CRMD earnings call for the period ending December 31, 2024.
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CorMedix (CRMD -27.67%)
Q4 2024 Earnings Call
Mar 25, 2025, 8:30 a.m. ET
Contents:
- Prepared Remarks
- Questions and Answers
- Call Participants
Prepared Remarks:
Operator
Good day, and welcome to the CorMedix Inc. fourth-quarter and full-year 2024 financial results conference call. All participants will be in listen-only mode. [Operator instructions] Please note, today’s event is being recorded.
I would now like to turn the conference over to Dan Ferry with LifeSci Advisors. Please go ahead.
Daniel Ferry — Investor Relations
Good morning, and welcome to the CorMedix fourth-quarter and full-year 2024 earnings conference call. Leading the call today is Joe Todisco, chief executive officer of CorMedix. And he is joined by Dr. Matt David, executive vice president and CFO; Beth Zelnick Kaufman EVP and chief legal and compliance officer; Liz Hurlburt, EVP and chief clinical strategy and operations officer; and Erin Mistry, EVP and chief commercial officer.
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 statements other than statements of historical fact regarding management’s expectations, beliefs, goals, and plans about the company’s prospects and future financial position. Actual results may differ materially from the estimates and projections on which these statements are based due to a variety of important factors, including the risks and uncertainties described in greater detail in CorMedix’ filings with the SEC, which are available free of charge at the SEC’s website or upon request from CorMedix. CorMedix may not actually achieve the goals or plans described in these forward-looking statements.
Investors should not place undue reliance on these statements. CorMedix does not intend to update these forward-looking statements except as required by law. During this call, the company will discuss certain non-GAAP measures of its performance. GAAP to non-GAAP financial reconciliations and supplemental financial information are provided in CorMedix’ earnings release and the current report on Form 8-K filed with the SEC.
This information is available on the Investor Relations section of the CorMedix Website. At this time, it is now my pleasure to turn the call over to Joe Todisco, chief executive officer of CorMedix. Joe, please go ahead.
Joe Todisco — Chief Executive Officer
Thank you, Dan. Good morning, everyone, and thank you for joining us on this call. Having completed our initial partial year of commercial launch of DefenCath, I’m incredibly proud of the team’s efforts and pleased with the commercial results thus far. The fourth quarter saw continued growth with both existing as well as new customers in the outpatient segment which was the primary driver of our strong revenue and profit results for both Q4 and full year 2024.
Net revenue for the fourth quarter and full year were 31.2 million and 43.5 million respectively, both of which exceeded Wall Street consensus prior to our pre-announcement on January 7th. The fourth quarter was also the first profitable commercial quarter in the company’s history, with net income of $13.5 million and adjusted EBITDA of $15.3 million. Fourth-quarter results were driven by strong uptake among patients at U.S. Renal Care, ramping implementation at our mid-size customers, IRC and DCI, as well as utilization by other small outpatient dialysis customers.
As we announced back in early January, we began the first quarter of 2025 with more than $25 million of purchase orders in hand from existing customers for first-quarter delivery. While we are not going to provide full-year revenue guidance at this time, we currently estimate that net revenue from existing purchasing customers for the first six months of 2025 should be in the range of $50 million to $60 million with more than 33 million expected in the first quarter. DefenCath net selling price has been fairly stable throughout the first three quarters of outpatient commercialization. However, we do expect to begin to see some net price erosion beginning in the second quarter of 2025.
With respect to patient growth opportunities, there is still some potential for new patients with existing outpatient customers. However, to a large extent, our ability to grow patient volumes significantly in the back part of 2025 will be contingent upon the timing of purchasing and scale of implementation by our contracted large dialysis organization customer. Prior to year-end, we met with our contracted LDO customer who communicated to CorMedix that DefenCath implementation was pushed into 2025 due to operational resource constraints. Over the course of February and early March, we have had multiple meetings with this customer, provided significant requested information around resources available at CoreMedix to assist with training and the implementation of DefenCath, and we remain hopeful the customer will begin ordering and commence utilization prior to mid-year.
