Greetings. Welcome to the PAVmed Incorporated Business Update Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions]I would now turn the conference over to your host, Mike Havrilla. You may begin.

Thanks operator. Good afternoon, everyone. This is Mike Havrilla, PAVmed's Director of Investor Relations. Thanks for participating in today's business update call. Joining me today on the call are Dr. Lishan Aklog, Chairman and Chief Executive Officer; and Dennis McGrath, President and Chief Financial Officer.Before we begin, I'd like to caution that comments made during this conference call by management will contain forward-looking statements, regarding the operations and future results of PAVmed.I encourage you to review the company's filings with the SEC, which identify specific factors that may cause actual results or events to differ materially from those described in the forward-looking statements.Factors that may affect the company's results, include but are not limited to, the uncertainties inherent in research and development, including the costs and time required to advance products to regulatory submission; whether and when products are cleared by regulatory authorities; market acceptance of products once cleared and commercialized; the company's ability to raise additional capital; and the competitive environment.PAVmed has not yet received clearance from the FDA or other regulatory bodies to market many of its products. PAVmed has been monitoring the COVID-19 pandemic and its impact on our business. PAVmed expect the significance of the COVID-10 pandemic including the extent of its effect on financial and operational results to be dictated by among things, success of effort to contain it and the impact of actions taken in response.New risks and uncertainties may arise from time to time and are difficult to predict. All these factors are difficult or impossible to predict accurately. Many of them are beyond the company's control.For a further list and description of these and other important risks and uncertainties that may affect future operations see Part I, Item IA, entitled Risk Factors in PAVmed's most recent annual report on Form 10-K filed with the Securities and Exchange Commission and any subsequent updates filed in quarterly reports on Form 10-Q.Except as required by law, PAVmed disclaims any intention or obligation to publicly update or revise any forward-looking statement to reflect changes in expectations or in events conditions or circumstances on which those expectations may be based or that may affect the likelihood that actual results will differ from those contained in the forward-looking statements.With that said, I would like turn the call over to Lishan Aklog. Dr. Aklog?

Thank you, Mike. Good afternoon, everyone, and thank you for joining us on this quarterly call to update you on our business and discuss our recent financial results.Although its only been six weeks, we've been very active since our last update with many exciting accomplishments and upcoming milestones to report on. As with our last update let me first start with the few words about the ongoing challenges we're all facing as a result of the COVID-19 pandemic. I'll start by hoping thing -- we hope and pray that all of you are holding up as best you can and keeping yourself and your love ones safe. Thankfully all members of the PAVmed family are healthy, safe and able to continue their important work.Our corporate structure and culture continue to serve as well as we confront these challenges so far with minimal short-term and really no anticipated long-term disruptions to our strategic plan.Before providing you with updates on our product portfolio, let's first discuss how each area of our business has or has not been affected by the pandemic and how we are continuing to respond to those that are affected.On the financial and administrative side as Dennis will explain in more detail shortly, we recently completed a convertible note financing with the same investor as our previous convertible note financing.We also received proceeds of approximately $300,000 from the Paycheck Protection Program, the PPP in the form of a forgivable loans. Our balance sheet is strong and will support our full strategic plan for the foreseeable future as we advance through upcoming milestones.We remain confident in our ability to continue to finance these operations until we begin to generate meaningful revenue through commercial sales or non diluted financing through M&A activities. We continue to be laser focused on cash management.…

