Medovex Corporation (MDVX) Medical Technology

Transcription

1 MDVX RESEARCH REPORT: Published April 28, 205 COMPANY OVERVIEW AND PRODUCTS: (NasdaqCM: MDVX), ( the company ), is a development stage company incorporated in Nevada on July 30, 203 as Spinez Corporation. The company changed its name to Medovex Corp. on March 20, 204, and had its initial public offering on Friday, December 9, 204. Medovex is the parent company of Debride, which was incorporated in Florida in October 202. Medovex acquired all of the issued and outstanding capital stock of Debride through merger in September The company focuses on obtaining, developing and commercializing various intellectual property rights, which include patents and patent applications in the medical technology area, with particular focus on the development of medical devices. The company s intention is to build a portfolio of medical device products in areas where its management team believes the largest, most targetable market opportunities exist. The company plans on building this portfolio primarily by acquiring companies or technologies that it believes have promising commercial potential. The company has acquired a patent, patent application and other intellectual property rights relating to the use, development and commercialization of the DenerVex device ( the DenerVex ), which is used in the treatment of conditions resulting from the degeneration of joints in the spine that cause back pain. The DenerVex is designed to provide long lasting relief of pain associated with Facet Joint Syndrome ( FJS ), a condition in which the joints in the back of the spine degenerate and subsequently cause back pain. 3

2 The concept behind the DenerVex is simple; to remove the affected nerve endings sending pain signals to the brain in such a way that they won t grow back. The DenerVex device combines tissue scraping and electrocautery for relief from back pain. A tiny incision is made above the facet joint and the DenerVex is inserted through a cannula to the facet joint region. A current treatment for this pain removes the nerve endings, but the nerve endings regenerate and the pain returns. A patient is forced to return again and again to seek pain relief at a substantial cost over time. Illustrations of the DenerVex device are shown below: 4 In addition to the current procedure to treat FJS, a small number of surgeons employ a two-step procedure to avoid patients having to return for repeated treatments. In this procedure, the surgeon first scrapes away synovial tissue using a deburring device around the facet joints in the spine so nerves will not have tissue that could be used for regrowth. Once this tissue is removed, a standard electrocautery unit is used to cauterize the nerve endings, as is done with the temporary treatment to render the nerves incapable of sending pain signals to the brain. Due to the complexity and time required to complete this procedure, it is only employed by a small number of surgeons. Thus, standard treatments for FJS are either expensive or provide only temporary relief. The creator of the DenerVex device, Dr. Scott M.W. Haufe (a member of the company s Board of Directors) has designed the DenerVex device to combine the two-step procedure into a simplified procedure to be used by doctors specializing in pain management and other areas in addition to spine surgery. The conceptualized hand-held device combines the tissue scraping and electrocautery procedures into one action that can be performed quickly and safely, and less expensively than the cost of temporary treatments over time. Based upon the company s internal research on non-living tissue, the DenerVex 2

3 device will produce the same result as the 2-step procedure, but require significantly less surgical skill and take much less time. The company has recently performed the procedure in human cadaver labs and on animals in order to get data on the effectiveness of the tissue removal in a setting that is as close as the company can get without testing on a live person. In the procedure, a tiny incision is made above the facet joint and the DenerVex will be inserted through a cannula to the facet joint region. The cannula has a bullet-shaped tip that acts as a retractor system. The physician performing the procedure will insert a guidewire down to the facet joint region and the cannula/retractor is inserted over that wire. The tip is removed, leaving a hollow tube for working space. The device is positioned and manipulated via fluoroscopy. No other devices or tools are required beyond standard surgical tools for closure and a cautery generator. The treatment of each joint is intended to take a couple of minutes and the incision will be closed with a single suture stitch. The DenerVex is designed to be powered by (and compatible with) a few currently marketed electrocautery consoles, and is intended to be being designed as a single use device that will be provided to health care practitioners in a package that contains all of the items necessary in the sterile field of the operating room to carry out the surgery necessary to address FJS. The device is also being designed for use with a few commercial electrocautery units, in addition to a dedicated electrocautery unit being developed by the company. In order to get the widest possible distribution of the device, the Company intends to develop its own cautery generator. In addition to the potential cost savings from the use of the DenerVex device 5, the company believes that the procedure using the DenerVex will be less invasive, faster and represent a lower risk of infection from surgery than its competitors, while offering a longer term solution to FJS than is currently available. 3