Turning to the inpatient segment. We have started to see utilization increase at a handful of larger hospitals, and we are hopeful to increase penetration as we move throughout 2025. Back in January, we announced a change to our inpatient commercialization strategy, whereby we reorganized our field team covering outpatient and inpatient customers. This process is now complete as we are partnering with Syneos Health to build a dedicated inpatient field team that is highly experienced in the hospital formulary process and the launch of first-in-class products in this setting of care.
We also recently announced a partnership with WSI to provide marketing and promotional resources for DefenCath, specifically to facilities operated by the Veterans Administration. I am happy to announce that the new inpatient team is nearly fully staffed and is expected to be active in the field in the next four to five weeks. The team contracted through WSI has already commenced promotional activities to VA facilities. While we do not currently report inpatient sales as a separate segment, we do expect to see meaningful growth in this setting of care by the end of 2025 with an increased contribution to overall revenue and earnings in 2026 and beyond.
Focusing now on our clinical developments, we are in the process of beginning our Phase 3 clinical study for the reduction of central line-associated bloodstream infections or, CLBSIs, in patients receiving total parenteral nutrition, or TPN, through a central venous catheter. We began site selection in February and expect to begin patient enrollment for the study in the second quarter of this year. As we communicated previously, this is a 12-month study in less than 150 patients, and we are targeting completion of the study and submission of a new drug application to FDA by the end of 2026. We recently submitted to FDA an application for orphan drug status for this indication and are awaiting FDA’s determination of eligibility.
The company’s goal for TPN is to obtain FDA approval for an expanded use of our taurolidine and heparin catheter lock solution in the late 2027 to early 2028 time frame. And we estimate annual peak sales potential in this indication to be in the range of $150 million to $200 million. We’ll provide investors with updates on progress in this important area of unmet need as we move forward. During our previous earnings call, we also discussed three additional clinical initiatives, all having either commenced in 2024 or expected to begin in 2025.
The most meaningful of the three from a data value standpoint is our real-world evidence study, which we are running in cooperation with our study partner, U.S. Renal Care. Our hope with this study in which we expect to evaluate outcomes of more than 2,000 patients over 24 months would be to generate real-world evidence around the impact of DefenCath utilization on cost-of-patient care, infection rates, hospitalizations, mortality, and multiple other metrics such as lost share time and CRBSI-related antibiotic use. Data collection for this study has already commenced.
In addition to our adult TPN and real-world evidence studies, we will also be commencing a study in pediatric hemodialysis in 2025. This will be a relatively small study spread over several years as we expect patient enrollment to be a challenge given an extremely small patient population and the need for very personalized protocols for these ultra vulnerable patients. This pediatric study is a post-marketing requirement under the Pediatric Research Equity Act by the FDA, and we have FDA’s concurrence on the final study protocol. We currently expect patient enrollment to begin in the third quarter of 2025, and we expect this study to span three to five years.
Lastly, in addition to our other clinical initiatives, we have commenced an expanded access program for high-risk populations, including but not limited to pediatric TPN, peritoneal dialysis patients with refractory peritonitis, and neutropenic oncology patients utilizing a CVC. These high-risk patients are those that have exhausted other infection-prevention methods and, unfortunately, remain at significant risk for comorbidities and mortality. We are fielding a high number of requests for participation in this expanded access program and currently expect patients to be dosed under this program in the second quarter of this year. I would now like to turn the call over to Matt to discuss the company’s fourth-quarter and full-year financial results and financial position.
Matt?
Matt David — Executive Vice President, Chief Financial Officer
Thanks, Joe, and good morning, everyone. I am pleased to be here today to provide an overview of our fourth-quarter and full-year 2024 financial results as well as an update on CorMedix’ cash position. The company has filed its annual report on Form 10-K for the year ended December 31st, 2024. I urge you to read the information contained in the report for a more complete discussion of our financial results.
With respect to our fourth quarter of 2024 financial results, our net revenue for the fourth quarter of 2024 amounted to 31.2 million. CorMedix achieved profitability in the fourth quarter as our net income was 13.5 million, or $0.22 per share, compared with the net loss of 14.8 million or $0.26 per share in the fourth quarter of 2023. The net income recognized in 2024 was driven by the profits associated with net sales of the DefenCath following the product’s launch in 2024. Operating expenses in the fourth quarter of 2024 increased 9% to 17.1 million, compared with 15.7 million in the fourth quarter of 2023.
