What changed in this filing

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Item 1. Business

2021-03-30 compared with 2020-03-16 · 526 added, 551 removed, 457 unchanged (70% of the section changed)

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of infectious and inflammatory diseases.

primary focus is on the development of our lead product candidate, Neutrolin®, for potential commercialization in the United

States, or U.S., and other key markets.

We have in-licensed the worldwide rights to develop and commercialize Neutrolin.

is a novel anti-infective solution (a formulation of taurolidine 1.35%, citrate 3.5%, and heparin 1000 u/ml) intended for the

reduction and prevention of catheter-related infections and thrombosis in patients requiring central venous catheters in clinical

settings such as hemodialysis, critical/intensive care, and oncology.

Infection and thrombosis represent key complications among hemodialysis,

critical care/intensive care and cancer patients with central venous catheters.

These complications can lead to treatment delays

and increased costs to the healthcare system when they occur due to hospitalizations, need for intravenous, or IV, antibiotic

treatment, long-term anticoagulation therapy, removal/replacement of the central venous catheter, related treatment costs and

increased mortality.

We believe Neutrolin addresses a significant unmet medical need and a potential large market opportunity.

primary focus is on the development of our lead product candidate, DefenCath ™ , for potential commercialization

in the United States, or U.S., and other key markets.

We have in-licensed the worldwide rights to develop and commercialize DefenCath

and Neutrolin ®

The name DefenCath is the U.S.

proprietary name conditionally approved by the U.S.

Food and Drug

Administration (“FDA”).

The name Neutrolin is currently used in the European Union (“EU”) and other territories

where the Company has received CE-Mark approval for the commercial distribution of Neutrolin as a catheter lock solution (“CLS”)

regulated as a medical device.

DefenCath is a novel

anti-infective solution (a formulation of taurolidine 1.35% and heparin 1000 USP U/ml) intended for the reduction of catheter-related

infections in patients requiring central venous catheters in clinical settings such as hemodialysis, total parenteral nutrition

and oncology.

Infections represent key complications among hemodialysis, total parenteral nutrition and cancer patients with central

venous catheters.

These complications can lead to treatment delays and increased costs to the healthcare system when they occur

due to hospitalizations, need for intravenous, or IV, antibiotic treatment, removal/replacement of the central venous catheter

(“CVC”), related treatment costs and increased mortality.

We believe DefenCath addresses a significant unmet medical

need and a potential large market opportunity.

– United States

late 2013, we met with the U.S.

Food and Drug Administration, or FDA, to determine the pathway for U.S.

marketing approval of

We launched the Phase 3 clinical trial in patients with hemodialysis catheters in the U.S.

late 2013, we met with the FDA, to determine the pathway for U.S.

marketing approval of DefenCath.

We launched the Phase 3 clinical

trial in patients with hemodialysis catheters in the U.S.

in December 2015.

clinical trial, named Phase 3 Prospective, Multicenter, Double-blind, Randomized, Active Control Study to Demonstrate Safety

and Effectiveness of Neutrolin in Preventing Catheter-related Bloodstream Infection in Subjects on Hemodialysis for End Stage

Renal Disease, or LOCK-IT-100, was a prospective, multicenter, randomized, double-blind, active control trial which aimed to

demonstrate the efficacy and safety of Neutrolin in preventing catheter-related bloodstream infections, or CRBSI, in subjects

receiving hemodialysis therapy as treatment for end stage renal disease.

The primary endpoint for the trial was time to

The trial evaluated Neutrolin relative to the active control heparin by documenting the incidence of CRBSI

and the time until the occurrence of CRBSI for each study subject.

Secondary endpoints were catheter patency, which was

defined as required use of tissue plasminogen activating factor, or tPA, or removal of catheter due to dysfunction, and

removal of catheter for any reason.

The clinical trial, named Phase 3 Prospective, Multicenter,

Double-blind, Randomized, Active Control Study to Demonstrate Safety and Effectiveness of DefenCath in Preventing Catheter-related

Bloodstream Infection in Subjects on Hemodialysis for End Stage Renal Disease, or LOCK-IT-100, was a prospective, multicenter,

randomized, double-blind, active control trial which aimed to demonstrate the efficacy and safety of DefenCath in preventing catheter-related

bloodstream infections, or CRBSI, in subjects receiving hemodialysis therapy as treatment for end stage renal disease.

endpoint for the trial was time to CRBSI.

The trial evaluated DefenCath relative to the active control heparin by documenting

the incidence of CRBSI and the time until the occurrence of CRBSI for each study subject.

Secondary endpoints were catheter patency,

which was defined as required use of tissue plasminogen activating factor, or tPA, or removal of catheter due to dysfunction,

and removal of catheter for any reason.

the course of the study, in consultation with the FDA, we established the Clinical Adjudication Committee, or CAC, to critically

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discussions with the FDA, we proceeded with an orderly termination of LOCK-IT-100.

In late January

2019, we announced the topline results of the full data set of the LOCK-IT-100 study.

The study continued enrolling and

treating subjects until study termination, and the final efficacy analysis was based on a total of 795 subjects.

primary endpoint of the Phase 3 LOCK-IT-100 study was the reduction of the risk of occurrence of CRBSI by Neutrolin relative

to the active control of heparin.

In the analysis of the full data set, a total of 41 CRBSI events were determined by the

There was a 71% reduction in the risk of occurrence of CRBSIs compared with the active control of heparin, which was well

in excess of the study’s assumed treatment effect size of a 55% reduction.

In the Neutrolin arm, the CRBSI event rate was

0.13 per 1000 catheter days, which is significantly lower than the event rate of 0.46 per 1000 catheter days in the control arm.

The statistical significance of the primary endpoint in the full data set (p=0.0006) was even more impressive than that of the

interim analysis (p=0.0034).

There were no statistically significant

differences between the results in the Neutrolin arm compared with the control arm in the final analysis for the

secondary endpoints.

The event rate for one of the secondary endpoints, catheter removal for any reason, was 3.48 per 1000

catheter-days (236 out of 397 subjects) in the Neutrolin arm and 3.23 per 1000 catheter-days (225 out of 398 subjects) in the

In late January 2019, we announced the topline

results of the full data set of the LOCK-IT-100 study.

The study continued enrolling and treating subjects until study termination,

and the final efficacy analysis was based on a total of 795 subjects.

primary endpoint of the Phase 3 LOCK-IT-100 study was the reduction of the risk of occurrence of CRBSI by DefenCath relative to

the active control of heparin.

In the analysis of the full data set, a total of 41 CRBSI events were determined by the CAC.

was a 71% reduction in the risk of occurrence of CRBSIs compared with the active control of heparin, which was well in excess

of the study’s assumed treatment effect size of a 55% reduction.

In the DefenCath arm, the CRBSI event rate was 0.13 per

1000 catheter days, which is significantly lower than the event rate of 0.46 per 1000 catheter days in the control arm.

The statistical

significance of the primary endpoint in the full data set (p=0.0006) was even more impressive than that of the interim analysis

were no statistically significant differences between the results in the DefenCath arm compared with the control arm in the final

analysis for the secondary endpoints.

The event rate for one of the secondary endpoints, catheter removal for any reason, was

3.48 per 1000 catheter-days (236 out of 397 subjects) in the DefenCath arm and 3.23 per 1000 catheter-days (225 out of 398 subjects)

in the control arm (p=0.416).

The loss of catheter patency, which was defined either as catheter removal due to loss of catheter

patency or the administration of tPA, was also a secondary endpoint.

The event rate for loss of catheter patency was 0.99 per

1000 catheter-days (63 out of 397 subjects) in the DefenCath arm and 0.74 per 1000 catheter-days (48 out of 398 subjects) in the

control arm (p=0.12).

The loss of catheter patency, which was defined either as catheter removal due to loss of catheter patency

or the administration of tissue plasminogen activating factor (tPA), was also a secondary

The event rate for loss of catheter patency was 0.99 per 1000 catheter-days (63 out of 397 subjects) in the Neutrolin

arm and 0.74 per 1000 catheter-days (48 out of 398 subjects) in the control arm (p=0.12).

In the top-line safety analysis, the

observed rate of treatment-emergent adverse events was lower in the Neutrolin arm.

The rate of adverse events per patient was

5.1 in the Neutrolin arm and 5.8 in the control arm.

In the top-line safety analysis, the observed rate of treatment-emergent adverse events was lower in the

DefenCath arm.

The rate of adverse events per patient was 5.1 in the DefenCath arm and 5.8 in the control arm.

the FDA usually requires two pivotal clinical trials to provide substantial evidence of safety and effectiveness for approval

of an NDA, the FDA will in some cases accept one adequate and well-controlled trial, where it is a large multicenter trial with

a broad range of subjects and investigation sites with procedures to include trial quality that has demonstrated a clinically

meaningful and statistically very persuasive effect on prevention of a disease with potentially serious outcome.

have had discussions with the FDA and plan to proceed with submission of the NDA for Neutrolin based on the results of LOCK-IT-100.

Whether data from LOCK-IT-100 are sufficient will be a review issue with the FDA.

