CorMedix Inc.

Good morning and welcome to the Corps Medics fourth quarter and full year 2025 earnings and corporate update conference call. Today's conference call is being recorded. There will be a question and answer session at the end of today's presentation and instructions on how to ask a question will be given at that time. At this time, I would like to turn the conference call over to Dan Ferry from LifeSci Advisors. Please go ahead.

Good morning. And welcome to the Corps Medics fourth quarter and full year 2025 earnings and corporate update conference call. Leading the call today is Joe Tedisco, Chairman and Chief Executive Officer of Corps Medics. And he is joined by Liz Hurlburt, EVP and Chief Operating Officer, and Susan Blum, EVP and Chief Financial Officer. In addition, Beth Zelnick-Kaufman, EVP and Chief Legal and Compliance Officer, Mike Seckler, EVP and Chief Commercial Officer, and Dr. Matt David, EVP and Chief Business Officer, are also 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 meaning set forth in the Private Security Litigation Reform Act of 1995. These statements are statements other than statements of historical facts regarding management's expectations, beliefs, goals, and plans about the company's prospects and future financial position. Actual 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 CoreMedix filings with the SEC, which are available free of charge at the SEC's website or upon request from CoreMedix. CoreMedix may not actually achieve the goals or plans described in these forward-looking statements. Investors should not place undue reliance on these statements. CoreMedix 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 CoreMedix earnings release in the current report on Form 8K filed with the SEC. This information is also available on the Investor Relations section of CoreMedix's website. At this time, it is now my pleasure to turn the call over to Joe Tedisco, Chairman and Chief Executive Officer of CoreMedix. Joe, please go ahead.

Thank you, Dan. Good morning, everyone, and thank you for joining us on this call. 2025 was truly a transformational year for CoreMedix. While the FinCAS achieved peak sales of just under $260 million, we are excited to have both announced and closed the acquisition of Moenta Therapeutics in the third quarter of the year. In addition, the team worked expeditiously to facilitate integration and achieve our target synergy of $35 million during the fourth quarter of 2025. This was a monumental achievement and truly a testament to the operational execution capabilities of the CourtMedics leadership team. As we turn our attention to the year ahead, there is much focus on our post-TDAPA add-on period strategy for maintaining patient utilization rates for DefendCast in outpatient hemodialysis. As a reminder, on July 1st of this year, the TDAPA reimbursement for DefendCast We'll transition from a buy-and-bill format to a bundled add-on mechanism. We've had multiple conversations with our top customers and are in the process of finalizing supply pricing for Q3 and Q4 of 2026, as well as for 2027. At this time, we are affirming our 2026 DefendCast guidance of $150 to $170 million and 2027 DefendCast guidance of $100 to $125 million. With respect to 2026, we expect much of the revenue concentration to be front-loaded in the first half of the year as price erosion related to the post-TDAPA add-on occurs in the third and fourth quarter. Assuming CMS utilizes the same methodology to calculate the 2027 bundle addition, we do expect a meaningful increase in traditional Medicare provider reimbursement 2027, which we expect to translate into a higher net selling price in 2027 compared to Q3 and Q4 of 2026. To that extent, we took the extra step of issuing 2027 DefendCast guidance, which is based on existing patient utilization rates, as well as our current estimates for the range of net selling prices, and does not include potential upside from new customers or managed care contracting. In addition to DefendCast guidance, the company is also affirming its full year 2026 financial guidance of revenue of 300 to 320 million and adjusted EBITDA of $100 to $125 million. That said, we are actively in discussions with multiple Medicare Advantage providers, as well as new potential customers for DefendCat in both the inpatient and outpatient settings of care, focused on execution of sales and marketing efforts for Rosio, Minison, and Vabomir, and will evaluate appropriate updates to financial guidance as we progress throughout 2026. This past month, we completed our first Analyst R&D Day, in which we focused on educating our analysts and investor community on the market opportunity for our antifungal product, Roseo, in its current approved indication in the treatment of invasive fungal infections, as well as our key pipeline assets of Roseo in development for prophylaxis of invasive fungal infections and DefendCast in development for prevention of CLABSI in adult patients receiving total parental nutrition. Liz will provide an update on the status of these development programs shortly. During the Analyst Day event, stakeholders were given the opportunity to engage with multiple panels of physician thought leaders around key aspects for each of these three growth opportunities for core medics. The webcast of the event and associated materials remains available on our website, and I encourage all investors to review those materials. The feedback from thought leaders was excellent and underscores our view for the large potential market opportunity for Rizeo, which we estimate at approximately $2.5 billion across both potential indications, and for DefendCat and Tipien, which we estimate between $500 and $750 million. 2026 is expected to be a transitional year for CoreMedix, with a heightened investor focus on new catalysts and value drivers. Most notably, our phase three respect data for Roseo and prophylaxis, which is on track for the second quarter of this year. With the acquisition of Malenta, not only did we acquire what we believe will be an exceptional growth asset in Roseo, but also added highly durable institutionally administered products like Minison and Vabomir, which we expect to provide a stable base of revenue while the company builds toward future growth. I believe CoreMedix has done an exceptional job of maximizing the value of the initial to DAPA period afforded to defend cats in outpatient hemodialysis and parlayed that success into building a pipeline that positions the company for long-term sustainable growth. I'd now like to turn the call over to our Chief Operating Officer, Liz Hurlburt, to provide an update on clinical activities. Liz, please go ahead.