The increase was driven by higher selling and marketing and G&A expenses offset by a decrease in R&D. R&D expenses decreased by 26% to 1.7 million, driven by the approval of DefenCath. CorMedix is now reporting selling and marketing expense and general and administrative expense as separate line items. On an apples-to-apples basis, S&M expense increased 1% to 8.3 million in the fourth quarter of 2024 compared with 8.2 million in the fourth quarter of ’23.
G&A expense increased 36% to 7.1 million in the fourth quarter of 2024 versus 5.2 million in the fourth quarter of 2023. The increase in S&M expense was attributable primarily to increased marketing efforts and new personnel inclusive of our field sales organization and support for the commercial launch of DefenCath. The increase in G&A expense was primarily due to increases in personnel costs in preparation for support activities related to our commercial launch. With respect to our full-year 2024 financial results, total net revenue during 2024 amounted to 43.5 million.
This marks the first full year CorMedix is reporting net revenue since launching DefenCath in spring-summer of 2024. Total operating expenses during the full year 2024 amounted to 62.6 million, compared with 49 million in 2023, an increase of 28%. R&D expense decreased 70% to 3.9 million, driven primarily by the approval of DefenCath. Selling and marketing expense increased 59% to 28.7 million, compared with full year 2023, and G&A expense increased 69% to 30 million, compared with 2023.
The increases in S&M and G&A were driven primarily by new personnel and costs to support the commercial launch of DefenCath. We recorded net cash used in operations during 2024 of 50.6 million, compared with net cash used in operations of 38.4 million in 2023. The increase is primarily driven by an increase in trade receivables and inventories, offset by a net increase in the change of accrued expenses and accounts payable and a decreased net loss. The company has cash and cash equivalents of 51.7 million as of December 31st, 2024.
Based on accounts receivable collection throughout first quarter of 2025 and, to a lesser extent, proceeds from ATM issuance, we anticipate completing first quarter of 2025 with at least 75 million in cash and cash equivalents. As described in our January 7th release, we are guiding to 2025 cash operating expenses of approximately 72 million to 78 million. The increase over 2024 spending levels is expected to be primarily driven by an increase in R&D spending on clinical initiatives. I will now turn the call back over to Joe for closing remarks.
Joe?
Joe Todisco — Chief Executive Officer
Thanks, Matt. CorMedix is working diligently on all fronts to increase our existing customer base as well as expand the use of DefenCath to new therapeutic indications. I appreciate everyone’s continued support and CorMedix, and I’m happy to take questions.
Questions & Answers:
Operator
Thank you. We will now begin the question-and-answer session. [Operator instructions] At this time, we’ll pause for just a moment to assemble our roster. And today’s first question comes from Roanna Ruiz with Leerink Partners.
Please go ahead.
Roanna Ruiz — Analyst
Hey, good morning, everybody. So, I did have a question about the Syneos Health partnership and your build-out of the inpatient sales team. What are your first steps for this team once they’re fully launched? And do you have any color on what the ramp might look like in the inpatient setting for DefenCath over time?
Joe Todisco — Chief Executive Officer
Well, look, let me — I’ll comment on the inpatient kind of ramp, and then I’ll let Erin and Liz comment a little bit on — on the team and its deployment. So, you know, obviously, we were a little bit slow at the gate on the inpatient side last year. That’s not unusual for — for this setting of care or for these types of launches. It takes quite a while to — to work through P&T processes.
I am pleased with what we’ve seen in the first quarter. I know we — as I said, we don’t report anything from a — from a separate segment standpoint on the inpatient side. But right now, for the first quarter, inpatient is looking to be about 3% of unit volume and 4% to 5% of dollars. So, I feel pretty good about that trend.
Inpatient as a as a total is 10% of the unit volume of the overall market opportunity. So, if we can, you know, move toward there, right, as we get into 2026, I think that’s certainly a target that we’d like to try to achieve. We’re at the process of — of just finally completing the staffing of the last two to three roles, right, to fill out the team completely. Training is near complete, and we’re hope to have them out in the field in the next four to five weeks.
Erin, do you want to comment anything beyond that?
