Q3 2024 CorMedix Inc Earnings Call
Speaker Change: Good day and welcome to the core Maddox Inc. 3rd quarter, 2024 Financial Results Conference Call. All participants will be in listen only mode. Should you need assistance? Please signal a conference specialist by pressing the star key followed by zero.
Speaker Change: After today's presentation, there will be an opportunity to ask questions.
Speaker Change: To ask a question, you may press star then one on your telephone keypad. To withdraw your question, please press star then two. Please note this event is being recorded. I've been now linked to trim the conference over to Dan Ferry of Life Sidesvisors. Please go ahead.
Dan Ferry: Thanks, operator. Good morning and welcome to the CoreMedics third quarter 2024 earnings conference call.
Speaker Change: We are in the call today's show to discuss chief executive officer of Quorumatics.
Speaker Change: He is joined by Dr. Matt David, Executive Vice President CFO, Beth Zelnick Kaufman, EVP and Chief Legal Officer, Liz Hurlbert, EVP and Chief Clinical Strategy and Operations Officer, and Aaron Mystery, EVP and Chief Commercial Officer.
Speaker Change: Before we begin I would like to remind everyone that during the call, management may make what or not as forward-looking statements within the meaning set for it in the private security litigation before Mac at 1995.
Speaker Change: 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.
Speaker Change: 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 on climatic's silence with the SEC, which are available free of charge at the SEC's website, or upon request from corematics.
Speaker Change: Quarmedics may not actually achieve the goals or plans described in these four-lical statements, and a vester should not place on the reliance on these statements.
Speaker Change: Quorumatics does not intend to update these four-licensed statements, except as required by law.
Speaker Change: At this time, it is now my pleasure to turn the call over to Joe Tstisco. Chief Executive Officer, Coremetics. Joe, please go ahead.
Joe Tstisco: Thanks, Sam.
Joe Tstisco: Good morning everyone and thank you for joining the call.
Joe Tstisco: As we approach the end of our first calendar year of commercial launch of Defend Cat, I'm incredibly proud of the team's efforts and pleased with the commercial results thus far.
Joe Tstisco: The third quarter marks the first full quarter of the product shipment for the FENCAC, as well as the first quarter of the Alpatient Product Utilization.
Joe Tstisco: are net revenue for the third quarter of $11.5 million, exceeded street consensus.
Joe Tstisco: and was largely driven by our initial anchor customer, US-Rainland, which has done an exceptional job with the fantastic documentation within its clinics.
Joe Tstisco: We recently announced new agreements with two mid-sized dialos operators and one large scale operator.
Joe Tstisco: which combined with our existing customers will provide patients access to FENCAS and roughly 60% of dials with clinics in the U.S.
Joe Tstisco: We are currently working diligently with our new partners to operationalize the ingredients.
Joe Tstisco: and currently expect churches to commence for all three before the end of the fourth quarter.
Joe Tstisco: While we have not issued revenue guidance for the fourth quarter, based upon our current forecast, we do expect to be a bit up positive for the fourth quarter.
Joe Tstisco: with respect to guidance. There was a wide potential variability before the quote of revenue, driven by the timing and scale of purchases by our LDO customer, as well as the scale of purchases by our UVNL to mid-sized customers.
Joe Tstisco: to thank cats for the most part, because being protocolized by the outpatient customers that adopt the product.
Joe Tstisco: Meaning they are establishing criteria for patients in their system for which to bend Catherine's appropriate and then implementing protocols based on those criteria.
Joe Tstisco: The Sequoires and significant pre-implementation effort with each customer to establish protocols, order sets, and conduct training on an enterprise level. In the case of our LVO customer requires implementation on a much larger scale to allow a rollout over 2,000 clinics.
Joe Tstisco: The upside of having our drug-porky lives in this matter is that once a customer goes live, the expectation conversion ramp to move fairly quickly.
Joe Tstisco: The downside is that setup can take anywhere from several weeks to a few months.
Joe Tstisco: Currently, we are expecting our LDO customer to begin a ordering in December.
Joe Tstisco: but a couple weeks move in either direction from a customer this scale would obviously have a material impact on our fourth quarter left.
Joe Tstisco: for our new MDL customers, we expect to always begin in November.
Speaker Change: With respect to our inpatient lunch activities, we have made significant progress in terms of building the Fentile champions within hospitals and health systems and scheduling P&T meetings with those institutions.
