Q2 2023 EyePoint Pharmaceuticals Inc Earnings Call

Good morning, My name is Valerie there'll be a conference operated today at this time I'd like to welcome everyone to the iPhone pharmaceutical second quarter 20 twenty-three financial results in recent corporate development Conference call.

There'll be a question and answer session of power at the completion of the prepared remarks.

Please me about that this call is being recorded at the company's request I have now.

Like to turn the call over to George Allison Chief Financial Officer iPhone Pharmaceuticals.

Thank you and thank you all for joining us on today's conference call to discuss I point pharmaceutical second quarter 2000 twenty-three financial results in recent corporate development with me today is Doctor, Jay Duecker, President and Chief Executive Officer.

They will begin with a review of recent corporate updates and discuss phase two clinical trials for you I P. 19 O. One I will close with commentary on the second quarter of 2023 financial results and we will then open to the call for your questions.

Earlier. This morning, we issued a press release detailing our financial results in recent operational developments occur.

A copy of the release can be found in the Investor Relations tab on the corporate website Www Dot <unk> pharma dot com.

Before we begin our formal comments I'll remind you that various remarks, we will make today constitute forward looking statements for the purposes of the Safe Harbor provisions under the private Securities Litigation Reform Act of 1995.

These include statements about our future expectations clinical developments in regulatory matters and timelines the potential success of our products and product candidates financial projections, and our plans and prospects Act.

Actual results may differ materially from those indicated by these forward looking statements as a result of various important factors, including those discussed and the risk factor section of our most recent annual report on Form 10-K, which is on file with the SEC and another filings that we may make with the SEC in the future.

Any forward looking statements represent our views as of today only while we may elect to update these forward looking statements at some point in the future. We specifically disclaim any obligation to do so even if our views change. Therefore, you should not rely on these forward looking statements as representing our views as in any date subsequent to today.

I'll now turn the call over to Doctor, Jay Duecker, President and Chief Executive Officer of I point Pharmaceuticals.

Thank you George Good morning, everyone and thank you for joining us to discuss our continued success as we advance first in class therapeutics and delivery technologies to provide a brighter future for those at risk of losing their site [laughter] first of all I'd like to say that I'm honored to have been named <unk> C E O and I would like to thank the eye.

Board of directors for their confidence in me.

I would also like to thank Nancy and the entire executive team for their partnership collaboration and leadership during my tenure Die point.

As a physician dedicated to improving outcomes and retinal disease I'm incredibly passionate about I points mission of bringing innovative therapy to patients at risk of losing your sight.

For the past seven years I've had the opportunity to work closely with the exceptional team of talented professionals that I'd like to advance or exciting pipeline of products with the aim of transforming treatment paradigms for patients.

I'm committed to continued execution towards the skull with.

With the recent sale if you take we had I have completed our transformation to a pure play development stage biopharmaceutical company and I'm incredibly excited to be stepping into the C. E O role at this important juncture.

With our compelling clinical pipeline, representing multibillion dollar product opportunities are best in class sustained ocular delivery systems, along with a strong balance sheet, we are well positioned to grow as a leader and ocular drug delivery and to bring impactful therapy to patients.

With that I will now review, our recent progress and give an overview of upcoming milestones.

Turning toward Lee program, you might be 19 O. One a potentially paradigm shifting maintenance treatment for patients suffering from serious eye diseases. We are now fully enrolled into oversubscribed phase two clinical trials <unk> to trial for with age related macular degeneration or wet M D and the Pavia trial for non.

Prolific diabetic retinopathy or N P D R.

As a reminder, you might be 19 O. One is an investigational sustained really stirrup either consists of <unk> E. The bio erodible formulation of our dresser technology with <unk>, a highly selective small molecule Harrison County send you had better with unique properties.

Might be 19 O. One brings a new mechanistic approach to the treatment of betcha mediated chronic serious pushed your segment diseases, such as wet M. D. N P. D R and diabetic match Redeemer by acting as a pan <unk> receptor blockers blocking all vet, Jeff isoforms.

Compared to other T. K I's for relative features reduced off target binding and does not inhibit the tie two receptor clinically relevant doses, leading to a potentially improved safety and efficacy profile for this differentiated molecule.

Additionally, another potential treatment benefit of <unk> no one's mechanism of action is the possibility for duro protection and anti fibrotic effects.

You might be 90 to one delivers for relative consistently and reliably with steady zero order kinetic dosing for approximately nine months in the eye through the dura certain technology.

At the <unk> annual meeting in April we presented preclinical data highlighting the potential neuroprotective effective for rolling it the active drug and you might be 19 O one against photoreceptor degeneration, and a validated road retinal detachment model.

The preclinical data highlighted rolling potential new mechanism of action for treating retinal diseases and its potential unique benefits that may set it apart from existing logjam binding biologics.