Thanks Lishan, and good afternoon everyone.I'll be brief in our preliminary results for the quarter ended March 31, 2020. We reported in our press release that was published earlier this afternoon. On quarterly we report on Form 10-Q will be available at sec.gov and on our website early next week.The complicities involved with accounting for the non-cash charges related to our first quarter convertible debt financing, couple with lawyers, auditors, consultants and staff working remotely may the extension unavoidable.We recall that even as late as the end of April we were completing the S-3 registration for that financing which also was the gateway to the additional $4 million convertible debt financing on April 30th.So with regard to the preliminary financial results; research and development expenses for the first quarter of 2020 were $2.6 million, up from $1.5 million for the same period in 2019 and $300,000 higher sequentially.The year-over-year increase reflects incremental hiring; Chief Medical Officer, Chief Operating Officer for Lucid Diagnostics and a regulatory professional for PAVmed, as well as approximately $1 million in a clinical trial cost principally related to the EsoGuard as the set-up cost and first patient enrollment cost for the two IVD clinical trial began [indiscernible].General and administrative expenses were $2.6 million for the first quarter of 2020, compared with $1.7 million for the same period in 2018 and were hired by about $300,000 sequentially.The sequential increases reflect the financing transaction costs in the first quarter related to completing the November 2019 convertible debt financing and a year-over-year increase reflects about $300,000 increase in compensation related costs, purely related to sales staffing levels and other sales related costs and approximately a $0.5 million in consulting services related to patents regulatory compliance, legal processes for contract review and public company expenses. There's also an increase of…

[Operator Instructions] Our first question is from Anthony Vendetti from Maxim Group. Please proceed with your question.

Thanks for the overview. That was very helpful and for all the detail. Lishan, I was wondering, if you could just talk a little bit more about the backlog pressure sensor for CarpX. You said it -- you think it's a few weeks that its backlog. Can you give us a little more color about?

Yes. I think from a -- I was just being direct about that. But I think from a practical point of view it's not going to change a whole lot, because the elective procedures are still ramping up slowly. So the delay was the few weeks; two to three weeks. We expect the components, the printed circuit board which has the pressure sensor on it to be around in a couple of weeks and then a couple weeks after that before the commercial law could be released. So really in terms of when we would have expected the carpal tunnel surgeries are elective procedures and will come online over the coming months. It doesn't really delay our commercial launch from a practical point of view, but just thought I'd point that out that that is one aspect of our supply chain that we've had to monitor close.

Okay. You know that's so forth like you said elective procedures have been largely postponed or delayed. So I guess as said, you decide a new sales manager for CarpX. What's the thought process in terms of a commercialization strategy as we start to reopen as a country. Is this is this more like a July/August timeframe, slow ramp up with KOLs and then is it more of a September or so full commercial launch?

Yes. I mean, I probably won't be able to give you some specific dates, but I think that's a reasonable summary. CarpX unlike EsoGuard and EsoCheck is an interventional procedure, right? So you have to be careful in the early launch and make sure that you identify the appropriate early adopters to take through the procedural steps and to be frank to do iterative enhancements of the procedure itself. So that's really Dan's first task is to get that group of KOLs and experienced folks who were committed to being early adopters of this technology and to start doing cases, and I do think sort of a midsummer time point for that is appropriate.The ramp from that is going to be affected by a variety of factors. One is how does this -- how does the ramp up the opening of elective cases actually proceed. We're fairly optimistic because how patient facilities which is where the vast majority of carpal tunnel surgeries are performed are less burdens in terms of their ability to reopen. But it'll depend really on that as well as sort of a steady focused, but safe sort of outreach to increase in concentric circles of physicians. And again it's very important to do that in a very careful way to make sure that the procedure is being performed carefully and that people are being appropriately trained.

Okay. Make sense. And then just in terms of commercialization of EsoCheck, EsoGuard, what's been the COVID-19 impact on that? And then how do you expect that to continue to rollout this year?

Sorry. So the COVID impact has been pretty straightforward which is that no one's getting for the last two months they've been essentially no elective or non-emergent procedures being performed in the GI offices. So whether they're endoscopies or other office based procedures. But what's amazing is, I sort of bragging about this and like the brag about it again is that the team was not in any way -- they were able to overcome that challenge and despite that I've had literally contacts with hundreds of accounts and numerous virtual sales calls. These physicians I think as I mentioned last time are not necessarily on the front lines of COVID. So they have time and they're getting used to using telemedicine and so these virtual calls have been -- have gone remarkably well and and the volume has increased almost exponentially.So as the case -- as the elective procedures start and as I said one of our partners in Ohio did a full day of endoscopy today. So that to me it was a very good sign that things are starting to open up then that activity of opening accounts and getting product shipped will actually start to translate, I think very soon into actual cases being performed in tests and tests being ordered and fit. So again there's still some uncertainty, but there's some pretty good sign in the last week or two that this activity will start to ramp up hopefully fairly quickly.

