CORMEDIX INC. REPORTS FOURTH QUARTER AND FULL-YEAR 2018 FINANCIAL
RESULTS, ANNOUNCES REVERSE STOCK SPLIT AND PROVIDES BUSINESS
UPDATE
Conference Call Scheduled for Today at 4:30 p.m. Eastern
Time
Berkeley Heights, NJ – Mar. 14, 2019 – 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 fourth quarter and full-year ended
December 31, 2018 and provided an update on recent business
events.
The Company also announced today that its Board of Directors has
approved a one-for-five reverse stock split of its common stock
that is scheduled to become effective before trading opens on March
26, 2019, after which time the CorMedix common stock will trade on
a split-adjusted basis under a new CUSIP number 21900C308. As
previously disclosed, at the CorMedix Annual Meeting of
Stockholders held on June 26, 2018, the Company’s
stockholders approved a proposal authorizing the Company’s
Board of Directors to effect a reverse stock split at a ratio of
between one-for-five and one-for-ten.
Recent Corporate and Clinical Highlights:
●
Announced statistically significant topline
results of the interim analysis and full data set of its Phase 3
LOCK-IT-100 Study in Neutrolin. A total of 41 catheter
related blood stream infections (CRBSI) was determined by the
Clinical Adjudication Committee (CAC) in the full data set,
compared with 28 CRBSI cases in the interim analysis. The
full data set showed a 71% reduction in the risk of occurrence of
CRBSIs compared with the active control of heparin, which is well
in excess of the study’s assumed treatment effect size of a
55% reduction and statistically significant with a p-value of
0.0006.
●
Announced
that the FDA has agreed that the
Company can request consideration of Neutrolin for approval under
the LPAD (Limited Population Pathway for Antibacterial and
Antifungal Drugs) pathway. Per FDA guidance, the formal request for
consideration of the LPAD pathway is made as part of the
NDA.
●
Strengthened the Board of Directors with the appointment of Alan W.
Dunton, M.D. as a Director.
●
Closed a senior secured convertible debt financing
with gross proceeds of $7.5 million with its largest shareholder. The loan has a
three-year maturity, carries an interest rate of 10% per annum, and
is convertible into the Company’s common stock at $1.50 per
share. The loan is callable by the Company beginning in June
2020.
●
Cash
at December 31, 2018 amounted to $17.6 million.
“We were excited to begin the year with the favorable news
that the interim analysis of our LOCK-IT-100 study had hit
statistical significance of p=0.0034 with its primary
endpoint,” said Khoso Baluch, CEO of CorMedix. “We were
delighted that the analysis of the full data set supported the
interim analysis data, yielding 41 CRBSI cases and a p-value of
0.0006. In our view, these data strongly support our case for
Neutrolin’s efficacy as a catheter lock solution in
hemodialysis patients. Because the unblinding of the full data set
had occurred just prior to our meeting with the FDA, we agreed to
provide a detailed analysis of the data to the FDA as soon as
possible.”
Mr. Baluch continued, “We were also pleased that the FDA
agreed the Company could request consideration of Neutrolin for
approval under the LPAD pathway. We believe this strengthens our
position that the results of the LOCK-IT-100 study are sufficiently
robust to demonstrate safety and effectiveness, and support filing
of an NDA for Neutrolin.”
Mr. Baluch concluded, “We successfully progressed the
Neutrolin development program during 2018. Now that our cash
position has been strengthened and we anticipate that existing cash
can fund us into the second quarter of 2020, we believe we are well
positioned to make significant progress during 2019. We believe
also that because we desire to attract more institutional interest
into our stock and need to have available unissued shares to
reserve for past transactions and provide for future opportunities,
it is a good time to move ahead with the reverse stock split
approved by the stockholders last year.”
Reverse Stock Split
The
reverse stock split will uniformly affect all issued and
outstanding shares of the Company’s common stock. The reverse
stock split will not alter any stockholder’s percentage
ownership interest in CorMedix, except to the extent that the
reverse stock split results in fractional shares. No fractional
shares will be issued in connection with the reverse stock split.
Stockholders who would otherwise be entitled to receive a
fractional share will instead receive one whole share of the
Company’s common stock. The par value of the Company’s
common stock will remain unchanged at $0.001 per share after the
reverse stock split.
The
number of shares of common stock available for issuance under the
Company’s equity incentive plans and issuable upon the
exercise of stock options, warrants and preferred stock outstanding
immediately prior to the reverse split will be proportionately
affected by the reverse stock split. The exercise prices of the
Company’s outstanding options and warrants, and the
conversion price of its outstanding preferred stock will be
adjusted in accordance with their respective terms.
As a
result of the reverse stock split, the number of shares of common
stock issued and outstanding will be reduced from approximately
119.0 million to approximately 23.8 million shares. There will be
no change to the number of authorized shares.
VStock
Transfer, LLC will act as the exchange agent and transfer agent for
the reverse stock split. Computershare will provide instructions to
stockholders with physical certificates regarding the optional
process for exchanging their pre-split stock certificates for
post-split stock certificates.
Fourth Quarter 2018 Financial Highlights
For the
fourth quarter 2018, CorMedix recorded a net income of $2.2
million, or $0.02 per share, compared with a net loss of $10.3
million, or $0.15 per share in the fourth quarter 2017, an increase
of $12.5 million. The significant improvement in the fourth quarter
2018 was primarily driven by the reversal of clinical trial
expenses as a result of the confidential settlement agreement with
our CRO signed in November 2018.
Operating
expenses in the fourth quarter 2018 recorded a gain of $2.1
million, compared to an expense of $10.4 million in the fourth
quarter of 2017, a decrease of approximately 120%. This decrease
was due primarily to a $12.8 million, or 151% decrease, in R&D
expense, while SG&A expenses remained unchanged.
