Benjamin Wolin - Chairman and Interim Principal Executive Officer.

James Terwilliger - Paulson Investment David Bouchey - IFS Securities Thomas Klema - Rockwell Medical.

Good afternoon. And welcome to the Rockwell Medical Second Quarter 2018 Business Update Conference Call. Before we begin, I would like to note that certain matters we will discuss may be forward-looking statements intended to qualify for the Safe Harbors from liability established by the Private Securities Litigation Reform Act of 1995.

These forward-looking statements can be identified as such because the context of the statement will include words such as we believe, anticipate, expect or words of similar import. Similarly, statements that describe our future plans, objectives, strategies or goals are also forward-looking statements.

These forward-looking statements are subject to certain risks and uncertainties that may materially adversely affect our anticipated results. Risks and uncertainties included but are not limited to, the factors described in our Form 10-K for fiscal 2017 as updated in our periodic reports.

Copies of our Form 10-K are available on the SEC's website, which is www.sec.gov and through a link on our website located at www.rockwellmed.com. The forward-looking statements made on this call are made as of the date of this call.

As we disclaim any obligation to publicly update these forward-looking statements to reflect subsequent events or circumstances. This conference call is being recorded for rebroadcast on Rockwell's website at www.rockwellmed.com. The call will be followed by a brief question-and-answer session.

At this time, I would like to turn the conference call over to Benjamin Wolin, Chairman of the Board and Interim Principal Executive Officer. Ben, please go ahead..

Thank you, Operator. Good afternoon and thank you all for joining me on this call. Apologies for getting out today press release so close to the start of the call. Today I plan to focus on several important changes and business developments underway at Rockwell Medical.

For an overview of our financial performance from the second quarter 2018 I will refer you to the press release and Form 10-Q for the second quarter that the company issued and filed respectively just before this call. Turning to our business updates. As you heard me say before, we recognize that change is needed at Rockwell Medical.

There is much work to be done to strengthen the business and maximize value for our shareholders. We are not standing still and remain as focused as ever on realizing the potential of our innovative renal drug therapies to enhance the lives of dialysis patients and drive value for our shareholders.

The Board is acting in a diligent and purposeful fashion and has taken necessary steps over the past months to better position Rockwell Medical for the future. This starts with the recent appointment of Stuart Paul as our next CEO and Class 1 Director to the Rockwell Medical Board of Directors.

I'm extremely excited that we are welcoming the leader of Stuart’s caliber to Rockwell Medical during this pivotal time for the company. Stuart is a seasoned veteran in the healthcare industry with 25 years of experience serving in a number of senior leadership roles with Abbott Laboratories, Quest Diagnostics and Gambro AB and Baxter.

Stuart brings significant operating and commercialization expertise across domestic and international markets, and deeply familiar with the clinical development process.

At Gambro AB, a $2 billion global dialysis products company, Stuart was a key member of the senior leadership team and was responsible for running a variety of businesses, including its $150 million Asia-Pacific and $400 million Americas businesses, which he brought to new levels of revenue and profitability.

Stuart also played an integral role in the $4 billion sale of Gambro AB to Baxter International in 2013 and led the integration of the combined $650 million Baxter, Gambro renal business in Latin America, driving significant synergies, revenue and profit growth.

Stuart is eager to hit the ground running when he joins us on September 4th and will play an integral role in continuing to build out the leadership team, including selecting our new Chief Financial Officer. Until he officially joins the company I will be serving as the Interim Principal Executive Officer.

As we stabilize the business and transition into our next phase of growth we will look to leverage a successful experience executing on commercialization strategies and driving growth and profitability. We've also engaged a new independent registered public accounting firm Marcum LLP as our auditor.

Marcum is one of the largest independent public accounting and advisory services firms in the nation and we are pleased to be working with them. And finally, as we announced on August 7th, we have resolve the dispute with former management team. We are pleased to have these matters firmly behind us so we can focus solely on operating the business.

To that end, with regard to our renal therapies we continue to focus on maximizing the opportunity with Triferic. The company remains focused on its commercial planning to launch the product in the U.S., while still continuing to pursue separate reimbursement.

We know that with the right resources and focus we can create significant savings for clinics and the healthcare system and improve clinical outcomes for patients. Before we open up the call for Q&A, I want to take a moment to thank those who helped us get to where we are today.

First, to our shareholders, as I said, at our Annual Meeting I recognize that the last few months have been filled with a lot of extra noise and we appreciate your support and candid feedback during this period.

Second to my fellow board members, your focus and leadership have been critical to the progress that the company has made over the last few months, as we have started a new chapter for Rockwell Medical. I would also like to thank our customers for their support and shared vision of helping our patients live healthier lives.

