CorMedix Inc (CRMD) 2019 Q4 法說會逐字稿

Greetings. Welcome to the CorMedix Inc. Fourth Quarter and Fiscal Year 2019 Earnings Call. (Operator Instructions) Please note, this conference is being recorded. I will now turn the conference over to your host, Dan Ferry. You may begin.

Leading the call today is Khoso Baluch, Chief Executive Officer of CorMedix. He is joined by Phoebe Mounts, Executive Vice President and General Counsel.

Before we begin, I would like to remind everyone that during the call, management may make what are known as forward-looking statements within the meaning set forth in the Private Securities Litigation Reform Act of 1995. These statements are subject to certain risks and uncertainties and include, but are not limited to, any of the following. Any statements other than statements of historical fact regarding management's expectations, beliefs, goals and plans about the company's prospects, including its clinical development program for Neutrolin in the U.S. and other product candidates, future financial position, future revenues and projected costs and potential market acceptance of Neutrolin and other product candidates.

More specifically, forward-looking statements include any statements about our clinical development plans and the timing, cost results and interpretations thereof, projections as to the company's future capital raising and spending and cash position, expectations as to the timing and nature of anticipated regulatory actions, possible product licensing or other business development transactions, any commercial plans and expectations, market projections for our product candidates and expectations as to manufacturing and product component costs. Actual results may differ materially from these projections or estimates due to a variety of important factors, including, but not limited to, uncertainties related to clinical development, regulatory approvals and commercialization. These risks are described in greater detail in CorMedix's filings with the SEC, copies of which are available free of charge at the SEC's website at www.sec.gov or upon request from CorMedix.

CorMedix may not actually achieve the goals or plans described in these forward-looking statements. And investors should not place undue reliance on these statements. Please note that CorMedix does not intend to update these forward-looking statements, except as required by law. At this time, it is now my pleasure to turn the call over to Mr. Khoso Baluch, Chief Executive Officer of CorMedix. Khoso, please go ahead.

Thank you, Dan. Good afternoon, everyone, and thank you for joining us on this call. On today's earnings call, we will cover with you our continued effort to bring Neutrolin to the U.S. market for the first indication for use as a catheter lock solution for hemodialysis patients with subsequent expansion into other indications.

Phoebe will participate in this call and provide the details on our regulatory program. I plan to cover 3 topics. First, an update on the significant progress we've made on the NDA filing for Neutrolin. I'm very pleased to report that we have begun to submit modules of the NDA, following from the FDA's agreement to grant our request for a rolling submission of modules as we announced in February 2020.

As we've stated previously, we remain on schedule for a possible NDA approval in the second half of 2020. Phoebe will get into further details on our continuing regulation progress with the FDA. Second, I want to update you on our plans to commercialize Neutrolin for hemodialysis. During our last earnings call, Jack Armstrong covered the progress we've made to establish the supply chain CorMedix will use to manufacture and distribute Neutrolin in the U.S. market. On this call, I will focus on the commercial plans. And finally, we'll update you on the progress we've made in our financial position. The detailed information is available for you to review in the 10-K that we plan to file today.

So let's begin with Phoebe.

Thank you very much, Khoso. It is a pleasure to be here again and report on the significant progress we have made on the regulatory activities required to secure marketing authorization for Neutrolin in the U.S. As you know from previous updates, our primary focus has been on preparing information required for filing the new drug application for Neutrolin to secure marketing authorization in the U.S. for the hemodialysis indication. I am extremely pleased to report that through the hard work and focus of the CorMedix team, we have continued to complete regulatory requirements and have begun submitting the NDA with FDA.

First, as we have reported previously, in our pre-NDA meeting with FDA last year, the agency agreed that we could request a rolling review for the Neutrolin NDA based on the Fast Track designation received in 2015. After the pre-NDA meeting, we submitted a formal request to FDA for a rolling submission and review of NDA modules with a proposed submission plan. In January of 2020, FDA granted the request for a rolling review and agreed the submission plan was reasonable.

