Blueprint
CORMEDIX INC. REPORTS THIRD QUARTER FINANCIAL RESULTS AND PROVIDES
BUSINESS UPDATE
Conference Call today at 4:30 p.m. Eastern Time
Berkeley Heights, NJ – November 14, 2018 – CorMedix Inc. (NYSE American: CRMD),
a biopharmaceutical company focused on developing and
commercializing therapeutic products for the prevention and
treatment of infectious and inflammatory disease, today announced
financial results for the third quarter and nine months ended
September 30, 2018 and provided an update on recent business
developments.
“After the Data and Safety Monitoring Board recommended our
LOCK-IT 100 trial be halted for efficacy, we began the methodical
process of closing the study and are well on our way to completing
locking the data set,” said Khoso Baluch, Chief Executive
Officer of CorMedix. “Additionally, we are simultaneously
preparing to file an NDA with the Food and Drug Administration for
Neutrolin in anticipation of receiving a favorable response from
the FDA at our upcoming meeting to discuss Neutrolin's development
path. Our clinical team has put in a tremendous effort and we are
pleased with the progress on all fronts. We look forward to
commercializing Neutrolin and meaningfully advance patient care by
significantly reducing or eliminating costly and potentially deadly
catheter-related bloodstream infections.”
Recent Corporate and Clinical Highlights:
●
In
the process of locking the data set from the LOCK-IT 100 trial,
which the Company halted for efficacy on the recommendation of the
independent Data and Safety Monitoring Board (DSMB) after it
completed its review and analysis of the interim data. The DSMB
recommended the study be terminated early as the pre-specified
level of statistical significance had been achieved and efficacy
had been demonstrated. No safety concerns were reported by the DSMB
based on the interim data.
●
Completed
a confidential settlement agreement with its CRO in which the
Company agreed to make certain payments to its CRO through January
2019, plus investigator fees and third party costs that have not
been invoiced as of September 30, 2018. The settlement agreement
will result in full satisfaction of the balance of the accounts
payable and accrued expenses recorded as of September 30, 2018 in
connection with the Master Services Agreement. Additionally, in
parallel with the settlement agreement, a new work order under the
Master Service Agreement was executed specifying certain services
the CRO will continue to provide to the Company related to the
closeout of the study.
●
Signed
a binding term sheet with the Company’s largest investor (the
“Investor”) for a proposed new $7.5 million secured
convertible debt financing, which subject to completion of
documentation, will be closed and drawn before year end 2018. The
three year note will bear interest at 10% per annum and will be
convertible into the Company’s common stock at a conversion
price of $1.50 per share.
Third Quarter and Nine Month 2018 Financial Highlights
For the third quarter 2018, CorMedix recorded a net loss of $10.2
million, or $0.11 per share, compared with a net loss of $10.0
million, or $0.17 per share, in the third quarter 2017, an increase
of $0.2 million. The increase in net loss in the third quarter 2018
compared with the third quarter of 2017 was driven primarily by
increased costs related to the LOCK-IT-100 clinical study. During
the third quarter of 2017, the Company also recorded a $1.9 million
non-cash gain related to a change in the fair value of warrants
issued in connection with a public offering.
Operating expenses in the third quarter 2018 were $10.3 million,
compared to $8.0 million in the third quarter of 2017, an increase
of approximately 28.8%. This increase was due primarily to a
$2.3 million, or 38.3% increase, in R&D expense, while SG&A
expense remained unchanged. Within R&D, the cost of the
LOCK-IT-100 clinical trial increased by $1.7 million due to higher
investigator site fees resulting from the accelerated efforts to
complete patient dosing and the one month safety follow-up, and to
record all trial related data as quickly as possible in order to
permit timely site closure.
For the nine months ended September 30, 2018, CorMedix recorded a
net loss of $29.0 million, or $0.35 per share, compared with a net
loss of $22.7 million, or $0.44 per share, in the first nine months
of 2017, an increase of $6.3 million. The increase in net loss in
the first nine months of 2018 compared with the first nine months
of 2017 was driven primarily by increased costs related to the
LOCK-IT-100 clinical study. During the first nine months of 2017,
the Company also recorded a $1.9 million non-cash gain related to a
change in the fair value of warrants issued in connection with a
public offering completed in May 2017.