January 2015, the FDA designated Neutrolin as a Qualified Infectious Disease Product, or QIDP, for prevention of catheter-related

of a New Drug Application, or NDA, the FDA will in some cases accept one adequate and well-controlled trial, where it is a large

multicenter trial with a broad range of subjects and investigation sites with procedures to include trial quality that has demonstrated

a clinically meaningful and statistically very persuasive effect on prevention of a disease with potentially serious outcome.

In March 2020, we

began the modular submission process for the NDA for DefenCath for the prevention of CRBSI in hemodialysis patients, and in

August 2020, the FDA accepted for filing the DefenCath NDA.

The FDA also granted our request for priority review, which

provides for a six-month review period instead of the standard ten-month review period.

As we announced in March 2021, the

FDA informed us that it will not approve the NDA for DefenCath in its present form.

The FDA noted concerns at the third-party

manufacturing facility after a review of records requested by the FDA and provided by the manufacturing facility.

working with the manufacturing facility to develop plans for resolution of the deficiencies.

Additionally, the FDA is

requiring a manual extraction study to demonstrate that the labeled volume can be consistently withdrawn from the vials

despite an existing in-process control to demonstrate fill volume within specifications.

We expect to be able to complete

this requirement expeditiously.

Satisfactory resolution of these issues is required for approval of the DefenCath NDA by a

pre-approval inspection and/or adequate manufacturing facility responses addressing these concerns.

If an inspection is

required, we may encounter delays in obtaining FDA approval because the FDA is currently facing a backlog due to the pandemic

and is actively working to define an approach for scheduling outstanding inspections once safe travel may resume.

request a meeting with the FDA, which we estimate will occur in mid-April, to obtain agreement with the FDA on the proposed

resolutions of the deficiencies.

FDA did not request additional clinical data and did not identify any deficiencies related to the data submitted on the efficacy

or safety of DefenCath from LOCK-IT-100.

In draft labeling discussed with the FDA, the FDA added that the initial approval will

be for the limited population of patients with kidney failure receiving chronic hemodialysis through a central venous catheter.

This is consistent with our request for approval pursuant to the Limited Population Pathway for Antibacterial and Antifungal Drugs,

LPAD, passed as part of the 21 st Century Cures Act, is a new program intended to expedite the development

and approval of certain antibacterial and antifungal drugs to treat serious or life-threatening infections in limited populations

of patients with unmet needs.

LPAD provides for a streamlined clinical development program involving smaller, shorter, or fewer

clinical trials and is intended to encourage the development of safe and effective products that address unmet medical needs of

patients with serious bacterial and fungal infections.

We believe that LPAD will provide additional flexibility for the FDA to

approve DefenCath to reduce CRBSIs in the limited population of patients with kidney failure receiving hemodialysis through a

central venous catheter.

January 2015, the FDA granted Fast Track designation to DefenCath, a designation intended to facilitate development and expedite

review of drugs that treat serious and life-threatening conditions so that the approved drug can reach the market expeditiously.

Also in January 2015, the FDA designated DefenCath as a Qualified Infectious Disease Product, or QIDP, for prevention of catheter-related

blood stream infections in patients with end stage renal disease receiving hemodialysis through a central venous catheter.

Catheter-related

blood stream infections and clotting can be life-threatening.

The QIDP designation provides five years of market exclusivity in

addition to the five years granted for a New Chemical Entity upon approval of a New Drug Application, or NDA.

In addition, in

January 2015, the FDA granted Fast Track designation to Neutrolin Catheter Lock Solution, a designation intended to facilitate

development and expedite review of drugs that treat serious and life-threatening conditions so that the approved drug can reach

the market expeditiously.

The Fast Track designation of Neutrolin provides us with the opportunity to meet with the FDA on a more

frequent basis during the development process, and also ensures eligibility to request priority review of the marketing application.

The FDA has agreed

that the Neutrolin NDA is eligible for both priority review and for submission under rolling review.

In January 2020, the FDA

granted our request for rolling review.

A determination on priority review will not be made until the submitted NDA is reviewed

by the FDA to determine the acceptance for filing.

The FDA informs the applicant of a Priority Review designation within sixty

days of the receipt of the complete original application, if it determines the criteria have been met.

Priority Review designation

would mean the FDA’s goal is to take action on an application within six months, compared to a standard review period of

FDA also agreed that we could request consideration of Neutrolin for approval under the Limited Population Pathway for Antibacterial

and Antifungal Drugs, or LPAD.

LPAD, passed as part of the 21 st Century Cures Act, is a new program intended to expedite

the development and approval of certain antibacterial and antifungal drugs to treat serious or life-threatening infections in

limited populations of patients with unmet needs.

Given that the LPAD pathway provides for a streamlined clinical development

program for a limited population that may involve smaller, shorter, or fewer clinical trials, we believe that LPAD will provide

additional flexibility for the FDA to approve Neutrolin to prevent CRBSIs in the limited population of patients with end-stage

renal disease receiving hemodialysis through a central venous catheter.

blood stream infections can be life-threatening.

The QIDP designation provides five years of marketing exclusivity in addition

to the five years granted for a New Chemical Entity upon approval of the NDA.

We received a deferral from FDA for the requirement

of submitting data in the NDA for use of DefenCath in pediatric hemodialysis patients as a catheter lock solution.

When the pediatric

study is completed as a post-approval commitment, DefenCath will be eligible for an additional six months of marketing exclusivity.

– International

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In July 2013, we received CE Mark approval for

In December 2013, we started commercial sales of Neutrolin in Germany for the prevention of CRBSI, and

maintenance of catheter patency in hemodialysis patients using a tunneled, cuffed central venous catheter for vascular

To date, Neutrolin is registered and may be sold in certain European Union and Middle Eastern countries

for such treatment.

In December 2013, we commercially launched Neutrolin in Germany for the prevention of CRBSI, and maintenance of catheter

patency in hemodialysis patients using a tunneled, cuffed central venous catheter for vascular access.

To date, Neutrolin is registered

and may be sold in certain European Union and Middle Eastern countries for such treatment.

September 2014, the TUV-SUD and The Medicines Evaluation Board of the Netherlands, or MEB, granted a label expansion for Neutrolin

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Development Possibilities

addition to Neutrolin, we are sponsoring a pre-clinical research collaboration for the use of taurolidine as a possible treatment

for rare orphan pediatric tumors.

In February 2018, the FDA granted orphan drug designation to taurolidine for the treatment of

neuroblastoma in children.

We may seek one or more strategic partners or other sources of capital to help us develop and commercialize

taurolidine for the treatment of neuroblastoma in children.

We are also evaluating opportunities for the possible expansion of

taurolidine as a platform compound for use in certain medical devices.

Patent applications have been filed in several indications,

including wound closure, surgical meshes, and wound management.

Based on initial feasibility work, we are advancing pre-clinical

studies for taurolidine-infused surgical meshes, suture materials and hydrogels.

We will seek to establish development/commercial

partnerships as these programs advance.

FDA regards taurolidine as a new chemical entity and therefore it is currently an unapproved new drug.

We might in the future

pursue product candidates that would involve devices impregnated with taurolidine, and we believe that at the current time

such products would be combination products subject to device premarket submission requirements (while subject also, under

review by FDA, to the standards for drug approvability).

Consequently, given that there is no appropriate predicate medical

device currently marketed in the U.S.

on which a 510(k) approval process could be based and that taurolidine is not yet

approved in any application, we anticipate that we would be required to submit a premarket approval application, or PMA, for

marketing authorization for any medical device indications that we may pursue for devices containing taurolidine.

event that an NDA for Neutrolin ®

is approved by the FDA, the regulatory pathway for these medical device product

candidates may be revisited with the FDA.

Although there may be no appropriate predicate, de novo Class II designation can be

proposed, based on a risk assessment and a reasonable assurance of safety and effectiveness.

venous catheters and peripherally inserted central catheters (“Central Catheters”) are an important and frequently

used method for accessing the vasculature in hemodialysis (a form of dialysis where the patient’s blood is circulated through

a dialysis filter), administering chemotherapy and basic fluids (total parenteral nutrition) in cancer patients and for cancer

chemotherapy, long term antibiotic therapy, total parenteral nutrition (complete or partial dietary support via intravenous nutrients)

and critical care/intensive care patients.

addition to developing the use of taurolidine as a catheter lock solution, we are sponsoring a pre-clinical research collaboration

for the use of taurolidine as a possible treatment for rare pediatric tumors.

In February 2018, the FDA granted orphan drug designation

to taurolidine for the treatment of neuroblastoma in children.

We may seek one or more strategic partners or other sources of

capital to help us develop and commercialize taurolidine for the treatment of neuroblastoma in children.

We are also evaluating

opportunities for the possible expansion of taurolidine as a platform compound for use in certain medical devices.

Patent applications

have been filed in several indications, including wound closure, surgical meshes, and wound management.

Based on initial feasibility

work, we are advancing pre-clinical studies for taurolidine-infused surgical meshes, suture materials and hydrogels.

to establish development/commercial partnerships as these programs advance.

FDA regards taurolidine as a new chemical entity and therefore it is currently regulated as an unapproved new drug.

the future pursue product candidates that would involve devices impregnated with taurolidine, and we believe that at the current

time such products would be combination products subject to both device premarket submission requirements and drug regulations.

