Eyenovia, Inc. (EYEN) on Q1 2021 Results - Earnings Call Transcript
Operator: Greetings, welcome to Eyenovia's First Quarter 2021 Earnings Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. Please note this call is being recorded. I will now turn the conference over to your host, Eric Ribner. Please go ahead.
Eric Ribner: Good afternoon, everyone, and welcome to Eyenovia's first quarter 2021 earnings conference call and audio webcast. With me today are Eyenovia's Chief Executive Officer and Chief Medical Officer, Dr. Sean Ianchulev; Eyenovia's Chief Financial Officer, John Gandolfo; and Eyenovia's Chief Operating Officer, Michael Rowe.
Sean Ianchulev: Thank you, Eric, and welcome everyone to our first quarter 2021 earnings conference call. A key highlight since our last quarterly update is that the FDA has confirmed October 28 as the PDUFA date to review our MydCombi NDA. Recall that MydCombi is our unique fixed combination of two leading mydriatic medications or pupil dilation. If approved, this would be the first microdose ocular therapeutic applied with a high precision smart delivery system, the Optejet. It would also transition us to a commercial stage company. So we are rapidly approaching a very significant milestone for our company. If approved, we would anticipate launching MydCombi commercially soon after the FDA approval. In anticipation of potential approval later this year, in March we announced an exclusive agreement with EVERSANA, a leading commercial service provider to the life sciences industry, to manage the physical distribution of MydCombi and to oversee the order fulfillment process. Michael will elaborate on this shortly. Also during the first quarter, we completed enrollment in our VISION-1 study of MicroLine, our proprietary pilocarpine formulation for the improvement in near vision in patients with presbyopia. Presbyopia is age-related hardening of the lens of the eye, causing blurred near vision that affects approximately 113 million people in the U.S. alone. The most common remedy is glasses or readers, contact lenses or surgery. MicroLine is intended to be a companion product to glasses to be used situationally on demand and not necessarily as a full replacement of glasses altogether. We're expecting to see VISION-1 top line results shortly, pending data at important analogies by our data management partners. We anticipate sharing the results in the coming weeks. Those results will help inform how VISION-2 will be conducted, helping us to quickly and efficiently complete this program. And if approved, unlock the market opportunity that we estimate at nearly 8 billion in the U.S. alone. Before turning the call to Michael, I want to comment on the significant addition that was made to our Board of Directors last month. We announced that renowned ophthalmologist and scientific leader, Dr. Julia Haller, has joined our Board. Dr. Haller is one of the world’s leading retinal surgeons and physician educators. She currently serves as an Ophthalmologist-in-Chief at Wills Eye Hospital in Philadelphia, where she holds the William Tasman Endowed Chair. She's also Professor and Chair of the Department of Ophthalmology at Sidney Kimmel Medical College at Thomas Jefferson University and hospitals. Needless to say, we're very pleased that Dr. Haller has decided to join us, and we believe her insights and guidance will be invaluable as we advance our current programs while in parallel working on our pipeline.
Michael Rowe: Thank you, Sean. Let's lead off today with an update on MydCombi, our unique fixed combination of two leading mydriatic medications or pupil dilation agents. As we announced a few weeks ago, the U.S. Food and Drug Administration accepted our new drug application, and has now informed or confirmed the PDUFA date of October 28, 2021. The NDA was supported by two Phase 3 studies, MIST-1 and MIST-2, which demonstrated that MydCombi provides quick, effective and reliable pupil dilation with fewer than 1% of subjects reporting blurred vision, reduced visual acuity, photophobia or installation site pain. MydCombi is a diagnostic agent with meaningful potential benefits to both the practitioner and the patient. For the practitioner, there is a potential to increase patient throughput without increasing costs. With MydCombi, doctors and staff can spend less time putting different eyedrops into patients, including those that help minimize the sting of the current formulations. On a daily basis, we believe that over an hour of exam room time can be reclaimed just by switching to this faster, more comfortable option. And for patients, since there are no protruding parts for the Optejet and a recess nozzle, MydCombi is far less likely to touch the surface of the eye as compared to a conventional eyedropper. This results in a potential decrease in cross-contamination and improved patient safety, something that resonates loudly in the COVID-19 era. Also as mentioned, the product was reported to be very comfortable in use in our clinical studies. All of these benefits we hope will translate to more people being willing to undergo a comprehensive eye exam. Market research suggests that millions of people fail to get a comprehensive eye exam every year due to the discomfort and other side effects of traditional mydriatic drops. MydCombi may be able to address these issues and doctors may be able to further encourage people to take better care of themselves by having a comprehensive exam. The market opportunity for MydCombi is substantial there are an estimate of 80 million office-based comprehensive in diabetic eye exams, and 4 million ophthalmic surgical dilations performed annually in the U.S. alone. We estimate this market to be approximately $250 million annually in value. Last quarter, we went into some detail on our commercialization plan for MydCombi, just recapping the key points, upon FDA approval our planned approach will not resemble our traditional drug launch with the related expenses around a large salesforce and corporate infrastructure.