Operating expenses in the nine months ended September 30, 2018 were
$29.0 million, compared to $22.7 million in the nine months ended
September 30, 2017, an increase of approximately 27.8%. This
increase was due primarily to a $7.1 million, or 44.5% increase, in
R&D expense, while SG&A expense declined by $0.8
million.
Total
cash on hand and short-term investments as of September 30, 2018
was $6.4 million, excluding restricted cash of $0.2 million. The
Company believes that, based on the
Company’s cash resources at September 30, 2018, the proceeds
received under its ATM program through the filing date of its
report on Form 10-Q, the financial impact of the CRO settlement
agreement, and the anticipated closing of the convertible
debt transaction it has sufficient resources to fund the
Company’s operations into the second quarter of 2019. The
Company will more fully evaluate the amount of funding needed to
complete Neutrolin development and file an NDA after its planned
meeting with the FDA.
Conference Call Information:
CorMedix CEO, Khoso Baluch will host a conference call and webcast
today, November 14, 2018, at 4:30 PM Eastern Time, to discuss
recent corporate developments and financial results. Call details
and dial-in information are as follows:
Wednesday, November 14 at 4:30pm Eastern Time
International:
201-689-8584
Webcast:
http://www.investorcalendar.com/event/40032
Replays, Available through November 28, 2018:
International:
919-882-2331
40032
About CorMedix
CorMedix Inc. is a biopharmaceutical company focused on developing
and commercializing therapeutic products for the prevention and
treatment of infectious and inflammatory diseases. The Company is
focused on developing its lead product Neutrolin®,
a novel, non-antibiotic antimicrobial solution designed to prevent
costly and dangerous bloodstream infections associated with the use
of central venous catheters, currently in Phase 3 development for
patients undergoing chronic hemodialysis. Such infections cost the
U.S. healthcare system approximately $6 billion annually and
contribute significantly to increased morbidity and mortality.
Neutrolin has FDA Fast Track status and is designated as a
Qualified Infectious Disease Product, which provides the potential
for priority review of a marketing application by FDA and
allows for 5 additional years of QIDP market exclusivity in the
event of U.S. approval. Neutrolin is already marketed as a CE
Marked product in Europe and other territories. In parallel,
CorMedix is leveraging its taurolidine technology to develop a
pipeline of antimicrobial medical devices, with active programs in
surgical sutures and meshes, and topical hydrogels. The
company is also working with top-tier researchers to develop
taurolidine-based therapies for rare pediatric cancers. For
more information, visit: www.cormedix.com.
Forward-Looking Statements
This press release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995
that are subject to risks and uncertainties. All statements, other
than statements of historical facts, regarding management’s
expectations, beliefs, goals, plans or CorMedix’s prospects,
future financial position, financing plans, future revenues and
projected costs should be considered forward-looking. Readers are
cautioned that actual results may differ materially from
projections or estimates due to a variety of important factors,
including: the risk of closing the convertible note financing with
CorMedix’s largest investor; the resources needed to
terminate the Phase 3 trial and the costs and time needed to submit
a new drug application to the FDA; the risks and uncertainties
associated with CorMedix’s ability to manage its limited cash
resources and the impact on current, planned or future research,
including the continued development of Neutrolin and research for
additional uses for taurolidine; obtaining additional financing to
support CorMedix’s research and development and clinical
activities and operations; risks related to obtaining FDA approval
of the new drug application for Neutrolin; relying on preclinical
results that may not be indicative of success in clinical trials
and might not be replicated in any subsequent studies or trials;
and the ability to retain and hire necessary personnel to staff our
operations appropriately. These and other risks are described in
greater detail in CorMedix’s filings with the SEC, copies of
which are available free of charge at the SEC’s website at
www.sec.gov or upon request from CorMedix. CorMedix may not
actually achieve the goals or plans described in its
forward-looking statements, and investors should not place undue
reliance on these statements. CorMedix assumes no obligation and
does not intend to update these forward-looking statements, except
as required by law.