<unk> preclinical data demonstrated that for rolling up significantly reduce the severity of change and baseline visual acuity and improved contrast, thresholds and mice treated with Verona compared with placebo, suggesting a neuroprotective effects against photoreceptor D generation.

Should just be reflected in clinical data it would provide an important new <unk> action for the treatment of these chronic blinding retinal diseases, such as wet AMD M. P. D. R D M, a and retinal vein occlusion.

We are very pleased with the progress of our two key phase two trials of <unk> 19 O. One.

In the <unk> two trial, you might be 19 to what is being investigated and 160 subjects with previously treated wet M. D with a goal to sustain the treatment effect for the majority of wedding M. D patients up to six months or longer following a single injection of the Ypu 19 O. One.

This could represent a significant improvement compared to current standard of care <unk>, which your dose on average every two months in the United States.

This lifetime, a frequent treatment represents a tremendous burden for patients who were at risk for losing sight from wet AMD.

By using <unk> 19 O one as a maintenance therapy following induction treatment with large molecule anti bad chest. We aim to provide a sustained delivery of a rolling it should that patients and practitioners can potentially have the flexibility to reduce the number of visits to the retina specialist without sacrificing visual outcomes.

All patient to the <unk> to try were previously treated with the standard of care anti <unk> therapy and were randomly assigned to one or two doses of you might be 19 O. One approximately two milligrams or approximately three milligrams versus an on label a flipper self control.

You might be 19 O. One is delivered with a single intravitreal injection in the physician's office similar to current F. D. A approved anti that Jeff treatments reset.

Recently, where <unk> Friday update at several medical meetings for the face <unk> in phase two <unk> two trials.

At the O I S retinal innovation summit in July we presented interim mask safety and baseline patient demographics from the top of your two clinical trial on wedding date.

As of July 1st 2023, a mask safety summary found that there were no reported drug related serious ocular adverse events or S. A E or drug related systemic essay ease and the 160 enrolled patients in the Davia to trial.

Additionally, an analysis of the reported baseline patient demographics suggest that the face to Dobie O. Two patients have on average better starting visual acuity and less central sub field thickness than the face went aveo cohort.

Mean P. C. P. A at baseline was 74 letters for patients had davia two versus 69 letters for patient to the Davia one trial, while on O C. T evaluation. The mean central sub field thickness was 265 microns for patience and <unk> two versus 299 microns and the.

Phase one <unk> trial.

Additionally, at this year's American Society of <unk>, a specialist annual meeting in July we presented 12th month ocular pharmacokinetic results from a study evaluating he might be 19 O once drug delivery through the Duressor platform.

We also presented an encore subgroup analysis of that you might be 19 O. One final 12 month face when Dobey, you'll results, which showed that of the nine face one of your patients that had no excess fluid at screening, 67% did not require a supplemental anti geoff injection for up to six months and over fit.

50 per cent did not require any additional therapy for up to one year.

In June we presented an encore presentation of 12 months results at the European Society of Ophthalmology Congress 2023 in Prague for the phase one W. A clinical trial evaluating you might be 19 O one and previously treated wedding M D.

The presentation is significant because it marks the first time that we presented you I P 19 O one clinical trial results outside of the United States.

We are very excited by the trials progress and we look forward to reading a topline results for the <unk> to trial in December of this year.

Now, let me turn to our second indication N P. D. R <unk>.

In June we were pleased to report that we completed enrollment in the phase two Pavia clinical trial. This is a randomized controlled phase two trial evaluating you might be making a one as a potential nine months of treatment for moderate to severe M. P. D. R. <unk>.

Similar to the <unk> to trial or Pavia trial saw significant investigators patient interesting enrollment and the travel enrolled 77 patients exceeding the 60 patient target.

Patients were randomly assigned to one of two doses of you might be 19 O. One approximately two milligrams or approximately three milligrams or to the control group that received <unk> injection.

As in the wedding M. D trials, you <unk> 19 O. One is delivered with a single Intravitreal injection in the physician's office for M. P. G R.

As a reminder, N P. D. R is a very common eye disease that affects almost one third of diabetic adults over the age of 40 and is projected to impact over 14 million Americans by 2050.

N N P D or blood vessels are weakened potentially leading to swelling in the macula, which is called diabetic neck of the redeemer or D. M. A and eventually abnormal blood vessel growth, which is called proliferative diabetic retinopathy four P. D. R. <unk>.

Both of these complications can ultimately result in severe visual loss.

It's important to note that there remains a great unmet need for a safe efficacious inconvenient treatment option for N. P. D. R. At pro actively maintains a patient's vision over a long period of time with fewer intravitreal injections and the currently available therapeutic options.

