CorMedix (CRMD) Q2 2026 earnings call transcript

Good morning, and welcome to the CorMedix second quarter 2026 earnings and corporate update conference call. Leading the call today is Joe Tedisco, chairman and chief executive officer of CorMedix. He is joined by Liz Hurlburt, EVP and chief operating and commercial officer, and Susan Blum, EVP and chief financial officer. In addition, Beth Zellnick-Koffin, EVP and Chief Legal and Compliance Officer and Corporate Secretary, and Dr. Matt David, EVP and Chief Business Officer, are on the line and will be available during the Q&A session.

Before we begin, I would like to remind everyone that during the call, management may make what are known as forward-looking statements within the meetings set forth in the Private Securities Litigation Reform Act of 1995. These statements are statements other than statements of historical facts regarding management's expectations, beliefs, goals, and plans by the company's prospects and future financial position. Action results may differ materially from the estimates and projections on which these statements are based due to a variety of important factors, including the risks and uncertainties described in greater detail in Cormedix's filings with the SEC, which are available free of charge at the SEC's website or upon request from Cormedix.

Cormedix may not actually achieve the goals or plans described in these forward-looking statements. An investor should not place undue reliance on these statements. CorMedix does not intend to update these forward-looking statements, except as required by law. During this call, the company will discuss certain non-GAAP measures of its performance. GAAP to non-GAAP financial reconciliations and supplemental financial information are provided in CorMedix earnings release and the current report on Form 8K filed with the SEC.

This information is also available on the Investor Relations section of CorMedix's website. At this time, it is now my pleasure to turn the call over to Joe Tedisco, Chairman and Chief Executive Officer of Cormedix. Joe, please go ahead.

Thank you, Dan. Good morning, everyone, and thank you for joining us on this call. In the second quarter, we continue to execute on our core strategic initiatives. We're identifying the FENCAT's market position as we navigate the evolving post-DEPA landscape, We are now working collaboratively with Mundi Farmer towards their submission of the SMBA for Rizeo in the prophylaxis of invasive fungal disease. And lastly, deploying our capital in a disciplined manner to fuel sustainable growth and new business development opportunities. We believe this combination of commercial execution, pipeline progression, and strategic capital allocation positions CorMedix to drive long-term value for shareholders, while building an increasingly diversified and resilient business.

We announced this morning second quarter consolidated revenue of $101.9 million and adjusted EBITDA of $58.7 million. Susan will provide more granular details of second quarter financial results. Today, we also announced that we've signed a multi-year commercial supply agreement for DefendCAT with an additional large dialysis organization, or LDO. With this agreement, Cormedix now has commercial supply agreements in place with all five of the top dialysis providers in the U. S. The newly signed LDO has placed initial order and will initially begin a pilot of DefendCAT in the third quarter of this year with a potential opportunity to expand utilization in 2027. We view the signing of this agreement as an important milestone and validation of DefendCat's clinical value proposition with the largest providers in the U. S. dialysis market.

Turning to guidance, we are reaffirming our full-year 2026 revenue guidance with a range of $325 million to $345 million and raising our full-year adjusted EBITDA guidance to a new range of $125 million to $140 million. We will revisit guidance as the year progresses and as we gain additional visibility into post-ADAPA ordering patterns. While we're only a few weeks into the third quarter, Bankhead order volumes in July have tracked consistent with the post-ADAPA forecast underlying our financial guidance.

In addition to the new LDO agreement, we have signed contract amendments with our major customers covering third and fourth quarter 2026 pricing, and in some instances, pricing and volume commitments for 2027. These amendments give us improved visibility into pricing and utilization through year-end and are designed to keep patients on therapy through the reimbursement transition.

We continue to focus significant internal resources on the FENCAP growth strategy through Medicare Advantage contracting, and I'm pleased with the progress of those discussions to date. Contracting cycles with these plans can be lengthy, and we have not assumed a contribution for Medicare Advantage in our 2026 guidance. We continue to believe Medicare Advantage represents a meaningful long-term growth avenue for DefendCast.