Consequently, given that there is no appropriate predicate medical device currently marketed in the U.S.

on which a 510(k) clearance

process could be based and that taurolidine is not yet approved in any application, we anticipate that we would be required to

submit a premarket approval application, or PMA, for marketing authorization for any medical device indications that we may pursue

for devices containing taurolidine.

In the event that an NDA for DefenCath is approved by the FDA, the regulatory pathway for

these medical device product candidates may be revisited with the FDA.

Although there may be no appropriate predicate, de novo

Class II designation can be proposed, based on a risk assessment and a reasonable assurance of safety and effectiveness.

Central venous catheters

and peripherally inserted central catheters (“Central Catheters”) are an important and frequently used method for accessing

the vasculature in hemodialysis (a form of dialysis where the patient’s blood is circulated through a dialysis filter), administering

chemotherapy and basic fluids in cancer patients and for cancer chemotherapy, long term antibiotic therapy, total parenteral nutrition

(complete or partial dietary support via intravenous nutrients).

to the 2015 United States Renal Disease System, there were 660,000 patients on hemodialysis in the U.S.

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days per year.

In the United States, 5.7 million intensive care patients are admitted annually according to the Society of Critical

Care Medicine, which is estimated to represent 28.5 million catheter days associated with Central Catheter use in the ICU alone.

As of 2014, there were over 14.5 million patients in the United States living with cancer, with an estimated 7.7 million having

had long-term Central Catheters.

When stages of disease and types of chemotherapy regime are considered, the number of catheter

days per year in cancer patients reaches 90 million.

of the major and common complications for all patients requiring central venous catheters is CRBSI and the clinical complications

associated with them.

There are an estimated 250,000 CRBSI each year.

Centers for Disease Control and Prevention

stated in the Journal of American Medicine that the total annual cost in the United States of treating all CRBSI episodes and

their complications amounts to approximately $6.0 billion.

Biofilm build up is the

pathogenesis of both infections and thrombotic complications in central venous catheters.

Prevention of CRBSI and inflammatory

complications requires both removal of pathogens from the internal surface of the catheter to prevent the systemic dissemination

of organisms contained within the biofilm as well as an anticoagulant to retain blood flow during dialysis.

Biofilm forms when

bacteria adhere to surfaces in aqueous environments and begin to excrete a slimy, glue-like substance that can anchor them to

various types of materials, including intravenous catheters.

The presence of biofilm has many adverse effects, including the ability

to release bacteria into the blood stream.

The current standard of catheter care is to instill a heparin lock solution at a concentration

of 1000 u/mL into each catheter lumen immediately following treatment, in order to prevent clotting between dialysis treatments.

In 2019, the estimated number of patients with cancer is approximately 6 million, and between 25-60% require Central

Catheters, and represents about 136 million catheter days per year, based on market research by a third-party commissioned by

of the major and common complications for all patients requiring CVCs is CRBSI and the clinical complications associated with

The total annual cost for treating CRBSI episodes and their related complications in the U.S.

is up to $2.7 billion, with

approximately 250,000 CRBSI episodes per year (Becker’s Hospital Review).

build up is the pathogenesis of both infections and thrombotic complications in central venous catheters.

Prevention of CRBSI

and inflammatory complications requires both removal of pathogens from the internal surface of the catheter to prevent the systemic

dissemination of organisms contained within the biofilm as well as an anticoagulant to retain blood flow during dialysis.

forms when bacteria adhere to surfaces in aqueous environments and begin to excrete a slimy, glue-like substance that can anchor

them to various types of materials, including intravenous catheters.

The presence of biofilm has many adverse effects, including

the ability to release bacteria into the blood stream.

The current standard of catheter care is to instill a heparin lock solution

at a concentration of 1000 u/mL into each catheter lumen immediately following treatment, in order to prevent clotting between

dialysis treatments.

However, a heparin lock solution provides no protection from the risk of infection.

there are no pharmacologic agents approved in the U.S.

for the prevention of CRBSI in central venous catheters.

As noted above,

we received the CE Mark approval for Neutrolin from the MEB of the EU in July 2013.

We believe there is a significant need for

prevention of CRBSI in the hemodialysis patient population as well as for other patient populations utilizing central venous catheters

and peripherally inserted central catheters, such as oncology/chemotherapy, total parenteral nutrition and intensive care unit

Neutrolin is a broad-spectrum

antimicrobial/antifungal and anticoagulant combination that is active against common microbes including antibiotic-resistant strains

and in addition may prevent biofilm formation.

We believe that using Neutrolin as an anti-infective solution will significantly

Currently, there are

no pharmacologic agents approved in the U.S.

for the prevention of CRBSI in CVCs.

As noted above, we received the CE Mark approval

for Neutrolin from the MEB of the EU in July 2013.

We believe there is a significant need for prevention of CRBSI in the hemodialysis

patient population as well as for other patient populations utilizing central venous catheters and peripherally inserted central

catheters, such as oncology/chemotherapy, and total parenteral nutrition.

is a broad-spectrum antibacterial, antifungal and anticoagulant combination that is active against common microbes including antibiotic-resistant

strains and in addition may prevent biofilm formation.

We believe that using DefenCath as an anti-infective solution will significantly

reduce the incidence of life-threatening catheter-related blood stream infections, thus reducing the need for local and systemic

antibiotics while prolonging catheter life.

Initially, we expect to sell Neutrolin in the U.S.

to key operators of dialysis centers.

We anticipate that Medicare reimbursement could be available for Neutrolin in hemodialysis

and other catheter indications in intensive care, oncology and total parenteral nutrition through relevant hospital inpatient diagnosis-related

groups (DRGs) or outpatient ambulatory payment classifications (APCs), the End-Stage Renal Disease Prospective Payment System (ESRD

PPS) base payment, or under the Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS) Fee Schedule, depending

on the setting of care.

We also plan to seek separate reimbursement as a drug, where available under Medicare, through mechanisms

such as pass-through status under the Hospital Outpatient Prospective Payment System, the transitional drug add-on payment adjustment

(TDAPA) under the ESRD PPS, or reimbursement as a drug used with a DMEPOS infusion pump.

We have engaged U.S.

Centers for Medicare & Medicaid Services (CMS) in preliminary discussions concerning the reimbursement for Neutrolin under TDAPA;

however, qualifications

cannot be determined until after FDA approval.

antibiotics while prolonging catheter function.

Initially, we expect

to sell DefenCath in the U.S.

primarily to key operators of dialysis centers.

We anticipate that Medicare reimbursement could be

available for DefenCath in hemodialysis and other catheter indications such as oncology patients and total parenteral nutrition

patients through relevant hospital inpatient diagnosis-related groups, or DRGs, or outpatient ambulatory payment classifications,

or APCs, the End-Stage Renal Disease Prospective Payment System, or ESRD PPS, base payment, or under the Durable Medical Equipment,

Prosthetics, Orthotics, and Supplies, or DMEPOS, Fee Schedule, depending on the setting of care.

We also plan to seek separate

reimbursement as a drug, where available under Medicare, through mechanisms such as pass-through status under the Hospital Outpatient

Prospective Payment System, the transitional drug add-on payment adjustment, or TDAPA, under the ESRD PPS, or reimbursement as

a drug used with a DMEPOS infusion pump.

We have engaged the U.S.

Centers for Medicare & Medicaid Services, or CMS, in preliminary

discussions concerning the reimbursement for DefenCath under TDAPA, however, qualifications cannot be determined until after FDA

approval and CMS evaluates the request for coverage in a quarterly review.

If approved under TDAPA, reimbursement of DefenCath

would be calculated based on its average selling price.

To be eligible for TDAPA, a new renal drug or biologic must be:

Approved by FDA

Commercially available

Assigned a Healthcare Common Procedure Coding System code

Identified as having an end action effect that treats or manages a

condition or conditions associated with ESRD

Identified as not fitting into an established ESRD PPS functional

Designated by CMS as a renal dialysis service

We cannot fully anticipate changes in reimbursement requirements

and mechanisms in the coming years, and we cannot be certain that Neutrolin will be granted separate reimbursement under any of

these mechanisms.

Furthermore, we anticipate that the CMS, and private payers will increasingly demand that manufacturers demonstrate

the cost effectiveness of their product as part of the reimbursement review and approval process.

With this in mind, we are performing

health economic evaluations to support this review in the context of the prospective use of Neutrolin in dialysis, the ICU and

oncology settings.

Our studies may not be sufficient to support coverage or reimbursement at levels that allow providers

to use Neutrolin.

by FDA pursuant to Section 505(b)(1) of the Federal Food, Drug, and Cosmetic Act

● Commercially

a Healthcare Common Procedure Coding System code

as having an end action effect that treats or manages a condition or conditions associated

as not fitting into an established ESRD PPS functional category

by CMS as a renal dialysis service.

we cannot fully anticipate changes in reimbursement requirements and mechanisms in the coming years, we expect DefenCath would

be eligible for and would obtain TDAPA.

DefenCath meets the criterion of being a new renal dialysis product used to treat or manage

a condition associated with ESRD, since infections are the second leading cause of death in patients with ESRD and CVCs are a

significant risk factor for infection-associated mortality.

we anticipate that the CMS, and private payers will increasingly demand that manufacturers demonstrate the cost effectiveness

of their product as part of the reimbursement review and approval process.