4 The DenerVex is currently in the prototype development phase. In order to commercialize the device, the company will be undertaking the following steps: Conduct additional research to further refine the product. Submit the final version to regulatory agencies for their approval, including conducting additional studies as they may require. Finalize reimbursement, marketing and distribution strategies. Source vendor(s) for production and marketing/distribution partners (the company currently does not plan to manufacture or distribute the product itself). In addition to the acquisition of the DenverVex device, the company has acquired the assets of Streamline Inc. Streamline Inc. develops and provides intra-hospital patient transportation systems and services to a network of healthcare providers, hospitals, clinics, and medical suppliers in the United States. Streamline Inc. offers the IV Suspension System, a multipurpose IV transport system that combines the advantages of stand-alone and bed-mounted IV poles in one system. The poles are designed to attach and lock to various transport devices, such as beds, gurneys, carts, and wheelchairs. MARKET AND COMPETITION: The spinal implant and surgical equipment market is a sub segment of the orthopedic industry. In 202 the market s size was estimated at $.554 billion and expected to grow at a compound annual growth rate (CAGR) of 5.% through 207, reaching $4.833 billion. The company s addressable market for FJS is significant, and is shown on the following page. 6 The market for the development and commercialization of spinal surgical equipment is very competitive and based on extensive research and clinical efforts, and rapid technological change. The company faces competition worldwide from medical device, biomedical technology and medical products companies, including major medical product companies. Most of the company s competitors have substantially greater financial, marketing, sales, distribution, manufacturing, and technological resources. These competitors may also be in the process of seeking FDA or other regulatory approvals, or patent protection for new products. These competitors may commercialize new products in advance of the company s products. The company s products also face competition from numerous existing products and procedures, which currently are considered part of the standard of care. Competition in the company s markets is based upon multiple factors, including: the quality of outcomes for medical conditions; acceptance by surgeons and the medical device community generally; ease of use and reliability; technical leadership and superiority; effective marketing and distribution; speed to market; and product price and qualifications for coverage and 4

5 reimbursement. Several companies are developing technologies in the company s current and future product areas. The company believes that its principal competitors for the DenerVex device include Cosman Medical, Stryker Corporation, and Spembly Medical Systems. The company could also face competition from unproven technologies, including Zyga s GLYDER device. The company s recent Streamline acquisition faces competition from multiple bed and boom transfer systems, none of which the company believes take the Streamline patented approach to addressing IV pole transportation. Other bed transportation products have been on the market longer and larger organizations marketing their products. The hospital market is highly competitive, and introducing new products is difficult and consuming. The company also faces potential competition from other manufacturers and distributors of products addressing the spinal implant and surgical equipment market. A partial list of these potential competitors includes: 78 Alphatec Spine, Inc.; Amedica; AxioMed, LLC. BioMed Spine; DePuy Spine; Exactech; Globus Medical; Integra Lifesciences; K2M; LDR Holdings; Medtronic; NuVasive; Orthofix; Orthovita Inc.; Pioneer Surgical; Smith & Nephew Plc; Spinefrontier; Stryker Corporation; Synthes; Trans; Zimmer Spine Inc.; and Zyga Technology. Many of these potential competitors are well-established 5