Okay, great. That's helpful. And then Dennis, if we could put aside the non-cash charges, could you just talk about sort of the burn rate that you see right now. What's your best guess as to what you expect that to be on a per quarter basis for the remainder of this year and then what do you expect your capital requirements to be as you move into -- as you move through this year and next year?

If you dissect the first quarter, there is some clues there in terms of how that projects going forward. It is a $4.4 million non-GAAP which you can make these -- it being a proxy for what the cash burn for the quarter and it gave you the data point that about $1.1 million were clinical trials really that's EsoGuard related. So the baseline burn is just around a $1 million, the clinical files we'll add to that but really now it's depended upon when we can get to that. The plan for the year was about a $1.7 million or so per month. We have $12 million pro forma at March 3,1 so you can kind of lay that in. There's availability in multiple forms of financing for us and that will be dictated by not only the ability finance at the parent level, but the possibility financing inside subsidiary level and also the non diluted financing opportunities that we're pursuing particularly with NextFlo.So the ability to finance that we believe is readily available. Which choices we make of those opportunities will be dependent upon the time when they come about and when we get back to cut full-scale clinical trial work.

Our next question is from Chris Sommers from Hammerstein. Please proceed with your question.

Lishan and Dennis, hope you guys are well. Congrats on all the recent accomplishments and milestones and seems like there is an exciting year or two ahead here.

I think we agree with you.

But actually thought that's happening maybe at a trial or study at U-Penn, so you guys might be in Philadelphia a little bit more. Yes, but my question kind of relates, I guess that the third question that the Maxim analyst just had. As far as the planning for funding these trials and it seems like there's a lot, maybe additional funding that Lucid might require for the Eso product.I mean, it seems like and you probably can't comment too much, but with that much activity, with that much funding potentially can you comment at all about the potential spin-off of Lucid, I mean it certainly seems but like the most you have kind of common or that the best strategic, I mean you guys would know better opportunity to fund that company separately, the investors can be in that separately and it would be a great way to raise cash for that company separately as well and unblock value, tremendous value for the company?

Before Dennis can answer, Chris, let me clarify one thing as it relates to these clinical trials. So as you said there are numerous clinical but the bulk of the expense is really in the two IVD trials that are looking to support PMA submission. Many of the other trials are actually part of partnerships with academic medical centers where we're providing only nominal financial support and we're able to leverage the value of EsoCheck and we're providing EsoCheck as a device and many of those actually have their own intramural academic funding as well. So just to be clear that there's really the bulk of the capital requirements are really on EsoGuard IVD trials. Dennis, do you want to follow.

So, yes, Chris. Obviously there's been a lot of speculations. I get a lot of questions about Lucid and the EsoGuard being the key jewel inside that subsidiary and the approaches do to finance that inside that subsidiary whether is a spin-out or is the private investment in there gets financed at the parent level or there are other ways to finance that that may not require issuing securities to do it. No decision has been made. We are talking to a variety of financial types that fit all of those profiles. And once we have a little bit more visibility on some of those choices then the board's going to make a decision.So I think we're in agreement that there's a lot of excitement about that technology. And there are some proxies of other companies that have done similar things with products that are not competitive with these regard, but serve kind of the same mindset and those prospects are very encouraging and that certainly helps in our flexibility of trying to make the right choice for our shareholder.So no decisions at this point. We'll keep you apprised as those decisions are made and we believe they're all favorable outcomes, so we're just trying to figure out what's the best approach out of all those treasures.

[Operator Instructions] Our next question is from [indiscernible] with Private Investor. Please proceed with your question.