DefendCast's clinical value and its potential for meaningful downstream cost savings continue to be supported by a growing body of real-world evidence that our partners are publishing, And we anticipate additional data presentations this fall at the American Society of Nephrology's Kidney Week and at ID Week.

Turning to our pipeline, we announced this morning that we anticipate the submission of the SMDA for Reseo and prophylaxis in the third quarter of this year. This follows last quarter's announcement of positive preliminary top-line clinical trial results from the RESPECT study, A Phase III clinical study evaluating Reseo for the prophylaxis of invasive fungal disease in adult immunosuppressed patients undergoing allogeneic bone and marrow transplant.

We believe these results position Reseo, if approved, to become an attractive option for clinicians in the prophylaxis of invasive fungal disease, or IFD. Assuming timely submission and FDA acceptance of the filing, we would anticipate agency action in the first half of 2027.

As we begin to prepare our commercial infrastructure for potential launch of Reseo for prophylaxis we expect to incur incremental spend in the back half of the year including the anticipated addition of 15 to 20 positions across both commercial and medical These investments are sized to allow us to move quickly at approval while preserving flexibility if regulatory timelines shift and are already reflected in our narrowed full Cash X guidance of to million As a reminder our Cash X guidance excludes non charges such as stock compensation I would now like to turn the call over to our Chief Operating Commercial Officer, Liz Hurlburt, to provide an update on clinical activities. Liz, please go ahead.

Thank you, Joe, and good morning, everyone. As Joe mentioned, we were pleased to announce preliminary top-line results of the RESPECT study at the end of April, and following a constructive pre-NDA meeting with the FDA, are working diligently with our partner, Mundy Pharma, in support of their submission of the FNDA for Reseo in prophylaxis in the third quarter. As a reminder, the RESPECT study met its primary endpoint for FDA of fungal-free survival at day 90, showing non-inferiority versus the standard antifungal regimen, or SAR, meeting the pre-specified non-inferiority margin.

In addition, results showed a favorable profile across multiple secondary endpoints, most notably in the treatment of emergent adverse events leading to dose reduction, interruption, or withdrawal of study drugs and study discontinuation. As we stated previously, the objective with the RESPECT study was to show comparable efficacy to standard of care while also demonstrating a favorable overall safety profile with regard to drug-drug interactions and toxicity.

We believe the study has achieved this objective in that the results position of ZEO, if approved, as a differentiated option for prophylaxis of ISD with a meaningful potential commercial opportunity. It's important to remember that this was a global study conducted by our partner, Mundy Pharma, who owns global IT rights and will pursue regulatory approvals outside of the United States.

Mundy Pharma is currently the holder of the U. S. NDA, and under the terms of our agreement, transfers ownership of the NDA to Cormedix following approval of an FNDA for the prophylaxis indication, at which point Cormedix would own and control the U. S. asset. Under our agreement, the parties must work together on the publication of data and any submissions to FDA. In terms of data publication, we currently expect additional data from the Phase III RESPECT study to be published later this year at one or more medical conferences during the fourth quarter.

Turning to defend caps, we also expect additional real-world evidence to be published in the fourth quarter, with multiple abstracts having been submitted to both ASN and ID Week. Assuming acceptance, these publications will present the final results from the U. S. Renal Care Real-World Evidence Study, which, at interim analysis, showed a meaningful impact on infection-related hospitalizations and catheter-related bloodstream infections, As well as two other external studies. The first will highlight the demonstrated efficacy of DifenCAS when used in combination with chlorhexidine antimicrobial TAP.

And the second is expected to highlight the clinical and economic benefits of DifenCAS in the outpatient hemodialysis setting related to a meaningful reduction in TPA use by facilities. All combined, we expect that these data will add to the growing body of evidence supporting the clinical and pharmacoeconomic value of DefendCal. Difting gears to our Phase 3 TPN study, we recently submitted a protocol amendment to FDA that narrows certain exclusion criteria, which we believe can support increased enrollment in the coming months. And we have additionally activated additional sites. We will continue to update investors on our progress as we move through the year, and we continue to expect steady completion in 2028.

