PAVmed Inc. (Nasdaq: PAVM, PAVMZ) (the “Company” or “PAVmed”), a highly differentiated, multi-product, commercial-stage medical technology company, today announced the launch of a new subsidiary, digital health company Veris Health Inc. (“Veris”), which acquired Oncodisc Inc. (“Oncodisc”), a digital health company with groundbreaking tools to improve personalized cancer care through remote patient monitoring.
Oncodisc was founded by experienced physician entrepreneurs, James Mitchell, M.D., who joins Veris as its full-time Chief Medical Officer, and Andrew Thoreson, M.D., who will serve as a Veris consultant. Oncodisc’s core technologies include the first intelligent implantable vascular access port with biologic sensors and wireless communication, combined with an oncologist-designed remote digital healthcare platform that provides patients and physicians with new tools to improve outcomes and optimize the delivery of cost-effective care through remote monitoring and data analytics.
“PAVmed is entering the rapidly expanding digital health sector at an exciting time, characterized by high-multiple IPO’s and M&A activity driven by dramatically increased utilization of telemedicine, remote patient monitoring and artificial intelligence, which collectively seek to establish new standards for data-driven optimized care,” said Lishan Aklog, M.D., PAVmed’s Chairman and Chief Executive Officer. “This acquisition is consistent with our commitment to identify and seize upon unique and timely opportunities to create value in any sector, as we did three years ago with Lucid in the diagnostics sector. We expect Veris to leverage strong synergies with the robust expanded infrastructure we built to support Lucid during this period.”
“I warmly welcome Drs. Mitchell and Thoreson to the PAVmed family,” Dr. Aklog added. “They have developed all the necessary elements to create the premier integrated digital healthcare platform for millions of cancer patients and their oncologists, representing an estimated $2 to 3 billion U.S. addressable market opportunity, based on established reimbursement codes and an attractive recurring revenue subscription model. The technology is also applicable to potentially even larger market opportunities in other conditions such as renal failure and heart failure. As with many digital health platforms, we have additional prospects for substantial value-creation through data monetization and biotherapeutic clinical trial support.”
“Over 80% of U.S. cancer care, including immunotherapy and chemotherapy, takes place in outpatient clinics, leaving patients unmonitored while at high risk of complications and hospitalizations, up to 50% of which can be avoided,” said James Mitchell, M.D., co-founder and Chief Executive Officer of Oncodisc, and now Chief Medical Officer of Veris. “Although we have solid published data demonstrating that remote monitoring of cancer patients reduces hospital utilization, improves outcomes including survival, and is well-reimbursed, current consumer-oriented tools have not succeeded due to limited data points and poor patient adherence. We are excited to join this impressive team and believe we have found in PAVmed the ideal partner, with a proven track record of success, to bring our technologies into the market for the benefit of patients.”
Oncodisc was founded in 2018 by Mitchell, a radiation-oncologist, and Thoreson, an interventional radiologist, who previously co-founded Redsmith, Inc., an interventional catheter company whose technology was acquired by C.R. Bard Inc., now BD Inc. (NYSE: BDX), in 2017. Oncodisc received a National Science Foundation (“NSF”) Small Business Innovation Research (“SBIR”) grant award to support its early work and completed both the MedTech Innovator Accelerator and UCSF Rosenman Institute Accelerator programs.
Its groundbreaking vascular access port contains biologic sensors capable of generating continuous data on key physiologic parameters known to predict adverse outcomes in cancer patients undergoing treatment. Wireless communication to the patient’s smartphone and its cloud-based digital healthcare platform efficiently and effectively delivers actionable real time data to patients and physicians. The technologies are the subject of multiple patent applications and one allowed patent awaiting final issuance. Veris is targeting FDA 510(k) clearance of the intelligent implantable vascular access port and launch of the remote digital healthcare platform for H2-2022.
The planned Veris business model seeks to generate 100% recurring revenue through oncology practice and hospital-based subscriptions. These entities would purchase seats on the platform and pay a monthly remote monitoring charge to drive revenues from remote patient monitoring and device implantation under existing CPT codes, as well as established CMS Oncology Care Model (OCM) bonuses and CMS Quality Reporting Program incentives. Veris also anticipates strong demand for its intelligent implantable vascular access port and remote monitoring platform from oncology biotherapeutic companies to support clinical trials of their novel immunotherapy and chemotherapy agents with continuous physiologic data and transformative analytics.
Veris inherits a world-class medical advisory board including oncologists from leading academic centers such as Harvard’s Dana Farber Cancer Institute, Stanford Medicine, University of California San Francisco, Cedars-Sinai Medical Center and Northwell Health.
PAVmed formed Veris Health Inc., a Delaware Corporation, as a wholly owned subsidiary, which in turn entered into a Stock Purchase Agreement to acquire 100% of the outstanding shares of Oncodisc Inc. from Oncodisc Holdings LLC, including all of Oncodisc’s intellectual property, hardware, and software assets. In exchange, PAVmed granted Oncodisc Holdings LLC a 19.6% equity interest in Veris and provided $155,250 in cash to pay off two Oncodisc convertible notes. No additional cash consideration or PAVmed stock consideration was provided. A Shareholder Agreement between the parties provides additional terms and conditions concerning certain regulatory and commercial milestones, anti-dilution protection and other customary provisions. PAVmed will manage Veris through a Management Services Agreement until such time that the Veris Board of Directors decides to engage a dedicated management team and will finance its operations through intercompany advances until Veris decides to raise its own capital. Mitchell and Thoreson have entered into employment and consulting agreements, respectively, which include stringent intellectual property assignment and non-compete provisions.