Q3 2024 Lenz Therapeutics Inc Earnings Call
Speaker Change: Good morning ladies and gentlemen and welcome to the Lens Thurpidics 3rd Quarals Junkton D'Port conference call. At this time, all participants are in the Lissian Only Move following prepared remarks on the
Speaker Change: We will conduct a question and answer session and instructions will follow at that time. As a reminder, this call is being recorded. At this time, I would like to turn the call over to Dan Shevelard. Chief Financial Officer, please go ahead.
Dan Shevelard: Thank you. Good morning and thank you for joining us today. The discuss lens is third quarter, 2024 financial results and recent highlights.
Dan Shevelard: My name is Dan Shavalard, Chief Financial Officer of Lenstherer Pudix. We are joined today by Apes Schimmelpennix, our president and chief executive officer, and Sean Olson, our chief commercial officer. As well as Dr. Mark Odrich, Chief Medical Officer, we'll join us for the question and answer session.
Dan Shevelard: Before we begin, I would like to remind you that this call will contain forward-looking statements regarding lens of future expectations, plans, prospects, corporate strategy, regulatory and commercial plans and expectations, cash, runway projections and performance.
Dan Shevelard: Actual results may differ materially from those indicated by these forward-looking statements, as a result of various important factors and risks, including those discussed in our filings with the Security and Exchange Commission, in which can also be found on our website.
Dan Shevelard: In addition, any forward-looking statements represent only our views as a data-visual cast and should not be relied upon as representing our views as of any subsequent date. We specifically display any obligation to update such statements.
Dan Shevelard: The company encourages you to consult the risk factors contained in our SEC filing for additional detail, including in our third quarter 2024 Form 10Q, which was filed this morning.
Speaker Change: With that, I will now turn the call over to Abe.
Abe: Thank you, Dan, and good morning, everyone.
Abe: The third quarter of 2024 has been highlighted by multiple significant corporate achievements.
Abe: They reflect the consistent pattern of execution by the LEMS team as we continue to build momentum on our path towards the potential approval and launch of LMG100.
Abe: I'd like to take a moment to summarize our recent milestones.
Abe: And signal a clear and important transition in the profile of Lens, as we move from a late-stage clinical development by a pharmaceutical company to a pre-commercial company, fully focused on what we believe is to come in 2025.
Abe: The recent period has been pivotal in our advancements with significant achievements, most notably the acceptance by the FDA of our NDA for LNG-100 for the treatment of presbyopia.
Abe: And importantly, receive our Padupha Targon Action Date of August 8th, 2025.
Abe: With that, I'd like to provide a brief refresher on the widespread and inevitable problem we are aiming to solve.
Abe: As we know, presbyopia is a loss of near vision that impacts the daily lives of nearly all people over the age of 45.
Abe: As the crystalline lens in our eye hardens with age, the eye is less able to accommodate and focus the incoming light for near vision on the retina, resulting in blurry near vision.
Abe: Although the progression of presbyopia is gradual, presbyopians often experience an abrupt change in their daily life as the symptoms become more pronounced starting in their mid-40s, when reading glasses or other corrective aids are suddenly necessary to read text or conduct close-up work.
Abe: To address the daily challenges faced by presbyopes, we are advancing the first and only a cycle-based once-daily eye drop that in our phase three clarity trials has shown to be capable of improving near vision throughout the full workday without the need for reading glasses.
Abe: We are extremely excited about the LMG100 product profile, which we believe has best-in-class potential.
Abe: The profile of LND100 includes a rapid onset of response, with 71% achieving three lines or greater of near-vision improvement at 30 minutes, and also 71% achieving three lines or greater of near-vision improvement at three hours, which was a primary endpoint.
Abe: An unprecedented, long-lasting response rate measures out to at least 10 hours, with 40% achieving three lines or greater in their vision improvements.
Abe: which was the last time but measured in our efficacy trials.
Abe: And a very impressive near-universal response to LNG-100 with 95% of participants achieving at least two lines of near-vision improvements.