With this in mind, we are performing health economic

evaluations to support this review in the context of the prospective use of DefenCath in dialysis, and other settings, such as

Our studies may not be sufficient to support coverage or reimbursement at levels that allow providers to use DefenCath.

drug and medical device industries are highly competitive and subject to rapid and significant technological change.

Neutrolin’s

current and future competitors include large as well as specialty pharmaceutical and biotechnology companies.

2 unchanged sentences

and commercialization of drugs and medical devices.

Further, the development of new treatment methods could render Neutrolin non-competitive

believe that the key competitive factors that will affect the development and commercial success of Neutrolin are efficacy and

safety, as well as pricing and reimbursement.

Given that there are no approved catheter lock solutions with anti-microbial properties

in the U.S., and that the current standard of care is heparin, we believe there is an opportunity for Neutrolin to become the

new standard of care in the U.S.

market, if approved.

the best of our knowledge, the following product candidates have been recognized for the prevention and treatment of catheter-related

blood stream infections in the U.S.

or elsewhere.

manufactured by Tauro-Implant (Winsen, Germany).

TauroLock has received a CE Mark and

is distributed in 25 countries.

It has anti- microbial and anti-coagulant activity and

contains a combination of citrate 4% with (cyclo)-taurolidine and heparin or urokinase.

TauroLock has four formulations:

TauroLock, Taurolock Heparin 100, TauroLock Heparin

500 and TauroLock Urokinase 25000 IU.

None of these formulations is approved for use

by Ash Access Technology (Lafayette, IN), has antimicrobial and anticoagulant activity

and contains methylene blue, parabens and 7% citrate.

Clinicaltrials.gov most recently

reported status as not yet recruiting subjects as of October 2014.

As of February 2020,

development status is listed as “unknown”

in clinicaltrials.gov.

by Great Lakes Pharmaceuticals Inc.

(Cleveland, OH).

It has anti-microbial, anti-coagulant

and anti-fungal activity and contains trimethoprim, EDTA and ethanol combinations.

initiated a study in 2012 in Poland and Hungary to support CE Mark in European Union.

Clinicaltrials.gov reported the study as terminated for failure to meet primary endpoint

in February 2017.

● DuraLock-C,

manufactured by Medical Components, Inc.

(Harleysville, PA).

DuraLock-C received

a CE Mark and is distributed in a number of European Union countries.

It has anti-microbial

and anti-thrombosis activity and contains trisodium citrate in 46.7%, 30% and 4% concentrations.

No clinical update has been provided for this product on Clinicaltrials.gov since March

This product has not been approved for use in the U.S.

manufactured by Fresenius Medical Care AG & Co.

(Bad Homburg, Germany).

received a CE Mark and is distributed in a number of European Union countries.

an anticoagulant solution to prevent thrombus formation in catheters.

IntraLock contains

citrate (4%) for anticoagulation and a small amount of polyhexanide for preservation.

This product has not been approved for use in the U.S.

manufactured by Geistlich Pharma (Wolhusen, Switzerland).

TauroSept received Class 3

CE Mark and is distributed in a number of European Union countries.

TauroSept contains

2% taurolidine solution, 5% polyvinylpyrrolidone and traces of HCl and NaOH to adjust

It contains no anticoagulant substances.

This product has not been approved for use

being developed by Citius Pharmaceutical (Cranford, NJ).

Mino-Lok is intended to salvage

the central venous catheter obviating the need to remove and replace the catheter.

contains a proprietary combination of minocycline, edetate (disodium EDTA), and ethyl

This product is in Phase 3 development in the U.S.

Needlefree Connector, manufactured by ICU Medical Inc.

(San Clemente, CA).

Tego Needlefree Connector received 510(k) clearance from the FDA.

The Tego connector

creates a mechanical and microbiology closed system when attached to the hub of the catheter

and works with all hemodialysis central venous catheter, or CVC, related applications.

● Curos ®

(Luer-lock caps twist on, stay on) disinfecting port protectors designed specifically

for Tego Needlefree Connectors, manufactured by Ivera Medical Corporation (San Diego,

Curos received 510(k) clearance from the FDA.

Curos for Tego Needlefree Connectors

contains 70% isopropyl alcohol-saturated, sponge-like foam that disinfects ports in three

minutes and keeps ports clean for seven days.

● ClearGuard ®

HD End Caps for Hemodialysis Catheters, manufactured by Pursuit Vascular, Inc.

(Maple Grove, MN).

ClearGuard HD End Caps received 510(k) clearance from the FDA.

ClearGuard HD End Cap consists of (1) a copolyester polymer plug, which has a rod extending

from the tier region that is coated with the antimicrobial agent chlorhexidine acetate

(CHA) and (2) a nylon lock ring with threads that are also coated with CHA.

DuraMax Dialysis Catheter with Endexo Technology, manufactured by AngioDynamics (Latham,

The product received 510(k) clearance by the FDA.

The BioFlo DuraMax chronic dialysis

catheter features Endexo Technology, a catheter material more resistant to thrombus accumulation.

Endexo technology is permanent, non-eluting polymer “blended”

into the polyurethane

from which the catheter is made.

device companies have launched antibiotic or antimicrobial-coated catheters as short-term prevention of catheter infection.

believe these are not effective for hemodialysis catheters due to the long-term use and high blood flow associated with hemodialysis.

Further, the development of new treatment methods could render DefenCath non-competitive

We believe that the

key competitive factors that will affect the development and commercial success of DefenCath are efficacy and safety, as well as

pricing and reimbursement.

Given that there are no approved catheter lock solutions with antimicrobial properties in the U.S.,

and that the current standard of care is heparin, we believe there is an opportunity for DefenCath to become the new standard of

care as a CLS in the U.S.

market, if approved by FDA.

We are not aware of any potentially competitive CLS which are approved or

under development by other companies in the U.S.

A development stage product from Citius is being studied for salvage of CVCs once

a patient becomes diagnosed with a catheter related blood stream infection.

In the EU, several

catheter lock solutions have received a CE Mark, in addition to Neutrolin.

For example, TauroLock contains a combination of citrate

4% with (cyclo)-taurolidine and heparin or urokinase, but it is not approved for use in the U.S.

Some device companies have launched

antibiotic or antimicrobial-coated catheters as short-term prevention of catheter infections.

We believe these are not effective

for hemodialysis catheters due to the long-term use and high blood flow associated with hemodialysis.

Manufacturing/Supply

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We intend to continue this practice in

regards to taurolidine, an active drug ingredient, or API, of Neutrolin, we have a Drug Master File filed with the FDA.

is a master commercial supply agreement between the third-party manufacturer, Alcami, and CorMedix in place from August 2018.

We have three sources for the other key API, Heparin sodium.

currently utilize two drug product contract manufacturer organizations, or CMO.

One is for the EU and Middle East markets and

the other for U.S.

regards to taurolidine, an active drug ingredient, or API, of DefenCath, we have a Drug Master File filed with the FDA.

is a master commercial supply agreement between the third-party manufacturer, Alcami, and us in place from August 2018.

two sources for the other key API, Heparin sodium.

We have utilized two

drug product contract manufacturing organizations, or CMOs.

One CMO manufactures for the EU and Middle East markets and the other

In order to assure supply, we are in the process of beginning to qualify a second CMO for U.S.

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All API and drug products are validated at commercial scale.

are confident that these CMO’s have adequate capacity to produce the volumes needed, and that there exists a sufficient

number of potential alternate sources for the drug substances required to produce our products, as well as third-party manufacturers,

that we will be able to find alternate suppliers and third-party manufacturers in the event that our relationship with any supplier

or third-party manufacturer deteriorates.

We are confident that

these CMO’s have adequate capacity to produce the volumes needed, and that there exists a sufficient number of potential

alternate sources for the drug substances required to produce our products, as well as third-party manufacturers, that we will

be able to find alternate suppliers and third-party manufacturers in the event that our relationship with any supplier or third-party

manufacturer deteriorates.

The process for selecting and qualifying an alternative contract manufacturer and for completing the

technology transfer to such a manufacturer to the point of enabling commercialization of the product would take several years.

States Government Regulation

research, development, testing, manufacture, labeling, promotion, advertising, distribution, and marketing, among other things,

of our products are extensively regulated by governmental authorities in the United States and other countries.

Our products may

be classified by the FDA as a drug or a medical device depending upon the indications for use or claims.

Because certain of our

product candidates are considered as medical devices and others are considered as drugs for regulatory purposes, we intend to

submit applications to regulatory agencies for approval or clearance of both medical devices and pharmaceutical product candidates.

In the United States,

the FDA regulates drugs and medical devices under the Federal Food, Drug, and Cosmetic Act (FDCA) and the agency’s implementing

If we fail to comply with the applicable United States requirements at any time during the product development process,

clinical testing, and during the approval process or after approval, we may become subject to administrative or judicial sanctions.

These sanctions could include the FDA’s refusal to approve pending applications, license suspension or revocation, withdrawal

of an approval, warning letters, adverse publicity, product recalls, product seizures, total or partial suspension of production

or distribution, injunctions, fines, civil penalties or criminal prosecution, among other actions.

