Q2 2022 Oyster Point Pharma Inc Earnings Call

August 11, 2022

Yeah.

The conference will begin shortly to raise your hand during Q&A you can dial star one.

[music].

Good day, and thank you for standing by.

Walking through the off their port Palmer second quarter 2022 earnings Conference call.

At this time all participants are in a listen only mode.

After the speaker's presentation, there will be a question and answer session.

To ask a question. So on the session you will need to press star one one on your telephone.

I would now like to hand, the conference over to your speaker for today.

Arty Ahmed Vice President and Investor Relations you may begin.

Yeah.

Good evening, everyone and welcome to Oyster point Pharma second quarter 2022 earnings Conference call.

Good evening, we issued a press release containing our financial results and recent business highlights for the second quarter ended June 32022.

In addition, our earnings press release and Form 10-Q, which were filed with the SEC. After the close of market today are available on our website under the investors and media section at Www Dot Oyster point Rx Dot com.

Joining us on our call today are Dr. Jeffrey now the President and Chief Executive Officer of Oyster point Pharma, Dan Lochner, Our Chief Financial Officer, and Chief Business Officer, and Michael Campbell, Our senior Vice President and head of commercial.

Following our prepared remarks, we will open up the line for questions. Please.

Please note that during the call today, we will be making forward looking statements regarding potential future events, including statements on oyster point farmers potential future financial status and results of operations and our plans and potential for success relating to commercializing <unk> via nasal spray.

Forward looking statements involve known and unknown risks uncertainties and other factors that may cause our actual results to differ materially from any future results performance or achievements expressed or implied by such statements for a description of these factors. Please see our quarterly report on Form 10-Q for the quarter ended June 32022 filed with the SEC.

SEC after the closing market today.

I will now turn the call over to Dr. Jeffrey now, our president and Chief Executive Officer.

Thank you Aarti good evening, everyone and thank you for joining us on our call today I am pleased to report a strong second quarter for Oyster point, which included continued robust growth and positive sales momentum for <unk> nasal spray for the treatment of the signs and symptoms of dry eye disease.

Our continued growth in this quarter highlights the value that our differentiated product brings to patients and physicians were selling at our goal to continue to expand access to tier buyer to more eligible patients and progressing the development of our exciting pipeline assets.

Today, I will provide an update on our commercial progress with tier buyer and discuss additional business and development highlights.

We are excited by the impacted to your buyer has had on the dry eye landscape dry eye diseases and conditions affecting an estimated 38 million people in the U S alone.

Patients in eyecare professionals, our ECP had traditionally struggled to find suitable long term treatments that are efficacious practically administered and fast acting <unk>.

<unk> is easily administered to patients even those with <unk> and provides natural tear film production for most within minutes after administration.

<unk> differentiated clinical profile, which rapidly bio activate the tear film production can help the body create more natural tears continues to garner high levels of interest and enthusiasm with both patients and Ecp's alike. We remained confident that this is the beginning of a paradigm shift in the way that ECP think about dry eye treatment by.

Harnessing the body's own natural tear producing machinery to delivering therapy with tier fire.

We believe tier bias brand perception has been increasing on a quarterly basis since launch with this enthusiasm illustrated by our refill rates and persistence data.

Our 60 day refill rate is 65% representing a blended average between our mail order in traditional retail pharmacy outlets as is the last data available from June <unk>.

Based on data from <unk> <unk> from the November 2021, dry eye cohort to Avaya has the highest persistence rate of all prescription dry eye medications in the first six months after initiation of therapy and.

In addition from that same dataset and time period tier buyer has the highest percentage of restarts after any interruption in therapy.

This data highlights the leading patient adherence and restart profile procure via characteristic not common with other branded dry eye therapeutics.

Which can often take a long time to work.

We believe that this data illustrates our tier buyer has quickly become an important part of the current treatment paradigm for ECP and how patients suffering from dry eye disease are positively responding to tier fire.

In the second quarter of 2022 turbine generated $4 7 million in net revenue approximately 30000 prescriptions were filled during the quarter and were written by over 5700 unique eyecare professionals, reflecting strong quarter on quarter growth.

Our commercialization strategy continues to focus on engagement with both ophthalmology and optometry.

Since launch approximately 7700 unique eyecare professionals have written a prescription for tier buyer as of July 22022, which represents over a third of the total number of ecp's being targeted by our field based sales resources.

Prescriber numbers continue to show consistent growth month over month, we expect that we will continue to build commercial insurance coverage and attain coverage by Medicare part D. Plans and then adoption will continue to increase as a result, we remain focused on growing tier buy into a leading dry eye disease brand underpin.