Speaker Change: A large number of P&T meetings occurred in the third quarter, and we're in the process of fielding questions and providing additional information required for a formal decision.
Speaker Change: The PMT committee discussions required both a comprehensive review and collaboration across multiple stakeholders, including critical and financial within the health system.
Speaker Change: To that extent, we expect the inpatient update process to be longer and the ramp to be more consistent with traditional inpatient launches. We can compare some to the more rapid update we have seen on the outpatient side.
Speaker Change: We have started to see some utilization in the handful of hospitals that have completed paintings through the early and added the fantastic formularity. And we are optimistic to build on that progress in 2025 as we continue our field efforts with the fantastic advocates.
Speaker Change: focusing now on our clinical developments. We announced in the second quarter that we received supportive feedback from FDA related to our proposed clinical pathway for adult total parental matrition or TPPF.
Speaker Change: Since then, we've received FDA feedback and conducted extensive market research and clinical feasibility studies. And accordingly, we are refining the clinical protocol and anticipates submitting it to FDA by MINDOWEMBER to align with our plans to operationalize the study in the first half of 2025.
Speaker Change: The company's goal for TPN is to obtain FDA approval for an expanded use of our torolidine and heparin catheter lock solution in the late 2027 to 2028 timeframe and we estimate annual peak sales potential in this indication to be in the range of 150 million to 200 million dollars.
Speaker Change: We will provide investors with updates on progress as we move forward.
Speaker Change: From a clinical budget standpoint, we anticipate the study to cost between $10 and $12 million with the majority of expense spanning the 2025 and 2026 calendar years.
Speaker Change: During our previous earnings call, we also announced three additional clinical initiatives, all expected to commence in the 2024 or early 2025 timeframe.
Speaker Change: The most meaningful of the three, from a data value standpoint, is our real-world evidence study that we will run in cooperation with our study partner, US Renal Care.
Speaker Change: Our hope with this study, in which we expect to evaluate outcomes of roughly 2,000 patients over 24 months at a cost of less than a million dollars a year, would be to generate real-world evidence around the impact of the FENCAS utilization on cost of patient care, infection rates, hospitalizations, mortality, and multiple other metrics such as lost chair time and antibiotic use.
Speaker Change: Ultimately, we would intend to utilize this data in our post-ADAPTA period to negotiate future sustainable reimbursement from Medicare Advantage plans and other value-based care contracting entities.
Speaker Change: Data collection for this study has already commenced.
Speaker Change: Simultaneously with our adult TPN and real-world evidence studies, we will also be commencing a study in pediatric hemodialysis.
Speaker Change: This will be a relatively small study, spread over several years, as we expect patient enrollment to be a challenge given an extremely small patient population and the need for very personalized protocols for these ultra-vulnerable patients.
Speaker Change: This pediatric study is a post-marketing requirement under the Pediatric Research Equity Act by the FDA, and we have FDA's concurrence on a final study protocol.
Speaker Change: We have plans to begin patient enrollment in early 2025, and we expect the study to cost between $4 and $6 million, spread over five years.
Speaker Change: Lastly, in addition to our other clinical initiatives, we plan to commence an expanded access program for high-risk populations.
Speaker Change: including but not limited to pediatric TPM, peritoneal dialysis patients with refractory peritonitis, and neutropenic oncology patients utilizing a CBC.
Speaker Change: These high-risk patients are those that have exhausted other infection prevention methods and unfortunately remain at significant risk for comorbidities and mortality.
Speaker Change: The cost for the Expanded Access Program is expected to be less than $750,000 a year, primarily in the form of free product and distribution costs, and we expect to generate data that supports further label expansion and complements our Adult 2PM Program.
Speaker Change: I would now like to turn the call over to Matt to discuss the company's third quarter financial results and financial position. Matt?
Matt David: Thanks Joe and good morning everyone. I am pleased to be here today to provide an overview of our third quarter 2024 financial results as well as an update on CoreMedix's cash position.
Matt David: The company has filed its quarterly report on Form 10-Q for the quarter ended September 30, 2024. I urge you to read the information contained in the report for a more complete discussion of our financial results.
Matt David: With respect to our third quarter of 2024 financial results.
Matt David: Our net revenue for the third quarter of 2024 amounted to $11.5 million. As Joe indicated, this marks the first full quarter since DefendCats became commercially available this past spring.