Any agency enforcement action

and/or any related impact could have a material adverse effect on us.

of our products are extensively regulated by governmental authorities in the U.S.

and other countries.

Our products may be classified

by the FDA as a drug or a medical device depending upon the indications for use or claims.

Because certain of our product candidates

are considered as medical devices and others are considered as drugs for regulatory purposes, we intend to submit applications

to regulatory agencies for approval or clearance of both medical devices and pharmaceutical product candidates.

the U.S., the FDA regulates drugs and medical devices under the Federal Food, Drug, and Cosmetic Act (FDCA) and the Agency’s

implementing regulations.

If we fail to comply with the applicable U.S.

requirements at any time during the product development

process, clinical testing, and during the approval process or after approval, we may become subject to administrative or judicial

These sanctions could include the FDA’s refusal to approve pending applications, license suspension or revocation,

withdrawal of an approval, warning letters, adverse publicity, product recalls, product seizures, total or partial suspension

of production or distribution, injunctions, fines, civil penalties or criminal prosecution, among other actions.

Any agency enforcement

action and/or any related impact could have a material adverse effect on us.

Approval Process

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● Pre-clinical

laboratory and animal tests performed under the FDA’s Good Laboratory Practices,

or GLP, regulations;

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before human clinical trials may commence;

clinical studies to evaluate the drug’s safety and effectiveness for its intended

review of whether the facility in which the drug is manufactured, processed, packaged,

or held meets standards designed to assure the product’s continued quality and

FDA review of clinical trial sites to determine whether the clinical trials were conducted

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These studies are often

referred to as “Phase 1/2”

referred to as “Phase 1/2” studies.

However, even if patients participate in initial human testing and a Phase 1/2

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Among other things, SPAs can cover clinical studies for pivotal trials whose

data will form the primary basis to establish a product’s efficacy.

SPAs help establish up-front agreement with the FDA

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even if the study is subject to an SPA.

Additionally, some clinical trials are

overseen by an independent group of qualified experts organized by the clinical trial sponsor, known as a data safety monitoring

board or committee.

This group regularly reviews accumulated data and advises the study sponsor regarding the continuing safety

of trial subjects, and the continuing validity and scientific merit of the clinical trial.

The data safety monitoring board receives

special access to unblinded data during the clinical trial and may advise the sponsor to halt the clinical trial if it determined

there is an unacceptable safety risk for subjects or on other grounds, such as no demonstration of efficacy.

The committee can

also stop a clinical trial for an overwhelming demonstration of efficacy, based on pre-defined, stringent statistical parameters

and ethical considerations.

The manufacture of investigational drugs for the conduct of

human clinical trials is subject to current Good Manufacturing Practice, or cGMP, requirements.

Investigational drugs and active

pharmaceutical ingredients imported into the United States are also subject to regulation by the FDA relating to their labeling

and distribution.

Further, the export of investigational drug products outside of the United States is subject to regulatory requirements

of the receiving country as well as U.S.

export requirements under the FDCA.

Additionally,

some clinical trials are overseen by an independent group of qualified experts organized by the clinical trial sponsor, known

as a data safety monitoring board or committee.

This group regularly reviews accumulated data and advises the study sponsor regarding

the continuing safety of trial subjects, and the continuing validity and scientific merit of the clinical trial.

The data safety

monitoring board receives special access to unblinded data during the clinical trial and may advise the sponsor to halt the clinical

trial if it determined there is an unacceptable safety risk for subjects or on other grounds, such as no demonstration of efficacy.

The committee can also stop a clinical trial for an overwhelming demonstration of efficacy, based on pre-defined, stringent statistical

parameters and ethical considerations.

manufacture of investigational drugs for the conduct of human clinical trials is subject to current Good Manufacturing Practice,

or cGMP, requirements.

Investigational drugs and active pharmaceutical ingredients imported into the United States are also subject

to regulation by the FDA relating to their labeling and distribution.

Further, the export of investigational drug products outside

of the United States is subject to regulatory requirements of the receiving country as well as U.S.

export requirements under

sponsors are required to submit a number of reports to the FDA during the course of a development program.

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policy concerning expanded access to investigational drugs.

States law requires that studies conducted to support approval for product marketing be “adequate and well controlled.”

In general, this means that either a placebo or a product already approved for the treatment of the disease or condition under

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Similarly, adverse events that are reported after marketing authorization can result in additional

limitations being placed on a product’s use and, potentially, withdrawal of the product from the market.

Following the completion

of a clinical trial, the data are analyzed by the sponsoring company to determine whether the trial successfully demonstrated

safety and effectiveness and whether a product approval application may be submitted.

In the United States, if the product is

regulated as a new drug, an NDA must be submitted and approved by the FDA before commercial marketing may begin.

include a substantial amount of data and other information concerning the safety and effectiveness of the compound from laboratory,

animal, and human clinical testing, as well as data and information on manufacturing, product quality and stability, and proposed

product labeling.

limitations being placed on a product’s use and, potentially, withdrawal of the product from the market.

the completion of a clinical trial, the data are analyzed by the sponsoring company to determine whether the trial successfully

demonstrated safety and effectiveness and whether a product approval application may be submitted.

In the United States, if the

product is regulated as a new drug, an NDA must be submitted and approved by the FDA before commercial marketing may begin.

NDA must include a substantial amount of data and other information concerning the safety and effectiveness of the compound from

laboratory, animal, and human clinical testing, as well as data and information on manufacturing, product quality and stability,

and proposed product labeling.

domestic and foreign manufacturing establishment, including any contract manufacturers that we may decide to use, must be listed

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One basis for a waiver or refund of the application

user fee is if the applicant is a “small business”

generally defined as employing fewer than 500 employees, including

user fee is if the applicant is a “small business” generally defined as employing fewer than 500 employees, including

employees of affiliates, no approved marketing application for a product that has been introduced or delivered for introduction

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The resubmitted application is also subject to review before the FDA accepts it for filing.

accepted for filing, the FDA’s review of an application may involve review and recommendations by an independent FDA advisory

The FDA must refer applications for drugs that contain active ingredients, including any ester or salt of the active

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The FDA may also refer drugs to advisory committees when it is determined that

an advisory committee’s expertise would be beneficial to the regulatory decision-making process, including the evaluation

of novel products and the use of new technology.

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the regulatory criteria for approval.

If and when those conditions have been met to the FDA’s satisfaction, the FDA may

issue an approval letter.

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In addition, the FDA may initiate review of sections of an NDA before the application is complete.

This “rolling review”

is available if the applicant provides and the FDA approves a schedule for the remaining information.

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under the provisions of the Food and Drug Administration Safety and Innovation Act, or FDASIA, enacted in 2012, a sponsor can

request designation of a product candidate as a “breakthrough therapy.”

A breakthrough therapy is defined as a drug

request designation of a product candidate as a “breakthrough therapy.” A breakthrough therapy is defined as a drug

that is intended, alone or in combination with one or more other drugs, to treat a serious or life-threatening disease or condition,

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final new program to expedite the development of drug products is the LPAD, which was passed as part of the 21 st Century

LPAD allows for the FDA’s determination of safety and effectiveness to reflect the risk-benefit profile of the

drug in the intended limited population, taking into account the severity, rarity, or prevalence of the infection and the availability

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A Section 505(b)(1) NDA is an application that contains full reports of investigations of safety and efficacy.

A Section 505(b)(2) NDA is an application in which the applicant, in part, relies on investigations that were not conducted

by or for the applicant and for which the applicant has not obtained a right of reference or use from the person by or for whom

the investigations were conducted.

Section 505(j) establishes an abbreviated approval process for a generic version of approved

drug products through the submission of an Abbreviated New Drug Application, or ANDA.

An ANDA provides for marketing of a generic

drug product that has the same active ingredients, dosage form, strength, route of administration, labeling, performance characteristics,

A Section 505(b)(2) NDA is an application in which the applicant, in part, relies on investigations that were not conducted by

or for the applicant and for which the applicant has not obtained a right of reference or use from the person by or for whom the

investigations were conducted.

Section 505(j) establishes an abbreviated approval process for a generic version of approved drug

products through the submission of an Abbreviated New Drug Application, or ANDA.

An ANDA provides for marketing of a generic drug

product that has the same active ingredients, dosage form, strength, route of administration, labeling, performance characteristics,

and intended use, among other things, to a previously approved product.

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be submitted one year before NCE exclusivity expires if the applicant submits a certification stating that the patents listed

by the NCE sponsor in FDA’s list of Approved Drug Products with Therapeutic Equivalence Evaluations, or Orange Book, are

invalid or will not be infringed by the manufacture, use, or sale of the drug product for which approval is sought.

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necessary to demonstrate safety and efficacy.

exclusivity is another type of non-patent marketing exclusivity in the United States and, if granted, provides for the

attachment of an additional six months of marketing protection to the term of any existing regulatory exclusivity, including the

non-patent exclusivity period described above.

This six-month exclusivity may be granted if an NDA sponsor submits pediatric data

that fairly respond to a written request from the FDA for such data.

