Question · Q3 2018
Laura Engle from Stonegate Securities asked for clarification on the Invekra manufacturing deal, specifically its contractual end date and margin impact. She also inquired about the company's cash burn relative to its cash position and potential future funding needs to reach profitability. Finally, she questioned if there were plans to seek U.S. approval for products recently approved in the UAE.
Answer
CFO Robert Miller clarified that the contractual obligation to manufacture for Invekra at a 6% margin ends in October 2018, at which point Sonoma can renegotiate terms. He also stated that the company's cash burn is expected to decrease significantly in the upcoming quarters as it moves toward profitability. CEO James Schutz addressed the UAE approvals, explaining that while desirable, obtaining similar broad indications from the FDA in the U.S. is highly unlikely due to different regulatory standards, and the company is not actively pursuing them.