And most importantly, to our employees, thank you for your continued dedication and commitment to improving clinical outcomes for our patients. I will now turn the call over the operator to open call for Q&A.

I want to reiterate that the focus of today’s call is a change underway at Rockwell Medical, when Stuart settles into his new position as CEO, he will provide more detailed observations on his financial and strategic priorities of the company in the coming periods. With that, let’s open up the call for questions.

Operator?.

[Operator Instructions] And our first question comes from the line of John Crowley [ph]..

Hello.

My question is what is Rockwell's current business relationship with Baxter International in terms of selling its dialysate products, are the company is working together still to get that product out to customers or have they gone separate ways?.

Thanks for your question. John, the company continues to work with Baxter. And as I said in my prepared remarks, we are excited to have Stuart on board and he is going to review all of the opportunities across the business and I think can do a great job of maximizing those opportunities for us..

All right. Thank you..

[Operator Instructions] Your next question comes from the line of James Terwilliger with Paulson Investment..

Yeah. Hey, guys.

Can you hear me?.

Yeah. We can hear you perfectly..

First of all, thank you for taking my questions. I'm new to the story, a new shareholder. Just quickly as I'm starting to do additional work on the company, the gross margin seemed to have trended down a little bit this quarter.

Is there any additional color you can provide on the what drove the increase in the cost of goods sold?.

In terms of any real detail questions on the financial, I will obviously kind of wait for Stuart to get in and talk about trends in the business, the material changes that you saw were really related to write-downs for inventory, as well as the settlement that occurred, the core business that you see it today remains pretty steady and we look for that to be steady in the upcoming quarters..

Okay. So just in a general rule that make sense and as I'm looking at this, there's a lot of one-time items and noise in this particular quarter.

Is that fair?.

Yeah. You can see the write-down of over $5.4 million or $5.4 million due to the inventory and the one-time $1 million settlement. So if you back out those you should see a business at least on a quarter-over-quarter basis that looks pretty steady..

Okay. That is better trend. Okay. I will jump back in the queue. But thanks guys. Thank you..

Thank you..

Your next question comes from the line of David Bouchey with IFS Securities..

Hi, guys. I was hoping that I would kind of be near the tail-end of the questions, I thought it would be a good idea let the individual investors finally get their first crack at asking questions. But since I am in the queue, I will go ahead.

I do want to say that according to my calculations if you back out the $5.4 million charge for Triferic inventory from the cost of goods sold from this quarter, I come up with actually a bit better than what my estimate for the quarter was.

So I'm pleased with how that has been going? I do want to ask two quick questions? The first is about China, there is been a lot of a news in the, well, in the news about the Chinese Government doing a lot of work to get drugs that already approved in the United States and Europe to market faster in China and have you any update for us on whether or not that would apply to Triferic and Calcitriol in the Chinese market?.

Thanks, Dave. Good hear from you again as always. I don’t have a specific update on progress with China other than to tell you that the company remains very excited about the opportunity. It is obviously a very large market. We think our products are well-positioned to succeed in the market. And I again I would reiterate my excitement around Stuart here.

He obviously has experienced both in the renal market, as well as in the international market.

I think all of the companies that he recently been at, he had international experience in Latin America, as well as Asia and so that was one of the reasons that we brought him on and we think that he can really accelerate our progress on that front -- on the business development front, as well as on the clinical development front..

Excellent. And the last question I want to ask is about the IV version of Triferic. Can you give us an update on when we might expect to see an announcement of a new drug application filing with the U.S.

FDA?.

No. No. I don't have a specific timeline to share on today's call. But the team is hard at work on that front, and again, we think that's a great opportunity for the company to expand our offering here in the U.S., as well as abroad..

And just to be sure I have this right. This is an actual NDA filing.

So the FDA is looking at IV Triferic basically as a new drug?.

Yes..

Okay. And is it impossible to use an IV formulation even in the U.S. where they have centralized mixing. Can you still, well, there are a lot of IV drugs that are used.

Can you market IV in the U.S., as well as abroad?.

Yes. I believe so that some of the clinics would be using that as their preferred methodology with Triferic..

All right. And I will just -- hopefully there are some other investors who are in the queue. I will back out and make way for them. Thank you very much..

Your next question comes from the line of Randy Hearing, Private Investor..

Hey, guys.

How are you doing today?.

Good..

Good. Good. Could you give us some color, we have heard about, I mean, I wouldn’t say miracle drug, but it’s just drug has a huge potential to improve the lives of dialysis patients. Can you talk about and maybe provide also the investor community some color on uptake from the customers such as U.S.

renal, American renal, DaVita, Fresenius, and maybe speak to when you might start seeing some traction on the front?.