The data do not need to show the product to be effective

in the pediatric population studied;

rather, if the clinical trial is deemed to fairly respond to the FDA’s request, the

additional protection is granted.

If reports of requested pediatric studies are submitted to and accepted by the FDA within the

required time frames, whatever statutory or regulatory periods of exclusivity or Orange Book listed patent protection cover the

drug are extended by six months.

Moreover, pediatric exclusivity attaches to all formulations, dosage forms, and indications for

products with existing marketing exclusivity or patent life that contain the same active moiety as that which was studied.

exclusivity is another type of non-patent marketing exclusivity in the United States and, if granted, provides for the attachment

of an additional six months of marketing protection to the term of any existing regulatory exclusivity, including the non-patent

exclusivity period described above.

This six-month exclusivity may be granted if an NDA sponsor submits pediatric data that fairly

respond to a written request from the FDA for such data.

The data do not need to show the product to be effective in the pediatric

population studied;

rather, if the clinical trial is deemed to fairly respond to the FDA’s request, the additional protection

If reports of requested pediatric studies are submitted to and accepted by the FDA within the required time frames,

whatever statutory or regulatory periods of exclusivity or Orange Book listed patent protection cover the drug are extended by

Moreover, pediatric exclusivity attaches to all formulations, dosage forms, and indications for products with existing

marketing exclusivity or patent life that contain the same active moiety as that which was studied.

Orphan Drug Act also provides incentives for the development of drugs intended to treat rare diseases or conditions, which generally

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orphan exclusivity.

For certain infectious

disease products, the above discussed exclusivity periods may be further extended under the FDA’s qualified infectious disease

product program.

A qualified infectious disease product, or QIDP, is an antibacterial or antifungal drug for human use intended

to treat serious or life-threatening infections, including those caused by an antibacterial or antifungal resistant pathogen,

including novel or emerging infectious pathogens;

or qualifying pathogens designated by the FDA that have the potential to pose

a serious threat to public health.

Subject to the specified statutory limitations, a drug that is designated as a QIDP and is

approved for the use for which the QIDP designation was granted will receive a 5-year extension to any exclusivity for which the

application qualifies upon approval.

For example, if the FDA approves an NDA for a drug designated as a QIDP, the NCE exclusivity

period is extended to ten years and the FDA may not accept applications for nine years.

Moreover, if a product is designated as

a QIDP and an orphan product, the orphan product exclusivity period is extended to twelve years.

These extensions are in addition

to any extension that an application may be entitled to under the pediatric exclusivity provisions.

To receive a QIDP designation,

the sponsor must request that the FDA designate the product as such prior to the submission of an NDA.

This designation may not

be withdrawn except if the FDA finds that the request for designation contained an untrue statement of material fact.

also eligible for fast track status and priority review.

certain infectious disease products, the above discussed exclusivity periods may be further extended under the FDA’s qualified

infectious disease product program.

A qualified infectious disease product, or QIDP, is an antibacterial or antifungal drug for

human use intended to treat serious or life-threatening infections, including those caused by an antibacterial or antifungal resistant

pathogen, including novel or emerging infectious pathogens;

or qualifying pathogens designated by the FDA that have the potential

to pose a serious threat to public health.

Subject to the specified statutory limitations, a drug that is designated as a QIDP

and is approved for the use for which the QIDP designation was granted will receive a 5-year extension to any exclusivity for

which the application qualifies upon approval.

For example, if the FDA approves an NDA for a drug designated as a QIDP, the NCE

exclusivity period is extended to ten years and the FDA may not accept applications for nine years.

Moreover, if a product is

designated as a QIDP and an orphan product, the orphan product exclusivity period is extended to twelve years.

These extensions

are in addition to any extension that an application may be entitled to under the pediatric exclusivity provisions.

a QIDP designation, the sponsor must request that the FDA designate the product as such prior to the submission of an NDA.

designation may not be withdrawn except if the FDA finds that the request for designation contained an untrue statement of material

QIDPs are also eligible for fast track status and priority review.

Approval Requirements

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Physicians, in their independent professional

medical judgment, may prescribe legally available products for unapproved indications that are not described in the product’s

labeling and that differ from those tested and approved by the FDA.

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significantly from the current descriptions provided herein in the time that it may take for any of our product candidates to

reach a point at which a NDA is approved.

reach a point at which an NDA is approved.

Moreover, individual states may have laws and regulations that we must comply with,

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research, development, and approval times depend on a number of factors, including the period of review at the FDA, the number

of questions posed by the FDA during review, how long it takes to respond to the FDA’s questions, the severity or life-threatening

nature of the disease in question, the availability of alternative treatments, the availability of clinical investigators and

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Device Approval Process

In addition to our lead product candidate

Neutrolin, which is subject to regulation by the FDA as a drug, we may be developing other products that may be regulated as medical

devices in the United States.

The FDA considers a product to be a device, and subject to the FDA regulation, if it meets the definition

of a medical device in the FDCA, which states that a device is an instrument, apparatus, implement, machine, contrivance, implant,

in vitro reagent, or other similar or related article, including a component part, or accessory which is:

recognized in the official National Formulary, or the United States

Pharmacopoeia, or any supplement to them,

intended for use in the diagnosis of disease or other conditions,

or in the cure, mitigation, treatment, or prevention of disease, in man or other animals, or

intended to affect the structure or any function of the body of man

or other animals, and which does not achieve its primary intended purposes through chemical action within or on the body of man

or other animals and which does not achieve its primary intended purposes through chemical action within or on the body of man

or other animals and which is not dependent upon being metabolized for the achievement of its primary intended purposes.

The FDA regulates the design, development,

clinical testing, manufacture, labeling, distribution, import and export, sale and promotion of medical devices.

Unless an exemption

applies or a product is a Class I device, all medical devices must receive either 510(k) clearance or an approved pre-market application

(PMA), from the FDA before they may be commercially distributed in the U.S.

In addition, certain modifications made to marketed

devices also may require 510(k) clearance or approval of a PMA supplement.

Unlike approved drug products, there are no market exclusivity

provisions under the FDCA for products regulated as medical devices.

To obtain a 510(k) clearance for a device,

a pre-market notification to the FDA must be submitted demonstrating that the device is substantially equivalent to a legally marketed

predicate device.

For a new device to be found “substantially equivalent”

to one or other legally marketed predicate

devices, the new device must have:

addition to our lead product candidate DefenCath, which is subject to regulation by the FDA as a drug, we may be developing other

products that may be regulated as medical devices in the United States.

The FDA considers a product to be a device, and subject

to the FDA regulation, if it meets the definition of a medical device in the FDCA, which states that a device is an instrument,

apparatus, implement, machine, contrivance, implant, in vitro reagent, or other similar or related article, including a

component part, or accessory which is:

in the official National Formulary, or the United States Pharmacopoeia, or any supplement

for use in the diagnosis of disease or other conditions, or in the cure, mitigation,

treatment, or prevention of disease, in man or other animals, or

to affect the structure or any function of the body of man or other animals, and which

does not achieve its primary intended purposes through chemical action within or on the

body of man or other animals and which does not achieve its primary intended purposes

through chemical action within or on the body of man or other animals and which is not

dependent upon being metabolized for the achievement of its primary intended purposes.

FDA regulates the design, development, clinical testing, manufacture, labeling, distribution, import and export, sale and promotion

of medical devices.

Unless an exemption applies or a product is a Class I device, all medical devices must receive either 510(k)

clearance or an approved pre-market application, or PMA, from the FDA before they may be commercially distributed in the U.S.

In addition, certain modifications made to marketed devices also may require 510(k) clearance or approval of a PMA supplement.

Unlike approved drug products, there are no market exclusivity provisions under the FDCA for products regulated as medical devices.

obtain a 510(k) clearance for a device, a pre-market notification to the FDA must be submitted demonstrating that the device is

substantially equivalent to a legally marketed predicate device.

For a new device to be found “substantially equivalent”

to one or other legally marketed predicate devices, the new device must have:

1) the same intended use as a predicate;

and 2) either a) the same technological characteristics

as the predicate device or b) different technological characteristics, but the information submitted must not raise new questions

of safety and effectiveness and must demonstrate substantial equivalence.

The FDA attempts to respond to a 510(k) pre-market notification

within 90 days of submission, but as a practical matter, pre-market clearance can take significantly longer, potentially up

to one year or more.

The PMA process is much more demanding

and uncertain than the 510(k) pre-market notification process and must be supported by extensive clinical, laboratory, technical

and other information, including at least one adequate and well-controlled clinical investigation conducted under an investigational

device exemption (IDE).

The FDA has 180 days to review an accepted PMA, although the review generally occurs over a significantly

longer period of time and can take up to several years.

The FDA has informed us that it regards

taurolidine as a new chemical entity and therefore an unapproved new drug.

Consequently, for any other products that we intend

to develop as a medical device, there is currently no appropriate predicate device currently marketed in the U.S.

on which a 510(k)

approval process could be based.

As a result, we will be required to submit a premarket approval application for marketing authorization

for these indications.

In the event that the NDA for Neutrolin is approved by the FDA, the regulatory pathway for these taurolidine

product candidates can be revisited with the FDA.