Erin Mistry — Executive Vice President and Chief Commercial Officer
Sure, I think that just what we plan for them to do right out of the gate is to focus on the large academic medical centers. Similar as before, they’re not starting from scratch. These hospitals either have — going through the P&T process now, or they have already ordered DefenCath. And so, we’re just making sure that they’ve got the support they need and the ramp to order more.
And we’re also aligning them closely with VA medical centers that are typically in the same territory or region.
Roanna Ruiz — Analyst
Got it. Thanks. And second one for me. I noticed on the call you talked about net price erosion starting in 2Q.
Could you just elaborate a bit on the degree of the erosion? Could it flow into some of the subsequent quarters as well?
Joe Todisco — Chief Executive Officer
Yeah, thanks, Roann. I think it’d be good to comment on the guidance we gave first and kind of what it means, right? So, you know, I know it’s unusual to — to guide for a partial part of the year, but the way we’re kind of looking at it or the way I think investors should look at it is, the 50 million to 60 million range is really, I guess, what you would think of as our base business, right? In terms of the customers that we’re — that we’re really buying by year-end and then you know into the early part of the first quarter, certainly to the extent we bring in either new customers — obviously new customers, there’s upside, right, from those numbers. If — certainly, if our LDO customer starts buying in the second quarter, right, that there’s upside in those numbers. Now, when we talk about price erosion, it’s — I’m not going to — I don’t know if I can give you an exact percentage, but the way in which we’re thinking about it is our agreements with customers and the way that we’re currently priced, there are, let’s say, discounts and rebates off of government ASP.
And government ASP has remained kind of stable, right? It starts out at whack during TDAPA, and then it adjusts for the first quarter. I think it was down only 1% from — from what it was the prior quarter. Next quarter is still — second quarter, going to be fairly stable. The third quarter, you know, it should come down a little bit, but we’re going to have to or we’re expecting to take a shelf stock adjustment at the end of the second quarter, right, as we move into third.
And what we don’t really have a handle on right now is exactly how much inventory will be in the channel by the end of the second quarter. So, that’s something that we’re still working through, and that kind of factors into the range that we gave for revenue from existing — you know, what we’ll call the existing base business over the — over the first part of the year.
Roanna Ruiz — Analyst
Got it. Helpful. Thanks.
Joe Todisco — Chief Executive Officer
Thanks.
Operator
Thank you. And our next question today comes from Jason Butler, Citizens JMP. Please go ahead.
Jason Butler — Analyst
Hi. Thanks for taking the question, and congrats on the progress in the quarter. Joe, can you maybe just give us some more color about the process that the contracted LDO is going through and your interactions that kind of just reinforce your confidence that they will begin ordering in the next couple of months, next few months?
Joe Todisco — Chief Executive Officer
Thanks, Jason. Look, I think what I can say at this point in time is we’re being as supportive as we can possibly be. We’ve had a lot of information requests come from them, right, specifically around support services we could provide for training, for reimbursement. And we’re making our staff available to them kind of across the board.
So, I — you know, as I said, we’re hopeful that we’ll stick with the original kind of plan or communicated timeline of implementation by mid-year, but that’s really all I have to go on at this point in time.
Jason Butler — Analyst
OK, helpful. And then just from in terms of the magnitude of use within the LDO, has that number remained consistent throughout your dialogue with them?
Joe Todisco — Chief Executive Officer
Yeah. Look, they haven’t — they haven’t given us any indication right now that that number — or they’re going to deviate from that number. But we do know they’re looking at implementation. I think there’s — there’s a possibility that number could be higher.
There’s a possibility that number could be lower. Right. I think what we’re trying to do right now, as I said, is make all the resources of CorMedix available to them and, hopefully, accelerate the rollout, both in terms of speed and scale.
Jason Butler — Analyst
Great. And then just a second one for me. In terms of potential new customers, obviously, there’s the other LDO. Could you give us an update there? But beyond that, are there other smaller providers that, potentially, could come online in the second half of the year? Thanks.
Joe Todisco — Chief Executive Officer
Yeah, thanks. Look, with respect to the other LDO, obviously, we remain in communication with them. We’ve — we’ve provided them additional information. I think, candidly, we haven’t moved the needle there as much as we would have liked to over the past couple of months.