Yeah. Thanks for the question. I think, right now there is no update to report, the products not in market. There is a free sample program that has been in place for several years now.

So we see very positive results in the free sample program both anecdotal feedback from clinics and patients, as well as the data that we received from them, but no commercial sales.

I think when Stuart gets on board, that’s obviously going to be top of the list from a priority standpoint as we look to bring Triferic to market, as well as continue to pursue transitional pricing in Washington. So stay tuned on that front. We are very bullish on the opportunity with the drug.

But at the end of the day the proof is in the numbers and we will be eager to share those with you when we can start generating some real results..

Well, and I would ask the same question on Calcitriol, any I think, when are we going to start seeing traction on that front, what would you anticipate it?.

Again, until Stuart gets on board, I would anticipate immediate traction on that front. The team and Stuart will really evaluate the opportunity with Calcitriol in the best way to maximize that opportunity.

So as soon as he gets on the ground, feet stabilize, he will be able to articulate the plan and the progress that we expect to be able to make on that front..

Thank you so much. Thank you for taking my questions..

Yeah. Thank you..

Your next question comes from the line of Jim Warsaw [ph], Private Investor..

Hi. My question is similar to Dave, I was already in the queue, when David asked this question. I was curious like what’s the timeline to enter China and India and like where we at in the regulatory process there? And then I have one more after that..

Yeah. Again, I don't have a specific timelines to share today. I mean, again -- we expect Stuart to come on and I'm excited about his deep international experience, both on the commercial front and on the clinical development. China represents a large opportunity, as does India, although I prioritize China above that.

But until he gets in here and really can wrap his hand around the opportunity and can start to prioritize those opportunities, there won’t be much to share until that happens. But rest assured that he and everybody else will be very focused on taking advantage of those opportunities..

Like, Ben, you know how long it takes to get approved in China and where we are at in that process?.

Again, nothing to share on that -- on this call in terms of where we are in the process, we obviously do have a partner there, but again, as soon as we have detail to share of where we are we will definitely share that..

All right. That’s fair. That’s fair enough.

I was curious too but you said there is not going to be any significant revenues with Calcitriol or Triferic this -- by the end of the year? Could there be a little bit, like a million or more in that – in your mind that’s significant?.

Again, I don’t have a number to give. We are going to make as much progress as we can and quickly as we can and whether it’s Q4 or Q1, what you should hear from me is that we are going to be heads down and we are going to make the best of it and build a real business here.

So no forecast to give or predation on the revenue front, but we have good products and I think we are going to be able to make something of it..

All right. That’s fair.

So significant you could be zero or could be a million?.

Yeah. Again, no, I don't have a specific number to give you on today's call. But we are going to make the best of it..

Okay. Thank you. Thank you for your leadership and thank you for everything you have done..

Thank you for your questions. Thanks for the feedback..

Your next question comes from the line of Joe Emas [ph] with a Private Investor..

Good day, Ben. I have emailed to you a couple of times. Appreciate the feedback. I have got a couple of skeletons in the closet that I'm interested in, a lot of the capital reserve that was in the Rockwell account from last year was attributed to Baxter to investing in the western plan.

They were also investing in the company and I think there were some private money that they invested. So it amounted in my estimate about $40 million, you down the roughly $25 million.

What part of that is Baxter's commitment?.

In terms of the cash on hand that’s all the company's cash on hand and Baxter. We had a commitment from Baxter that we publicly disclosed. There has been nothing more on that front than what was made available in our filings..

All right.

So right now there is no commitment that financial commitment to repay anything to Baxter to current time?.

No. I don't have any more detail to share on the Baxter agreement right now..

Okay. I appreciate that. You have a great day. Appreciate everything you've done. Good luck..

Thank you..

[Operator Instructions] Your next question comes from the line of Joseph Tish [ph]..

Good afternoon. Before I ask my question, I wanted to thank you for all the steps that you have done – you have taken during the past several months and specially for the transparency that you have provided to the investors and as a long-term shareholder I really appreciate that..

Thank you..

My question is as we all know we don't have much coverage in the investment community with our stock and that have you planned or are you planning any steps that will results in more coverage?.

Yeah. So thank you for the question and thank you for the support. Yeah.

So I think as the company, now that the company is on a path towards more stability and starting to bring its products to market and can be generating real results and driving the business forward, I would expect that you should also see us develop our business relationships both the partners as well as with investors and with banks.