Approximately 90% of patients with N. P. D Art received no course of treatment apart from observation by the right Doctor until the disease progresses to a site threatening complication due to the burdensome nature of the currently approved short acting treatments.

Might be 19, one in our face to Pavia trial could potentially safeguard patients vision for a much longer period of time between treatments.

Top line data remains on track for the second quarter of 2024.

Looking ahead, we also plan to initiate a phase two trial evaluating you might be 19 to when a D. M me in the first quarter of 2024.

Importantly in May we sold you keep the Alamitos Sciences for 82.5 million in addition to future royalties.

This value, creating transaction allowed us retire to retire all of our outstanding bank debt reduce our projected SG&A and extend our cash runway into 2025 as we prepare for potential phase three trials to sale also completed I point to transformation into a pure play drug development.

Company was sharp and focused on advancing and expanding our pipeline of sustained delivery treatments for serious side diseases.

I would like to thank the entire I point team for an incredibly productive quarter I will now turn the call back over to George to review the financials George.

Thank you J as the financial results for the three months ended June 30th 2023 were included in the press release issued this morning. My comments today will focus on a high level review for the quarter.

S. J mentioned and May we sold the U T franchise dwell in neuroscience is 482 and a half million dollars. In addition to future royalties.

I point received a 75 million dollar upfront cash payment at closing and will receive an additional $7.5 million an equal quarterly installments in 2024.

Importantly, we were able to pay off all existing bank debt from the upfront proceeds of this transaction significantly improving our balance sheet.

In addition, commencing in 2025, we will receive a low to mid double digit royalty on Alan mirrors related U S. Net sales above define thresholds for the calendar years 2025 through 2028.

Under the terms of the agreement Alan Merrill received global rights do you take outside of China, Hong Kong, Taiwan, Macau in Southeast Asia, where you take us exclusively license to walk you mentioned therapeutics and I point will continue to receive royalties from Mark you mentioned <unk> sales.

For the second quarter ended June 30th 2023, total net revenue was $9.1 million compared to 11.6 million for the quarter ended June 30th 2022.

And that product revenue for the second quarter was $5.3 million compared to net product revenues for the second quarter ended June 32022 of $11.3 million.

Consistent with our exit from the commercial business. The decline in revenue resulted from the sale of the teak franchise to Almere in may along with the discontinuation of marketing activity for the <unk> franchise earlier this year due to the loss of pass through reimbursement by CMS effective on January 1st 2023.

<unk> revenue from royalties and collaborations for the second quarter ended June 30th 2023, total $3.8 million compared to point $3 million in the corresponding period in 2022.

The increase was primarily due to recognition of deferred revenue from the sale of U T, which will be recognized over a two year period.

Operating expenses for the second quarter ended June 30th 2023, total $31.9 million versus $30.8 million in the prior year period. This.

This increase was primarily driven by higher R&D spending on a white bean 19 O one clinical trials, partially offset by lower sales and marketing expense.

Not operating expense net total point $2 million in net Lloyd loss was $22.9 million or 61 cents per share compared to a net loss of $19.4 million or 52 cents per share for the prior year period.

Cash and investments at June 30th 2023 totaled $142.5 million compared to $144 6 million at December 31st 2022.

We expect the cash cash equivalents in investments on hand at June 32023 will enable us to fund our current and planned operations into 2025.

In conclusion, we are pleased with I points progress in the second quarter and year to date and are well capitalised to advance our product pipeline to key value inflection points and I'll turn the call back over to J for closing remarks.

Thank you George as you can see 2023 has been an excellent ear for I point, thus far as we continue to execute on multiple clinical catalysts.

Moving forward, we are well positioned to achieve a number of potentially value, creating milestones, including top line data from our phase two <unk> two clinical trial in December .

Dosing of the first patient in the phase two clinical trial would be wiping 19 at <unk> in the first quarter of next year <unk>.

Reading out top line data from our phase two Pavia clinical trial in the second quarter of 2024 and advancing our discovery stage pipeline that includes both fully on products and partnered programs.

We believe you might be 19 O. One is a potentially game changing treatment for patients suffering from serious side diseases, providing unique benefits, including delivery of the active drug for rolling it consistently over approximately nine months with the majority of patients not requiring any supplemental therapy up to six months after a single treatment.

A new mechanism of action to treating retinal disease beyond anti veg up like in Walker's <unk>.

Potential for neuro protection, and Antifibrotic benefits to the retina and a proven delivery technology with a positive safety profile.

This remains an incredibly exciting time to be part of the iPhone story as we are well positioned to execute on our upcoming milestones can continue to transform the treatment landscape with innovative longterm solutions to improve both the vision and the lives of patients with serious side diseases.

Thank you all very much for listening. This morning, I will now turn it over to the operator for questions.