Consistent with the submission plans, we have begun submission of the NDA module. We continue to focus on preparing all of the required information in the module to ensure complete filing and facilitate an efficient review by FDA. We remain optimistic for a potential approval of the NDA in the second half of 2020.

However, you may be aware that like many government agencies and organizations, restrictions on travel overseas have been imposed by FDA for its employees because of the coronavirus pandemic. FDA announced on March 10 that it is postponing most foreign inspections through April, and inspections outside of the U.S. seemed mission-critical will still be considered on a case-by-case basis. We cannot predict if this will delay approval of the NDA because pre-approval inspections of the manufacturing facilities relied upon for manufacturing of Neutrolin are required. We will provide updates on any delays that would prevent approval of the NDA in the second half of 2020 as we become aware of them.

Secondly, as you may know, the Pediatric Research Equity Act or PREA requires sponsors to conduct pediatric studies for new drug applications for a new active ingredients, such as taurolidine in Neutrolin, unless a waiver or deferral is obtained from FDA. Studies required and conducted under PREA may qualify for pediatric exclusivity, which would provide an additional 6 months of marketing exclusivity for an approved product. CorMedix filed a formal request for a waiver or deferral from conducting a pediatric study because hemodialysis for end-stage renal disease in children in the U.S. is uncommon. For example, our LOCK-IT-100 trial was opened to enrollment for individuals as young as 18, but there were no study subjects youngers on 20 years of age among the 800 study subjects who are enrolled in the study. This is consistent with 2018 data from the U.S. renal data system on the number of children and adolescents developing end-stage renal disease, where the incidence or number of new cases in 2016 in those aged 0 to 17 in the U.S. was 840 individuals.

Furthermore, of the 9,619 children and adolescents under 22 years of age was prevalent end-stage renal disease. Kidney transplant was the most common end-stage renal disease therapeutic modality, followed by hemodialysis and then peritoneal dialysis. In 2016, the median waiting time for first transplant for pediatric patients was 12.94 months. This is in stark contrast to the adult population where the median waiting time to kidney transplant in 2011 was 4 years. During which time, hemodialysis is required and the risk of developing a catheter-related bloodstream infection exists.

Moreover, unlike the decline in pediatric patients developing end-stage renal disease, the disease rates continue to climb in adult patients. According to the 2018 U.S. Renal Data System annual report, in 2016, there were 124,675 newly reported cases of end-stage renal disease in adult. With this increase in hemodialysis patients comes an increase in the potential cases of the life-threatening catheter related bloodstream infections, for which there is currently no preventative product on the market. We believe Neutrolin can address this unmet medical need in the adult hemodialysis population, as demonstrated by the data from LOCK-IT-100, which demonstrated a 71% reduction in catheter-related bloodstream infections with the use of Neutrolin in adult hemodialysis patients.

The FDA responded to our request for a waiver or deferral for a pediatric study by granting a deferral. A deferral acknowledges that a pediatric assessment is required, but permits the applicant to submit the pediatric assessment after the submission of an NDA. CorMedix has made a commitment to conduct the pediatric study after approval of the NDA for use in adult hemodialysis patients. We have submitted a plan for the proposed pediatric study to FDA for review and approval. We believe that conducting a study in children will be challenging, given the very small number of pediatric patients, but we are determined to fulfill the deferral requirements.

We are also grateful that CorMedix can go forward with an indication for use in adult hemodialysis patients where there is an urgent unmet medical need. It is FDA's policy to offer applicants the opportunity to qualify for pediatric exclusivity for studies required and conducted under PREA, receiving pediatric exclusivity provides an additional 6 months of marketing exclusivity. As we have discussed previously, Neutrolin would have the potential to receive 10 years of marketing exclusivity upon approval of the NDA. Five years of marketing exclusivity is awarded for approval as a new chemical entity and approval as a qualified infectious disease product would add an additional 5 years of marketing exclusivity. Therefore, pediatric exclusivity would provide the benefit of extending the marketing exclusivity for an additional 6 months from 10 years to 10.5 years. CorMedix intends to meet the required elements to be eligible for pediatric exclusivity to extend marketing exclusivity to 10.5 years.