Thank you, Joe, and good morning. The combined clinical development and operations teams, along with field medical affairs, have been working diligently on numerous clinical activities. As we shared last fall, enrollment for the global phase three RESPECT study evaluating Roseo for the prophylaxis of fungal infections in adult allogeneic bone marrow transplant patients completed in September. This pivotal trial is being conducted by our global partner, Mundy Pharma, who has confirmed that all sites have completed study participation and they are on track for an anticipated database lock later this month. We expect to announce top-line data from the RESPECT study in the second quarter of 2026. Top-line results will include the primary efficacy outcome of fungal fury survival at day 90, discontinuation of study drugs due to toxicity or intolerance, all-cause mortality and attributable mortality with invasive fungal disease as determined by the Data Review Committee and the cumulative incidence of invasive fungal disease at day 90 by the Data Review Committee and by Azol Choice. Additionally, safety data including overall adverse events, treatment emergent adverse events, and serious adverse events is expected to be included in top-line results. The team continues to work closely with investigators and clinical experts in the field to deepen our understanding of the evolving clinical practices and the needs of these patients as we prepare to support a potential commercialization in 2027. As Joe mentioned earlier, our panel of thought leaders provided excellent insights into the market opportunity for a long-acting echinocandin in the prophylaxis of invasive fungal infections, and we are looking forward to our Phase III data readout. Turning to DefendCast, I'm pleased to share that the Phase 3 NeutroGard clinical study, which is evaluating the impact on central line associated bloodstream infections, or CLABSI, for adult patients receiving total parental nutrition via a central venous catheter, is approximately 30% enrolled toward our minimum patient target of 90 patients. And we are working to increase enrollment rates as we progress throughout 2026 with new sites in Turkey. At this time, we are still anticipating study completion in early 2027. The adaptive design of the NeutraGard study allows for a minimum of 90 and maximum of 200 participants based on the incidence rate of CLABSI. An interim assessment will be made by the independent data monitoring committee after 15 participants have experienced a CLABSI event. I would now like to turn the call over to Susan to discuss the company's fourth quarter and full year financial results and financial position. Susan?