Thank you ladies.

Ladies and gentlemen, she'd like to ask a question. Please press star one wanting your telephone again to ask a question. Please press star 111 moment for our first question.

Our first question comes from the line of Tyler Van Buren at T. D. Cowan Your line is open.

Hey, guys. Good morning, Congrats on all the progress there's a lot to look forward to over the next year I've got a couple of questions for you. So the first one is you mentioned the starting visual acuity in central still feel thickness for the W. Two patients that were enrolled and presented on over the weekend of course, but can you discuss how that compares to the subgroup of patience.

<unk> and the Derby, Oh, one trial that had no excess fluid a baseline.

What the read through for those for the <unk> <unk> read through that has for the results coming in Q4 and then the second question is give.

Give them the safety issue with experienced myself over early on the launch what can you guys do during clinical trials to ensure that 19 O. One does not have the same issues pop up upon potential market introduction.

Oh, Thanks, Tyler appreciate the questions I'll take the first one on visual acuity N C. S. T from <unk> to trial again, just to remind people <unk>, we had a pretty heavily treated group of patients.

On average they had received 8.6 injections in the year prior.

W. Two we believe represents more of a cross section of wedding D population out there and so the visual acuity and W. Two we're about Ah line better than <unk>, one and the C. S. Ts were dryer 299 verses 265 now.

Now if you go back and look at this subgroup analysis and that'll be Oh, one by definition that subgroup had no excess fluid.

Remembering davia too we allowed some fluid.

And the C. S T cut off was 350 microns, which allow some fluid.

So D C S. Ts in the no excess fluid group was about 244 microns, so naturally less than the entire W. One cohort or even W. O two.

Visual acuity, however were worse in the suburb analysis again, reflecting the severity of the disease and Davia one.

S for read through you know again I like to say that'd be a one was an end of 17 and so it's dangerous to to make broad statements about read through but I think it's safe to say that the davia to population was under better control with her wet M. D. Then the Davia one population.

The second question was around safety and of course that is on everybody's mind in the retina community has been for awhile. The good news is they're really has never been any significant safety signal that we are aware of in the Duressor platform remember the nurse your platform is paid for it.

The approved products over the last few decades, we estimate over 80000 people have received it.

And again has a very clean safety record.

The <unk> E or erodible form with your assert that we're using that you might be 19 O. One has actually fewer excipients. So we believe the safety profile should be similar.

Turning to <unk> <unk> was tested as an oral agent and when a M D and two trials approximately 150 patients in total received it and while it did have systemic toxicity as an oral agent at it had no ocular toxicity and.

And so far in the <unk> two trials, we have seen no evidence or had no reports of any drug related ocular essay E. <unk>.

Turning to preclinical we have preclinical data on rabbits that shows at the equivalent dose in a human of 10 times, what we could ever put into a human it was safe and a rabbit. So we've not found the maximally tolerated dose overrun with them in a rabbit at this point.

Looking at inserts, we've injected up to six inserts into a rabbit I. The rabbit is about a quarter the size of a human eye and no toxicity was reported so we're very comfortable with the preclinical talks and so part of the clinical talks with you might be 19 O. One of course, if you're talking about.

<unk>, Vince that can occur one and 5000 or one in 10000.

No you've got to do a lot of patience before something like that would come out.

That into your questions Tyler.

Yep, that's wonderful thank you very much right.

Thank you one moment please.

Our next question comes from the line of getting <unk> I've taken on your line is open.

Thank you let me just swelling up on Tyler question.

Can you just tell us the incomes of you know these patients are based on that you provided like what was the <unk> <unk> injections for them coming into the study so.

That's fast and then you know can you maybe talk about the need treatment plan in phase three what the goal would be.

How would you get treatment on the table once you move into that <unk> would you have to show that didn't go through with this study.

Thanks, Yeah.

The the first question about the number of injections for the phase two patients leading into the trial.

That data has been collected but it hasn't been collated yet that's the type of data that we will hold off from you know talking about are showing publicly onto we're ready to show the top line.

So at this point, we as a company haven't seen that data and won't be talking about it until we're <unk> confirm that the data is accurate.

With respect to Retreatment you know we've been very consistent from the start of the <unk> 19, one program that we want to get a label for every six months Retreatments that's been our goal.

Why every six months well the answer is first of all that's what most retina specialist want when you hold them and ask them.

Number two you could ask why you know you've insert that could last about nine months in human why would you go for six months and the answers flexibility.

Every patient is different and that's <unk> really if you really drill down to the data and all these need to catch up programs that the number one determinant of when a patient need to re treatment has the patient it isn't the drug as a result, we have patience interface. Once a third of them went out a full year without a re treatment.

But we would like the doctors to have the flexibility to retreat as early as every six months on the label and that's been the plan.