By our belief that tier buyer is a transformative solution simply put there is no substitute for a patient's own natural tear film and this is a message that is resonating with both ECP and patients alike.

In our mission to make <unk> widely available to all patients suffering from dry eye disease. I'm also pleased to share that formulary access to tier buyer has grown meaningfully as of July 2020 to cheer bias now covered by commercial prescription drug plans managed by the nation's top three pharmacy benefit <unk>.

<unk> group purchasing organization.

In addition to our unique patient assistance program team tier buyer, we've introduced new programs to expand access to tier buyer for eligible patients.

Michael Campbell, our senior Vice President head of commercial will shortly provide further details on these programs as well as to your bias commercial performance during the quarter.

Outside of the United States <unk> Pharmaceuticals.

Licensing partner in greater China announced in July that the first patients were enrolled in a single phase III clinical trial to support a new drug application for regulatory approval of Oc <unk> nasal spray for the treatment of signs and symptoms of dry eye disease in China.

We are pleased with the progress being made and how the global footprint of tier via continues to grow we remain excited about the prospect of helping patients suffering from dry eye disease in China, where an estimated 200 million people suffer from the disease the.

The differentiated profile of <unk> is drawing positive interest from partners in numerous ex U S geographies.

We continue to engage with potential partners to explore opportunities to provide patient access to tier buyer in international markets beyond greater China and to improve the health of patients worldwide and create long term value for our shareholders.

Moving on to provide the quarterly update on our pipeline assets. We have made important strides to progress our phase II Olympia clinical trial of Oc <unk> nasal spray for the treatment of stage, one neurotrophic keratopathy and K <unk>.

And our preclinical studies of Oyster Point's enrich tear film or ETF gene therapy program for the treatment of stage, two and three neurotrophic care Carpathia.

Given our unique and differentiated expertise of working in harmony with the body's natural processes, we believe that Oc <unk> nasal spray will become a truly differentiated treatment option for stage, one 8-K, which is estimated to affect as much as 15% of the 38 million dry eye disease patients in the United States.

In our phase II Olympias study of Oc <unk> nasal spray, we have continued to enroll patients throughout the quarter and remain on track to deliver results in the fourth quarter of 2022.

Within the discovery engine of Oyster point labs are enriched cheered on gene therapy platform has progressed and much like recent advances in mrna vaccines. The goal is to turn the lacrimal gland into a protein producing factory that naturally secrete the multitude of potential therapeutic targets into the tear film.

This preclinical platform is robust and we believe it will fuel the development of new and innovative therapies for patients with high unmet need.

We have now completed our second preclinical study of <unk> 101, and adenovirus vector encoding the gene for human nerve growth factor delivered as a single intra lacrimal gland injection after.

After injection we observed significant.

<unk> amounts of nerve growth factor president and the natural tear film as early as day, seven and for up to 42 days after transduction and.

In addition, cholinergic activation of our OCR <unk> nasal spray produce a further significant increase in NGF levels in the tear film within minutes after administration.

These results support the future potential for our enriched tear film gene therapy program to leverage the lacrimal gland as a natural bio factory that can deliver therapy to the ocular surface.

Based on this groundbreaking data we have submitted a pre IND meeting request to the FDA for the treatment of stages, two and three neurotrophic keratopathy.

We're excited about the potential to change the treatment paradigm for stage, two and three neurotrophic Keratopathy, which currently requires the re application of refrigerated drops six times a day over a two month treatment course.

We're also pleased to announce the second asset in our enriched tear film gene therapy program, <unk> 103, and add in there a viral vector encoding for the gene for <unk> and.

Naturally occurring human enzyme responsible for the cleavage of histamine.

Once injected into the lacrimal gland. The promise of this approach is discrete this naturally present enzyme in increased amounts as part of the natural tear film with the potential to create antihistamine tear film.

The development plan, we will initially target patient suffering from farnell or atopic keratoconjunctivitis, two severe sight threatening condition to the ocular surface.

In summary, I'm very pleased with our performance in the second quarter and the value to your bias delivering to patients in eyecare professionals, given the size of the U S market and the notable high levels of satisfaction among patients and clinicians we see significant opportunity ahead.

I am also very excited about our multiple pipeline opportunities aimed at delivering transformative innovation for ocular surface disease, where there remains significant unmet need.

I would now like to introduce Mike Campbell Oyster Point's Senior Vice President head of commercial well. This is Mike first earning call at Oyster point, Mike has been with Oyster point in January of 2020 and has been instrumental in the pre commercial planning for tier buyer as well as the day to day commercial operations since peer by its commercial launch in November 2021.

One.

Mike is a known commercial leader in pharma biotech and particularly in ophthalmology with approximately 30 years of experience, including J&J vision care Genentech Shire and Novartis.