We are still working there, call it top-down, right, through the senior level of management. We’ve also started to work their bottom-up, right? These — a lot of these large [Inaudible] operators, they have joint venture-owned entities where the JV partner has some decision-making authority. So, we’ve started to work through some of those joint venture organizations that have expressed an interest in DefenCath. And we’re hopeful to kind of make inroads there over the next two to three months.
On the small side, you know, yes, right, there’s — you know, there are a lot of — I guess first, I’d say we are shipping to a number of small customers where we don’t talk about them specifically. You know, some may have 10 — you know, 10 dialysis centers. Some might have 20, but in addition to some health systems that have 10 to 25 hospitals. But yes, that’s absolutely part of our focus over the next — part of 2025 to build inroads with those smaller customers and to increase ordering size and frequency.
Jason Butler — Analyst
OK, great. Thank you for taking the questions.
Operator
Thank you. And our next question today comes from Gregory Renza with RBC Capital Markets. Please go ahead.
Anish Nikhanj — Analyst
Hi, guys, it’s Anish on for Greg. Congrats on all the progress, and thanks for taking our questions. Just a couple from us. First, just on TDAPA.
How should we be thinking about patient applicability, and what are your thoughts and trends in coverage such as Medicare Advantage over the next two to three years? And second, what are the key levers you look to pull to maximize uptake of DefenCath to ensure the best possible post-TDAPA add-on adjustment? Thanks so much.
Joe Todisco — Chief Executive Officer
Thanks, Anish. Look, I think with respect to TDAPA, I’m not sure what you meant by applicability, but in terms of what we’re seeing — I’ll start out with what we’re seeing from Medicare Advantage now, right? So, when we look at our payer claims, we launched the product in mid 2024 in the outpatient setting. And initially, 100% of claims were fee for service, right, because it’s the Medicare Advantage. There was a little bit of a lag in picking up TDAPA.
And as we move toward the back part of last year, we started to see the trend going toward Medicare Advantage. I think we closed out last year with about 25% or 30% of our claims being Medicare Advantage through this first part of the first quarter, 40% of our claims are Medicare Advantage and other payers, and 60% are fee for service. Som that’s certainly the trend we want to see. When you look at the broader ESRD market, 80% to 85% of it is Medicare.
And within Medicare, half of it is fee for service and half is Medicare Advantage. We do see the Medicare Advantage market share of Medicare growing over time. We do think it ultimately will become 70% of ESRD patients, and we do see that as a good opportunity for CorMedix. So, what we’re doing to better prepare ourselves, call it for the out years of the TDAPA and beyond, is the real-world evidence study that we’re running in collaboration with U.S.
Renal Care, right? A lot of that data and, you know, specifically around the pharmacoeconomic benefits of DefenCath is what we’d like to utilize as part of a direct contract negotiation with the MA plans for — for separate and more sustainable reimbursement. Did I address the second question as well, Anish?
Anish Nikhanj — Analyst
Yes, that’s very helpful. Thank you.
Joe Todisco — Chief Executive Officer
OK, all right.
Operator
Thank you. And our next question comes from Les Sulewski with Truist Securities. Please go ahead.
Jeevan Larson — Truist Securities — Analyst
Hey, this is Jeevan On for Les. Thanks for taking our questions. We recently saw the news on FDA’s acknowledgment of bloodline shortages that might impact hemodialysis procedures. Can you provide any commentary if this has any impact on utilization or uptake of DefenCath? Thank you.
Joe Todisco — Chief Executive Officer
Yeah. Hi, thanks, Jeevan. No, it’s not — it’s not likely to have any impact, but I’ll let Liz explain why.
Liz Hurlburt — Executive Vice President, Clinical and Medical Affairs
Yeah. So, thanks for the question. The good news is that there are two equivalent alternative manufacturers for this. So, hemodialysis isn’t going to stop.
I think that the dialysis providers feel pretty good about that, but I don’t anticipate any impact to DefenCath utilization with this. It’s simply a manufacturing challenge that can be addressed with alternatives.
Jeevan Larson — Truist Securities — Analyst
OK, great. Then just a quick second one from me. Can you provide any updates on the status of DefenCath manufacturing capacity? Has there been any readjustments needed or challenges to filling the open purchase orders due Q1? Thank you.