This was discussed with the F D a and R type C meeting last year and <unk>. The Tox studies to show that Reinjection is safe in animals had been completed and so we are optimistic that when we have our end of phase two needing to <unk>.

Can the pivotal trials the F D. A will be agreeable to our plan to do Q six doses throughout the pivotal trials.

Okay. Thank you.

Thank you one moment please.

Our next question comes from the line of Jennifer Cam.

Cancel your line is open.

Hey, Thanks for taking my questions and congrats on another great clear Explication J again, congrats on your new <unk>. Thank you I think Christmas here Yeah. The the first is just following up on the last question about the baseline average injections of patients coming in <unk> can we get that.

Data prior to December meter uhm.

And then my second question is on the December we added just any thoughts on the plan granularity data in terms of.

You know the patience reasoning for rescues et cetera, what should we expect in terms of what will get in December .

Thank you Jennifer first baseline injections again.

That data has been collected the dishes historical from charts of the investigators it isn't controlled within a study and it's not something that.

Necessarily you want to state publicly until you're confident that the numbers are correct.

So I I don't believe there's any value were advantage for us to talk about interim data around the injection numbers.

Suffice it to say, we would expect it to be less than the 8.6 that we saw on <unk>, one, but we really don't know at this point.

However, when you really talk about that what you're really getting out is the reduction in treatment burden.

And I actually believe that the <unk> <unk> denominator here to look at is not the retrospective injections leading into the study, but it's the prospective injections that the eylea arm will receive.

So drilling down into that after months to when all the patients received their last highly load and then they got either 19 O one or a sham.

For the six months following that visit the Eylea arm should on average get at least three injections and in fact, they may get more because they could also get supplemented.

That's really the best <unk> because that is under the control of the study and six injections of year multiple studies have shown us that's kind of the average that patients get into real world. So when we talk about treatment burden reduction at the top line. The first treatment reduction burden will be prospective.

Against that highly arm, but we will also talk about retrospectively.

One last point, which again drilling down a little bit three injections N D Eylea arm and the aveo too goes to six injections per year, that's a smaller number than the 8.6 that the <unk>.

Trials showed so even if we do just as well in davia too with supplements or lack thereof, and the treatment arms. The percentages will be different will be lower because the denominator against that will be lower so just a note there.

Finally granularity of the data one I'd say once again, we're working through exactly what we will be able to show and be confident in in early December because the data will not be locked at that point that takes another month or two but we will certainly show by group visually <unk>.

Judy change in visual acuity, Oh C. T data, we expect to show supplement free right for all the arms and percentages of patient sewer supplement free up two months, six which I'm sorry. After months eight in this study and also safety of course, we we we showed some safety that already and will.

<unk>, we should have that reported safety data pretty complete by the time, we do top line.

Jennifer anything else.

[laughter] no that was great uhm actually maybe one question beyond diarrhea to the N. P. D. R data. It also right around the corner. So I'm wondering when you're thinking about that opportunity. We hear a lot of talk that these retina conferences at that homeless, 18th and increased prevalence rates and D. R than previous estimates does that all factor into.

How ya reviewing that opportunity. Thanks.

Well, that's part of it we view the opportunity basically as large because physicians and patients report that the reason that they're really not opting for the large molecule I became blockers in this disease is the treatment frequencies too great if the <unk>.

<unk> frequency were much less every nine months or once a year and the treatment was safe effective and tolerable, we believe a lot of patients and doctors would opt for it.

Homo C T. As an early warning system, you know again under the clinical trials when you've got patients who are motivated and are coming in every month or two in a clinical trial, you don't necessarily need homeless C. T. You're picking up any problems in the real world. That's not what happens we know 50 per cent of diabetics don't even go in for eye exams. So Homo C. T I think for the diet.

Population in general if you could get them to do it at home would be very helpful to catch the disease earlier and again, probably be an early warning for all of these retinal vascular diseases that the patient should be treated.

Mmk, great, Thanks, and congrats <unk> letter.

Again, thank you.

Thank you one moment please.

Our next question comes from the line of <unk> Bear the line is okay.

Great. Good morning, Congrats on the progress and thanks for taking our questions can you spell the limit to the variability of response of patients with what Andy to current therapies do we have a sense of what's driving the variable response to current therapy and is there a way to control for that and your enrollment.

Calling that's a great question and so I I would say the simple answer what's driving it is how fast that Jeff levels come up it and I after an injection.

Both sides and wedding M D respond to antique digest respond anatomically meeting the fluid gets better and 50 per cent of the time goes away.

Remember 50 per cent of the wedding. The population approximately you never get all the fluid to go away, but we all have seen patients who despite monthly injections continued to have persistent fluid or worse include the good news is there's not many of them.