Matt David: Our net loss was approximately $2.8 million, or $0.05 per share, compared with a loss of $9.7 million, or $0.17 per share, in the third quarter of 2023.
Matt David: The smaller net loss recognized in 2024 compared with 2023 was driven by the gross profits associated with the net sales of the FinCAP.
Matt David: Operating expenses in the 3rd quarter of 2024 increased approximately 33% to $14.1 million compared with $10.5 million in the 3rd quarter of 2023.
Matt David: The increase was driven by higher selling and marketing and G&A expenses offset by a decrease in R&D.
Matt David: Cormetics is now reporting selling and marketing expense and general and administrative expense as separate line items.
Matt David: On an apples-to-apples basis, selling and marketing expense increased 66% to $6.7 million in the third quarter of 2024, compared with $4.1 million in the third quarter of 2023.
Matt David: G&A expense increased 76% to $6.6 million in the third quarter of 2024 versus $3.7 million in the third quarter of 2023.
Matt David: The increase in selling and marketing expense was attributable primarily to increased marketing efforts and new personnel inclusive of our field sales organization and support for the commercial launch of the FANCAP.
Matt David: The increase in G&A expense was primarily due to increases in personnel costs in preparation for support activities related to the commercial launch, as well as certain expenses previously expensed as a component of R&D prior to FDA approval.
Matt David: R&D expense decreased by approximately 73 percent to 0.7 million driven by the approval of the FENCAF.
Matt David: As a result of the post-FDA approval commercial operations, costs related to medical affairs and certain personnel expenses that supported R&D efforts prior to the FDA approval of the FENCAS have been recognized in selling and marketing or G&A expense.
Matt David: In addition, a portion of the costs related to the manufacturing of the FENCAP, previously recognized in R&D, are now capitalized as a result of the FDA approval.
Matt David: With respect to our nine-month year-to-date 2024 financial results.
Matt David: Total net revenue during the nine-month year date of 2024 amounted to $12.3 million.
Matt David: Total operating expenses during nine months year-to-date of 2024 amounted to $45.5 million compared with $33.3 million in the first nine months of 2023, an increase of 37 percent.
Matt David: R&D expense decreased 80% to $2.2 million, driven primarily by the approval of the FENCAP. Selling and marketing expense increased approximately 106% to $20.5 million, compared with the first nine months of 2023, and G&A expense increased approximately 83% to $22.9 million, compared with the comparable period in 2023.
Matt David: The increases in selling and marketing and G&A were driven primarily by new personnel and costs to support the commercial launch of the FedCap.
Matt David: We recorded net cash used in operations during the nine-month year-to-date of 2024 of $45 million, compared with net cash used in operations of $27.7 million in the same period in 2023.
Matt David: The company has cash and cash equivalents of $46 million as of September 30, 2024.
Matt David: While we expect to begin to see cash collection from our accounts receivable in Q4, our cash position was supplemented in Q3 with approximately $12.4 million in net proceeds from ATM issuance.
Matt David: We believe our cash equivalents, short-term investments, and projected future operating cash flow gives the company the ability to fund operations for at least 12 months.
Matt David: Assuming we maintain our current trajectory of sales from existing outpatient accounts and see initial shipments to new accounts during Q4, we believe we can achieve positive EBITDA in the fourth quarter. I will now turn the call back to Joe for closing remarks. Joe?
Joe Tstisco: Thanks, Matt.
Joe Tstisco: Grametics is executing well on our launch of Defendcast and focused on growing the business with existing customers as well as expanding utilization of new ones.
Joe Tstisco: We're also actively working to expand the label for Dufencaf beyond hemodialysis.
Joe Tstisco: and beginning to scout for commercial stage business development opportunities to expand our product portfolio beyond the FedCat.
Joe Tstisco: I appreciate everyone's continued support of CoreMedics, and I'm happy to take questions.
Speaker Change: 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 are using a speakerphone, please pick up your handset before pressing the keys.
Speaker Change: If at any time your question has been addressed and you would like to withdraw your question, please press star then 2.
Speaker Change: Our first question comes from...
Speaker Change: Jason Butler, Lucidison JMP. Please go ahead.
Jason Butler: Hi, thanks for taking the questions and congrats on the quarter.
Jason Butler: I guess just a couple from me.