I continue to be excited about our progress in developing the information needed to secure marketing authorization for Neutrolin in the U.S. and remain confident that, internally, we have the team and capabilities to be successful. As I covered in the last earnings call, in addition to continuing with the submission of the NDA for the hemodialysis indication for use, we are working on developing the regulatory pathways for additional indications for use in oncology patients and for patients requiring total parenteral nutrition or TPN. We are focusing on securing the indication for use in hemodialysis patients, first, with the data from LOCK-IT-100 because we believe it will provide more flexibility leading to approval for the expanded indication.

With that summary, please let me pass the floor back to Khoso to cover the other topics. Khoso?

Thank you, Phoebe. As I've stated, our goal is to maximize shareholders' value because hemodialysis is a very concentrated payer provider market. We are continuing to prepare to launch Neutrolin in the hemodialysis segment, while at the same time being open to potential partnerships. All options are on the table and will be evaluated with one goal in mind.

At the same time, we will refine our commercial organization, optimization plan by matching our resources needs and locations where we can target most of the CDC catheter patients receiving hemodialysis. The hemodialysis market is very concentrated market with 2 or 3 players providing 2/3 of all dialysis in the U.S. and one large payer, CMS, reimbursing about 90% of all dialysis patients.

This level of concentration is not very common in the U.S. health care market and, therefore, provides CorMedix a unique opportunity to tailor our strategy that will be leveraged to maximize the return on investment. We have begun building internal functions for medical affairs and payer markets. We have begun hiring individuals to fill senior roles in these new units. This gradual buildup will help us move forward in preparing and refining our launch plans as we move closer to our potential Neutrolin approval. We intend to continue building out these functions over the course of the year, followed at the end by the hiring of the field sales force if we are in a go-it-alone scenario.

In previous earnings call, we covered the potential size of the different segments of the market. By 2025, the hemodialysis market alone will require an estimated 80 million catheter locks per year. If you add those receiving chemotherapy and total parenteral nutrition, then you would add another 150 million catheter lock solutions for a total need of 230 million catheter lock solutions estimated in 2025.

We are now in a position to step up and focus a great deal of our energy on understanding the various stakeholders within the dialysis market, through market research involving both providers and payers. We now are actively developing our plan of approach and prelaunch message strategy, which will need to be unique to each stakeholder yet consistent in strategy. We will be prepared to tell our messages shortly and begin to actively reengage with CMS and commercial payers. In addition, other priorities for the payer market include precisely mapping Neutrolin likely flow through the distribution channels, assessing opportunities to strengthen our product value through retrospective claims analysis, devising a coding TDAPA time line to guide our forecasting effort for launch and through 2021 and segmenting our commercial market targets. These activities will be required in either case, whether we go it alone or we have a strategic partnership.

Once again, let me remind you that this huge market represents a very large unmet medical need. As today, there is no pharmacological agent approved in the U.S. for the prevention of CRBSI in central venous catheters. I, therefore, believe should Neutrolin be approved by the FDA, it would become the standard of care in the U.S.

Now let me provide you with a top line review of our quarter 4 and full year 2019 financials. The company will file shortly its annual report on Form 10-K for the year ending December 31, 2019. I urge you to read the information contained in the report for a more complete discussion of our financial results. Total cash on hand and short-term investments as of December 31, 2019, amounted to $28.3 million, excluding restricted cash of $200,000.

Beginning in January 2020, the company made selective use of its ATM program, raising approximately $2.5 million net of commissions. We also announced in February that we expect to close shortly on the sale of New Jersey net operating losses through the State Tax Certificate program and raised approximately $5.2 million net of commissions. The company believes that based on the company's cash resources at December 31, 2019, plus the ATM and NOL funding, I've outlined, it has sufficient resources to fund operation to the end of quarter 2, 2021, including the submission of the NDA of Neutrolin and the initial preparation for commercial launch. Additional financing will be necessary for a complete inventory build and other prelaunch commercial needs if the company launches Neutrolin after approval without a commercial partnership.