And hopefully that will result in some more coverage from analysts, we've been very grateful for the support that IFS has given us, but would also be interested in expanding the coverage that we can get. So, again, nothing to report on today's call, but that is something that we will be focused on and should start to happen in the coming quarters..

Okay. Thank you..

Thank you..

[Operator Instructions] Your next question comes from the line of Lyle Smith [ph]..

Yes. Hello, gentlemen. I have a some common sense questions, seems to me a lot of U.S. dialysis patients could use Triferic now and ignoring government payments for Triferic.

Tell me if there's some dialysis clinics right now where they can walk under the guidance of their physician of course and say I want the treatment now, I will pay cash or by check? And then the second question is, if there are clinics that will allow that and have that adequate inventory and so on, then what's the retail price on the high-end right now for just a single patient that things they really needed and can use it and is willing to pay? Thank you..

Yeah. Thank you for the question. I think maybe before answering that specific question, the -- I would say the highest level we agree we want to get Triferic in the hands of patients, not just to drive revenue and profit, but to improve their lives and we are very focused on that.

I think we made that clear at the Board when we announced that, we would no longer wait just transitional pricing that we would go down a parallel path in which we will -- still pursue that, but also wanted to pursue a direct commercial strategy selling within the bundle.

So we are -- on the same line in terms of getting the product in the hands of patients. Right now the product is only available through the sample program. There is no retail sales right now where a patient can just go and purchase with the price point. It’s certainly one of the thing that we can consider along our – with our commercial strategy.

But right now the only patients that have access to the product are in the free sample program..

Well, my only comment would be again common sense, the free sample program except in extremely limited circumstances.

I am a shareholder is going to have to go away soon and quickly and it's a needed therapy on the part of patients and it seems silly that they just can’t pay out of their pocketbook right now?.

Yeah. Listen I think you have probably seen from the actions that the Board has taken in terms of the changes that we've made and our desire to get into market, the desire to bring on a new management team. We want to get this product in the hands of patients as well. So we are aligned.

We obviously want to do it in the right way and make sure we are very thoughtful about the price that we set for the product, but we absolutely want to get the product in the hands of patients..

All right. Well, thanks for taking my call..

Thank you..

Your next question comes from the line of Mark Abrothman [ph]. Your next question comes from the line of Gary Choi [ph] with Acumen. Mr. Choi, your line is open. Your next question comes from the line of Thomas Klema with Rockwell Medical..

I have been a private investor for about 10 years turning grey, do we have any backlog orders on the Vitamin D?.

So, first of all, I appreciate your support and your patience with the company. It’s definitely noted and right now that the company was just approved on the -- with Calcitriol. We are bringing Triferic to market. So I think we are going to be able to make progress on that front.

We don't have specific plan to share or more detailed than what I gave in the prepared remarks. But I think what you have seen, this is the Board that’s committed to action and committed to driving the company forward and that you should start to see results in the future..

Thank you and you have all my support. You did a great job..

Thank you. Thank you. All right. With that, I am going to leave it for one last question.

Operator, make this the final question please?.

Certainly. And your final question will comes from Tom Astad with Gloton [ph]..

… prior quarters the call would have been over after the first question. So thanks for your patience.

In terms of the clinical data on the free sample program, is there any information that you can disseminate to the investment community, showing the results of what patients have been experiencing for the last years on this free sample program?.

Tom, thanks for your question and your patience. There isn’t specific data that I can share. It is a great question and it's something that we are obviously focused on.

The free sample program really is the best repository of data in terms of how patients are succeeding and really should drive the company’s thinking around price and how to enter the market. We don't have anything that is packaged up that we can share with the public right now.

But when we do we definitely will, I mean, I think as you can tell the company is very committed to transparency, whether the news is good or bad and the free sample program would be a logical place to look for data. So when we have that data in a format that we can share, we definitely will.

Great. Well, thank you. And one quick question about transitional add-on.

It’s kind of a grey areas, so what exactly the law is, are all new drugs coming online effective January 2019, are they going to be part of transitional add-on or what is that proposal/lost then?.

Nothing is formalized on that front. We are – we haven’t even entered a comment period. Certainly that what -- what you asserted in terms of all new drug post 2019 would be available for that, but nothing has been finalized yet on that front. So we will definitely keep you posted. We definitely are paying attention there.

But at the same time we are not resting on our laurels and are pretty focused on our own commercial planning regardless of what happens with CMMI or CMS..

Great. Well thanks for your efforts on our behalf. Thank you..

Okay. Thank you. And with that folks we are going to wrap it up. I really appreciate the time and all of the questions and your continued support of the company. We look forward to chatting with you again in the coming days and weeks..

This concludes today’s call. You may now disconnect..