Abe: This is an important measure because it's seen as clinically meaningful and significant for most raspberry oaks.
Abe: Notably, 69% of the participants still reported this improvement at the end of the day, 10 hours after dosing.
Abe: In addition, we observed a statistically significant, at least one line of distance vision improvement across the population. And importantly, in terms of safety, LNG-100 was seen to be well-tolerated with no treatment-related serious adverse events observed in the over 30,000 treatment days across all three clarity trials.
Abe: Of all reported adverse events, 95% were classified as mild, believed to be transient, and in the rare cases of headache, appeared to be tachycolactic, and for most, no longer appearing with prolonged use of LMG100.
Abe: Returning now to our recent news, an exciting regulatory milestone announced a few weeks ago.
Abe: We are pleased to receive our Day 74 letter, which signifies the official acknowledgment of acceptance by the FDA of our MDA for LNG-100 for the treatment of Thresbyopia.
Abe: Importantly, including our PDUPA target action date of August 8, 2025.
Abe: As I mentioned on our second quarter call, our NDA is the culmination of a development program that along the way incorporated valuable feedback and guidance from the FDA. And we believe that we've compiled the DASHE with strong clinical manufacturing and quality data.
Abe: We look forward to continuing to collaborate with the agency as they review our submission.
Abe: All of which we believe could result in a potential approval by the FDA in August of next year and a commercial launch in the United States as early as the fourth quarter of 2025.
Abe: Before we transition to a commercial discussion, I would like to also take a moment to highlight the exciting results from Corksell, previously known as Yiching, our development and commercial licensing partner in China, which we jointly announced last week.
Abe: We were very pleased with the top-line data from the Phase III study performed by Coxell. It was a well-executed study, as evidenced by the strong p-values of at least – of less than 0001.
Abe: We believe it's important to emphasize the relative strength and consistency of that data with that of the clarity study.
Abe: As the JX07001 clinical study was performed by a different company in a different country and importantly with a patient population that was predominantly of a different ethnicity.
Abe: We believe this further highlights the potential LNG-100 has as a global therapy, starting with potentially providing access to the estimated 400 million presbyopes in China.
Abe: We believe this to be an illustration of an XUS partnership that has an opportunity to create meaningful shareholder value.
Abe: As the balance of the global rights to the LNG-100 ex-China remains unpartnered.
Abe: We believe opportunities to further partner globally could provide significant additional upsides to our shareholders.
Abe: Bye.
Abe: As I mentioned in my opening remarks, these recent milestones signal an important transition in the focus and profile of Lens.
Abe: As we have moved from a late-stage clinical development by a pharmaceutical company to a pre-commercial company.
Abe: With that, we would like to highlight a few key observations from a recent primary market research survey commissioned by Lens of approximately 430 eye care professionals, comprised of approximately 80% optometrists and 20% ophthalmologists.
Abe: We believe the results will help illuminate some very interesting insights about the potential treatment of presbyopia with LNG-100 if approved.
Abe: I will now hand the call over to Sean Olsen, our Chief Commercial Officer, to step us through the results of this analysis. Sean? Thank you, Abe, and good morning, everyone.
Sean Olsen: It goes without saying that the commercial potential for an effective presbyopia treatment represents one of the largest eye care market opportunities.
Sean Olsen: Presbyopia impacts an estimated 128 million people in the U.S.
Abe: population incident that is nearly four times larger than those impacted by dry eye.
Abe: It is also more than the combined U.S. population suffering from dry eye, childhood myopia, macular degeneration, diabetic retinopathy, and glaucoma.
Abe: As we continue to advance towards potential approval by our PDUFA date of August 8th next year, we wanted to take this opportunity to share significant and insightful perspectives gained from eye care professionals.
Abe: through primary market research.
Abe: confirming what we had have understood to be anecdotally true.
Abe: Reflecting on eye care professional patients.
Abe: Our survey found that most patients seen are presbyopic and the recommendation for a retinal eye exam is already built into their standard eye care exam process.