I would now like to turn the call over to Susan to discuss the company's second quarter financial results and financial decisions. Susan?

Thanks, Liz, and good morning, everyone. We are pleased to announce our second quarter results, which reflects strong execution across the business, continued demand for DefendCast, and the contribution from the acquired Malenta portfolio. As a reminder, because the Melinda acquisition closed in August 2025, the second quarter of 2026 includes a full quarter of Melinda operations, while the second quarter of 2025 does not.

Accordingly, year-over-year comparisons are heavily influenced by the broader product portfolio and cost structure of the combined company. We also filed our Form 10-2 this morning, and I encourage investors to review it for additional details and important disclosures.

Turning to the numbers, second quarter 2026 consolidated revenue was $101.9 million, compared with $39.7 million in the second quarter of 2025. Second quarter revenue included $66.1 million in sales of the FENCAP and $35.8 million in revenue associated with the acquired Malenta portfolio. The FENCAP sales increased year over year, largely due to the onboarding of a large dialysis customer in mid-2025.

Operating expenses were $34.2 million in the quarter, compared with $18.3 million in the second quarter of 2025, an increase of approximately 87%. The increase of $15.9 million over the prior year period was driven primarily by the contribution of operating expenses from the Malenta acquisition for the full quarter and reflects the larger combined company. Research and development expenses were $6.7 million in the second quarter of 2026, compared with $2.4 million for the same period in 2025. The increase was due primarily to higher personnel and clinical trial services in support of ongoing clinical programs, including pediatric studies for several brands, and continued investment in the development of DefendCast for the TPN indications. Selling and marketing expense increased approximately 95% to $12.4 million in the second quarter of 2026, from $6.4 million in the second quarter of 2025.

The increase was due primarily to higher personnel costs associated with a larger product portfolio and related marketing programs. General and administrative expenses increased approximately 59% to $15.1 million in the second quarter of 2026, from $9.5 million in the second quarter of 2025. The increase was driven by higher costs associated with operating as a combined company following the acquisition including branded prescription drug fees and higher personnel information technology legal and facilities costs G expenses in the quarter also reflects a reduction to expense of million which represents the amount of expected insurance reimbursement of legal fees incurred by the company to support its ongoing securities litigation Of the $4.2 million credit recorded in the second quarter, $2.7 million related to legal fees that were incurred in prior periods.

On the bottom line, Cormedix recorded net income of $26.0 million, or $0.33 and $0.29 per basic and diluted share, respectively, in the second quarter of 2026, compared with net income of $19.8 million, or $0.29 and $0.28 per basic and diluted share, respectively, in the second quarter of 2025. In addition to net revenue and operating expenses, EPS was impacted by income tax expense of $12.7 million, as well as non-operating income and expenses net of approximately $4.2 million, associated with the mark-to-market of marketable equity securities and contingent consideration, which reflects the approximate fair value of future milestone and royalties payable to former Malenta shareholders. On a non-GAAP basis, adjusted EBITDA was $58.7 million for the second quarter of 2026, compared with adjusted EBITDA of $22.4 million in the second quarter of 2025.

This adjusted EBITDA metric excludes non-cash items such as depreciation, amortization, stock-based compensation, interest and other income and expenses net, taxes, and certain non-recurring items. We ended the second quarter with $256.7 million in cash and cash equivalents. For the 6 months of 2026, net cash provided by operating activities was $128.6 million, compared with $49.7 million for the first 6 months of 2025. As Joe mentioned, we are confident in our fiscal year 2026 financial guidance, which includes full year 2026 consolidated revenue of $325 million to $345 million, full year defend cash revenue guidance of $175 million to $195 million, and revised full year adjusted EBITDA guidance of $125 million to $140 million. We continue to believe we are well positioned with a strong balance sheet, meaningful cash generation, and the financial flexibility to support our operating priorities, headline development, and shareholder value creation.

