CorMedix Inc. — FY 2022 Form 10-K
Reporting period: Fiscal year ended December 31, 2022; filed March 30, 2023. This is an annual report, not a quarterly filing. CorMedix is a development-stage biopharmaceutical company whose lead candidate, DefenCath, is intended to reduce catheter-related bloodstream infections in hemodialysis patients. It had not received final FDA approval and generated no significant commercial revenue.
Financial performance and liquidity
| Metric | 2022 | 2021 |
|---|---|---|
| Revenue | $65,000 | $191,000 |
| Gross profit | $62,000 | $42,000 |
| Research and development expense | $10.68 million | $13.13 million |
| Selling, general and administrative expense | $20.01 million | $16.35 million |
| Operating loss | $30.62 million | $29.44 million |
| Net loss | $29.70 million | $28.21 million |
| Loss per share, basic and diluted | $0.74 | $0.75 |
| Net cash used in operating activities | $24.36 million | $21.16 million |
Revenue fell 66%, primarily as CorMedix wound down EU operations and discontinued Neutrolin sales in the EU and Middle East. The resulting gross margin is not meaningful as an indicator of a scaled commercial business. R&D expense declined 19%, while SG&A rose 22%, mainly due to DefenCath market research and pre-launch work and higher legal expenses, including securities litigation. Net loss increased 5%; loss per share improved slightly as the weighted-average share count increased.
At year-end, cash and cash equivalents were $43.15 million and short-term investments were $15.64 million, or $58.79 million combined, excluding $226,000 of restricted cash. Current assets were $59.55 million and current liabilities $6.31 million. Total liabilities were $6.98 million, including $803,000 of operating lease liabilities; the balance sheet reports no borrowings. Stockholders’ equity was $55.06 million. The company raised $17.77 million net through its ATM program in 2022, issuing 4.70 million shares.
Management said year-end cash and investments were expected to fund operations for at least 12 months from the report’s issuance, including NDA resubmission costs and initial launch preparations. It expects continued operating cash outflows and likely further financing needs, particularly for a commercial build-out after approval. Subsequent to year-end and through March 30, 2023, it raised approximately $7.2 million through the ATM; $24.2 million remained available under that program, alongside a $150 million shelf registration. Additional equity financing could dilute existing holders.
Material developments and outlook
- FDA review: CorMedix resubmitted the DefenCath NDA in February 2022; the FDA accepted it for a six-month Class 2 review. In August 2022, the FDA issued a second Complete Response Letter citing unresolved deficiencies at the contract manufacturer and heparin API supplier. The FDA had not identified new clinical efficacy or safety deficiencies in the LOCK-IT-100 data. Approval remained contingent on satisfactory manufacturing-related resolution.
- Manufacturing and timing: By March 2023, the primary contract manufacturer reported completing corrective actions and submitting supporting documentation, pending FDA feedback. The heparin supplier reported corrective actions were underway. CorMedix requested FDA guidance before resubmission; a Type A meeting was scheduled for mid-April 2023. The filing does not provide a definitive approval or resubmission date.
- Clinical evidence: In the completed LOCK-IT-100 trial of 795 subjects, DefenCath reduced CRBSI risk by 71% versus heparin (p=0.0006); the company reported a good safety profile. The intended initial U.S. indication is limited to patients with kidney failure receiving chronic hemodialysis through a central venous catheter.
- Commercial access: CMS had granted conditional alternative inpatient NTAP reimbursement of up to $14,259 per hospital stay, contingent on final FDA approval before July 1, 2023. CorMedix filed a duplicate application in case approval missed that date. Outpatient reimbursement remained undetermined, and coverage, pricing and uptake are not assured.
- International business and pipeline: CorMedix began winding down EU operations and discontinued Neutrolin sales in the EU and Middle East at year-end 2022. Other opportunities—including taurolidine for pediatric neuroblastoma and taurolidine-infused devices—remain developmental and may require partners or additional capital.
- Litigation and intellectual property: Securities class-action and shareholder derivative suits relate to alleged misstatements concerning DefenCath’s FDA submissions and manufacturing issues; the company said it would contest the claims. CorMedix’s German patent infringement action was withdrawn with prejudice after the European patent was finally invalidated; the company expects to bear defendants’ costs. A separate German unfair-competition appeal was withdrawn, and approximately $41,000 plus interest was reimbursed to TauroPharm.
There is no formal financial guidance in the filing. Management’s principal outlook is conditional on FDA resolution, commercial readiness, reimbursement and access to additional capital. The company reported effective disclosure controls and effective internal control over financial reporting as of December 31, 2022. The auditor gave an unqualified opinion on the financial statements and reported no critical audit matters; it did not express an opinion on internal control.
Most important facts for investors to verify
- Current FDA status and whether the manufacturing observations and heparin supplier issues have been resolved; verify the outcome of the scheduled FDA meeting and any resubmission timeline.
- Whether the conditional inpatient NTAP remains available, the applicable approval deadline or renewed terms, and CMS’s decisions on outpatient and dialysis reimbursement.
- Cash burn and runway after the filing date, actual launch and commercial-infrastructure costs, and financing raised or shares issued under the ATM and shelf.
- Potential dilution from outstanding preferred stock, options, restricted stock units and future equity-plan grants; common shares outstanding were 42.8 million at December 31, 2022 and 44.5 million at March 28, 2023.
- Developments in the securities and derivative litigation, expected legal costs, and the financial and commercial implications of the German patent invalidation.