Mike will now discuss our recent commercial activities related to tier buyer.

Thank you, Jeff and good evening everyone.

And just over nine months since launch we remain enthusiastic about <unk> growth prospects underpinned by the metrics generated to date and the positive feedback we have received from both patients and ECP we.

We remain confident that <unk> unique mechanism of action and route of administration for the treatment of signs and symptoms of dry eye disease, well positioned to avaya to change the paradigm for dry eye disease.

To begin with I'd like to provide an update regarding <unk> launch to date success.

As of July 22022.

Over 62000, <unk> prescriptions have been filled by around 7700 unit ECP.

The <unk> launch in November 2021.

<unk> performance is notable particularly when putting <unk> launch into perspective with the last two prescription dry eye product launches.

<unk> cumulative Trs is having outpaced those products on our launch to date basis.

This conclusion for tier buyer also remained similar when comparing the quantity of ecp's adopting tier buyer on this launch to date basis.

<unk> bio we remain committed to helping as many patients as possible and this starts with ecp's adopting tier buyer as an important product for their treatment paradigm.

As we have previously highlighted our commercial team has already activated around 7700 unique ECP since launch.

Which actually represents over one third of the ECP is targeted by our field based sales resources.

And this activated ECP base has grown consistently each week since launch.

Looking forward, we expect continued ECP growth, notably upon survival, securing Medicare part D access.

We anticipate new ECP momentum to build particularly from ECP practices with high quantities of Medicare part D patients.

Given access and reimbursement has been a requirement for adoption.

In total by the end of this year, we would expect to have approximately half of our total 21 targeted ecp's activated.

Which is expected to further drive new patient adoption and prescription growth.

We continue to remain focused on ECP adoption as a result of PURA Vida is early market share results and Ecp's who've adopted the product.

As we announced for the week of July one 2022 within those Ecp's that have written a prescription for <unk> <unk> has achieved approximately a 21% market share of commercial new to brand prescriptions.

This market share number illustrates three key takeaways for survival.

First since launch <unk> has become a key therapeutic option for ecp's treating dry eye disease patients.

Second an early read on the potential for <unk> commercial market share with continued ECP adoption.

And third this market share has been achieved prior to launching a full scale direct to consumer marketing campaign.

Which has been shown across the industry to stimulate prescriptions and impact market share.

Another driver that will remain important to <unk> success is patient refill and patient persistence.

We continue to observe strong refill rates for to Avaya and since launch approximately 65% of prescriptions have been rebuilt within 60 days.

Furthermore, this year Oyster point commissioned a study with <unk> to evaluate providers patient persistent beginning with the cohort of patients who adopted tier buyer in November 2021.

Six months into this study when following the November 2021 patient cohort.

The results demonstrated that <unk> has the highest persistency and restart rates among the five prescription dry eye products evaluated in the study.

With an average number of refills at three four which has continued to grow as this study is mature.

We will continue to follow this study out to month 12.

However, this data underpins our confidence in the efficacy and safety profile of <unk>.

Its acceptance by patients in the refill potential for to fire being an important CRX driver going forward.

To drive awareness, we've completed 125 peer to peer programs since we launched the initiative in April of this year.

In addition, these programs with captured approximately 1800 ECP engagements through August four 2022.

These targeted activities among other marketing initiatives have helped inform the ECP community about the potential of your buyer.

Our market access team has continued to execute and securing coverage for <unk>.

As we previously announced on July 27 2022.

<unk> is now covered by commercial prescription drug plans managed by the top three pbms GPO in the country.

As previously discussed our market access team has been aiming to secure Medicare coverage determinations in 2023.

The company is currently in discussion with Medicare part D plans.

And to start the company is now expecting to Avaya to have up to approximately 40% of Medicare part D lives covered by Q4 2022.

With approximately up to half of those lives to be covered as early as September 2022.

We're particularly excited about gaining access to Medicare part D patients given this patient group accounts for almost half of the U S dry eye prescriptions.

We also expect that once Medicare coverage determinations are in place.

This improved market access would open up another segment of prescription growth for tier buyer.

Lastly on market access we have expanded our patient support programs to provide additional financial assistance to more eligible patients.

This includes patients who have prescription coverage with out of pocket cost over $150 for a 30 day supply.

Or who's prescription insurance plans do not cover to Avaya as well as patients who have no prescription insurance.

With our expanded patient support programs and increasing commercial coverage, we are committed to optimizing access to <unk> for eligible patients.

For more information about these programs. Please visit the website at <unk> Dot com.

With that I'll now turn the call over to Dan Lochner, Oyster Point's, Chief Financial Officer, and Chief business Officer to discuss our second quarter financial results.