But the the point again is I I don't think you can take a patient who requires and monthly injection with one drug and every time you try to treat and extend that patient to five weeks or six weeks to get fluid you can't expect to switch that patient to another drug and get them to go out three or four months because.

They're just got high VHF levels now to turn it back that you might be 19 O. One we really don't know yet how that's gonna really pan out because this is a different mechanism actions were blocking intracellular Lee at the receptor level all I <unk>.

So there may be a similar type of Ah.

Of knowledge, where you know there are good responders and bad responded we expect that with any drug.

Just going back to the data that we have the end of 17 from or phase one trial. It did appear that ice that were failing standard of care, meaning despite monthly or every six week injections of a standard up guarantee veg up these eyes had worsening fluid. It didn't appear that you might be 19 O. One had much to offer those eyes.

We do believe that the bulk of the rest of the way of the population could benefit from our drug if the safety efficacy of Tolerability that we saw on phase one holds throughout the rest of the studies.

That's helpful. Thank you and then can you speak to how you approach to the rescue criteria for the phase two and you know in light of balancing visual acuity fluid and I'm getting patience rescue free.

Sure. So rescue tried to is interesting because as I know you know and I think a lot of people who in the field, though that there's no standard for this.

And again, there's also two categories really there's rescue criteria, which means the day of that visit the patient gets a non mandated injection non mandated by the protocol and then there's disease activity disease activity means that the ice.

Chose disease activity there in that day anyway for mandated injections, so they're not quote unquote the rescue they're just being shifted to a different interval a visit based on that so there are two different definitions and within those definitions every study has kind of different parameters S.

As far as I'm aware the F. D. A has never actually given direction to companies on what the rescue criteria should be and you see companies change the rescue criteria from phase one to phase two days three so that's just general statements for Us <unk>.

Recall that the primary end point that we would like to achieve and are striving to achieve in the pivotal trial is noninferiority change in visual acuity against the Eylea control or.

So we elected in the phase two to lower the standard for supplement.

In visual acuity to five letters. It was 10 letters in the in the phase one and that's again in an effort to try to bracket.

The visual acuity to try to keep it intact, which ultimately that's really what patients care about.

Yeah, you can show a patient picture of the row C T and say Oh look there's fluid or there's not flu, but ultimately with day care about what the retina specialist cares about is how are they see so O C T and fluid or a biomarker, but not a perfect biomarker for visual acuity. So ultimately that's the goal that we need to achieve noninferiority changing visual acuity.

Great that makes sense and then last one from US he was remind us what your current thinking is for the plan to faith three design would you the noninferiority and just what you're at Doctor for funding that.

Well the first part's easy the second part is a broad question, but I'll go with the first part first so our phase two was designed to looked very similar to the plan pays three remember we did have a type C meeting with the F. D. A to go over this and the F. D. A gave us excellent guidance at the time to what.

Was the expectations. So if you look at our phase two protocol. The W. Two protocol there are gonna be too I think obvious changes in the pivotal trial with one of them, we talked about already which is reinjection. We plan on doing Reinjection of you might be 19 O. One every six months into two.

<unk> pivotal trial. The second difference is the efficacy read out the.

The efficacy read out and W. Two was at eight months 32 weeks the advocacy read out for the pivotal trials will be at approximately one year.

Now things like dosing ended this study inclusion exclusion criteria. That's all undecided until we see the results of the aveo too and the science from <unk> will inform us on those other things, but ultimately the structure of <unk> and a phase III will look very soon.

Similar.

Now from a funding perspective, you know I've just.

Say, where we're very well funded right now our balance sheet looks great to see all of your teeth really helped us we've got cash into 2025. So we can fund all our our our phase two trials. There are multiple options, we have an art discussing to fund the Pivotals N.

Maybe I'll ask George to kind of give a little more color on them.

[noise] Hi, calling good morning, you know I think we've talked about this publicly can work as we look at.

Two of the ultimate cost of the face threes, it really isn't the decline.

Openly that we do have some strategic interest involved.

You never know with those transactions [noise] pardon me we are.

Evaluating every range of mechanisms on.

<unk>, which includes bringing in a partner potential equity races.

Another structure if that makes sense.

We're gonna be guided by the data.

The <unk>.

Phase two days is really going to give us a moment of clarity.

The total cost with a free will be.

Mmm.

Thank you for us sitting here today, you were on a good.

Physician and trajectory to data.

Great. Thanks for taking my question. Thank you for that again.

<unk>.

Thank you one moment please.

Our next question comes from the line of.

Danny Gotland, a shot and your line is open.

And wanting thank you for taking the question on congrats on the progress.

Just wanted to ask what does this message or <unk> <unk> you I P. In 19 O. One could also provide a benefit in patients with other <unk> other than <unk>.