Abe: Based on feedback from 426 eye care professionals,
Abe: the average ECP will see 300 to 400 patients per month.
Abe: Of those, 61% are reported to be presbyotes.
Abe: Further, the ECPs in the survey indicated that 80 percent, 87 percent of the annual eye exams they perform already include a retinal exam to evaluate retinal pathology.
Abe: We anticipate such a retinal exam will be recommended by the FDA, and we believe it integrates seamlessly into the existing exam process and will not be a burden to prescribe.
Abe: Next, we wanted to survey eye care professionals to get a sense if their prior experience with VUE had impacted their interest levels in the treatment of presbyopia, as well as their impressions of LMZ100.
Abe: The ECP surveyed were asked to review the LNZ-100 phase 3 safety and efficacy data. More specifically, we shared LNZ-100's 30-minute and 10-hour post-treatment 3-line and 2-line improvement rates from our clarity study.
Abe: The adverse event table from our Clarity Study.
Abe: in which all ocular IEs were mild, and noted that there were no treatment-related serious adverse events across more than 30,000 patient treatment days.
Abe: Following your view, 78% of ECPs surveyed agreed with the statement that LNZ100 is an attractive presbyopia treatment.
Abe: As well as 78% agreed with the statement that LNZ 100 is well tolerated and safe.
Abe: As we look forward to the adoption of LNZ100, we are excited to share that 83% and 82% of eye care professionals surveyed would be likely to sample and likely to prescribe LNZ100 respectively.
Abe: Confirming the sustained excitement for a non-pylocarpene presbyopia eyedrop solution.
Abe: As we've discussed on previous calls, the first eyedrop treatment for presbyopia was approved in 2021 and confirmed the strong consumer desire for an eyedrop treatment.
Abe: as evidenced by initial paid new scripts of over 5,000 per week.
Abe: Long-term usage beyond the trial period of this product did not materialize, as pylocarpine, even at the high concentration of 1.25%, couldn't deliver the consumer-required performance.
Abe: Other attempts at lower-dose BID strategies are being pursued.
Abe: But, given the efficacy profile is very similar to that of beauty, we do not believe this will clear the consumer hurdle for performance or the eye care professional hurdle for a pupil-selective option.
Abe: We continue to believe the category is wide open for an eyedrop solution that can deliver what consumers desire, a once-daily eyedrop that works for the full workday for the majority of presbyopes.
Abe: Unlocking this market requires an ideal presbyopia eye drop, and we are excited for the prospect of a cyclidine-based LNV100.
Abe: We believe the commercial potential of LNZ100 was validated in our Phase 3 Clarity Study with 90% of participants noticing an improvement in their vision and 75% of the participants indicating they would continue to use LNZ100 after the study.
Abe: of which 81% plan to use four to seven days per week.
Abe: Together with our broad inclusion criteria, we believe this positions L&Z 100 well for the estimated $3 billion plus potential market opportunity.
Abe: creating a potential category of one.
Abe: Continuing on that momentum and to support the projected launch following potential FDA approval, Lens has now fully staffed its commercial leadership team across marketing, sales, and commercial operations.
Abe: with expertise in eye care, direct consumer, influencer, and consumer product goods.
Abe: In addition, we have now hired our Regional Sales Directors for the East and West that will report to our Vice President of Sales.
Abe: From an infrastructure standpoint, LNZ-100 is actively building out its U.S. commercial capabilities, highlighted by the completion of our third-party logistic contracting, all in preparation for a potential launch of LNZ-100 as early as fourth quarter of 2025.
Abe: As we have discussed previously, in February of 2024, Lens launched its unbranded I Am Selective campaign.
Abe: to educate and excite eye care professionals about future presbyopia solutions.
Abe: Over 50 key opinion leaders are involved in this campaign, of which many are featured at iamselective.com. That is E-Y-E-AMSELECTIVE.COM.
Abe: where eye care professionals can learn about the importance of ideal pupil size, iris muscle selectivity, and expected early adopters of Pres-BOV eye drops.