Thank you Mike I will now provide a brief overview of oyster point pharma second quarter financial results.

Additional details about our second quarter Form 10-Q that was filed TICC dispute.

For Q2, 'twenty, two oyster point pharma reported a net loss of $49 9 million compared to a net loss of $22 million for the same period in 2021.

As of June 32022, cash and cash equivalents were $104 9 million compared to $143 4 million as of March 31 2022.

For Q2, 'twenty two tier by achieved net product revenues of approximately $4 7 million demonstrating strong quarterly performance, increasing 74% versus Q1, 'twenty two falling tier by U S. Commercial launch in November 2021, as a reminder, the company did not generate any revenues during Q2.

<unk> 'twenty one.

Product revenues for Q2, 2002 was approximately $1 3 million and consisted of product royalty expenses third party manufacturing cost reserves for inventory obsolescence and material costs.

Marketing expenses for Q2, 'twenty, two increased by $21 9 million compared to the same period in 2021.

Increase was primarily due to higher payroll related expenses of $11 $4 million, which was driven in part by the growth of the company's sales force since 2020.

The increase in payroll related expenses included an increase in severance expense of $1 4 million due to the reduction in force announced on June 28 2022.

Other sales and marketing expenses increased by $10 5 million for Q2 dollars 22 compared to the same period in 2021 and connection with advertising samples Tradeshows educational programs patient services payer access and other marketing efforts related to the commercialization of <unk>.

G&A expenses for Q2, 'twenty, two increased by $4 9 million compared to the same period in 2021 <unk>.

Increase was primarily driven by additional payroll related expenses of $3 million due to an increase in head count to support the company's business operations to increase in payroll related expenses also included an increase in severance expense of <unk> 5 million due to the reduction in force announced on June 28 2022.

G&A expenses increased by $1 9 million in Q2, 'twenty two compared to the same period in 2001 related to accounting public relations legal insurance and other professional services, primarily driven by the company's transition from a clinical stage to a commercial stage company.

R&D expense for Q2, 'twenty two decreased by $2 1 million compared to the same period in 2021.

The decrease was primarily due to lower expenses following FDA approval of <unk> in October 2021.

Partially offset by an increase in severance expense upfront 6 million due to the reduction in force announced on June 28 2022.

The company incurred interest expense in Q2 'twenty two.

<unk> $3 2 million related to the credit agreement.

Interest expense included contractual interest at two one times as well as non cash expense of $1 million related to the amortization of loan commitments.

And accretion of long term debt related costs. The company had no interest expense during Q2 'twenty one.

Other expense net for Q2, 'twenty Q, what three four months and kids consisted of $3 5 million change in the fair value of net embedded derivative liability, which was recorded in connection with the credit agreement, partially offset by interest on on money market funds.

Other income net for Q2 'twenty one primarily consist of interest income earned on money market funds.

With that overview of our financials I will now turn the call back over to the operator to open up the line for questions.

Thank you.

As a reminder, ladies and gentlemen, you need to press star one one via telephone to ask the question.

Again, Thats star one to ask a question.

Please standby, while we compile the Q&A roster.

Okay.

As a reminder, ladies and gentlemen, Thats star one to ask a question. Please standby, while we compile the Q&A roster.

Our first question comes from the line of Patrick <unk> with lifestyle capital. Your line is open.

Hi, Thanks for taking the questions.

So you mentioned that within prescribers, who are writing scripts youre, capturing about 20% of new to brand market share just curious for some color on the factors that you think are influencing this number over time.

For example are there any stipulations on.

Contract things such as step through.

And what's ultimately going to be key for you guys and activating the non prescribing target positions over time.

Yes, I'm going to add.

Thanks, Patrick Thats, a great question.

Mike jump in on this I think one of the important data points.

So what drives us.

That will be proud of is about 40% of <unk>.

Holly.

<unk> patients have not tried.

Branded.

Therapies in the past and so we think that that's a really exciting metric that is helping that new to brand number, but I think Mike can weigh in here and talk about some of the.

The rest of your question.

Yes. Thank you for the question Patrick.

One of the one of the business strategy, we have about activating continuing to activate prescribers is really focused around.

Coverage.

We obviously expect our commercial coverage to continue to grow really excited about the opportunity with our med D coverage that we announced today.

Looking forward to being really bringing a whole new group of doctors into this mix.

To be able to activate them to survive.

Got it thanks, and I guess, one more for me.

Just curious what level of direct to consumer marketing youre really incorporating until a tiered brier launched presently.

And if you could speak to just the relative importance of DTC as a marketing modality in the dry eye space generally.

And then just curious if there are kind of cost efficient ways, but you're you're able to roll this out over time. Thanks.