Thank you.

Thanks for the question.

At the present time the F D. A guidance at least for wedding M. D has been in a pivotal trial. The control group can either be on label Lucentis or on label Aelita.

So we're limited by the choices for wedding M D pivotal.

It's certainly possible then when we start our D M he'd pivotals that guidance for D. M V may be different than the standard of care for treating <unk> at that point may be different in which case the control arm may be different but currently our wedding and deeply.

<unk> is to use eylea on label in patients who have previously treated with a M D as the control one.

Thank you.

Thank you.

One moment please.

Our next question comes from the line of Shawn Kemp.

Jones trading again <unk> your line is open.

Hi, Thank you for taking my question. So I guess the first question is could you remind us whether the phase two trial is a statistically powered for <unk> George <unk> <unk>.

And also related to the statistics can come in and tell them get their ability and physical activity changes following treatment with 19 O. One.

Served in case, one daughter to trial and <unk> <unk> <unk> <unk>, what's your expectations aren't regarding their ability that'd make a specific standard deviation poor fourth 19 O. One index, okay per cent to control.

Okay.

Thanks, Sean great questions.

First of all with respect to the <unk> to the statistics are descriptive only this study is not powered to show.

We'll certainly confidence interval that would be necessarily noninferior. It could you do that but the end of this study is probably too small to have that absolute confidence.

The variability of visual acuity in the phase one again, there's no statistics around that there was variability, but remember this was four different doses of the white P 19, O one and I'm not sure that there's much read through two variability in Davia one two <unk>.

<unk>.

And finally expectations for standard deviation all we can do is go by what's out there for previous studies and if you look at the standard deviation for treatment <unk> wet a M D trials.

It's usually around 12 letters, it's pretty variable.

The only study that we're aware of that looked at or perhaps similar population of maintenance patience was the port delivery system phase three trial, which had a standard deviation of 7.1 letters.

But that study limited enrollment to patients who were diagnosed with wedding M D for nine months or less.

Our study allowed essentially anytime of diagnosis of wedding M. D and if I were you know guessing I would guess that our standard deviation would be closer to the seven one and then the 12 I think that would make sense. However, we don't know that's <unk>.

One of the many reasons that we chose to do what I would refer to as kind of a classic phase two trial.

Did I answer your questions.

Yeah. That's very helpful. Thank you very much and if I could squeeze into another question. That's a separate question. So I guess, we're relating to the new proprietary injector <unk> could you confirm it's 19 O. One will be package. That's a drop device combination for potential approval or would you make a lot of an option for Christians to yours to standard.

[noise] tribute show a needle in a Paris.

Oh, no I can confirm that this will be a drug device combination we've been aware of that from the start of the development of the program since the E. M. A requires staff and you know.

While we were into the program the F D H changed its guidance around that so we've been preparing for this to be a drug device combo. No. We we wouldn't intend to have doctors load the in search into any kind of their own hypodermic. These injectors and it's true of the current syringe injector that we're currently using in the.

Phase two trials they are pre loaded sterilized pre packaged the the the physician just opens up the sterile package takes a tab or a wire out and then goes ahead and injects. So there would be <unk> plan to deviate from that this is going to be something that's gonna be completely preloaded priester license self contained.

The doctors to make it really easy for them to safely and sterilely deliver the inserts.

Okay. Thank you very much.

Thank you one moment please.

Our next question comes from the line of Yale Jan of Layla Company. Your line is open.

Good morning, and thanks for taking the questions.

J for the first question is that the <unk>.

Comes up to the label seeking a particular label speaking for the pivotal.

<unk> study.

You mentioned earlier you you seek for six months, but just in.

In case of very few patients that potentially need to be rescued <unk> needs to be treated me treat it in five months. So example would that also be a label <unk> see king so the patient you can.

Cover all the patients.

Being treated.

So yell at the present time, we're planning on every six months in the pivotal trials.

If if if we you know see positive results there I could see a post approval study pushing that to shorter.

Timeframe and part of that really depends on the results you know if if we're not getting a lot of supplements and are pivotal trials at month, five or you know <unk>.

<unk> seven it would be after the 19 O. One goes in then there may not be value of death, I think it's something will clearly be looking at but at this point I don't believe that will be testing it shorter than six months.

You know part of this again is is our whole view here about the the treat to maintain where.

In the phase one trial over 50% of the patients to go up to six months with stable vision and stable O C. T didn't require any other supplement.

There was another approximately third of the patients in the phase one.

Who did get a supplement prior to months six but the majority of those only got one.

And many of those patients have been treated every four weeks or six weeks going into the study. So you've now shifted a patient from being treated every four to six weeks to being treated every three months, albeit it could be alternating eh eh eh approve like an blocker with 19 O one and there's a lot of <unk>.