6 corporations that have substantially greater capital, financial, managerial, technical, marketing, personnel and other resources than the company. MANAGEMENT TEAM: Jarrett Gorlin, Founder, and Chief Executive Officer Mr. Gorlin serves as the Chief Executive Officer and a Director of the Company. He previously co-founded and served as President of Judicial Correction Services, Inc. which was named three consecutive years in a row as one of America s fastest growing companies by Inc. Magazine. He served as President of Judicial Correction Services until successfully negotiating its sale to Correctional Healthcare Companies in 20. Mr. Gorlin remained with Correctional Healthcare as its President until 203. Patrick Kullmann, M.B.A., President and Chief Operating Officer Mr. Kullmann served as senior director at Medtronic (NYSE:MDT) in their $2.3 billion Cardiovascular Division. In addition, he has served in marketing, market development and sales leadership positions at Boston Scientific (NYSE:BSX) Baxter (NYSE:BAX), Johnson & Johnson (NYSE:JNJ), and four start-up medical device companies two of which had successful liquidity events with a combined valuation of $220M. He is also the author of the book The Inventor s Guide for that is listed on Amazon. Mr. Kullmann has been a featured speaker and presenter globally on topics related to medical technology innovation. Jeffery Wright, C.P.A., Chief Financial Officer Mr. Wright is a Certified Public Accountant who was recently promoted from Controller to Chief Financial Officer for the Company. Prior to joining Medovex, Mr. Wright was an audit senior at Ernst & Young within the Assurance Services division, where he had an opportunity to help manage audits of large ($2 billion to $0 billion in annual revenue) publicly-traded companies. He also has experience auditing medium size ($2 million $200 million annual revenue) privately-held companies in multiple industries with other accounting firms. Prior to his career in public accounting, Mr. Wright worked as a trading analyst in the retirement trust services department at Reliance Trust Company, managing the institutional trading desk to settle mutual fund transactions with the National Securities Clearing Corporation. Mr. Wright holds Master of Professional Accountancy and Bachelor of Business Administration degrees from the Georgia State University Robinson College of Business and is a member of the Georgia Society of Certified Public Accountants. Dennis Moon, Executive Vice President Mr. Moon has served in an Executive Management position in both public and privately held companies over the past 5 years, including positions as Chief Operations Officer of Roadie, Inc., a mobile device and technology company; and Chief Operations Officer for Judicial Correction Services (JCS), where he assisted in the sale of the company to a private equity fund and remained COO of the JCS Division for Correctional Healthcare Companies. As COO, his responsibilities included supervising the day to day operations and maintenance of over 50,000 monthly clients, over 200 City, County, and State Contracts, 70 physical office locations, over 400 employees and over.8 million financial transactions per year. Prior to his career in Executive Management he served in the United States 6

7 Army as an Intelligence Analyst and Combat Engineer with TS/SCI Clearance. Mr. Moon holds a bachelor s degree from the University of Central Florida. Manfred Sablowski, Senior Vice President, Sales and Marketing Mr. Sablowski is a business professional with over 20 years of senior management experience in the medical technology industry, where he has been instrumental in managing and growing several highly successful companies. He has held several executive level positions, including: General Manager at Valleylab/Pfizer, Europe; VP Sales and Marketing Dornier Medizin Technik, Europe; and VP Sales and Marketing Bovie Medical-Worldwide. He also served as Board Member and Vice President/COO for Trod Medical, a successful venture backed start-up, in which he was involved from its inception. Mr. Sablowski is the principal of FMS MedTech Consulting, a consulting firm focusing on strategic planning for the international businesses in the medical industry (Europe and U.S.). Mr. Sablowski holds a bachelor of science, a diploma as chemical engineer and earned a MBA in Germany. Charles Farrahar, C.P.A., Secretary Mr. Farrahar is a C.P.A. with 30 years of managerial finance, administration, human resource and accounting experience in the public, private and non-profit sectors. He has focused on assisting small privately-held companies grow until they reached a liquidity event. Mr. Farrahar helped two organizations (one for profit, one non-profit) in the medical research area grow and reach strategic goals, before joining Judicial Correction Services in 2003 as their CFO when it had just 25 employees. He helped this company grow into a 400+ employee organization as the head of its finance/accounting, human resource and risk management departments. Peter Blankenship, Director Business Development Mr. Blankenship founded Streamline, Inc. in Spending almost four years in patient transportation within Allina Hospitals and Clinics, he has firsthand experience with the problems inherent in today s intra-hospital transportation. Mr. Blankenship provides new business development, clinical and product support to strategic distribution partners as well as general product and business development. He has a BA in Entrepreneurship from the University of St. Thomas. Mr. Blankenship serves on the Streamline Board of Directors. Sam Blankenship, Director Product Development and Operations Mr. Blankenship co-founded Streamline, Inc. in Mr. Blankenship is in charge of product development and operations, where he has oversight on the development and manufacturing of the Streamline product offering in conjunction with executing its patent strategy. Mr. Blankenship is a highly experienced contributor in supply chain and logistics management. RECENT DEVELOPMENTS: 9 On Thursday, April 2, 205, the company announced that its DenerVex device successfully completed Phase III design and development device testing. The company s CEO stated, "This is a significant milestone for the design and development of the DenerVex device as what we believe to be a promising solution for treatment of patients who are suffering from Facet Joint Pain. The significance of this milestone is that the DenerVex device can now confidently proceed to the final verification and 7