Full-Year 2018 Financial Highlights
For the
full-year 2018, CorMedix recorded a net loss of $26.8 million, or
$0.30 per share, compared with a net loss of $32.9 million, or
$0.60 per share for the full-year 2017. The decrease in the loss in
2018 was primarily driven by decreased costs related to the
LOCK-IT-100 clinical study.
Operating
expenses for the full-year 2018 were $26.9 million, compared to
$33.1 million for the full-year 2017, a decrease of approximately
19%. This decrease was due primarily to a $5.7 million, or 23%
decrease, in R&D expense, while SG&A expenses remained
unchanged.
Conference Call Information:
The management team of CorMedix will host a conference call and
webcast today, March 14, 2019, at 4:30 PM Eastern Time, to discuss
recent corporate developments and financial results. Call details
and dial-in information is as follows:
International:
201-689-8584
Webcast:
https://www.investornetwork.com/event/presentation/45037
Replay
will be available through March 28, 2019:
International:
919-882-2331
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 have
significant treatment costs and lead to increased morbidity and
mortality. Neutrolin has FDA Fast Track status and is designated as
a Qualified Infectious Disease Product, which provide the potential
for priority review of a marketing application by FDA and
allow for a total of ten years of 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: risks relating to the effectiveness of the reverse stock
split; risks relating to the effect of the reverse stock split on
the Company’s stock price and its overall market
capitalization; the results of our discussions with the FDA
regarding the Neutrolin development path; the resources needed to
complete the information required to submit a new drug application
for Neutrolin 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; preclinical results are not 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
CONSOLIDATED STATEMENTS OF OPERATIONS
AND COMPREHENSIVE INCOME (LOSS)
|
|
For the Three
Months Ended
December
31,
|
For the Years
Ended
December
31,
|
|
|
|
|
|
|
|
Revenue:
|
|
|
|
|
|
Net
sales
|
$26,523
|
$92,526
|
$429,797
|
$329,327
|
|
Cost of
sales
|
(22,113)
|
63,312
|
(396,786)
|
(114,964)
|
|
Gross
profit
|
4,410
|
155,838
|
33,011
|
214,363
|
|
Operating
Expenses:
|
|
|
|
|
|
Research and
development
|
4,347,262
|
(8,457,971)
|
(18,822,488)
|
(24,486,122)
|
|
Selling, general
and administrative
|
(2,213,441)
|
(1,968,398)
|
(8,074,719)
|
(8,652,351)
|
|
Total Operating
Expenses
|
2,133,821
|
(10,426,369)
|
(26,897,207)
|
(33,138,473)
|
|
Income
(loss) From Operations
|
2,138,230
|
(10,270,531)
|
(26,864,196)
|
(32,924,110)
|
|
Other
Income (Expense):
|
|
|
|
|
|
Interest
income
|
6,235
|
21,550
|
36,618
|
110,714
|
|
Foreign exchange
transaction loss
|
4,052
|
(2,243)
|
(179)
|
(13,758)
|
|
Change in fair
value of derivative liability
|
-
|
(56,487)
|
-
|
(177,141)
|
|
Interest
expense
|
-
|
(2,809)
|
(1,873)
|
(5,619)
|
|
Total Other Income
(Expense)
|
10,287
|
(39,989)
|
34,566
|
(85,804)
|
|
Net
Income (loss)
|
2,148,518
|
(10,310,520)
|
(26,829,630)
|
(33,009,914)
|
|
Other
Comprehensive Income (Loss):
|
|
|
|
|
|
Unrealized gain
(loss) from investments
|
-
|
90
|
-
|
13,103
|
|
Foreign currency
translation gain (loss)
|
5,524
|
3,632
|
(1,911)
|
4,144
|
|
Total Other
Comprehensive Income (Loss)
|
5,524
|
3,722
|
(1,911)
|
17,247
|
|
Comprehensive
Income (Loss)
|
2,154,041
|
(10,306,798)
|
(26,831,541)
|
(32,992,667)
|
|
Net
Income (Loss) Per Common Share – Basic and
Diluted
|
$0.02
|
$(0.15)
|
$(0.30)
|
$(0.60)
|
|
Weighted
Average Common Shares Outstanding – Basic and
Diluted
|
104,400,977
|
66,722,074
|
89,083,119
|
55,141,133
|
CORMEDIX INC. AND SUBSIDIARY
CONDENSED CONSOLIDATED BALANCE SHEET DATA
|
|
|
|
|
|
|
|
|
|
|
|
Assets
|
|
|
|
Cash and cash
equivalents
|
$17,623,770
|
$10,379,729
|
|
Short-term
investments
|
$-
|
$1,604,198
|
|
Total
Assets
|
$18,825,914
|
$13,453,933
|
|
Total
Liabilities
|
$13,891,658
|
$6,260,582
|
|
Accumulated
deficit
|
$(178,988,098)
|
$(152,174,866)
|
|
Total
Stockholders’ Equity
|
$4,934,256
|
$7,193,351
|
CORMEDIX INC. AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
|
|
|
|
|
|
|
|
|
|
Cash
Flows From Operating Activities:
|
|
|
|
Net
loss
|
$(26,829,630)
|
$(33,009,914)
|
|
Net cash used in
operating activities
|
(23,700,565)
|
(28,587,180)
|
|
Cash
Flows Used In Investing Activities:
|
|
|
|
Net cash provided
by investing activities
|
1,555,414
|
10,357,838
|
|
Cash
Flows From Financing Activities:
|
|
|
|
Net cash provided
by financing activities
|
29,397,070
|
20,524,997
|
|
Cash
- Beginning Of Period
|
10,379,729
|
8,064,490
|
|
Cash
- End Of Period
|
$17,623,770
|
$10,379,729
|