Jason Butler: Can you speak to, you know, the use that you're seeing today, to what extent it's being driven by, you know, individual doctors or centers' decision to use the product versus...
Jason Butler: the overall institution already implementing SOPs.
Jason Butler: Second question, you've laid out reimbursement dynamics before for the outpatient setting, including the split between Medicare fee-for-service and Medicare Advantage. How do those broader population dynamics compare to what you're actually seeing during the launch?
Speaker Change: And then just lastly for me, can you speak to what you think about the trend for expenses, operating expenses in 4Q? Thanks.
Speaker Change: Okay, all right. Thanks, Jason. I appreciate the questions.
Speaker Change: So what I think we've seen most or almost entirely with the initial rollout has been a protocolization of the product.
Speaker Change: It's more of a top-down driven approach in the outpatient setting. I don't, we don't see as much of this being driven on a patient by patient or doctor specific basis, right? So the centers are putting protocols in place. They're setting, they're establishing criteria within their systems for whom
Speaker Change: X Тоntin. Thank you so much for being with us today. As I mentioned in the script, I would love to hear from you what methods you've taken available. If you have any questions about any of the subjects or anything that I have mentioned to you, please feel free to reach out. With that, without any further ado, we'll go into questions. There have actually been some quite interesting Twitter responses that have come back to the
Speaker Change: specifically with respect to you know our LDO customer which we expect to follow the same pattern. The downside is that setup takes a couple of extra weeks leading in but the upside is we expect patient conversion to move fairly quickly.
Speaker Change: We expect to see a similar type ramp to what we saw with our initial rollout with US Renal.
Speaker Change: So overall, we view that as a positive. Now, your question on reimbursement, I just want to make sure I understand. You were asking about what we're actually seeing in claims? Is that the question? Exactly. Yeah, okay. Are you seeing that roughly similar balance between fee for service and the met advantage?
Speaker Change: Yeah, well claims data lags, so what we've seen with our initial customer rollout I think is patients or the facilities rather utilizing in fee-for- service patients first, right, and then
Speaker Change: expanding use into other payers. So we are seeing claims that are being filed with Medicare Advantage, with Commercial, with Medicaid. So we are seeing, I'd say, a broad dispersion of claims. I'd say, overall, though,
Speaker Change: in terms of if you just look at the aggregate number of patients that are getting to FENCAP, I believe it's starting in the fee-for-service patients first and then expanding outward.
Speaker Change: And your third question, Jason, I apologize. How should we think about expenses? Yeah, look, for the fourth quarter, I think we've guided to the year that's 15 to 18 by quarter. We've been on the low end of that range. We're below the range for this quarter. I think we'll be somewhere in the 15 to 17 range for the fourth quarter is what I would expect.
Jason Butler: Thanks for taking the question. I just want to verify that with Matt.
Jason Butler: We've said to people we're going to begin to see things start to uptick related to R&D, but it's really the 2025-2026 thing going forward.
Speaker Change: Yeah, that's a cute one.
Speaker Change: The next question comes from Gregory Renza with RBC Capital. Please go ahead.
Gregory Renza: Thanks, good morning Joe and team. Congratulations on the progress and thanks for
Gregory Renza: for taking my questions. Great to see the setup for the long term, Joe. And of course, as there's always interest in the fourth quarter and nearer term.
Gregory Renza: We certainly appreciate all the uncertainties and the drivers, but just on the pushes and pulls, could you just remind us of just a few items when it comes to the stocking of defend cath lab facilities, the holding time and the order frequency, just how to think about that and maybe on another topic related, just when we think about the fourth quarter, how would we anticipate maybe some of the climate, the hurricanes are given you're certainly southeast based focus for sure with facilities, just any drivers on sort of the macro as it affects getting defend cath to facilities and to patients.
Gregory Renza: Thanks.
Speaker Change: Thanks, Greg. Those are good questions. So, you know, for the initial customer that we have rolled out, we've been shipping direct to clinic. And to that extent, we're not seeing a lot of stocking. I think...
Speaker Change: The estimates we're getting, maybe they're holding about 10 days on hand. As we onboard our LDO customer, we do think there'll be some stocking that they may hold 15 days to 30 days of inventory on hand, so it'll be a little bit.
Speaker Change: more of a, called a, maybe a traditional turnover of inventory.
Speaker Change: Thank you.