8 validation phases with confidence that it will meet customer expectations for delivering a longer lasting pain therapy for patients with Facet Joint Pain. A five-phase development approach is being used to design and develop the DenerVex device: Concept Development; Planning and Architecture; Detail Design; Verification and Optimization; and Validation and Launch. The DenerVex device will move into Phase IV for its final design testing and verification which includes biocompatibility, sterilization, distribution, shelf life, and functional testing. The company has started the transition to the contract manufacturer for the device. On Thursday, March 26, the company announced that it had closed the acquisition of Streamline, Inc., a Minneapolis, Minnesota-based medical technology company, founded in Streamline developed the IV Suspension System (ISS ), a patient equipment management device that makes the management of patients and their equipment easier, safer and more efficient within hospitals by combining the advantages of both stand-alone and bed-mounted IV pole in one system. According to Critical Care Medicine, there are roughly 00,000 critical care beds in U.S. hospitals. Streamline is a turnkey acquisition and its product can immediately be brought to market in scale. The technology is patent protected, FDA cleared, already manufactured and tested. The company is in the process of launching a U.S. marketing partnership to be followed by a full scale product launch On Thursday, February 26, 205, the company announced that it had established a research and operations center in Minneapolis, Minnesota. Strategically located in close proximity to the majority of the expert contract support vendors that the company uses for its DenerVex device, the center is expected to enhance accountability and performance monitoring, while allowing for important face-toface collaboration. Minneapolis-St. Paul, Minnesota is recognized as a world leader in the medical technology field with corporate headquarters for some of the most renowned names in medical technology. On Monday, February 23, 205, the company announced that it had signed a design and manufacturing agreement for its DenerVex Pro-40 Power Generator with Bovie Medical, a Florida based world leader in the radiofrequency technology area. According to the company s president and COO, the DenerVex Pro-40 generator will offer the optimal power source to the single use DenerVex device without relying on other less reliably matched power sources. On Wednesday, February 8, 205, the company announced that Manfred Sablowski has been named as Senior VP Sales and Marketing. Mr. Sablowski will be responsible for leading and coordinating the company's worldwide sales and marketing functions, in addition to developing and implementing its sales and marketing strategy. On Thursday, February 2, 205, the company announced that it had signed a manufacturing agreement with Nortech Systems for the DenerVex device. The DenerVex device will be manufactured and 8

9 assembled in Nortech Systems' Milaca, Minnesota plant. Nortech Systems serves the medical device, aerospace and industrial markets from facilities in the U.S. and Mexico. Nortech Systems provides a full range of manufacturing services for some of the largest medical device companies in the world, as well as many early-stage companies in the medical technology space. On Friday, January 0, 205, the company filed Form 8-K with the Securities and Exchange Commission, announcing that the its board of directors had approved a change of accountants to an independent registered public accounting firm with a more local presence with regard to the company's location in the metropolitan Atlanta, Georgia area. The former auditor served as auditors of the company's financial statements from inception through January 27, 205. The report of the former auditor on the company's consolidated financial statements for the period beginning February, 203 (inception) and ending on December 3, 203 did not contain any adverse opinion or a disclaimer of opinion and were not qualified or modified as to uncertainty, audit scope or accounting principle, except that there was an explanatory paragraph describing conditions that raised substantial doubt about the Company's ability to continue as a going concern. On January 27, 205, Charles Farrahar resigned from his position as Chief Financial Officer of the company. The resignation is not in connection with any known disagreement with the company on any matter relating to the Company's operations, policies or practices. Mr. Farrahar will remain with the company on a part-time basis as its Secretary. Also on January 27, 205, the company s board of directors appointed Jeffery Wright to serve as the Company's Chief Financial Officer, effective January 27, 205. OUTLOOK: The company is focused on the large and growing market for medical devices and medical technology. Although the company has been successful in acquiring several businesses with unique products, or potential products, the company is competing with both larger more established medical device manufacturers, as well as smaller, more entrepreneurial manufacturers. In order to continue to grow, the company must successfully complete verification, optimization, validation, and launch of its DenerVex device. In addition, the company must integrate its recent acquisition of the Streamline Inc. line of products, and continue to attract employees with the skills needed to fulfill the needs of its emerging lines of business. The time line for the company s DenerVex device is illustrated below: 0 9