Abe: As we think about the commercialization of LNZ100, we'd like to just take a moment to reiterate our commercial strategy based on three primary pillars.
Abe: First, we want doctors to recommend us.
Abe: This requires calling on approximately 15,000 eye care professionals who represent over 85% of the VOD scripts with potential best-in-class product to educate and equip them to recommend LMZ100 and to integrate our solution into their patient offering.
Abe: Second, we want consumers to request a sign-in.
Abe: This requires developing a product brand and consumer campaign that will elicit a strong emotional connection.
Abe: and promotional sensitivity to direct to consumer advertising.
Abe: And third, we want to ensure ease of product access for patients with a seamless journey to use.
Abe: This requires enabling the patient to experience the product and move from trial to usage as quickly as possible.
Abe: To support this, our team is building out consumer sampling capabilities and commercial access with multiple channels, including traditional retail pharmacy as well as home delivery.
Abe: Before I conclude, I'd like to highlight that we have turned our attention to key medical conferences with an aim to continue to get our data into relevant medical forums.
Abe: including a presentation last month at Icelerator at AAO 2024 in Chicago.
Abe: tomorrow at the American Academy of Optometry at Academy 2024 Indianapolis.
Abe: And we are pleased to recently learn that we have been accepted for presentation at OIS in San Diego later in November.
Abe: We look forward to providing further updates and progress on our pre-commercial preparations in the quarters to come as we approach potential approval and launch.
Speaker Change: With that, I'd now like to hand the call over to Dan Chevalard, our CFO, to step through our financial results.
Dan Chevalard: Thank you, Sean. As both Ace and Sean have highlighted, the third quarter and recent period has been very productive.
Dan Chevalard: In early July, we were very pleased to have completed a $30 million pipe financing with Ridgeback, bringing a strong and well-respected investor into our shareholder base and further strengthening our balance sheet.
Speaker Change: To that end, we ended the third quarter 2024 with approximately $217.2 million in cash, cash equivalents, and marketable securities, which as we have guided previously, is anticipated to fund the company's cash runway to post-launch positive operating cash flow.
Speaker Change: Turning now to our third quarter results, our operating expenses and resulting cash burn for the third quarter were once again substantially in line with our plan.
Speaker Change: Total operating expenses for Q3 2024 were approximately $12.9 million compared to $19.9 million for the same period in 2023.
Speaker Change: Our Q3 2024 cash burn, net of interest income, was approximately $9 million.
Speaker Change: Sequentially, our total operating expenses decreased quarter over quarter by approximately 10% from $14.4 million in the second quarter of 2024.
Speaker Change: On previous earnings calls, we highlighted that we would anticipate a decline in our research and development expenses due to the conclusion of our positive phase 3 clarity study, while shifting our research and development focus and spend towards preapproval manufacturing activities, which we have seen in the third quarter.
Speaker Change: Total R&D expenses decreased to $6.5 million in Q3 2024 compared to $17 million for the same period in 2023.
Speaker Change: sequentially.
Speaker Change: Research and development expenses decreased quarter over quarter by approximately 7% from $6.9 million in the second quarter of this year.
Speaker Change: Total SG&A expenses increased to $6.5 million in Q3 2024 compared to $2.9 million for the same period in 2023.
Speaker Change: This increase was driven primarily by increases in commercial headcount and pre-commercial planning activities.
Speaker Change: Sequentially, SG&A decreased quarter-over-quarter by approximately 12% from $7.4 million in the second quarter of 2024, driven primarily by decreases in non-commercial G&A administrative expenses, including outside legal services and other corporate expenses.
Speaker Change: We expect our SG&A expenses, or our sales and marketing expenses, to be more specific to begin to ramp from here as we approach a mid-2025 approval.
Speaker Change: For LNG 100.
Speaker Change: As we think about the year prior to launch and heading into the potential year of launch, we believe our sales and marketing spend is well aligned to deliver on our commercial plans.
Speaker Change: Importantly, our allocation of capital to sales and marketing, including our absolute dollar sales and marketing spend, and sales and marketing spend as a percentage of total operating expenses, all line up well to benchmark comparative analyses we have performed.