And now I will turn the call back to Joe for closing remarks. Joe?

Thank you, Susan. I'm confident where the company stands today and the opportunity ahead of us. For Medix has built meaningful momentum through the first half of 2026 across all three pillars of our investment thesis.

First, DefendCAT continues to perform in line with our internal expectations at Tadapa expiration, demonstrating durable underlying utilization, which we believe positions the franchise to remain a meaningful value generator following the reimbursement transition.

Second, we are advancing a pipeline of high-value late-stage opportunities, including Resale for Prophylaxis and DefendCast and TPN, which could meaningfully expand our long-term revenue opportunities. And third, we have delivered significant profitability in cash generation over the last year.

$277.8 million of adjusted EBITDA over the trailing 12 months, and $267 million of combined cash and investments at quarter end, which allows us to reinvest in growth and pursue business development opportunities. We remain confident in our outlook for this year and our past sustained growth and profitability beyond it. This concludes our prepared remarks, and I'll ask the operator to open up now for questions.

Thanks, Anna. So, you know, we just recently signed that agreement, and they're rolling out a pilot. We, you know, we're waiting to see kind of actually what they're looking for, and we're hopeful for additional utilization. So, once we get better visibility, you know, we'll be in a position probably to talk more about 2027. There's a lot of variables that go into 27 guidance. I don't expect we'll be in a position to comment on it until either late this year or early next year.

You know, so there's just a lot of pushes and pulls. We don't have any cause now to either adjust the top or bottom of that guidance, but as we move through the year and we get better visibility, we can provide updates.

No, no. Right now it's, well, obviously it's tracked in the revenue, so it's within, the revenue that we're seeing from the pilot is within our existing guidance. And right, for DEFENDCAST, we are right now tracking to the kind of mid-top part of the DEFENDCAST guidance. So, you know, let's see where we go through the year, and as I said, we'll update, you know, as we go.

Yeah. Look, right now, the size and scope of the pilot, we've shipped initial order. We think it's a couple hundred clinics. We'll see where we can go from there. I don't want to get out over my skis on the pilot yet, Jason. So, right now, we're really happy to have finally gotten that LDO kind of over the hump and And to the point of commercialization, so we're taking that one day by day.

On Rozeo Prophy, the full data set is not yet out, so we really haven't been able to conduct a robust market research. As we said in the script, we are working with our partner, Mundy Pharma. We would expect it to be published later in the fourth quarter at one or more medical conferences. And once we have that data available, we'll be able to have more substantive discussions around the data itself with clinicians.

Thanks, Serge. Look, I'm a new LDL, and I really can't speak to the motivations of the company in terms of timing. Obviously, we have built a wealth of real-world evidence around the clinical efficacy and the pharmacoeconomic benefits of DefendCast, and as I said, we're happy that now they are choosing to begin implementation of DefendCast. On Reseo, look, it's going to be a label review issue. So until we work through this process, we don't – just coming out of the pre-NDA meeting, we don't have yet visibility of what the final label will be.

Thanks, Brandon. I'll let Susan comment.

We didn't take any deliberate actions. We're obviously turning a little bit light on the expense side. Some of the staffing that we're bringing on is coming in later in the year. Yeah, and also we did, and we disclosed this in our Form 10-Q, we had a reduction of G&A for $4.2 million in a quarter. So it's reflecting artificially low because of that. $2.7 million of that was incurred primarily in Q1 of 2026. So we added the deductible under our insurance policies for the litigation costs. So we were able to claim the reimbursement of those, and that's what we recorded in the second quarter. So it essentially eliminates those litigation legal fees that we had incurred in Q1 and in Q2 during the second quarter.

So if you think about the run rate for expenses, it would be maybe $2.7 million higher because of what we reversed from prior periods. Does that make sense?

No, there's been no actions taken in the company.

Oh, thank you.