10 As a development stage company, the company has been initially successful in meeting these challenges, and I believe that the company will continue to be successful going forward. Potential investors should be aware of the expiration of the lockup period on the company s stock, which occurs on Wednesday, June 7, 205. Potential investors should also carefully consider the company s potential capital needs as it continues to develop the DenerVex device, and acquire other medical device and medical technology companies. RECENT PRICE ACTION: A chart showing the price action in the company s stock since coming public can be seen on the below. During February, 205, the company s stock was generally range-bound, trading between approximately $4.50 and $5.00 per share on volume of less than 20,000 shares per day. In March 205, the company s stock traded more frequently, and in greater volume. From early to mid-march, the company s stock remained in the $4.50 to $5.00 range, with volume reaching approximately 40,000 shares on occasion. From mid- to late March, the company s stock broke below the $4.50 lower bound of its previous trading range on increasing volumes. At the end of March, the stock broke below $4.00 per share on an intraday basis, with volume increasing to over 60,000 shares. This blow off created a temporary bottom in the stock price, and the company s stock traded higher during early to mid-april, with trading volumes surpassing 40,000 shares on multiple occasions. This move carried the stock back through the $4.50 level, with the stock reaching, and briefly exceeding, the $5.00 level. Since mid-april, the company s stock again broke below $4.50 per share, and appears to be establishing a bottom near the $4.00 per share level. On average, trading volumes in the company s stock have increased during 0

11 April, and on Friday, April 24, 205, the company s stock closed at $4.00 per share on volume of 5,64 shares, as compared to the stock s three-month average of 7,427 shares. BOTTOM LINE: As with an investment in any development stage company that has no revenues, emerging products, and is thinly traded, an investment in the shares of is potentially a very high risk, high reward situation. The company s future success is dependent upon its ability to execute its business plan, obtain future financing, rollout products, attract customers, and leverage the business expertise of its management team and board of directors. The company s share price is likely to remain highly volatile and will react to news releases, such as financial results for the first quarter of 205, additional acquisitions, and further development of the DenerVex device. If the company is successful in meeting the challenges that it faces, I believe that it has the potential to expand its business significantly in a large and growing market. Consequently, I believe that the potential rewards outweigh the currently foreseeable risks, and initiate coverage with a Speculative Buy recommendation.

12 RISK FACTORS: An investment in the common stock of the company is subject to a number of risks. The information below contains excerpts of some of the risk factors included in the company s Form 0-K for the fiscal year ended December 3, 204, and should be considered by all investors. 2 Investors should carefully consider the risk factors set out below and consider all other information contained herein, and in the company s SEC filings, before making an investment decision. We assume no obligation to update or revise any such forward-looking statements to reflect events or circumstances that occur after such statements are made. A more complete list of risk factors for the company can be found beginning on page 7 of its Form 0-K filing, dated December 3, 204, which is available on the SEC s Edgar website: The company has undergone a recent change of its auditors and a change of its Chief Financial Officer. The company is a development stage company and faces uncertainties associated with being an early stage venture. The company is in the early stages of product development and there can be no assurance that it will effectively and successfully develop products for commercialization. The company expects to continue to incur losses for the immediate future. The company s independent registered public accounting firm has included an explanatory paragraph with respect to its ability to continue as a going concern in its report on the company s consolidated financial statements for the period ended December 3, 204. Raising additional capital and carrying out further acquisitions may cause dilution to the company s existing stockholders, restrict its operations or require it to relinquish rights to its technologies or products. The company s operating results may fluctuate significantly as a result of a variety of factors, many of which are outside of its control, which could cause fluctuations in the price of its securities. These factors include: o the announcement or introduction of new products by the company s competitors o the company s ability to upgrade and develop its systems and infrastructure to accommodate growth o the company s ability to attract and retain key personnel in a timely and cost effective manner o technical difficulties o the amount and timing of operating costs and capital expenditures relating to the expansion of the company s business, operations and infrastructure o the company s ability to identify and enter into relationships with appropriate and qualified third-party providers such as Devicix, LLC for necessary testing, clinical trials and manufacturing services 2

13 o o regulation by federal, state or local governments and general economic conditions, as well as economic conditions specific to the medical device and healthcare industries. The company may be unable to manage growth effectively. Government regulation of the company s business is extensive and regulatory approvals are uncertain, expensive and time-consuming. The results of the company s clinical trials may not support its product claims or may result in the discovery of adverse side effects If the company s products do not gain market acceptance among physicians, patients and the medical community, it may be unable to generate significant revenues, if any The industry in which the company plans to operate is highly competitive and there can be no assurances that it will be able to compete effectively. Third parties may claim that the company infringes on their proprietary rights, and may prevent it from commercializing and selling its products. Healthcare policy changes, including the recently enacted legislation to reform the United States healthcare system, may have a material adverse effect on the company. The company is dependent on key personnel. If the company obtains approval to commercialize its products outside of the United States, a variety of risks associated with international operations could materially adversely affect its business. The company faces substantial competition, which may result in other companies discovering, developing or commercializing products before, or more successfully, than the company. The company will not be able to compete successfully unless it successfully: o designs and develops products that are superior to other products in the market o attracts qualified scientific, medical, sales and marketing and commercial personnel o obtains patent and/or other proprietary protection for its processes and products o obtains required regulatory approvals o collaborates with others in the design, development and commercialization of new products. The company may not be able to secure adequate clinical trial liability insurance for all of its products, and a successful clinical trial liability claim against the company could have an adverse effect on its financial condition even with such insurance coverage. If, in the future, the company is unable to establish its own sales, marketing and distribution capabilities, or enter into licensing or collaboration agreements for these purposes, it may not be successful in commercializing its products. The company may be unable to identify, acquire, close or integrate acquisition targets successfully. The company cannot guarantee that its strategic acquisitions, investments, or alliances will be successful. 3