Good afternoon, Lishan and thank you for your work and I feel guilty riding your coattails, you guys are amazing. I'm a long term investor. I heard this blade I was listening to the conference call. Did you guys mentioned the glucose monitor, the laser. Did you say you had a prototype device you're going to test this summer?

Yes. Let me have fill in some of those details. I did touch on it, but again just try to keep it a bit brief. So this is -- so the device that the technology we license from our partners at Airware, the Dr Jacob Longs company. We've licensed that within a field of use to create inpatient hospital based glucose, continuous glucose monitoring without the need for doing blood tests, without finger sticks or without blood drop, just by a clamp on the skin that's similar to one of this oximetry devices, the ones that clip on your finger.So where we are with that is we've been working on this R&D project taking the laser technology that he developed and putting it into a working prototype basically in a box that have the lasers configured consistent with the invention. That that's been completed. And we also have a prototype clip, tissue clamp that basically will be applied to the web of the hand.So that device has been tested on the bench-top using these little tubes, these little covets of glucose at varying concentrations and the key is if you do the concentrations across the range that you would be looking at in the patient do you get a linear response. So when the glucose is higher you get more of a signal, if glucose is higher than that you get more of a signal and it follows a nice linear response. And we have been able to document that just over the last week or two.The next step is and we were hoping to get this done this week but it's been delayed a couple of weeks but not too long. Is to actually take that box that working prototype and test it on human volunteers who basically start off fasting and then take some orange juice and see how their blood sugar goes up and all so in a rat model a diabetic rat model, animal model where we can get much higher glucose levels and confirm that that the non-invasive testing works.They are very precise standards for accuracy that that all glucose monitoring devices are held to. It's about plus or minus 15%. So we're pretty optimistic that we'll get to that and once we cross that threshold then that the gun goes off and we can actually start a formal commercial development process where we manufacture a device that can be used in a hospital typically in an ICU setting and continuously monitor glucose. So that's where things are with that and I think that's we're very excited about.

While, they're huge.

It’s a big opportunity, yes.

I mean, its huge, because I know so many people that hate to dip their finger pricked. My daughter hate needles. I mean, and then you could do this for at-home use. Is that what you look at that for?

That would be the next step. So just to clear, the original -- the initial license is only for the hospital, but that's a big a big market. So in the ICU, particularly in cardiac ICU a 100% of the patients there are on an insulin drip. So they're getting their blood sugar checked literally hourly or every other hour.So there's a huge opportunity in that. But obviously the goal, the next step in this would be to take this technology for use in an inpatient setting and then license it, continue to expand the license so that we can replace home fingerstick devices, that sort of deck of card sized boxes that wouldn't require a finger stick, but it could measure your glucose just by clamping onto the skin.

How much does that work?

I'll leave that up to you. It's a big market.

And our next question is from Mazu Amed, who is a Private Investor. Please proceed with your question.

I'm just going to be a brief. So I just wanted to ask you how much has this been charge for power device of CarpX you have decided?

We have set a price, but what we can tell you is based on our understanding of the reimbursement as well as the cost of goods that we are confident that we'll be able to commercialize at volume, so not necessary in the early stages when volume production is low, but at higher volumes we'll be able to achieve an 80%, 85% gross margin. So that is plenty of margin for us to build a very robust business on that.

And we have reached the end of the question answer and session. And I will now turn the call over to management for closing remarks.

So thank you very much everybody for your attention and for joining us this afternoon and for those great questions, and we always appreciate the enthusiasm and the go-get-them feeling that we get from our investors every day. It really inspires us.So we look forward to keeping you abreast of our progress via ongoing press releases, and periodic conference calls, such as this one. As a reminder, the best way to keep up with our news is an update and events to sign-up for email alerts on our Investor Relations website ir.pavmed.com and we encourage you to follow us on Twitter, LinkedIn, YouTube, we've been very, very active on all those platforms lately, and it’s a great way to keep up with what’s going on.Always feel free to contact Mike directly with any questions at jmh@pavmed.com. Have a great day. Thank you.

This concludes today’s conference. You may disconnect your lines at this time. Thank you for your participation.