As I covered earlier, our cash spend defined as our cash used in operations was $3.9 million during quarter 4 2019, about the same as during the third quarter. Our burn rate will increase starting in early 2020 as we hire key personnel to prepare for commercialization and commence manufacturing an initial order of Neutrolin for sale upon approval.

So let me summarize the key takeaways from this call. What Phoebe and I covered with you, hopefully, provides you with an insight into the work effort on which we are focused and that we have occurred over the last 3 months. I'm pleased on the progress we are making. I'd like to reemphasize, number one, we are pleased to report to our shareholders that the effort to move the regulatory process forward with the FDA is on track. We have begun to submit the modules of the NDA for Neutrolin and continue to plan for potential approval of Neutrolin NDA during the second half of 2020.

The progress to build the Neutrolin supply line for the U.S. market is moving along as planned. CorMedix has started the hiring of personnel to launch Neutrolin in the U.S. in anticipation of CorMedix receiving marketing approval for Neutrolin from the FDA.

We are also continuing our financial strategy, which is to raise the minimum amount of funds necessary to ensure that we meet the company's next inflection point. Our current cash is sufficient to fund a portion of the inventory required for launch and to initiate the building of our marketing infrastructure. If we commit ourselves to marketing Neutrolin on our own, additional financing will be required to complete the purchase of the inventory for launch and for safety stock and to fully staff our sales and marketing. Should we conclude a commercial partnership prior to launch, our financing needs may be significantly lessened.

Finally, please remember that while we are initially focused on the hemodialysis market, we are determined to seek additional indications for Neutrolin use in oncology and TPN. We've had discussions with the FDA on the clinical trial design for Neutrolin use as a catheter lock solution in oncology and TPN, and we are working to develop the protocols with the goal of finalizing the regulatory pathway for these patient groups.

Our goal is to maximize shareholders' value. I also continue to believe that if Neutrolin is approved, it will become the standard of care for preventing catheter-related bloodstream infections in hemodialysis patients. As Phoebe has discussed, the last year has been very productive in moving Neutrolin through the regulatory process. I am very pleased with the strength of our management team. The significant experience Phoebe brings in regulatory, Jack in manufacturing and supply chain, Paul in medical affairs and Liz in clinical operations, coupled with my Cialis and Byetta launch experience in the U.S., just to name a few recent launches, makes for a winning team. Together, we have a combined experience of over 170 years in the pharmaceutical business. The team will continue to evolve over the coming quarters in areas of strategic need.

As I've stated previously, we have been working hard to identify a new CFO. We expect to have one on board in the near future. The strategy we embarked on in early 2017 will continue to move forward at an ever-increasing pace. We are aware of the restrictions imposed by the coronavirus epidemic and have implemented precautions to ensure the safety and well-being of the CorMedix personnel. I look forward to providing you with material development updates via the CorMedix website, press release and conference calls. Thank you for your continued support of CorMedix. This concludes management presentation. So let me hand the floor back to the operator.

(Operator Instructions) And our first question is from Andrew D'Silva from the B. Riley & Company.

A couple of quick ones. And also, just let me know if you gave color on this during your prepared remarks, I was jumping between a couple of calls. So just to start, if you could just give a little bit of color on the strategy you have as it relates to sales and marketing and building a sales force. And what I'm really looking for is maybe some context if you do go from a direct standpoint context on the size of the sales team and maybe the timing before you determine if you'll be hiring a direct team or not? And then I know you touched on this briefly during the prepared remarks, but just how does CMS coverage and Fresenius and DaVita's market share really play a role in your decisions there?

Okay. Thank you, Andy. In terms of our sales and marketing organization, we have been looking at a very top line in terms of the concentration of where the hemodialysis patients with catheters are located. And we have seen that the requirements of having a direct sales force on the ground is not a very large organization. If you take a specialty organization, pretty much if you would cut a specialty organization in half, you may not even need that many people. Clearly, the payer environment is something that we will pay a lot of attention to. And that is the reason why the payer side, including medical affairs, are the first individuals that leaderships that we're bringing into place and have brought into play. The sales force, the actual boots on the ground, will come very much at the tail end when pretty much we're -- knowing that we are going it alone. And also at that time, we have just about enough time to get them on board and be able to launch product.