14 The company s future growth is dependent upon the development or acquisition of new products, and there can be no assurance that such products will be developed. The company is dependent on contract research organizations and other contractors to assist in its clinical testing and for certain research and development activities, thus, the timing and adequacy of the company s clinical trials and such research activities are, to a certain extent, beyond its control. The company relies on third parties to manufacture its products and as a result it may not be able to control its product development. The company s executive officers, directors, and principal stockholders maintain the ability to control all matters submitted to stockholders for approval. The company is an "emerging growth company" under the JOBS Act, and the information that it provides to stockholders may be different than they might receive from other public companies. APPENDIX: The following Consolidated Balance Sheets for the year ended December 3, 204; Consolidated Statements of Operations for the year ended December 3, 204; and Condensed Consolidated Statements of Cash Flows for year ended December 3, 204, should be read in conjunction with the company s unaudited financial statements and notes contained in the company s Form 0Q for the period ended December 3,

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17 SOURCES: Ibid. 5 Ibid. 6 Ibid Disclosure: I, Charles I. Reed, CFA have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I have no business relationship with any company whose stock is mentioned in the article. The information contained herein is not intended to be investment advice and does not constitute any form of invitation or inducement by Charles I. Reed, CFA to engage in investment activity. Neither the information nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. Securities, financial instruments, strategies, or commentary mentioned herein may not be suitable for all investors and this material is not intended for any specific investor and does not take into account an investor s particular investment objectives, financial situations or needs. Any opinions expressed herein are given in good faith, are subject to change without notice, and are only current as of the stated date of their issue. Prices, values, or income from any securities or investments mentioned in this report may fluctuate, and an investor may, upon selling an investment lose a portion of, or the entire principal amount invested. Past performance is no guarantee of future results. Before acting on any recommendation in this material, you should consider whether it is suitable for your particular circumstances and, if necessary, seek professional advice. FORWARD-LOOKING STATEMENT This report may contain certain forward-looking statements and information, as defined within the meaning of Section 27A of the Securities Act of 933 and Section 2E of the Securities Exchange Act of 934, and is subject to the Safe Harbor created by those sections. This material contains statements about expected future events and/or financial results that are forward-looking in nature and subject to risks and uncertainties. Such forward- looking statements by definition involve risks, uncertainties and other factors, which may cause the actual results, performance or achievements of mentioned company to be materially different from the statements made. 7

18 COMPLIANCE PROCEDURE Content is researched, written and reviewed on a best-effort basis. This document, article or report is written and authored by an outsourced research services provider, which provided Small Cap IR this article or report. However, we are only human and are prone to make mistakes. If you notice any errors or omissions, please notify us. Small Cap IR is not entitled to veto, interfere or alter the articles, documents or report once created and reviewed by the outsourced research provider. All parties responsible for the creation and dissemination of this report do not engage in high frequency trading. NO WARRANTY OR LIABILITY ASSUMED Small Cap IR is not responsible for any error which may be occasioned at the time of printing of this document or any error, mistake or shortcoming. Small Cap IR s parent company has been compensated ninety thousand dollars for marketing services in relation to MDVX. No liability is accepted by Small Cap IR whatsoever for any direct, indirect or consequential loss arising from the use of this document. Small Cap IR has compensated 3rd party research provider two hundred and fifty dollars for the right to disseminate this report. Small Cap IR expressly disclaims any fiduciary responsibility or liability for any consequences, financial or otherwise arising from any reliance placed on the information in this document. Small Cap IR does not () guarantee the accuracy, timeliness, completeness or correct sequencing of the information, or (2) warrant any results from use of the information. The included information is subject to change without notice. CFA and Chartered Financial Analyst are registered trademarks owned by CFA Institute. 8