Joe Todisco — Chief Executive Officer
I’m sorry, Jeevan. Was that — was that question around inventory availability?
Jeevan Larson — Truist Securities — Analyst
Yeah, yeah.
Joe Todisco — Chief Executive Officer
OK.
Jeevan Larson — Truist Securities — Analyst
Just your capacity there and any challenges in filling the 25 million open purchase —
Joe Todisco — Chief Executive Officer
No, no. We have more than a year’s worth of finished dosage on hand at our current run rate. We’re well situated.
Jeevan Larson — Truist Securities — Analyst
Great. Thank you.
Operator
Thank you. And our next question comes from Serge Belanger with Needham and Company. Please go ahead.
John Todaro — Analyst
Hi. Good morning. This is John on for Serge today. Thanks for taking our questions.
First, if you just quickly give us the current business mix between the various MDOs that you have on board. Obviously, U.S. Renal Care has been your — has been your anchor thus far. And secondly, in terms of the expectations for the TPN program, are these patients going to be similar to those that were enrolled in the LOCK-IT trial in terms of CRBSI susceptibility?
Joe Todisco — Chief Executive Officer
All right. Thanks, John. I’ll — in a minute, I’ll let Liz comment on the study design for TPN. From a business mix standpoint, I think we have exact percentages in the — in the 10-K for where we closed out last year.
Obviously, U.S. Renal Care still remains more than — more than 80% of orders through that period. It is — it is coming down. Beyond that, I don’t think we’re going to be providing specific customer specific guidance, but we’ll reevaluate as we go forward.
Do you want to comment on the study design on TPN?
Liz Hurlburt — Executive Vice President, Clinical and Medical Affairs
Sure. So, our Nutriguard study, which is our Phase 3 randomized double-blind, two-arm study, which is looking at the efficacy and safety of DefenCath for adult patients receiving TPN, is really focused on those that have had a CLBSI in the last 12 months. We know that patients that have had a CLBSI are at higher risk to have another one. They have an average infection rate of 20% to 25%.
So, similar to dialysis patients in the sense that they are very vulnerable to infection and they may be immunocompromised for a multitude of reasons, right — that’s why they’re probably on TPN. But unlike dialysis, these are folks that access their catheter on a daily basis, not three times a week like you would see in hemodialysis. Does that answer your question?
John Todaro — Analyst
Yeah, that’s great. Thank you very much.
Operator
Thank you. And this concludes the audio question-and-answer session. I’d like to turn the conference back over to Dan Ferry from LifeSci Advisors for written questions.
Daniel Ferry — Investor Relations
Thank you, operator. We do have some written questions from the audience. The first will be: Did the change in CMMI, which is the Center for Medicare and Medicaid Innovation, did that policy impact patient uptake in the first quarter?
Joe Todisco — Chief Executive Officer
OK, thanks, Dan. And I think — I think what you’re referring to is the policy change that took place back in November that removed or the patients that participate in a kidney care entity, the benchmarks, they excluded to TDAPA from the benchmark. So, they were now allowed to accept TDAPA payments and not be penalized. I think at the time, we guided — we did expect a patient lift of somewhere around 15% to 20%.
You know, we did see that throughout the first quarter, certainly, with U.S. Renal care that we saw lift in patient numbers as a result of that. And I think overall, I think it’s important for innovative products in general, right? It was somewhat of a of a headwind that, thankfully, CMS eliminated.
Daniel Ferry — Investor Relations
OK, great. I have another one here. Proposed changes from the new administration have certainly caused volatility in the sector. Have you seen anything in these announcements that you see as a risk or possibly an opportunity?
Joe Todisco — Chief Executive Officer
Yeah. Look, I know there’s a lot of trepidation from investors right now, certainly in the biotech segment, because of the new administration and potential tariffs on pharmaceuticals. I think the way we’re looking at it specific to DefenCath is definitely more — more of an opportunity. And I think I would divide it probably in a couple of buckets.
