to comply with the requirements of Section 404 in a timely manner, or if we or our independent

registered public accounting firm identify deficiencies in our internal control over financial reporting that are deemed to be material

weaknesses, the market price of our stock could decline and we could be subject to sanctions or investigations by the SEC or other regulatory

authorities, which would require additional financial and management resources.

Our compliance with Section 404 of the Sarbanes-Oxley Act requires that we incur substantial

accounting expense and expend significant management efforts.

We currently do not have an internal audit group, and as our business expands,

we will need to hire additional accounting and financial staff with appropriate public company experience and technical accounting knowledge.

If we are not able to comply with the requirements of Section 404 in a timely manner, or if we or our independent registered public accounting

firm identify deficiencies in our internal control over financial reporting that are deemed to be material weaknesses, the market price

of our stock could decline and we could be subject to sanctions or investigations by the SEC or other regulatory authorities, which would

require additional financial and management resources.

ability to successfully implement our business plan and comply with Section 404 requires us to be able to prepare timely and accurate

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affect our ability to access the capital markets.

we experience material weaknesses inn our internal control over financial reporting in the future, our business may be harmed.

our management services agreement with Lucid Diagnostics, many of our personnel and other resources are devoted to ensuring Lucid Diagnostics

complies with the above requirements applicable to public companies.

This further exhausts management and other personnel resources that

could be used for other revenue-generating activities.

we experience material weaknesses in our internal control over financial reporting in the future, our business may be harmed.

management is responsible for establishing and maintaining adequate internal control over financial reporting and for evaluating and

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which requires us to furnish annually a report by management on the effectiveness of our internal control over financial reporting.

our management determined that our internal control over financial reporting was effective as of December 31, 2021,

we may experience material weaknesses in our internal control over financial reporting in the future.

Any necessary remediation

efforts would place a significant burden on management and add increased pressure to our financial resources and processes.

If we were are unable to successfully remediate any material weaknesses in our internal control over financial reporting

that may be identified in the future in a timely manner, the accuracy and timing of our financial reporting may be adversely affected;

our liquidity, our access to capital markets, the perceptions of our creditworthiness may be adversely affected;

we may be unable to

maintain or regain compliance with applicable securities laws, the listing requirements of the Nasdaq Stock Market;

we may be subject

to regulatory investigations and penalties;

investors may lose confidence in our financial reporting;

our management determined that our internal control over financial reporting was effective as of December 31, 2022, we may experience

material weaknesses in our internal control over financial reporting in the future.

Any necessary remediation efforts would place a significant

burden on management and add increased pressure to our financial resources and processes.

If we were are unable to successfully remediate

any material weaknesses in our internal control over financial reporting that may be identified in the future in a timely manner, the

accuracy and timing of our financial reporting may be adversely affected;

our liquidity, our access to capital markets, the perceptions

of our creditworthiness may be adversely affected;

we may be unable to maintain or regain compliance with applicable securities laws,

the listing requirements of the Nasdaq Stock Market;

we may be subject to regulatory investigations and penalties;

investors may lose

confidence in our financial reporting;

our reputation may be harmed;

our stock price may decline.

and our stock price may decline.

securities or industry analysts do not publish research, or publish inaccurate or unfavorable research, about our business, our stock

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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 1A. Risk Factors