Reasons, why doctors might consider doing that even as they pushed patients out further and further and treat and extend remember with the log in blockers you know the the drugs gone by certainly by three or four months and if that patient misses a visit or get sick I think doctors would appreciate a safe.

Effective and tolerable sustained release insert that day no was working in the background for up to eight or nine months and that patient if they miss visits.

So again back to the original question right now not planning on pushing at the label sooner than six months, but it's something we will certainly consider based on the data and based on what the retina community wants.

Okay, Great. That's very helpful and maybe just one housekeeping questions for George.

You mentioned I believe you mentioned that you take <unk>.

Revenue income so it will be advertised over two years period, just curious what might be the reasoning behind giving that that the sales it's already completed.

Yeah. So thanks for that question you know the it's really counting.

Driven and because of the nature of the agreement.

Sailing license to Elmira.

There's really two components one is the sale of the asset.

N license a V I P with nets, the 82 and a half a million upfront part of that we also have a supply agreement with <unk> will continue to supply you <unk> to them and based upon the interpretation of the accounting rules of those are tied together so that.

Total of 82, and a half a million dollars will be recognized over a two year period.

Based on predicted volume. So you know if you think about it from your modeling perspective, it would be roughly even quarterly over this too.

It's again, it's non-cash.

We've already got $75 million.

The accounting treatment of the revenue and that will show up.

As soon as you see in there beneath us today that shows up as a.

Uhm.

Collaboration and royalty line is not a policy.

Uhm real quick <unk>.

And will continue I'm, sorry product sales.

For sales to both Almere in our pleasure in China Hockey you mentioned, but it gets very very different Ah line on our <unk>.

Not that it's not true from Arkansas.

Following the accounting pronounced.

Okay, Great. That's very helpful. Maybe just squeeze one more question here Oh J in terms of M. P. D. R. It is.

<unk> known that more than 90, <unk> 90 per cent of patients not receiving treatment at the moment. So in terms of 19 O. One if the data cut out to be robust. The question is that the besides the infrequent does theme is there other factors that can incur.

Such a physician and patient to use the drug okay at the <unk> of the.

So the treatment Paradise, Yeah sure.

Again, it's a great way to think about this but I go back to the first principle watches the efficacy and safety.

And so if the safety continues to look really good as it has so far in.

In the efficacy because it's a zero ordered genetics of the parole and release.

If you imagine that is advantageous against the staccato injection of a large molecule like Ian Walker, it's possible that our efficacy could be even better than what we see with the currently approved therapies I think those two things coupled would really drive the market in our direction.

But flipping it around and saying well, what if you're safe, but you're efficacy is less well given that essentially physicians and patients are not opting to any large degree <unk> blockers, even if our efficacy is less than day.

<unk>, if we're safe and tolerable I still think we'll get a significant part of that market and will grow that market.

Okay, Great that's very helpful and <unk> and <unk> looking forward in December for the data. Thank you.

[noise]. Thank you one moment please.

Our next question comes from the line of sight Tonya Gala COTA of H C. Wainwright. Your line is open.

Hey, this is saint on behalf of so <unk>.

You've answered most of my questions. So I'll just leave you with one quick one any major developments in the competitive landscape that you've noticed specifically for.

The maintenance treatment with M D.

<unk>.

Oh. Thank you for that question and then I would say it recently no I don't think there are any developments I think when you talk about true sustained-release true sustained release is what we're doing with with the White P 19, O one meaning that you've got a <unk>.

Vice or a method that continues to release drug and that would be the sustained release in search like you might be 19 O one or gene therapy I put that in the same category.

Against that is what I would refer to as extended duration.

The extended duration means you've got first order kinetics, but you're putting in a more of the drug in order to to have it last longer and you know obviously that might refer to <unk>. Those two had been around for awhile now, obviously hydro slightly it hasn't launched yet but.

Again, I don't we don't consider those to be really competitors, because we're looking at a maintenance population and we can be used in conjunction with them if the patient needs it or is it just a doctor desires.

So unlike the previous iterations of Entp that jeffs, where when the new one came out the promise was we're better than the last one we last longer you don't need them anymore, that's not our value our value as we can do something they can't which is take we believe <unk>.

At least half the wedding the population out six months or longer with a single injection and possibly provide your protection and possibly providing anti fibrosis, which may <unk>.

Result in better visual acuity.

So back to the question is simple answer to your question is I don't think there's been any significant.

Changes in the competitive landscape and the last quarter.

Thank you so much and congrats again hung all your progress thanks.

Thank you.

And I'm showing no further questions in the queue at this time, ladies and gentlemen, Thank you participate in today's conference does that conclude your program. You may now disconnect everyone have a great day. Thanks, everybody.

Mmm.

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