Speaker Change: For the fourth quarter, we did see a little bit of impact. Our initial customers and one of the new MDO customers that are deployed through the southeast have a lot of clinics down there. So we saw a little bit of disruption over the first week of the month, but largely back, the trend we're seeing is largely back to what we had.
Speaker Change: when we exited Q3. So we're focused now on onboarding new customers and trying to build that ramp as well.
Speaker Change: future demands.
Speaker Change: Thanks again.
Speaker Change: and congrats.
Speaker Change: Well, first, I'd say that we have more than sufficient finished dose inventory on hand today to take us through a decent part of next year.
Speaker Change: We've also stockpiled a large amount of both of our key active ingredients and we're
Speaker Change: and tend to purchase more in 2025 to shore that up. We have two finished dosage manufacturers as well. We have Rovi in Spain and we have SIGFREDE in Germany.
Speaker Change: The next question comes from Brandon Fulks with Broadman Renshaw. Please go ahead.
Speaker Change: Brandon, your line may be muted.
Speaker Change: Hello, can you hear me?
Speaker Change: Can you hear me? I can, Brandon. Yeah, okay. Let me start again. Apologies about that. Well, congrats on the quarter first and foremost, and thanks for taking my question.
Speaker Change: Thank you for your attention.
Speaker Change: Just two questions from me. Firstly, just in terms of patient types at the different providers.
Speaker Change: Have the mid-sized operators identified the patient types that were initially used in Defend-Cath? With how much consistency are you seeing across the providers in terms of where they're expecting to use Defend-Cath?
Speaker Change: And perhaps the other side of that, if you are seeing any variability, does that provide an opportunity to perhaps sort of cross-sole educate providers on where other providers are using DefendCast?
Speaker Change: Go to Beadaholique.com for all of your beading supply needs!
Speaker Change: Thanks, Brandon. So, look, I think, you know, we've talked about this over the last couple of quarters that some customers are triaging their patients based on the benefits verification.
Speaker Change: And I think that that's, you know, certainly how they're doing it in their respective institutions. So I don't know that there's consistency across all customers uniformly. But I think your question about opportunity is that, yes, it is absolutely.
Speaker Change: an opportunity for growth, right, beyond whichever initial kind of triage criteria the customers have used. And we're certainly already in discussions with some of our customers that have identified patients that are high risk as to what is the next cohort and how much more broadly.
Speaker Change: can we implement beyond high risk?
Speaker Change: Great, thanks. And then secondly from me, gross margin in the quarter looked extremely strong. How should we think about gross margin going forward given this was your first full quarter of Defend Cap?
Speaker Change: in the market and then
Speaker Change: especially as you bring on these sort of larger contracts.
Speaker Change: Just, you know, even if
Speaker Change: It's just a.
Speaker Change: http://www.youtube.com.au
Speaker Change: look I think gross margins are going to remain high. I mean the initial gross margins you're seeing a lot of that inventory was expenses R&D. These batches were manufactured prior to some of them prior to getting approval.
Speaker Change: But that said, the cost of goods sold currently relative to the net selling price, it's a healthy gross margin that we'd expect through 2025.
Speaker Change: Great, thanks for taking my questions and congrats on all the progress.
Speaker Change: Thank you.
Speaker Change: The next question comes from Les Sulewski with Truist Securities. Please go ahead.
Speaker Change: And then second, out of the 60% access to dialysis centers that you've provided,
Les Sulewski: Do you have a sense of what percentage of that is utilized with the TED-CAF and then how do you capture the rest of those patients within that pool?
Les Sulewski: And then the second part to that question is, what is the strategy to capture the other 40% operators to get them on board? And how concentrated is that share? And I have a follow-up. Thank you.
Speaker Change: Okay, thanks. So, I mean, in terms of third quarter metrics, I think we've put out currently what we're comfortable putting out. You know, we can certainly revisit that as we move forward, whether we want to put out any patient numbers or potentially unit information. But right now, I think we're just comfortable putting out our...
Speaker Change: and our sound data.
Speaker Change: So, in terms of the 60% access, that is measured based on the total number of clinics where Defend Death could potentially be available relative to the total number of clinics.
Speaker Change: in the U.S. First, you know, defend Cathy.
Speaker Change: is indicated for patients with CBCs, which are about 20% of dialysis patients overall. And what we're seeing varies by customers. Some customers.