Thanks, Liz, and good morning, everyone. We are pleased to share our fourth quarter and full year 2025 financial results, which reflect our ongoing commercial and operational execution. A few things to note on the financial results before I jump in. Following the close of the Melinda acquisition on August 29, 2025, The fourth quarter of 2025 represents the first full reporting period incorporating Molenta's operations into our consolidated results. Also, the company has filed its annual report on Form 10-K for the year ended December 31st, 2025. And I encourage you to review this filing for a more comprehensive discussion of our financial performance and operating results. As Joe mentioned, we had a strong quarter on the revenue front. For the fourth quarter, net revenue of $128.6 million reflected continued growth across our commercial portfolio, driven primarily by DefendCast, which contributed $91.2 million and supplemented by a full quarter contribution from the Malenta portfolio, which totaled $37.4 million. Compared to net revenue of $31.2 million in the fourth quarter of 2024, which included only results from DefendCast, This represents a meaningful year-over-year increase and highlights the company's ability to execute on product launches and business development initiatives. Total revenue on a pro forma basis for 2025, which is full year revenue for both the Cormetix and Malenta businesses, was $401.3 million, which is in line with our previously established guidance. Of the total, DefendCast generated $258.8 million in net sales for the year. Turning to OPEX, fourth quarter operating expenses of $48.2 million increased from $17.1 million in the comparable prior year period, reflecting the expanded cost structure of the combined organization, merger-related costs associated with the Melinta acquisition, including severance expenses, and additional investment in expanded indications for DefendCAS. Most notably, our phase three clinical program focused on the prevention of CLABSI in TPN patients. Our operating expenses for the fourth quarter were consistent with our expectations and aligned with our strategic focus on building a platform for long-term sustainable growth, which was supported by the execution and integration of the Molenta acquisition. Our employee base has grown significantly in connection with the merger and scaling of the business. Last year at this time, we had a workforce of approximately 100 people, and today we have just under 200 employees. The expanded infrastructure serves to support growth and is expected to provide significant operating leverage in the periods to come. Now that we have successfully streamlined the two organizations, we can focus on executing our business growth strategy and preparation for the anticipated new launch opportunities of DefendCath and TPN and Roseo for prophylaxis. On the bottom line, Hormetics recognized net income of $14 million in the fourth quarter of 2025. Net income was impacted by tax expense of $42.4 million, the majority of which was non-cash, resulting from the utilization of deferred tax assets that were established in the third quarter of 2025. On a pre-tax basis for the fourth quarter, income was 56.4 million, an increase of 43 million from the fourth quarter of 2024. Turning to non-GAAP results, adjusted EBITDA for the fourth quarter was 77.2 million, which was within our previously established guidance and reflects modest growth quarter over quarter. This metric excludes one-time acquisition-related and reorganization costs, stock-based compensation, and the tax benefits and expenses recognized during the year, and it provides additional insight into the strengths of our core operating performance. A reconciliation to GAAP results is included in the press release issued with our earnings announcement. From a liquidity perspective, we ended the quarter with cash and cash equivalents and short-term investments of $148.5 million, driven by strong operating cash flow of almost $100 million during the quarter, and ongoing working capital optimization. Where we stand today, given our financial flexibility and commercial momentum, we believe we are well positioned for both organic growth from existing pipeline and promoted assets and potential inorganic growth from new business development opportunities. I'm excited to be a part of the journey as we move forward. And now I will turn the call back to Joe for closing remarks. Joe?

Thanks, Susan. As I mentioned, 2025 was a transformational year, and 2026 will be a transitional year that we believe sets up CoreMedix for long-term sustainable growth in 2027 and beyond. We recently announced the share repurchase program and have been active in repurchasing shares throughout the first quarter. We intend to continue to be active throughout the year, subject to normal blackout periods, applicable volume restrictions, and other business needs, as we believe our balance sheet has sufficient flexibility to pursue this repurchase while leaving sufficient dry powder for new business development opportunities. The company sits here today with a diversified product portfolio, multiple late-stage pipeline opportunities, financial flexibility, and a capital structure to support future growth. We remain confident in the outlook for this year and our path to future growth and sustained profitability. Hi, we'd like to now open up the call for Q&A.

We will now begin the question and answer session. To ask a question, you may press star then 1 on your telephone keypad. If you're using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you'd like to withdraw your question, please press star then 2. The first question today comes from Roana Ruiz with Lear Inc. Please go ahead.