I think if you’re looking at the situation through the lens of let’s say DOGE, right, and kind of taking cost out of government spend, I think DefenCath is something that fits you know very well with that agenda, right? So, the government spends over $3 billion a year between inpatient and outpatient derived CRBSIs in the hemodialysis space. You know, if we can replicate our clinical result in a real-world setting, we have the opportunity to offset a large amount of that spend. You know, if — second, I think if you’re looking at it through the lens of, let’s say, make America healthy again, right, type thing — we — I think we also fit pretty well, right, with that type of mindset where if we are able to have, again, replicate our clinical results in a real-world setting and have that type of impact on infections, a byproduct of that is you’re reducing hospitalizations from those infections. You’d ultimately be reducing antibiotic use that would result from those infections.
I think both of which fit pretty well within that initiative. I think more broadly for this administration though, I think we do get — just because it’s a change of administration, not because of who the administration is, I think there is the ability to look at either past decisions through a new lens or new legislative initiatives. And certainly, there’s a lot of I think momentum right now on a bipartisan basis for, hopefully, TDAPA reform. I think — TDAPA was a really good start.
I think it’s — we’ve done OK, but I think everybody recognizes from a long-term standpoint that it certainly could be better in terms of incentivizing innovation, reimbursing providers for utilizing that innovation. And we do know that there’s a bill that’s hopefully making its way through Congress, and hopefully, it’ll be proposed before the end of this year. And if not, hopefully, CMS through rulemaking can make some more positive adjustments. But I think, you know, for us, in our situation specifically, I think we see a lot of opportunity.
Daniel Ferry — Investor Relations
Great. Thank you for that, Joe. I have another one here that’s a bit more on the commercial side of things. What resources does CorMedix have available to help providers with processing reimbursement?
Joe Todisco — Chief Executive Officer
That’s a good question. Yeah. So, we’ve set up a third-party hub, specifically to help the providers themselves navigate claims. And, Erin, do you want to — it’s through a third party.
Erin, do you want to comment on how that’s set up?
Erin Mistry — Executive Vice President and Chief Commercial Officer
Sure. So, third-party prospectus, and they work directly with both us and our customers across inpatient and outpatient settings. They have a couple of main focus areas. One of those is benefits verification for patients and then they have very specific billing and coding expertise to make sure that claims are submitted correctly for TDAPA, for example, on the outpatient side and NTAP on the inpatient side as well as the J codes.
And then they also can navigate any payer policies or complex state Medicaid challenges that we may run into.
Daniel Ferry — Investor Relations
OK, great. Thanks, Erin. It looks like we have one final one here. And I think you touched on this earlier, Joe.
But if signing an agreement or a currently contracted LDO requires greater capacity, what is your RAM time? And how does CorMedix — how is CorMedix situated from a raw material standpoint?
Joe Todisco — Chief Executive Officer
OK, thanks. So, I guess that goes back to inventory. So, I think we divide it into a couple of buckets. I said before from a finished dosage standpoint, I think we’re in pretty good shape based on the current run rate and the anticipated ramp that we kind of built into our LE, right, for — for the — what we expected the LDO customer to do.
Now, if they wanted to ramp significantly beyond that, our ability to pivot is pretty good, right? I don’t think our ramp time is more than a handful of months. We have more than enough raw material on hand between, let’s say, heparin and taurolidine API, you know, to cover that ramp over a year. Turnaround time on heparin API is not significant. Turnaround time on taurolidine API is a bit longer, but we have several — several lots on order that would be delivered in the back part of the year.
So, really, we’ve got two finished-dosage contract manufacturers. One of them is definitely underutilized. So, we have finished dosage capacity we can pivot to. And I think it’s a matter of a handful of months to be able — to be able to ramp.
Daniel Ferry — Investor Relations
That’s great. Thank you so much, Joe. Operator, this concludes the written question portion of the call. You may now close.
Operator
[Operator signoff]
Duration: 0 minutes
Call participants:
Daniel Ferry — Investor Relations
Joe Todisco — Chief Executive Officer
Matt David — Executive Vice President, Chief Financial Officer
Roanna Ruiz — Analyst
Erin Mistry — Executive Vice President and Chief Commercial Officer
Jason Butler — Analyst
Anish Nikhanj — Analyst
Jeevan Larson — Truist Securities — Analyst
Liz Hurlburt — Executive Vice President, Clinical and Medical Affairs
John Todaro — Analyst
Dan Ferry — Investor Relations
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