Note 4 — Equity Method Investment

The Company accounts for its investment in Lucid as an equity method investment with the election of the fair value option. Due to the Company’s continuing involvement and significant influence over operating and financial policies, Lucid is considered a related party of the Company.

The following presents summarized financial information related to Lucid accounted for under the equity method as of  June 30, 2026. This aggregate information has been compiled from the financial statements of Lucid.

At  June 30, 2026 and  December 31, 2025, the fair value of the Company’s investment in Lucid was $33.5 million and $34.1 million, respectively. The Company recognized an unrealized loss on its investment in Lucid of $2,504 and $626 in the accompanying unaudited condensed consolidated statements of operations for the three and six months ended June 30, 2026, respectively. The Company recognized an unrealized loss on its investment in Lucid of $10,643 and an unrealized gain on its investment in Lucid of $10,361 in the accompanying unaudited condensed consolidated statements of operations for the three and six months ended June 30, 2025, respectively. The fair value of shares of Lucid’s common stock held by the Company was determined using the closing price of Lucid’s common stock per share on  June 30, 2026 and  December 31, 2025 of $1.07 and $1.09, respectively. At  June 30, 2026 and  December 31, 2025, PAVmed held approximately 25.1% and 27.5%, respectively, of Lucid’s common stock voting interest. As of August 13, 2026, PAVmed held approximately 25.1% of Lucid's common stock voting interest.

Lucid - Management Services Agreement

Lucid’s daily operations are also managed in part by personnel employed by the Company, for which the Company records management fee income, referred to as the “MSA Fee”, according to the provisions of a Management Services Agreement (“MSA”) with Lucid. The MSA does not have a termination date, but may be terminated by Lucid. The MSA Fee is charged on a monthly basis and is subject to periodic adjustment corresponding with changes in the services provided by the Company’s personnel to Lucid, with any such change in the MSA Fee being subject to approval of the boards of directors of each of the Company and Lucid. The monthly fee due to the Company from Lucid is $1,050. During the three months ended June 30, 2026 and 2025, the MSA fee income was $3,150 for each period. During the six months ended June 30, 2026 and 2025, the MSA fee income was $6,300 for each period.