Hey, morning, everyone. A couple questions for me. I was thinking, in terms of your conversations with Dialysis customers and talking about supplying contract pricing for DefendCast, could you give a little bit more color on how those are going? Are you trying to build in certain features to drive DefendCast volume in 2026 and beyond, or how are you thinking about these different levers?

Hey, thanks, Rowana. So I say conversations, I believe, are going fairly well. Near-term focus is on preserving patient utilization for the back part of 26 and creating a structure for an increase in selling price in 27. And that's what we've been working toward negotiating with customers, and that's what we'll be finalizing shortly. We are also setting these up with flexibility to allow for changes in the event we are successful with Medicare Advantage contracting. as we progress through this year and into next year. So overall, I'm happy with the progress that we've made and hopeful in the near term we'll have some things finalized for the back part of the year.

Sounds good. And then I had a different question about Rosseo. It sounds like you're going to share a lot of interesting information with the top line for the phase three. Could you help frame what in that information you think is most clinically meaningful for physicians How do you plan to leverage some of this data in potential future discussions with payers, et cetera, if all goes well and the top line is positive?

All right, thanks. Before I let Liz comment, I'll just give you a little bit of my thoughts. And, you know, the way I look at the RISEO top line data, I think there's obviously various degrees of success, right? There's meeting the top line endpoint, and then there's going to be, you know, different aspects of the pathogen data within the top line data as well as secondary endpoint around the discontinuation of the standard of care. And I think obviously what we're able to show will guide toward the commercial utility and how we're going to think about marketing and promoting the product. But Liz, do you want to comment any further?

Sure. You know, Rowena, I think when it comes to how we're going to use the data, a lot of this is going to be dependent on the pathogens that we see in top line. Obviously, the more, the better. I think if we are successful in the way that respect reads out, there is a lot of opportunity for us to be able to talk to the payers about an option that does not have the drug-drug interactions that the azoles and some of the other therapeutics are presenting right now. And we're hopeful that that will lead to understanding around less hospitalizations, getting patients out quickly and to, you know, more safely be on their anti-cancer regimen. So it'll be certainly data dependent, but I'm confident that once it comes out, we'll be able to take a look at that data and strategically place it with payers and the clinical community.

Understood. Thanks.

And the next question comes from Les Salewski with Truist Securities. Please go ahead.

Hey, this is Jeevan on for Les. Thanks for taking our questions. First, any developments on the bipartisan proposed Tdapa extension bills and, you know, if the timing here has changed based on recent global events? And then also, any updates on a potential partnership with the other LDO and how post-TDAPA dynamics change the odds here? Thank you.

Thanks. Look, legislation is always speculative. What I can say is that we've spent a lot of time, we're working closely with the other company that's actively in TDAPA, Kibia. We've been compounding the payment on the Hill as well as with You know, career staff at CMS, political appointed staff at CMS, we've got a large number of co-sponsors of the bill. Now, timing is tricky, right, because this likely needs to be attached to another piece of legislation. There's a war in the Middle East. So we really can't speculate on whether this can happen before June 30th or December 31st. I think if it happens after June 30th, I think there is a pathway for potential retroactivity of some aspects of the bill to impact positively on defend cast. So that's something we'd actively be working on as well behind the scenes. But it's really hard to kind of pinpoint a timing with everything that's going on in Washington right now. With respect to the other LDO, I can't comment on ongoing discussions with customers.

And your next question comes from Serge Belanger with Needham & Company. Please go ahead.

Hey, good morning. This is John on for search today. One on DEF and CAS and then another one on the Malinta product portfolio. So first, just curious if you have any updates on the inpatient opportunity with DEF and CAS. You know, have the sizes of the current contributions been growing? And just curious what growth profile you see from this segment in 26 and 27. And then on the Melinta portfolio, you mentioned Mineson and Vabomir being potential significant contributors along with Roseo. Curious if there's anything promotionally sensitive that you could kind of reinforce into these products to see some growth in the future. Thanks.