Yeah, Great question, obviously direct to consumer advertising is a big part of.

Our business strategy looking forward.

We know this is a promotional <unk> sensitive space.

Really excited to get coverage.

In a place where more physicians have experienced.

We believe that as we continue to grow this coverage, both commercial and Med D.

We will have a base of physicians with experience with <unk> that it makes a lot of sense to be able to invest in the direct to consumer campaign at some point.

There's no question that is.

<unk> business strategy and goals.

Okay.

This has been something that we've talked about.

Launch, which was a very smart campaign in order to go out and go to those consumers whether it be on paid search or whether it's through social media and then as we grow coverage and we have both commercial and Medicare part D. Now.

The confidence to be able to see.

Go right to that consumer base.

About whether we're pushing patients through that then.

And then with.

No coverage or Oracle.

We're getting very close to about the right time to do that we're also being very smart.

Company and the way, we deploy our capital.

Great. Thanks, a lot for taking my questions.

Thank you.

Please standby for our next question.

Our next question will come from the line of Ken Cacciatore with Cowen Your line is open.

Hey team a lot of really nice metrics, you've given and good to see all the progress and congratulations on the part D. My question is Mike you took over kind of the leadership role. So I was just wondering as you gave us a lot of different components and things for us to think about can you talk about what was kind of priority. One was there anything that you did dip.

<unk> or wanted to press on when you assumed your position just give us a little bit of maybe where you thought you were lacking of where your point of focus then also I was wondering if Dan could speak to where we think we're going with net value per Rx. Eventually you can answer it with.

Or do you think the gross to nets are going to go and we're making slow and steady progress in part.

Part D being in place.

Finalized will be fantastic, but love to hear that and then also Dan maybe you can speak to the ability to maybe access non dilutive financing as you think about the go forward in the in the company and any progress on that front as well. Thanks so much.

Hey, John This is Greg I'm going to jump.

Jonathan There first.

We will probably don't avian reversals.

Two quick questions.

As we previously stated.

Do you plan to engage with a number of potential ex U S.

<unk>.

And at.

The momentum.

With our current licensing partner.

In greater China, as our goal really to choose the best partner or partners to maximize that international value virtue of iron.

There is many regions in the Rover tier buys in EMEA commercialized. There are also a large market opportunity such as Europe , and Japan, We believe.

There will be a need to conduct additional clinical studies.

Being said, we want to ensure that the partner a partner that we work with have the right combination of development and commercial acumen, you really success enter the various health care markets throughout the world. So we look forward to providing an update once we finalize our strategy on that front and we see this as an opportunity to add to our current.

Balance sheet.

What I would say in addition to that is.

So we really look at the EBIT upfront.

The transactions can bring.

As well.

<unk>.

Collaboration in General and then look at that.

<unk>.

From a strategic perspective, and so that's a lot of the work thats ongoing and part of our financing strategy going forward on the nonwoven side.

A very important part for US is we're very focused on.

Let's say.

In addition to Europe .

We expect G&A progress on the gross to net.

You probably saw that in the quarter.

This sequential growth.

We expect some improvement.

For the remainder of the year based off of the Q2 number that we put out today and then expect a more notable improvement next year as the business trends in the region.

There'll be.

Thanks, Craig.

Yes.

Yes, hi, Ken Thanks for the thoughtful question actually.

Having been part of Oyster point from the from the beginning.

Prelaunch.

It's been a lot of activity to really get established in the marketplace I think.

Priority one has been to make sure that we're continuing to invest in resources.

We've got a lot of really good valuable resources.

Hum.

We feel really good about the talent of our sales organization and our all of our field resources and secondly, what you've heard the market access.

Really the coverage has been a real focus of ours.

We see that as a real upside for us moving forward.

And I would say just in general as well.

We're quite happy with the 74% sequential revenue growth in the quarter versus Q1, and we believe that entry into Medicare part D will be an important inflection point for the business.

With regard to knowledge as prescribers, but also Crs.

Thanks, so much congrats on all the progress.

Thank you.

Please standby for our next question.

Okay.

Our next question comes from the line of Joe Catanzaro with Piper Sandler Your line is open.

Hey, guys. Thanks, so much for taking my questions here, maybe one first one following up on the Medicare part D potential coming in early September <unk>, just wondering what the underlying drivers there of that timeline moving forward.

For an event I think was originally in early 2023, and then maybe following up related to that on gross to net weather if that does occur we should expect that impact.

From that on gross to net.

At the end of the year, Thanks, and maybe I have a follow up.

Great well, thanks, Joe I think from that from the Medicare part D side, obviously, one that's really.

Important.

Attributor to Avaya.