In terms of your second question about CMS and the importance of CMS, that's a good question. And actually, it's one of the questions that I have also received from several people via e-mail. So let me try to cover it in its broader sense. The questions that we have received is the role of CMS, what happens while you wait for CMS coverage, what potentially could be the delay in terms of reporting sales and how does the TDAPA program, which is the transitional add-on program, play into this whole equation. So in order to answer this question completely, let me start the following way. So it's very true that Medicare covers about 90% of all the hemodialysis patients under the Medicare program. So they are a very important stakeholder. What is even more important is not just the coverage that one gets, what I mean by that is, is it going to be in the bundle? Or is it going to fall under the transitional drug add-on payment adjustment system called TDAPA? In January 2020, CMS finalized revisions to that TDAPA program, and that took effect. Some of these changes include new molecule entities, new chemical entities, that are eligible for CMS reimbursement outside of the bundle under the TDAPA program. And that is very good news. So if approved under TDAPA reimbursement of Neutrolin would be calculated based on its average selling price, ASP. If ASP is not available, then would be based on WAC, which is the wholesaler average cost. And if WAC is not available, then it will be based on drug manufacturer invoice. And generally, CMS will pay for the new renal drug or biological product using TDAPA for at least the first 2 years. And if the new drug or biological product is used to treat or manage a condition for which there is not an existing ESRD functional category, then they would look at it. It would be eligible. And today, there are 11 basic functional categories. We do not see Neutrolin fitting in any one of these categories because of its preventive claim that Neutrolin will have. Currently, the anti-infectives that has a category in the ESRD PPS functional category is focused on treatment, not prevention.

Also, an initial analysis of the process is as follow, because this is a question that's come up quite a bit is how long will it take. The FDA approval is the main gatekeeper. Once the approval is obtained, applications are sent to the division of the Chronic Care Management, the CCM in CMS, stating our interest in eligibility for TDAPA. And at the same time, we will need to apply for the healthcare common procedure coding systems. Both these process run in parallel and take about 3 to 4 months. CMS has moved their reviews to quarterly reviews. And their aim is for having an effective date for payment 1 quarter of the quoting effective date.

So as I've stated, this is the initial analysis. We will be working with experts in this area. They're called coders to ensure that Neutrolin value proposition gives us the best short to ensure a successful outcome. And that we get under the TDAPA program, at least for the first 2 years. Nothing is guaranteed. Amgen has 2 products up there, and it's in its third year. But the robust clinical data results, coupled with a huge unmet medical need gives us reason to be optimistic.

Okay, great. And then just my last question just relates to some of the comments you've made previously as it relates to potentially having to run another Phase III. Does that really don't apply anymore correct since the FDA granted your request for rolling review? And it's now really if the NDA, once you submit the various modules, has been filed adequately and with the appropriate amount of data or information. Is that a fair assessment? Or are you still unsure as it relates to second Phase III?

Phoebe?

It remains a review decision, Andy. So as you said, when FDA reviews the submission and reviews the data for LOCK-IT-100, it will determine whether or not in its opinion the information in the NDA provides the substantial evidence of safety and effectiveness to meet statutory requirements for drug approval. So if at that time, it decides that the data are not sufficient, then it could request the second Phase III trial.

But this isn't really any different than most other companies that run one pivotal and then file an NDA and look for an approval based on that one trial. It's just the way you're articulating it is for more of a conservative stance. Is that a fair assessment? Or from your previous experience, is it from your discussions with the FDA a little bit different relative to running a single Phase III versus having to do II?

Well, we believe that the extremely robust data from LOCK-IT-100 does provide substantial evidence of safety and effectiveness. As we have summarized previously, it was a milestone study in hemodialysis subjects. It was a very large study with over 800 subjects enrolled. It was conducted at 70 clinical sites across the U.S. that provide evidence to FDA that the product will perform as intended in different patient populations with different demographics across the United States. So we believe that the data will be sufficient, but you never can say never with the FDA until they actually get in and review it, you know.

