Pomerantz Appointed Co-Lead Counsel in CorMedix Securities Litigation

On October 12, 2021, U.S. District Judge Julien Xavier Neals of the District of New Jersey appointed Pomerantz LLP as Co-Lead Counsel on behalf of John V. Levon, the Lead Plaintiff in In re CorMedix Inc. Securities Litigation, 20-cv-13819 (D.N.J.), a securities action brought on behalf of a class of defrauded investors concerning alleged material misrepresentations related CorMedix Inc.’s (“CorMedix” or the “Company”) manufacturing process of its lead product candidate for the treatment of catheter-related bloodstream infections (“CRBSIs”).

CorMedix is a biopharmaceutical company that focuses on developing and commercializing therapeutic products for the prevention and treatment of infectious and inflammatory diseases in the United States and internationally. The Company is focused on developing its lead product candidate, DefenCath, a purported novel antibacterial and antifungal solution designed to prevent costly and dangerous CRBSIs.

Allegations against CorMedix include that: (i) deficiencies existed with respect to the Company’s manufacturing process for DefenCath and at the facility responsible for manufacturing DefenCath; (ii) in light of the foregoing deficiencies, the U.S. Food and Drug Administration (“FDA”) was unlikely to approve the DefenCath New Drug Application (“NDA”) for CRBSIs in its present form; and (iii) the Company had downplayed the true scope of the deficiencies with DefenCath’s manufacturing process and/or at the facility responsible for manufacturing DefenCath.

In July 2020, CorMedix completed submission of an NDA to the FDA for DefenCath as a catheter lock solution with an initial indication for use of preventing CRBSIs in patients with end-stage renal disease who are receiving hemodialysis via a central venous catheter.

The truth began to emerge on March 1, 2021, when CorMedix announced that “the [FDA] cannot approve the [NDA] for DefenCath . . . in its present form” due to “concerns at the third-party manufacturing facility after a review of records requested by FDA and provided by the manufacturing facility.” The Company stated that it would “work with the manufacturing facility to develop a plan for resolution when FDA informs the facility of the specific concerns” and that the FDA is “requiring a manual extraction study to demonstrate that the labeled volume can be consistently withdrawn from the vials despite an existing in-process control to demonstrate fill volume within specifications.”

On this news, CorMedix’s share price fell $5.98 per share, or 39.8%, to close at $9.02 per share on March 1, 2021.

On April 14, 2021, CorMedix announced that it would have to take additional steps to meet the FDA’s requirements for DefenCath’s manufacturing process, including addressing the FDA’s concerns regarding “the qualification of the filling operation [that] may necessitate adjustments in the process and generation of additional data on operating parameters for manufacture of DefenCath.”

On this news, CorMedix’s share price fell $1.44 per share, or 15.3%, to close at $7.93 per share on April 14, 2021.

Then, on May 13, 2021, CorMedix announced that “[b]ased on our analyses, we have concluded that additional process qualification will be needed with subsequent validation to address the deficiencies identified by FDA.” After an analyst pressed for clearer information on DefenCath’s manufacturing deficiencies on a conference call held that same day, CorMedix finally disclosed that “there are times when there may be unexpected results obtained”; that the FDA “expect[s] us to generate sufficient data to demonstrate that [the filling] process is a controlled process and is consistent with the agency’s requirements for good manufacturing practice”; that “sterility is a very important part of that process,” as well as “the accuracy in making sure the right volume of DefenCath is loaded into the vials”; that “we are talking about thousands of vials during the manufacturing run”; that Defendant must “generat[e] a lot of data to make sure that . . . all the equipment has been qualified for the intended use and every step in the manufacturing process has been qualified”; that the “process needs to be very robust, [and] needs to be reproducible”; and that “the burden is on the manufacturer to demonstrate that the facility can do that process reducibly and generate the required product for commercial distribution.”

On this news, CorMedix’s share price fell $1.51 per share, or 19.9%, to close at $6.05 per share on May 14, 2021.