We think that this is a product that is really foundational therapy for patients with dry eye disease and in particular.

As you probably know.

The diseases are related to age it's related to.

Women going through menopause, we really think this is going to be an important therapy for patients that are in that Medicare category as we engage with payers.

Bob.

Clinics and medical side as well as on the financial for patients that are in that Medicare category as being <unk>.

As with Payors bolt on.

Clinic and medical side as well as on the financial side I think the team has done a great job in really having discussions and just just.

Or just how important a therapy.

For this group of patients. So there's obviously a number of tenants in the marketplace that have occurred over the course of the year, including generic entry, but I do really think that this early reserving Irwin.

It also has something to do with it.

Essentially the profile of the product and really what it brings to this older population of patients.

And then to your question, Joe I would say.

The response to <unk>.

And would still be quite consistent here, our financial model incorporates all of this conditional access consideration for Medicare part D, including based structure.

And the fully loaded.

The GCN and so.

No.

Reiterating kind of the same response to Ken which is that we.

Expect that.

Net price.

Continue to steadily grow.

Sequentially based on Q2 number and then with the sunsetting of the bridge.

There'll be a more material.

<unk> rich in a positive way for Cologuard.

Okay got it. Thanks, that's helpful. And then maybe just one quick follow up just wondering if there is a milestone associated with zijin initiating that phase III and if not when is the next associated milestone potentially from that collaboration.

Yes <unk>.

Elaboration, there isn't the milestone related to the initiation, but it's more tied to the approval in that jurisdiction.

Okay got it thanks for taking my question.

Okay.

Thank you.

As a reminder, ladies and gentlemen that star one one to ask the question.

Please standby for our next question.

Okay.

Our next question comes from the line of Danielle Gosselin with Chardan. Your line is open.

Hello, Thank you for taking the question.

One.

With respect to the streamlining plan that you announced recently that <unk> opex.

Opex guidance account for a potential launch of <unk> hundred one clinical trials and mek potentially next year.

Yeah. Thanks, Thanks, Dave that's a great question, so with the announcement of the streamlining plan. We have continued our development of our gene therapy platform. So both 101 and only one of three as we think it through next.

Sure.

We've seen it in the in the prepared remarks, you will have a feedback from the FDA from our pre IND meeting request very shortly so we would expect that this month and then 'twenty.

We will look like.

All of the R&D, enabling studies.

And then we would at some point in time in 2020 quarter to build into first in human although obviously that has some bearing on some of the feedback that we may receive from the FDA. So surely we will have more clarity on what those IND, enabling studies look like buybacks.

Our thoughts at the moment and that restructure will not impact that program.

Alright, Thank you very much.

Thank you.

I'm showing no further questions from the queue I would now like to turn the call back over to Dr. <unk> for closing remarks.

Great. Thank you operator, and thanks to all of you for joining the call today in closing we are pleased with performance during the second quarter, including the progress made in commercializing tier buyer expanding for patients and development potentially transformative ocular disease therapies, we are particularly encouraged by.

The overwhelmingly positive feedback from patients and eyecare professionals and remain excited about the potential for tier buyer to continue reshaping dry eye disease treatment.

I, thank everybody for joining us today and have a great evening.

Ladies and gentlemen, this concludes today's call. Thank you for your participation you may now disconnect.

Goodbye.

The conference will begin shortly to raise Johan during Q&A you can dial one one.

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The conference will begin shortly to raise Johan during Q&A you can dial one one.

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The conference will begin shortly to raise Johan during Q&A, you can dial star one one.

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Good day, and thank you for standing by.

Walking through the off support pharma second quarter 2022 earnings conference call.

At this time all participants are in a listen only mode.

After the speaker's presentation, there will be a question and answer session.

To ask a question. So on the session you will need to press star one one on your telephone.

I would now like to hand, the conference over to your speaker for today.

Arty Ahmed Vice President and Investor Relations you may begin.

Good evening, everyone and welcome to Oyster point Pharma second quarter 2022 earnings Conference call.

Evening, we issued a press release containing our financial results and recent business highlights for the second quarter ended June 32022.

Following our prepared remarks, we will open up the line for questions.

Please note that during the call today, we will be making forward looking statements regarding potential future events, including statements on oyster point pharma potential future financial status and results of operations and our plans and potential for success relating to commercializing <unk> nasal spray.

These forward looking statements involve known and unknown risks uncertainties and other factors that may cause our actual results to differ materially from any future results performance or achievements expressed or implied by such statements for a description of these factors. Please see our quarterly report on Form 10-Q for the quarter ended June 32022 filed.

The SEC after the close of market today.

I'll now turn the call over to Dr. Jeffrey now, our president and Chief Executive Officer.