All right. Thanks, John. And I'm not sure I fully understood your question. It's a fantastic question, but what I'll kind of touch on is our guidance and how we constructed our guidance for 26 and 27. So, you know, the way we looked at 2026, obviously with the way CMS did the calculation for the bundle adjustment, the $2.37 that goes into the bundle for the third and fourth quarter, it doesn't fully reimburse providers, right, based on current utilization rates. They used an older period of time to do that calculation that was based on our first year of launch. But we had provisions in our agreements with customers that allow for that type of situation where there's certain floor pricing under these contracts. What we're working on now is hopefully getting a little bit better than that floor pricing. But our guidance was somewhat based on the floor, right? And we're working through that process now. Now for 2027, What we wanted to do was give investors comfort that there's at least a base business level of DefendCast for which we expect to see price appreciation and hopefully stable volumes based on what we're doing now in the outpatient hemodialysis sector to kind of steady the market with customers. Now, we elected not to include in that 2027 guidance potential upside from what we're trying to do with Medicare Advantage contracting with potential new customers both in outpatient hemodialysis and on the inpatient side. Because when it comes to a guidance, it's very difficult to guide towards something that is still under the way in terms of execution. So as we progress throughout the year and should we get a Medicare Advantage contract across across the goal line and we have the ability to look and make a forecast around volumes, we would update our guidance accordingly as we progress through the year. On the Malenta portfolio question, look, I think Minicin and Vavimir are two really good, durable products that have entrenched utilizations in the hospital inpatient segment for treatments of niche infections, right? I think, you know, Minison is closing in at around $50 million in sales. Vavimere is just under $30. So we do have a little bit of promotional efforts on there. We don't think that they are hugely promotionally sensitive the way a launch product would be, but we think there's a couple percentage points of growth there that we expect to get this year.

That's helpful. Thanks.

And your next question comes from Brandon Folks with HC Wainwright. Please go ahead.

Hi, thanks for taking my questions and congrats on the quarter. Maybe just two from me. Firstly, on DefendCast, can you just talk about the customer mix currently and whether you anticipate any change of that in your 2026 and 2027 guidance? How should we think about the opportunity in the other midsize operators for DefendCast?

So right now, I'd say we're fairly heavily concentrated volume-wise with one of the LDOs and then two of the three mid-sized players are driving probably 90-something percent of our volume amongst the three of them. There's a third mid-sized provider that's utilizing but not at the scale of others. And then we have a number of small accounts that Even if they're utilizing it fairly broadly, they don't represent as large of a market impact because they may only have 20 clinics or 15 clinics. So that's certainly kind of the mix today. Now, in terms of changes we would anticipate in 26 and 27, right, would depend in large extent to our ability to onboard either the other LDO or to get the third midsize player to meaningfully increase volume. So the only things that would really kind of, I'd say, change the mix in any meaningful fashion. You know, what we're doing on the inpatient side in terms of promoting to FENCAS, while that's a good dollar market opportunity, we believe the volumes there would be much lower, right, from a volume distribution standpoint. So I hope that answers the question.

That does. And if I just may ask one more, I know you mentioned you filed the 10 K, sorry, I haven't been through it, but so can you just talk about the operating cashflow in the quarter? It looked very strong. So just, you know, anything to consider there and then also maybe how we should think about it in 2026. Thank you.

Yeah. Look, I think roughly, you know, we, we, we like to say that, you know, EBITDA could be a proxy for cash flow for the year. I think there's some items that could impact in terms of our need to maybe stockpile some inventory this year as we're working through a few tech transfers. We also have some rebates, large accrued rebates that you'll see on the balance sheet that'll get paid out in the early part of this year. So those are kind of really the big items that impact cash flow. Susan, anything you want to No, you covered it, Joe.

Great. Thanks very much.

This concludes our question and answer session and today's conference call. Thank you for attending today's presentation. You may now disconnect.