Speaker Change: as they said, that are already implementing more broadly. It's probably a much higher percentage of their overall catheterized population.
Speaker Change: The initial LDO customer, which we've talked about in the past, looking to roll out with 4,000 patients, would be about 10% of the catheterized population. And then certainly we're working with them to grow beyond just that initial cohort. So that's.
Speaker Change: So there is a decent amount of, I think, upside opportunity potential as we move into 2025 across all customers.
Speaker Change: Now, you asked about the remaining 40%. Obviously, most of that is concentrating with one other LDO.
Speaker Change: We've been engaged with them over the past year and a half.
Speaker Change: took a wait-and-see approach at the launch. We are in the process of reengaging with them now, generating some additional data that we think that they'll find compelling and hopefully...
Speaker Change: We can make some progress with them in the fourth quarter or early next year. If not, I think we're very comfortable. We've got a really good trajectory with four of the top five dialysis providers in the U.S.
Speaker Change: Got it. Very helpful. Second portion to this, I guess, is when can we expect some sort of a meaningful contribution from the inpatient side? And I believe you had an ND license agreement. That has been triggered, I believe, based on your 10-Q. What is the amount and when that will be paid out?
Speaker Change: All right, thanks. So I'll start with the with the inpatient and I'll kick the ND partners over to Matt.
Speaker Change: Look, so inpatient, if you look at the size of the opportunity right now, outpatient is about 90% of our volume opportunity.
Speaker Change: and certainly it's got a much steeper ramp in terms of the ability to convert patients more quickly. So that's certainly what's going to, driving and what's going to drive.
Speaker Change: on material revenue, certainly in the short term.
Speaker Change: When we think about inpatient contribution, we look at it much more as a long-term potential revenue contributor.
Speaker Change: We see a lot of value in that segment, as we've talked about over the last two years. We see potentially better price durability there, but it's going to take a longer time to build share and penetration there. It's just the nature of the inpatient.
Speaker Change: inpatient market. So I have a long-term view there. I think we're very happy with the trajectory we've seen for sales on the outpatient side and then we're going to continue to plug away on the inpatient side, you know, building relationships and making progress.
Speaker Change: Matt, do you want to comment on any partners?
Matt David: Yes, sure. No problem, Les. I'll just mention real briefly, earlier this year the company determined that it was probable that the net sales milestones
Matt David: Related to this would be achieved and so as a result we recorded a license intangible asset which is included in accrued expenses in the consolidated balance sheet.
Matt David: The milestones were met during the three month period and it's September 30th, 2024. So this is something that you should probably see, we would expect over the coming year to be paid.
Speaker Change: Got it. Thank you guys.
Speaker Change: The next question comes from Serge Belanger with Needham & Co. Company. Please go ahead.
Speaker Change: Hi, good morning and congrats on the quarter.
Speaker Change: A couple questions around your anchor
Speaker Change: I guess the first one, just what percentage of 3Q sales did they represent?
Speaker Change: They've had a successful death-in-capitalization process. Just curious if this customer operates differently and whether you could replicate this partnership with some of the other partners that you've enlisted over this third quarter.
Speaker Change: And I think in terms of trying to replicate how well a job they've done with implementation, yes, that's certainly something that we're
Speaker Change: trying to duplicate with other customers, particularly our LVO customers. So we're hopeful for that, and we're just gonna keep executing over the next couple of months.
Speaker Change: Maybe one follow-up.
Speaker Change: To DAPA, it's currently reimbursed at the WAC price. I think it's going to transition to ASP sometime in the early part of 2025. Just curious what that transition will look like and whether it could impact ordering patterns.
Speaker Change: Thank you for watching. If you liked this video, please subscribe. See you in the next video.
Speaker Change: I don't think it's expected to impact ordering patterns, Serge, this is something that's anticipated and we've structured our agreements around the transition from WAC to ASP and we don't expect ASP to erode that drastically initially, right, so yeah this is this is somewhat of a known commodity I think government will publish ASP.
Speaker Change: at some point in late November or early December, I understand, for Q1. And I don't think it's going to be something that's problematic.
Speaker Change: Thanks for taking my questions.
Speaker Change: This concludes the audio portion of the Q&A session. I will now turn it over to Dan Ferry for written questions from the audience.
Dan Ferry: Thank you, operator. So, Joe, we have some written questions from the audience. The first one is, why isn't the company providing guidance? Do you have a sense when it may be possible to provide guidance for investors and analysts alike?
