Biotech stocks are notoriously volatile, and reinforcing this on Tuesday was the performance of the clinical-stage company CorMedix (CRMD 1.98%). A key pipeline product was again rejected by a top regulator, and as a result the shares were in free fall. They closed the day down more than 57%.
CorMedix reported Tuesday morning that the Food and Drug Administration (FDA) has effectively turned down the New Drug Application (NDA) for the company's DefenCath catheter lock product.
The company said that in a new Complete Response Letter, the FDA stated that approval could not be granted "until deficiencies recently conveyed to the contract manufacturing organization (CMA) and the supplier of the active pharmaceutical ingredient (API) heparin during inspections are resolved," to its satisfaction.
This sounded wearily familiar to CorMedix shareholders. The FDA's reaction was very much like what it expressed in the first Complete Response Letter for the DefenCath NDA. In that March 2021 missive, it voiced concern about the third-party manufacturing plant responsible for the product.
Several months after that, CorMedix announced a delay in resubmitting the DefenCath application, due to difficulties with that manufacturer. The new submission was finally made this past February.
So there's a gloomy, going-nowhere-fast pall hanging over CorMedix just now. The company doesn't seem in immediate danger of having to cease operations, but it's certainly burning through cash. At the end of March, it had $45.5 million on its books, down some distance from the more than $76 million it possessed one year earlier. That certainly isn't going to last forever, so the troubled biotech is going to need a significant win soon.