Sean Ianchulev: Thank you, Michael. For those of you who have been following Eyenovia, you know that we're – we out-licensed our third program, MicroPine for the treatment of progressive myopia to Bausch Health in the U.S. and Canada, and Arctic Vision in Greater China and South Korea. MicroPine is a proprietary atropine formulation that has been shown in clinical studies to slow myopia progression by 60% or more. There are currently no FDA approved therapies and if less than treated this can result in retinal detachment myopic retinopathy and vision loss. These partnerships are having the intended benefit of extending our commercial reach, while at the same time, providing non-dilutive capital. To-date we have received 16 million in upfront and milestone payments with the potential for significantly more when milestone-based payments reimbursed, development costs and potential sales royalties are factored in. We expect partnerships such as these will continue to be an important part of our long-term growth strategy. And to that end, we continue to evaluate additional out-licensing opportunities in other parts of the world. We're also assessing pipeline expansion opportunities, as we believe we can leverage the Optejet technology to address unmet needs in additional large ophthalmic indications. Some examples include anti-infective anti-inflammatories, dry eye and glaucoma, each with significant market opportunities. We have nothing definitive to share today. We do look forward to keeping you apprised of our progress in that front. Of course, the beauty here is that these development activities would be at least partly funded by outsourcing opportunities such as those just described. I'd now like to turn the call over to John to review the financials. John?
John Gandolfo: Thank you, Sean. Now I would like to review the financial results for the three months ended March 31, 2021. So in the first quarter of 2021, we reported a net loss of approximately $5.4 million or $0.21 per share and this compares to a net loss of approximately $5.5 million or $0.31 per share for the first quarter of 2020. For the first quarter of 2021, the company reported license fee revenue from our Arctic Vision license agreement of $2 million and the corresponding cost of revenue representing payments to Senju of $800,000. Research and development expenses totaled approximately $4.2 million for the first quarter of 2021. And this compares to approximately $3.6 million for the same period in 2020, an increase of approximately 16.9%. For the first quarter of 2021 G&A expenses were approximately $2.3 million compared with approximately $1.8 million for the first quarter of 2020, an increase of approximately 25.2%.
Sean Ianchulev: Thank you, John. In closing, we're very pleased with our performance during the first quarter and subsequent period. To summarize our key highlights today, we look forward to on October 28, PDUFA date pertaining to our MydCombi NDA. We are rapidly advancing our Phase 3 presbyopia program in estimated multibillion-dollar indication and anticipate data from VISION-1 in the very near term. And our licensing agreements with Arctic vision and Bausch Health are progressing well and continue to offer the potential for meaningful development and regulatory milestones, non-dilutive funding, if realized, we can use to expand and advance our pipeline. We believe we're well positioned to achieve multiple commercial, regulatory and development catalysts this year for the benefit of patients and shareholders. That concludes our prepared remarks. We would now like to open the call to questions. Operator?
Operator: Thank you. We will now be conducting a question-and-answer session. Our first question comes from Len Yaffe with Stoc*Doc Partners. Please go ahead.
Len Yaffe: Thank you very much. I was wondering if you could comment on the Allergan Phase 3 study that's been completely submitted to the FDA for approval. I'm pretty sure they looked at patient, cohort and age, age 40 to 55. And in your VISION-1, you were looking at age 40 to 60. And given that presbyopia tends to decline quite significantly, I think between ages 55 and 60, and then it stabilizes, does Allergan not focusing on that age group potentially conferred an advantage to you, or does it make it more difficult if you included patients 55 to 60 in your cohort, few to show benefit in that group? And can you tell us in the VISION-1 study roughly what the breakdown was by five-year increments in the Phase 3 clinical study? Thank you very much.
Sean Ianchulev: Wow, Len, thank you. That's – I think I'll be better able to answer in more detail these questions once we have the data, which will be shortly and we look forward to analyzing it. First, I want to step back and just mention that we have not in our field seen too many well conducted registration level studies in presbyopia, it's a fairly new field. And even though we are approaching it and all of us in many other companies who are going into that field with established agents, such as pilocarpine, which seem to be very active, again, we're yet to see high quality, well rigorously conducted data in the field. You mentioned correctly that Allergan is one of the first ones and they have conducted Phase 3 studies and completed, and I believe announced that pilocarpine in their formulation in an eyedropper form, has met the primary endpoint of their studies. That being said, we really haven't seen to-date, at least I haven't seen, the actual data presented so that I can really answer your question in a more informed way. We haven't seen even the point estimates or the exact results nor have we seen subgroup analysis. We and other companies too are approaching presbyopia in a slightly bigger range of population with another five-year population between 55 and 60 that wasn't included in Allergan study. Again, this is another population that is presbyopic and one can argue that population is more presbyopic because obviously between 50 and above 50 the population is more severely affected and they lose their accommodated potential almost completely. We're hoping to see a balanced population in our study, probably bias or maybe more on the earlier side. Given that those are the patients, the 40 to 50 that are not quite settled into eyeglasses and they are the ones that experienced presbyopia firsthand and for the first time and are looking for solutions. That being said, we are yet to see the exact breakdown. There is also a little bit of a factor of how COVID really impacted the enrollment whether it led to promote preferential enrollment with established older patients or younger. So in order to answer your question, I think, well, give us a few more weeks, months, we come out with the data, we'll be able to talk a little bit more about that, but we really haven't seen too many results from other companies, neither Allergan nor others that will give us that. And hopefully we'll see all that and be able to do comparative analysis. Michael, do you want to comment anything more?