Thank you Aarti good evening, everyone and thank you for joining us on our call today.

I am pleased to report a strong second quarter for Oyster point, which included continued robust growth and positive sales momentum for <unk> nasal spray for the treatment of the signs and symptoms of dry eye disease or.

Our continued growth in this quarter highlights the value that our differentiated product brings to patients and physicians. We're excelling at our goal to continue to expand access to tier buyer to more eligible patients and progressing the development of our exciting pipeline assets.

Today, I will provide an update on our commercial progress with tier buyer and discuss additional business and development highlights.

We are excited by the impacted to your buyer has had on the dry eye landscape dry eye diseases. The condition affecting an estimated 38 million people in the U S alone.

Patients in eyecare professionals, our ECP had traditionally struggled to find suitable long term treatments that are efficacious practically administered and fast acting to avaya as easily administered to patients even those with <unk> and provides natural tear film production for most within minutes after administration.

<unk> differentiated clinical profile, which rapidly bio activate the tear film production can help the body create more natural tears continues to garner high levels of interest and enthusiasm with both patients and Ecp's alike. We remain confident that this is the beginning of a paradigm shift in the way that ECP think about dry eye treatment by.

Harnessing the body's own natural tear producing machinery to delivering therapy with tier buyer.

We believe tier bias brand perception has been increasing on a quarterly basis since launch with this enthusiasm illustrated by our refill rates and persistence data.

Our 60 day refill rate to 65% representing a blended average between our mail order in traditional retail pharmacy outlets as is the last data available from June <unk>.

Based on data from <unk> from the November 2021, dry eye cohort to Avaya has the highest persistence rate of all prescription dry eye medications in the first six months after initiation of therapy in.

In addition from that same dataset and time period tier buyer has the highest percentage of restarts after any interruption in therapy.

This data highlights the leading patient adherence and restart profile procure via characteristic not common with other branded dry eye therapeutics, which can often take a long time to work.

We believe that this data illustrates how pure buyer has quickly become an important part of the current treatment paradigm for ECP and how patients suffering from dry eye disease are positively responding to tier via.

Our commercialization strategy continues to focus on engagement with both ophthalmology and optometry.

Since launch approximately 7700 unique eye care professionals have written a prescription for tier buyer as of July 22022, which represents over a third of the total number of ecp's being targeted by our field based sales resources.

Prescriber numbers continue to show consistent growth month over month.

We expect that we will continue to build commercial insurance coverage and obtained coverage by Medicare part D. Plans and then adoption will continue to increase as a result.

We remain focused on growing tier buy into a leading dry eye disease brand underpinned by our belief that tier buyer is a transformative solution simply put there is no substitute for a patient's own natural tear film and this is a message that is resonating with both ECP and patients alike.

In our mission to make <unk>, a widely available to all patients suffering from dry eye disease. I'm also pleased to share that formulary access to tier buyer has grown meaningfully.

As of July 2022 tier VI is now covered by commercial prescription drug plans managed by the nation's top three pharmacy benefit manager group purchasing organizations. In addition to our unique patient assistance program team tier buyer, we've introduced new programs to expand access to tier buyer for eligible patients.

Michael Campbell, our senior Vice President head of commercial will shortly provide further details on these programs as well as tiered bias commercial performance during the quarter.

Outside of the United States <unk> Pharmaceuticals, our licensing partner in Greater China announced in July that the first patients were enrolled in a single phase III clinical trial to support a new drug application for regulatory approval of Oc <unk> nasal spray for the treatment of signs and symptoms of dry eye disease in China.

The differentiated profile of <unk> is drawing positive interest from partners in numerous ex U S geographies.

Moving on to provide the quarterly update on our pipeline assets. We have made important strides to progress our phase III Olympia clinical trial of Oc <unk> nasal spray for the treatment of stage, one neurotrophic keratopathy or NK and our preclinical studies of Oyster point enriched tear film or <unk>.

<unk> gene therapy program for the treatment of stage, two and three neurotrophic keratopathy.

In our phase II Olympias study of Oc <unk> nasal spray, we have continued to enroll patients throughout the quarter and remain on track to deliver results in the fourth quarter of 2022.

Within the discovery engine of Oyster point labs are enriched cheerful in gene therapy platform has progressed and much like recent advances in mrna vaccines. The goal is to turn the lacrimal gland into a protein producing factory that naturally secrete the multitude of potential therapeutic targets into the tear film.

This preclinical platform is robust and we believe it will fuel the development of new and innovative therapies for patients with high unmet need.

We have now completed our second preclinical study of <unk> 101, and adenovirus vector encoding the gene for human nerve growth factor delivered as a single <unk> injection.