Although there will presumably still be no appropriate predicate, de

novo Class II designation can be proposed, a process that provides a pathway to classify novel medical device for which

there is no legally marketed predicate device, based on a risk assessment and a reasonable assurance of safety and effectiveness.

either a) the same technological characteristics as the predicate device or b) different technological characteristics, but the

information submitted must not raise new questions of safety and effectiveness and must demonstrate substantial equivalence.

FDA attempts to respond to a 510(k) pre-market notification within 90 days of submission, but as a practical matter, pre-market

clearance can take significantly longer, potentially up to one year or more.

PMA process is much more demanding and uncertain than the 510(k) pre-market notification process and must be supported by extensive

clinical, laboratory, technical and other information, including at least one adequate and well-controlled clinical investigation

conducted under an investigational device exemption (IDE).

The FDA has 180 days to review an accepted PMA, although the review

generally occurs over a significantly longer period of time and can take up to several years.

FDA has informed us that it regards taurolidine as a new chemical entity and therefore an unapproved new drug.

Consequently, for

any other products that we intend to develop as a medical device, there is currently no appropriate predicate device currently

marketed in the U.S.

on which a 510(k) approval process could be based.

As a result, we will be required to submit a premarket

approval application for marketing authorization for these indications.

In the event that the NDA for DefenCath is approved by

the FDA, the regulatory pathway for these taurolidine product candidates can be revisited with the FDA.

Although there will presumably

still be no appropriate predicate, de novo Class II designation can be proposed, a process that provides a pathway to classify

novel medical device for which there is no legally marketed predicate device, based on a risk assessment and a reasonable assurance

of safety and effectiveness.

a device is placed on the market, numerous regulatory requirements apply, including:

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the FDCA which may present a risk to health;

FDA’s recall authority, whereby it can ask, or under certain conditions order,

device manufacturers to recall from the market a product that is a risk to health.

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and Pricing Controls

In many of the markets

where we or the parties we collaborate with have targeted or will target Neutrolin for sale, laws control the prices charged to

certain purchasers of pharmaceutical products and the prices paid by drug reimbursement programs through varying price control

Public and private health care payors control costs and influence drug pricing through a variety of mechanisms, including

through negotiating rebates with the manufacturers, limiting the reimbursement rate paid to providers, and using tiered formularies,

co-payment structures that incentivize beneficiaries to request lower cost alternatives, and other mechanisms that provide preferential

access to certain drugs over others within a therapeutic class.

Federal and commercial payors use competition for health plan

coverage and market share as leverage to obtain rebates on products they reimburse, which impacts the manufacturer’s net

realization on the sale of the products.

many of the markets where we or the parties we collaborate with have targeted or will target DefenCath for sale, laws control

the prices charged to certain purchasers of pharmaceutical products and the prices paid by drug reimbursement programs through

varying price control mechanisms.

Public and private health care payors control costs and influence drug pricing through a variety

of mechanisms, including through negotiating rebates with the manufacturers, limiting the reimbursement rate paid to providers,

and using tiered formularies, co-payment structures that incentivize beneficiaries to request lower cost alternatives, and other

mechanisms that provide preferential access to certain drugs over others within a therapeutic class.

Federal and commercial payors

use competition for health plan coverage and market share as leverage to obtain rebates on products they reimburse, which impacts

the manufacturer’s net realization on the sale of the products.

These rebates may be paid on drugs sold at a mandatory discount.

Additionally, federal

and commercial health plans may choose to reimburse dialysis providers for dialysis services and drugs used in the provision of

those services through a single bundled payment rate, which tends to make cost a more important factor for providers when making

drug purchase decisions than it would otherwise be if the providers were reimbursed for drugs on a stand-alone basis.

set other criteria to govern the uses of a drug that will be deemed medically appropriate and therefore reimbursed or otherwise

In particular, many public and private health care payors limit reimbursement and coverage to the uses of a drug that

are either approved by the FDA or that are supported by other appropriate evidence (for example, published medical literature)

and appear in a recognized drug compendium.

Drug compendia are publications that summarize the available medical evidence for

particular drug products and identify which uses of a drug are supported or not supported by the available evidence, whether or

not such uses have been approved by the FDA.

Additionally, federal and commercial health plans may choose to reimburse dialysis providers for dialysis services and drugs used

in the provision of those services through a single bundled payment rate, which tends to make cost a more important factor for

providers when making drug purchase decisions than it would otherwise be if the providers were reimbursed for drugs on a stand-alone

Payors also set other criteria to govern the uses of a drug that will be deemed medically appropriate and therefore reimbursed

or otherwise covered.

In particular, many public and private health care payors limit reimbursement and coverage to the uses of

a drug that are either approved by the FDA or that are supported by other appropriate evidence (for example, published medical

literature) and appear in a recognized drug compendium.

Drug compendia are publications that summarize the available medical evidence

for particular drug products and identify which uses of a drug are supported or not supported by the available evidence, whether

or not such uses have been approved by the FDA.

Regulatory Requirements

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The CE Mark certification encompasses an extensive review of our quality management

system which is inspected by a notified body’s auditor as part of a Stage 1 and 2 International Organization for Standardization,

or ISO, 13485:2003 audit, in accordance with worldwide recognized ISO standards and applicable European Medical Devices Directives

23 unchanged sentences

solutions, processes for treating and inhibiting infections, a biocidal lock system and a taurolidine delivery apparatus, and

the corresponding United States and foreign patents and applications (the “NDP Technology”).

We acquired such licenses

and patents through our assignment and assumption of NDP’s rights under certain separate license agreements by and between

Hans-Dietrich Polaschegg, Dr.

16 unchanged sentences

regulatory approval processes and certain worldwide net sales amounts.

April 11, 2013, we entered into an amendment to the NDP License Agreement.

Under Article 6 of the NDP License Agreement, we were

obligated to make a milestone payment of $500,000 to NDP upon the first issuance of a CE Mark for a licensed product, which payment

was payable to NDP within 30 days after such issuance.

Pursuant to the terms of the amendment, we and NDP agreed to delay such

milestone payment to a time, to be chosen by us, anytime within twelve months after the achievement of such issuance.

As consideration

for the amendment, we issued NDP a warrant to purchase 25,000 shares of our common stock at an exercise price of $7.50 per share.

The warrant was exercisable immediately upon issuance and had a term of five years and expired in April 2018.

During the year ended

December 31, 2013, a milestone payment of $500,000 was earned by NDP upon the first issuance of the CE Mark for Neutrolin, which

was converted in January 2014 into 10,000 Series C-3 non-voting preferred stock and 50,000 warrants at an exercise price of $7.50

During the year ended December 31, 2014, a certain milestone was achieved resulting in the release of 7,277 shares

held in escrow.

The number of shares held in escrow as of December 31, 2019 is 21,832 shares of common stock.

There were no milestones

achieved in 2019 or 2018.

December 31, 2013, a milestone payment of $500,000 was earned by NDP upon the first issuance of the CE Mark for Neutrolin.

Article 6 of the NDP License Agreement, we were obligated to make a milestone payment of $500,000 to NDP upon the first issuance

of a CE Mark for a licensed product, which payment was payable to NDP within 30 days after such issuance.

On April 11, 2013, we

entered into an amendment to the NDP License Agreement which extended the milestone payment from within 30 days after such issuance

to within twelve months after the achievement of such issuance.

As consideration for the amendment, we issued NDP a five-year warrant

to purchase 25,000 shares of our common stock at an exercise price of $7.50 per share.

The warrant was exercisable immediately

upon issuance and expired in April 2018.

In January 2014, the $500,000 milestone payment due to NDP was converted into 10,000 Series

C-3 non-voting preferred stock and a warrant to purchase 50,000 shares of our common stock at an exercise price of $4.50 per share.

The warrants expired during the year ended December 31, 2020.

During the year ended December 31, 2014, a certain milestone

was achieved resulting in the release of 7,277 shares held in escrow.

The number of shares held in escrow as of December 31, 2020

is 21,832 shares of common stock.

There were no milestones achieved in 2020 or 2019.

NDP License Agreement will expire on a country-by-country basis upon the earlier of (i) the expiration of the last patent claim

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revert back to NDP.

We believe that the patents and patent applications we have

licensed pursuant to the NDP License Agreement cover effective solutions to the various medical problems discussed previously when

using taurolidine in clinical applications, and specifically in hemodialysis applications.

Our patent portfolio consists of 7 issued

believe that the patents and patent applications we have licensed pursuant to the NDP License Agreement cover effective solutions

to the various medical problems discussed previously when using taurolidine in clinical applications, and specifically in hemodialysis

applications.

Our patent portfolio consists of 5 issued U.S.

patents and 13 pending U.S.

patent applications;

13 issued foreign patents and 46 pending foreign patent applications.

patent applications will be filed to cover any additional related subject matter developed.

The patents cover additional applications

using taurolidine in, among others, sutures, hydrogels, meshes, transdermal and biofilm products.

As of March 12, 2020, we had 30 full time

employees, including our customer service representative and office manager in Germany.

We also engage various consultants and

contractors for project management and research and development, manufacturing and regulatory development, marketing, financing,

sales and marketing and administrative activities.

were organized as a Delaware corporation on July 28, 2006 under the name “Picton Holding Company, Inc.”

and we changed

our corporate name to “CorMedix Inc.”

on January 18, 2007.