Joe Tstisco: Okay, thanks Dan. So look, I think I kind of touched on it in the script a little bit. You know, we've got so much variability around the timing of onboarding our LDO customer.
Joe Tstisco: Think about a customer of that scale, and if they, you know, begin purchasing, you know, December 1st versus December 15th versus November 15th, there's a lot of variation there.
Joe Tstisco: and what it could do for fourth quarter numbers. So we didn't feel comfortable putting out a range at this point in time.
Joe Tstisco: Now, once we have orders and see repetition, what we're comfortable putting out there. But right now, I think we're comfortable guiding that we do expect to be ubidel positive, which is, I think, an incredible accomplishment in the first six to nine months of a product launch.
Speaker Change: Thank you.
Speaker Change: Excellent.
Speaker Change: Could you expand a bit on TPN? What has the FDA feedback been to date and what drove the company to make protocol amendments?
Speaker Change: Yeah, I'm going to turn that over to Liz in a moment, but...
Speaker Change: You know, we're excited about the TPN opportunity. You know, we put our protocol into FDA. They provided some comments, I think, essentially around the statistics and statistical calculations, but nothing really that's going to change, you know, our timelines or cost of the study. So Liz, you want to go ahead?
Liz Hurlbert: Sure. Thanks, Joe. So, exactly. We received pretty minor feedback, wholly statistical in nature, on the TPN protocol, and we've absorbed that and integrated it into a new protocol amendment that is forthcoming.
Speaker Change: There's always really a fine line in protocol development, the need to address the critical unmet need of the patient population with a study that's designed to provide rigor and high clinical value, and one that can be translated post-approval and integrated into clinical practice in a meaningful way.
Speaker Change: So I think I'm confident now we have a deeply experienced clinical regulatory and biostats team in place to meet those needs, and we'll be resubmitting that protocol amendment in the next couple of weeks.
Speaker Change: Thank you. Bye-bye.
Speaker Change: Okay, great.
Speaker Change: Thanks both. Another one here Joe, can you share any feedback from the nephrology community regarding product use and practice since launch?
Speaker Change: And has there been anything in there that surprised you?
Speaker Change: Thank you. Bye bye.
Joe Tstisco: I don't know if there's anything that I've found surprising. Obviously, I think some of the good things about utilizing DefendCath, there's no change to the workflow. I think the clinical results are really easy to understand, but I think overall the feedback that we get is positive and continues to be overall positive.
Joe Tstisco: But Aaron and Liz are in the field on a day-to-day basis, so I'll let them know if they want to add some comments.
Speaker Change: Yeah, I can add from there.
Speaker Change: I think from an implementation standpoint, we've seen very positive feedback from nurses and physicians.
Speaker Change: and also patient advocates.
Speaker Change: On the inpatient side, the coordination and complexity involved are obviously complex.
Speaker Change: Liz, do you have anything else you want to add to that?
Liz Hurlbert: No, I think you really covered it. I mean, I think we're just continually surprised to learn that despite all of these infection prevention efforts that are out there, from a number of groups and a number of initiatives, that CRVSIs are continuing to happen, and there's still a great need to educate and raise awareness around them and prevention around them. So I think we've got a plan for that. The team is actively addressing it. And I think we have really solid stewards in our clinician community and nursing communities that have adopted Defend-CAS and are really working with us to further that awareness within institutions too.
Speaker Change: Thanks, Liz. Excellent. Yeah. Thanks, Liz. Thanks, Aaron. Joe, one final one here.
Speaker Change: Can you give some thoughts on how Cormetics is thinking about financing going forward?
Joe Tstisco: Okay yeah and I think you know we didn't touch on in the script we've talked about it in past earnings calls you know over the last quarter you know with the with the higher volume and the appreciation in the stock it made sense to use the APM a little bit and we did that and we may continue to do that in a limited basis.
Joe Tstisco: You know we may want to consider something in the future. We are getting a lot of inbound interest from large institutional investors Right long only investors the type of people that we may want in the stock that can't currently find liquidity on the market
Joe Tstisco: And we also may want to start looking at building up a little bit of dry powder for business development. But we don't have anything, I'd say, imminently planned, but those would be the reasons why we might want to consider something down the road.
Speaker Change: Okay, great. Thanks Joe. Operator, you may now close the call.