Michael Rowe: No, I think you handled that quite well. Thank you.
Len Yaffe: Thank you very much.
Operator: Our next question comes from Tim Chiang with Northland. Please go ahead.
Tim Chiang: Great. Thanks. Sean, I know you haven't seen the results from VISION-1. I noticed that in the press release, you guys talk a little bit about planning for the second Phase 3 study, the VISION-2 study. Have you guys already thought about how that study is going to be designed? I thought the study was going to be very similar to VISION-1, but I'm sort of wondering if there's going to be any slight tweaks to the second pivotal study.
Sean Ianchulev: Yes. Well, that's a good question. First, maybe I would also ask another question. Why did we not do them all at the same time? Why not just run them in parallel, both of them? And I think we thought about that given the dearth of data and real rigorous clinical results all around, a lot of it is anecdotal or Phase 2s, we definitely wanted to see results from one trial before we plunge with the second one just to be prudent and do very more conservative development. Also we found that if we look at the data from VISION-1 who we may be able to inform VISION-2 in a way that we will make it more efficient, maybe we modify the population a little bit or maybe we eliminate one of the doses. Because if you look at the design of VISION-1, it actually – it's a bit of a dose ranging study, I would call it almost a Phase 2/3 because it's definitely one that can be qualified for registration a positive, but it really doesn't have a full-dose selection and we may be able to find a dose that we like and for VISION-2, we could keep a very similar design but go with one dose and make it more efficient and faster. So I tend to – in clinical development, you never know it's always good to look at empiric data. So I tend to obtain exactly how we're going to modify it, but I can tell you my team and our advisors will be able to get through the data quickly and we'll be able to find the best path forward with VISION-2.
Tim Chiang: Okay. That's helpful. Thanks, Sean.
Sean Ianchulev: Okay.
Operator: Our next question comes from Matt Kaplan with Ladenburg Thalmann. Please go ahead.
Matt Kaplan: Hi, good afternoon guys. Thanks for taking the question. Just wanted to follow up a little bit on Len’s question in terms of VISION-1 what should we'd be looking for in terms of the primary end point, the top line results that should be exciting in terms of reaching and achieving that end point.
Sean Ianchulev: Yeah, it's a good question Matt. And I think that I would look not only at the primary endpoint, I would also look at some of the secondary end points too. The primary end point is three lines vision gain at near. And it's a very standard point that we use in ophthalmology across multiple indications, such as macular degeneration, DMA, it's a bit of a non-specific and I don't think it's necessarily the most realistic for actually what matters to patients. I think patients want to be able to see their smartphone, their tablet or their computer, they don't necessarily have to gain three lines at 40 centimeters, but that is what is required for registration and it's actually a pretty standardized way for ophthalmology. So the other parts that are also important is that we have – we'll be looking at two line gainers, we'll be looking at also intermediate vision. And again, these are things that really will inform the overall therapeutic benefit for patients. Now, Michael has done a lot and I'll let him answer more specifically because we've done a ton of market research of what matters to patients, but it seems this will be an on-demand, needed therapy. Obviously you would want to see a fairly quick action that the effect comes in quickly. And our endpoint is a two hours, which is great, we expect maybe it will go even to three or four. But again, this will be on-demand episodic treatment and we want it to be as close to on and off side of the treatment as possible. So Michael, do you want to comment anything more to that?
Michael Rowe: Yeah, Sean, thank you and hi Matt. I think the other thing I would pay attention to is the side effect profile. One of the major thesis behind microdosing is that you can get efficacy and minimize some of the side effects and we know that pilocarpine and probably all miotics have an issue with a brow ache from local circulation that comes out of the eye and gets into the brow and contracts the muscle. We know from market research that if we're seeing or if anybody has seen a brow ache of 20% that could really put a damper on acceptance of this product. So I would be looking for a side effect profile with a very low level of brow ache, which would then differentiate us from the eyedrops as well.
Sean Ianchulev: Thank you.
Matt Kaplan: That's helpful. Thank you for taking the questions and the added detail.
Michael Rowe: Thank you, Matt.
Operator: I will now like to turn the floor over to Sean for closing remarks.
Sean Ianchulev: Well, thank you all. I think we look forward to communicating with you on our upcoming milestones. And with that I want to thank you again for joining us and hope everybody has a good afternoon.
Operator: This concludes today's teleconference. You may disconnect your lines at this time and thank you for your participation.