15 issued foreign

patents and 44 pending foreign patent applications.

Additional patent applications will be filed to cover any additional related

subject matter developed.

The patents cover additional applications using taurolidine in, among others, sutures, hydrogels, meshes,

transdermal and biofilm products.

Employees and Human Capital Resources

As of March 19, 2021, we employed 35 full-time employees, who work out of our corporate offices in Berkeley Heights NJ or work remotely in various

locations throughout the United States and Europe.

We are committed to diversity, equity and inclusion, regardless of gender or

race/ethnicity, and conduct training to reflect our commitment as an organization and build awareness.

We invest in our workforce

by offering competitive salaries and benefits.

We endeavor to foster a strong sense of ownership by offering stock options under

our stock incentive program.

We also offer comprehensive and locally relevant benefits for all eligible employees.

and support the growth and development of our employees.

We have implemented

COVID-19 policies designed to ensure the safety and well-being of all employees and the people associated with them.

of the COVID-19 pandemic, to reduce risk, our employees have been asked to work remotely, and all employees have been asked to

avoid all non-essential travel, adhere to good hygiene practices, and engage in physical distancing.

None of our employees

are subject to a collective bargaining agreement.

We consider our relationship with our employees to be good.

were organized as a Delaware corporation on July 28, 2006 under the name “Picton Holding Company, Inc.” and we changed

our corporate name to “CorMedix Inc.” on January 18, 2007.

Our principal executive offices are located at 300 Connell

2 unchanged sentences

March 26, 2019, we effected a 1-for-5 reverse stock split of our issued and outstanding shares of common stock, par value $0.001,

per share (“Common Stock”), by combining, reclassifying and changing each authorized and outstanding five shares of

“old”

common stock into one share of “new”

common stock.

per share (“Common Stock”), by combining, reclassifying and changing each authorized and outstanding five shares of

“old” common stock into one share of “new” common stock.

No fractional shares were issued, and, in lieu

10 unchanged sentences

for all periods presented.

April 2019, we received approximately $5.1 million, net of expenses, from the sale of a portion of our unused net operating losses,

The NOL was sold through the State of New Jersey’s Economic Development Authority, or NJEDA, Technology Business

Tax Certificate Transfer program, which allowed us to sell approximately $5.4 million of our total $6.1 million in available NOL

tax benefits for the state fiscal year 2018 to two unrelated, profitable New Jersey corporations.

In February 2020, we announced that we were

approved by the NJEDA to transfer approximately $5.5 million of the total $6.0 million of our available tax benefits to an unrelated,

profitable New Jersey corporation pursuant to our application to participate in the NOL program for state fiscal year 2019.

anticipate receiving approximately $5.2 million in cash proceeds from the sale of our NOLs before the final expiration date.

is subject to NJEDA’s typical closing conditions, which are in process.

August 14, 2019, we entered into an exchange agreement (the “Exchange Agreement”) with Manchester Securities Corp.

(“Manchester”), a wholly owned subsidiary of Elliott Associates, L.P.

(together with Manchester, “Elliott”),

who collectively beneficially own the largest portion of our common stock pursuant to which Elliott agreed to exchange all of

its outstanding warrants, its 10% senior secured convertible note and its shares of Series C-2 Preferred Stock, Series D Preferred

Stock and Series F Preferred Stock, and make a cash payment of $2.0 million to us, for 100,000 shares of Series G Preferred Stock.

September 25, 2019, we entered into a letter agreement with several holders, each referred to as a Holder, of several Series B

Warrants, that we had issued on May 3, 2017, and amended on September 20, 2019, referred to as a Letter Agreement.

each Letter Agreement, we agreed to reduce the exercise price of each Holder’s Series B Warrants from $5.25 to $4.00, provided

that the Holder exercised its Series B Warrants for cash at the time of entry into such Letter Agreement.

Each Holder exercised

its Series B Warrants in full and we issued an aggregate of 1,224,263 shares of our common stock to them.

We received net proceeds

of approximately $4.9 million.

As a result of the modification of the exercise price of these warrants, we recognized a deemed

dividend of $369,500 on our consolidated statement of operations and comprehensive loss (see Note 8).

We maintain a website at www.cormedix.com;

however, the information on, or that can be accessed through, our website or certain information in our website is not part of

This report and all of our filings under the Exchange Act, including copies of annual reports on Form 10-K,

quarterly reports on Form 10-Q, current reports on Form 8-K, and any amendments to those reports, are available free of charge

through our website on the date we file those materials with, or furnish them to, the Securities and Exchange Commission (the

“SEC”).

Such filings are also available to the public on the internet at the SEC’s website at www.sec.gov.

The public may also read and copy any document that we file at the SEC’s Public Reference Room located at 100 F Street,

NE, Washington, DC 20549 on official business days during the hours of 10 a.m.

For further information on the

Public Reference Room, the public is instructed to call the SEC at 1-800-SEC-0300.

In April 2020, we received

approximately $5.2 million, net of expenses, from the sale of most of our remaining unused New Jersey net operating losses (“NOL”)

eligible for sale under the State of New Jersey’s Economic Development Authority’s New Jersey Technology Business Tax

Certificate Transfer program (“NJEDA Program”).

The NJEDA Program allowed us to sell approximately $5.5 million of

our total $6.0 million in available NOL tax benefits for the state fiscal year 2019.

As previously announced,

the NJEDA has approved our application to participate in the NJEDA Program for the state fiscal year 2020.

The approval will allow

us to sell approximately $1.3 million of the total $1.3 million in available tax benefits to an unrelated, profitable New Jersey

corporation in return for approximately $1.3 million in cash.

Closing is subject to NJEDA’s typical closing conditions, which

are in process of completion.

In April 2020, we received

from the FDA a refund for the NDA application fee in the amount of $2.9 million, which was paid in the first quarter of 2020.

met the conditions of the Federal Food, Drug, and Cosmetic Act for the small business waiver of the user fees and our request for

a waiver of an application user fee was granted by the FDA.

In May 2020, we formed a wholly-owned Spanish subsidiary, CorMedix

Spain, S.L.U.

for which no substantial operations had occurred during the year 2020.

On July 30, 2020, we

completed an underwritten public offering of our common stock, par value $0.001 per share, which yielded gross proceeds, before

underwriting commissions and estimated expenses, of approximately $23.0 million.

The public offering was made pursuant to an underwriting

agreement with SunTrust Robinson Humphrey, Inc.

and JMP Securities LLC (collectively, the “Underwriters”), relating

to the issuance and sale of an aggregate of 5,111,110 shares of common stock, including 666,666 shares of common stock pursuant

to the full exercise of the Underwriters’ option, at a public offering price of $4.50 per share.

The offering was made pursuant

to our effective registration statement on Form S-3 Registration Statement No.

333-223562 previously filed with and declared effective

by the SEC and a prospectus supplement and accompanying prospectus filed with the SEC.

In November 2020, we

filed a new registration statement, under which we could issue and sell up to an aggregate of $100.0 million of shares of our common

stock, $0.001 par value per share.

On November 27, 2020, we entered into an Amended and Restated At Market Issuance Sales Agreement

(“Amended Sales Agreement”) with B.

Riley and Needham & Company, LLC (“Needham”), together with B.

Riley, acting as sales agents (“Sales Agent”).

The Amended Sales Agreement relates to the sale of shares of up to $25.0

million of our common stock under our ATM program, of which we may issue and sell common stock from time to time through the Sales

Agent, subject to limitations imposed by us and subject to Sales Agent’s acceptance, such as the number or dollar amount

of shares registered under the registration statement to which the offering relates.

Sales Agent is entitled to a commission of

up to 3% of the gross proceeds from the sale of common stock sold under the ATM program.

During the year ended December 31, 2020,

we sold 832,676 shares of common stock under the Amended Sales Agreement at the weighted average price of $8.69 per share and realized

net proceeds of approximately $7.0 million.

At December 31, 2020, we have approximately $17.8 million available under the Amended

Sales Agreement and $75.0 million available under our current shelf registration for the issuance of equity, debt or equity-linked

securities unrelated to the Amended Sales Agreement.

On February 5, 2021, we allocated to our ATM program an additional $25.0 million

of the remaining $75.0 million available under our shelf registration statement.

Giving effect to the additional $25.0 million,

plus the $17.8 million available at December 31, 2020, we had a total of $42.8 million available under the ATM program.

January and February 2021, we sold an aggregate of 3,737,862 shares of our common stock under the ATM program and realized net

proceeds of approximately $41.5 million.

As of the filing of this Annual Report on Form 10-K, we have no available balance under

our ATM program and we have $50.0 million available under our current shelf registration for the issuance of equity, debt or equity-linked

We maintain a website

at www.cormedix.com;

however, the information on, or that can be accessed through, our website or certain information in our website

is not part of this report.

This report and all of our filings under the Exchange Act, including copies of annual reports on Form

10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and any amendments to those reports, are available free of charge

through our website on the date we file those materials with, or furnish them to, the Securities and Exchange Commission (the “SEC”).

Such filings are also available to the public on the internet at the SEC’s website at www.sec.gov.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business