Our next question is from Ram Selvaraju from H.C. Wainwright.

Firstly, I just wanted to ask about the pediatric study plan and where that fits into the processing of the NDA? Is that going to be a gating item, meaning the review and approval of the pediatric study plan for the actual approval of the Neutrolin NDA? Or is that something that is going to occur before the final NDA submission is completed? Or is it something that will likely be done before the actual expected PDUFA date approval this year? Just give us an idea of where the pediatric study plan fall in the overall continue of approval process?

We requested and received the deferral for conducting it as a pediatric study prior to NDA submission. So it's part of that deferral process, a pediatric study plan was embedded. And FDA will then expect us to fulfill our commitment to conduct the pediatric study post approval of the NDA. And as you know, there is a lot that need to be done to get a clinical trial up and running. So while the NDA is under review, we can go forward with those discussions with FDA.

Okay. But does the study plan need to be approved by the FDA before the Neutrolin NDA is approved? And has the study plan actually been approved by the FDA yet? My understanding was that, that is still [tight].

The pediatric study plan has been submitted to FDA and agreed upon.

Okay, great. Secondly, I was wondering if you could just give us some additional clarity. Khoso, you mentioned that some initial hiring has begun with respect to the sales and marketing infrastructure, can you just give us a sense of what personnel, what staffing, if any, has actually been spun up as it were -- as you prepare for the potential commercialization of Neutrolin so far?

Yes. So when the process is started, we have so far appointed 2 people, one in the payer world and one in medical affairs to be focused here in the U.S. and we have others lined up behind these to bring on board. As I said, the focus will be initially on the payer and medical affairs components and then the rest of the buildup will come through the remaining months and quarters.

Okay. And then I just wanted some additional clarity regarding the differentiation between the new technology add-on payment and TDAPA? And what specific framework would apply to Neutrolin specifically?

So I maybe not prepared at the moment to talk about the differences of the 2 program. What I can focus is on the TDAPA program where if you got a new chemical entity or new molecule, then you would be eligible to apply for TDAPA, particularly if you've got a drug or a biologic that does not fit in any of the categories. And clearly, that has been the position we have taken -- that do not fit in those categories. And we will be a new chemical entity. But I cannot separate out because the other one covers other supplies, which I don't have the separation of the 2. I can get it and provide that to you, Ram.

Okay, great. And then with respect to the distribution, can you comment at this time on what the distribution channel would look like for Neutrolin? And if you expect there to be any kind of learning curve as it were as Neutrolin is deployed into the field with respect to how it is used in conjunction with catheter lock solutions? Or if you expect it to be very seamless because everybody uses catheter lock solutions and Neutrolin is basically just going to be incorporated into that?

Yes, I think there are -- it's several questions in your one question. One is your distribution chain, and I think when we had Jack on the call previously, we talked that we will be using a 3PL for coordinating our distribution in the U.S. But we expect -- and I covered in our early -- in this call that we are now nailing down how that flow will look, but we expect to have sales going through specialty GPOs, we expect sales going through wholesalers. And we also expect some direct sales that would be going to the larger dialysis providers. The mix of how that flows is what we will be nailing down over the coming period with the team now we've got in play. So that's the first part of your question. The second part of your question, could you repeat the last part of your question?

I missed that last part.

Yes, it was just to be able to determine if there is going to be any learning curve with regard to the adoption of Neutrolin or if you anticipate that to be very seamless because everyone knows what catheter lock solutions are, and it's just going to be a component of that.

Yes. So the answer would be, our expectation would be that it would be seamless because today, they used a catheter lock solution. And the way they would use our catheter lock solution will be exactly the same way. So it will be seamless from that perspective. Clearly, the benefit they get with a 71% reduction in infection rate, will make a huge difference. And in today's environment, where we are with what's going on around, clearly, infections and the implications on infections on loved one means a lot.