After injection, we observed significant amounts of nerve growth factor president and the natural tear film as early as a 7% and for up to 42 days. After transduction. In addition, cholinergic activation of our <unk> nasal spray produce a further significant increase in NGF levels in the tear film.

He then minutes after administration.

These results support the future potential for our enriched tear film gene therapy program to leverage the lacrimal gland is a natural bio factory that can deliver therapy to the ocular surface.

Based on this groundbreaking data we have submitted a pre IND meeting request to the FDA for the treatment of stages, two and three neurotrophic keratopathy.

We're excited about the potential to change the treatment paradigm for stage, two and three neurotrophic Keratopathy, which currently requires the re application of refrigerated dropped six times a day over a two month treatment course.

We're also pleased to announce the second asset in our enriched tear film gene therapy program, <unk>, 103, and adding a viral vector encoding for the gene for <unk>, a naturally occurring human enzyme responsible for the cleavage of histamine.

Once injected into the lacrimal gland. The promise of this approach is the secrete. This naturally present enzyme in increased amounts as part of the natural tear film with the potential to create antihistamine tear film.

The development plan, we will initially target patients suffering from farnell or atopic keratoconjunctivitis, two severe sight threatening conditions of the ocular surface.

I am also very excited about our multiple pipeline opportunities aimed at delivering transformative innovation for ocular surface disease, where there remains significant unmet need.

I would now like to introduce Mike Campbell Oyster Point's Senior Vice President head of commercial while this is Mike first earning call at Oyster point, Mike has been with Oyster point in January of 2020 and has been instrumental in the pre commercial planning procure buyer as well as the day to day commercial operation since peer bias commercial launch in November 2010.

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Mike is a known commercial leader in pharma biotech and particularly in ophthalmology with approximately 30 years of experience, including J&J vision care Genentech Shire and Novartis, Mike will now discuss our recent commercial activities related to tier buyer.

Thank you, Jeff and good evening everyone.

We remain confident that <unk> unique mechanism of action and route of administration for the treatment of signs and symptoms of dry eye disease, well positions to avaya to change the paradigm for dry eye disease.

To begin with I'd like to provide an update regarding <unk> launch to date success.

As of July 22020 to over.

Over 62000, <unk> prescriptions have been filled by around 7700 unit Ecp's sensitive <unk> launch in November 2021.

This <unk> performance is notable particularly when putting <unk> launch into perspective with the last two prescription dry eye product launches with the revised cumulative Trs is having outpaced those products on our launch to date basis.

This conclusion for tier buyer also remained similar when comparing the quantity of ecp's adopting thereby almost launch to date basis.

For tier buyer, we remain committed to helping as many patients as possible and this starts with ecp's adopting tier buyer as an important product for their treatment paradigm. As we have previously highlighted our commercial team has already activated around 7700 unique ECP since launch.

Which actually represents over one third of the ECP is targeted by our field based sales resources.

And this activated ECP base has grown consistently each week since launch.

Looking forward, we expect continued ECP growth, notably upon to Avaya, securing Medicare part D access.

We anticipate new ECP momentum to build particularly from ECP practices with high quantities of Medicare part D patients.

Given access and reimbursement has been a requirement for adoption.

In total by the end of this year, we would expect to have approximately half of our total 21 targeted ecp's activated.

Which is expected to further drive new patient adoption and prescription growth.

We continue to remain focused on ECP adoption as a result of <unk> early market share results in Ecp's who've adopted the product.

This market share number illustrates three key takeaways for survival.

First since launch to Avaya has become a key therapeutic option for ecp's treating dry eye disease patients.

Second an early read on the potential for <unk> commercial market share with continued ECP adoption.

And third this market share has been achieved prior to launching a full scale direct to consumer marketing campaign.

Which has been shown across the industry to stimulate prescriptions and impact market share.

Another driver that will remain important to <unk> success is patient refill and patient persistence.

We continue to observe strong refill rates for to Avaya and since launch approximately 65% of prescriptions have been refilled within 60 days.

Furthermore, this year Oyster point commissioned a study with <unk> to evaluate providers patient persistent beginning with the cohort of patients who adopted tier buyer in November 2021.

Six months into this study when following the November 2021 patient cohort.

The results demonstrated that <unk> has the highest persistency and restart rates among the five prescription dry eye products evaluated in the study.

With an average number of refills at three four which has continued to grow as this study has matured.

We will continue to follow this study out to month 12.

However, this data underpins our confidence in the efficacy and safety profile of <unk>.

Its acceptance by patients in the refill potential for to fire being an important driver going forward.

To drive awareness, we've completed 125 peer to peer programs since we launched the initiative in April of this year.

In addition, these programs with capture of approximately 1800 ECP engagements through August four 2022.