Investor Contact:
Dan
Ferry
Managing
Director
LifeSci
Advisors
617-535-7746
CORMEDIX INC. AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
AND COMPREHENSIVE LOSS
(Unaudited)
|
|
For the Three
Months Ended
September
30,
|
For the Nine
Months Ended
September
30,
|
|
|
|
|
|
|
|
Revenue:
|
|
|
|
|
|
Net
sales
|
$372,514
|
$61,075
|
$403,274
|
$236,801
|
|
Cost of
sales
|
(312,434)
|
(66,652)
|
(374,672)
|
(178,276)
|
|
Gross profit
(loss)
|
60,080
|
(5,577)
|
28,602
|
58,525
|
|
Operating
Expenses:
|
|
|
|
|
|
Research and
development
|
(8,289,094)
|
(6,014,260)
|
(23,169,750)
|
(16,028,151)
|
|
Selling, general
and administrative
|
(2,012,439)
|
(1,992,134)
|
(5,861,279)
|
(6,683,953)
|
|
Total Operating
Expenses
|
(10,301,533)
|
(8,006,394)
|
(29,031,029)
|
(22,712,104)
|
|
Loss
From Operations
|
(10,241,453)
|
(8,011,971)
|
(29,002,427)
|
(22,653,579)
|
|
Other
Income (Expense):
|
|
|
|
|
|
Interest
income
|
5,411
|
37,156
|
30,383
|
89,164
|
|
Foreign exchange
transaction loss
|
(77)
|
(4,692)
|
(4,230)
|
(11,515)
|
|
Change in fair
value of derivative liability
|
-
|
(1,974,019)
|
-
|
(120,654)
|
|
Interest
expense
|
-
|
(2,810)
|
(1,873)
|
(2,810)
|
|
Total Other Income
(Expense)
|
5,334
|
(1,944,365)
|
24,280
|
(45,815)
|
|
Net
Loss
|
(10,236,119)
|
(9,956,336)
|
(28,978,147)
|
(22,699,394)
|
|
Other
Comprehensive Income (Loss):
|
|
|
|
|
|
Unrealized gain
(loss) from investments
|
-
|
2,600
|
-
|
13,013
|
|
Foreign currency
translation gain (loss)
|
(6,405)
|
(4,573)
|
(7,435)
|
512
|
|
Total Other
Comprehensive Income (Loss)
|
(6,405)
|
(1,973)
|
(7,435)
|
13,525
|
|
Comprehensive
Loss
|
(10,242,524)
|
(9,958,309)
|
(28,985,582)
|
(22,685,869)
|
|
Net
Loss Per Common Share – Basic and Diluted
|
$(0.11)
|
$(0.17)
|
$(0.35)
|
$(0.44)
|
|
Weighted
Average Common Shares Outstanding – Basic and
Diluted
|
94,156,581
|
60,290,988
|
83,904,162
|
51,238,399
|
CORMEDIX INC. AND SUBSIDIARY
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
|
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
Cash and cash
equivalents
|
$6,615,421
|
$10,551,282
|
|
Short-term
investments
|
$-
|
$1,604,198
|
|
Total
Assets
|
$8,048,675
|
$13,453,933
|
|
|
|
|
|
Total
Liabilities
|
$17,546,249
|
$6,260,582
|
|
Accumulated
deficit
|
$(181,136,389)
|
$(152,174,866)
|
|
Total
Stockholders’ Equity
|
$(9,497,574)
|
$7,193,351
|
CORMEDIX INC. AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
|
|
Nine Month
Periods Ended September 30,
|
|
|
|
|
|
CASH
FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
Net
loss
|
$(28,978,147)
|
$(22,699,394)
|
|
Net cash used in
operating activities
|
(16,500,414)
|
(21,310,019)
|
|
CASH
FLOWS USED IN INVESTING ACTIVITIES:
|
|
|
|
Net cash provided
by investing activities
|
1,555,305
|
5,290,988
|
|
|
|
|
|
CASH
FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
Proceeds from sale
of common stock from at-the-market program
|
11,012,647
|
347,362
|
|
Proceeds from the
public offering of common stock and warrants
|
-
|
12,798,325
|
|
Proceeds from
exercise of stock options
|
-
|
6,800
|
|
Net cash provided
by financing activities
|
11,012,647
|
13,152,487
|
|
NET
DECREASE IN CASH
|
(3,935,861)
|
(2,851,911)
|
|
CASH
- BEGINNING OF PERIOD
|
10,551,282
|
8,236,043
|
|
CASH
- END OF PERIOD
|
$6,615,421
|
$5,384,132
|