And we have reached the end of the question-and-answer session. And I will now turn the call back over to Khoso for closing remarks.

Okay. So before I do a close, there were other questions that I had received and that I'd like to try to cover in this call. So let me just get that questions. So let me begin with 1 question that is pretty much prominent in the minds of people.

With the recent report that a big quantity of U.S. antibiotics are being manufactured in China, there's likely going to be potentially pressure. That's what the question indicated to us to require some amount of critical drugs to be manufactured in the U.S. going forward. And so the question was, will this affect our CMC plan? And if so, what has been done to address it. So let's start with that question. Phoebe?

Thank you, Khoso. I think all of us are aware of COVID-19 and the coronavirus pandemic that's ongoing. And that has certainly made us take precaution related to how we work and business-related travel plans. However, CorMedix was well aware of potential issues previously, and we have taken precautions to ensure that our supply chain does not involve China. Nonetheless, we'll continue to closely monitor the situation and make any adjustments that are needed in the future.

Thanks, Phoebe. Another question that we got was 2 large hemodialysis chains that participated in the LOCK-IT-100 trial, that's basically Fresenius and DaVita. Can you give some insight into discussions with these or other companies?

So yes, both of this hemodialysis change were part of our landmark study. Yes, they both know Neutrolin. There's always been an open dialogue with both of these centers -- providers. But it would really be inappropriate for me to share any further information of any discussions with them at the moment.

There was another discussion -- question about what is the status of the NDA submission and how many sections have been submitted? So Phoebe?

Yes. As I said during the call, we have informed you that the NDA submission has started. FDA will not make a decision on the acceptability of the modules until -- after all of the modules have been submitted. Our next update will occur once the FDA has accepted the NDA. Or as we mentioned during the prepared remarks, if we hear from the FDA that there is some delay imposed by the COVID-19 pandemic due to travel restrictions, then we'll certainly provide an update. However, we are still optimistic that we're planning for a potential approval of Neutrolin NDA in the second half of 2020.

Thanks, Phoebe. Another question that we got is, could you comment on CMS TDAPA decisions and how it could affect Davita and Fresenius negotiations in a positive or negative way?

Clearly, the payout strategy will be different if we obtain TDAPA not. We do believe the robust data from the LOCK-IT-100 study clearly demonstrates to all health care providers that implementation of Neutrolin in their catheter dialysis patients should be very carefully considered as Neutrolin's ability to prevent life-threatening infections fulfills a huge unmet medical need. That will be part of the value proposition that is being developed.

Another question that we got was, can you please update the status of the NDA? Is CorMedix on schedule to have the FDA review and give their guidance in the second half of 2020? Phoebe?

Yes, as I noted during the call and just a few minutes ago, we remain optimistic for our potential approval of the NDA in the second half of 2020. However, it's clear that the impact of the COVID-19 pandemic is continuing to evolve and could significantly change FDA's ability to function effectively, which could delay approval.

Thanks, Phoebe. And then just the last question, again, to Phoebe, was that in light of the current coronavirus pandemic, the huge unmet need out there, have CorMedix had any discussions with government agencies to see how we could contribute in flattening the curve? So Phoebe?

We agree that the coronavirus pandemic is imposing disruptions throughout the world. And the government is reacting on a daily basis to minimize the spread of the infection and provide medical resources over the next several weeks. We have not had any discussions with government agencies on redirecting limited resources given the unprecedented situation in which the government agencies are operating.

Thanks, Phoebe. So those were the questions that we got in writing. I tried to categorize them into these different groupings so that we could answer as many questions as we can. So for my closing remarks, I'd just like to thank you all for your time and attention. CorMedix remains committed to bringing Neutrolin to the U.S. market to help patients in need of protection from life-threatening infections. The importance of preventing infections is even more apparent now during this coronavirus pandemic. So thank you very much for spending time with us this evening. Be safe. And look forward to seeing you on future calls. Bye-bye.

Thank you, ladies and gentlemen. This now concludes today's conference. You may now disconnect your lines. Thank you for your participation, and have a good day.