Speaker Change: Finally,
Speaker Change: Our net loss per share, both basic and diluted, was $0.38 per share in the third quarter 2024 on a net loss of $10.2 million, compared to a net loss per share of $9.62 per share in the third quarter 2023 on a net loss of $18.9 million.
Speaker Change: As was noted on previous earnings calls, please keep in mind that our net loss per share figures consider only weighted average common shares outstanding, which were considerably different in 2023.
Speaker Change: Q3 2024, net loss per share was calculated on approximately 27.2 million weighted average common shares outstanding, compared to Q3 of last year, when as a then-private company with multiple classes of preferred and common stock outstanding, net loss per share was calculated on approximately 2 million weighted average common shares outstanding.
Speaker Change: Bye.
Speaker Change: We ended Q3 2024 with approximately $27.5 million total common shares outstanding.
Speaker Change: That concludes my comments on our Q3 financial results and with that I'd like to turn the call back over to Abe for final remarks.
Speaker Change: Yeah.
Abe: Thanks, Dan. As you can see, the third quarter and recent period has been a very productive time, and we feel the team continues to build momentum into the end of the year.
Abe: We've continued to execute in all facets of our organization.
Speaker Change: We remain highly confident that we are well on our way to deliver the first, and only, a psychedelic-based eye drop for the improvement in near vision in people with CRASVOPIA.
Speaker Change: We look forward to this next phase as a pre-commercial company as we prepare for a potential approval and commercialization of LNG100.
Speaker Change: and believe we are well-positioned to deliver a once-daily, safe, and rapidly-acting treatment to 128 million individuals living with presbyopia in the United States.
Speaker Change: With that, I'd like to open up the call for questions.
Speaker Change: Thank you. We will now begin the question and answer session. At this time, I would like to remind everyone, in order to ask a question, press star, dip the number 1 on your telephone keypad. We will pause for just a moment to compile the Q&A roster.
Speaker Change: And your first question comes from the
Speaker Change: Hi guys, thank you very much for taking the question.
Speaker Change: I had a few here. So first off, you mentioned, I believe, the survey that was 80% optometrists, 20% ophthalmologists. I'm just curious if the conclusions of the survey were consistent.
Speaker Change: amongst those two subgroups.
Speaker Change: And then the second question, obviously with this very, very large market over 100 million potential patients, I'm curious what level of investment in the social media access? I think you mentioned influencers. Are you expecting for the launch?
Speaker Change: And then thirdly, could you remind us, as far as the manufacturing of the product, where is it manufactured? Is it within the United States or is it ex-U.S. and do you have multiple suppliers? Thank you.
Speaker Change: Thank you, y'all.
Speaker Change: Great questions. Let me kick off with the 80-20 on the manufacturing and then I'll hand it over to Sean for the last investment. So, the 80-20 split between
Speaker Change: Someone should have said ophthalmologist, is obviously by design.
Speaker Change: We see that if you look at the VOD scripts that 80-20 split is how the VOD scripts and about how we expect that to be reflected for our commercial plan as well. That's why we ended up with 80-20.
Speaker Change: And the feedback across those two groups is very consistent, so you don't see any changes between those two groups.
Speaker Change: Then, on manufacturing, we are fully set up to produce at commercial scale. Actually, our phase three trial was produced at that same commercial scale, so ready to support the launch as is.
Speaker Change: Manufacturing setup is partly U.S.
Speaker Change: partly ex-U.S. or European-based, so European and U.S. manufacturers.
Speaker Change: both for drug products as well as drug substance or with ample capacity that we will continue to add to and build redundancy to as we launch.
Speaker Change: And turning to the interests from social and influencers to LNZ 100.
Speaker Change: So, we see the potential of LMZ100 in this large untapped market, right, that has the potential to be north of $3 billion. And because of that, we will put the financials behind it from a direct consumer strategy that would be commensurate with a product of that potential.
Speaker Change: What we saw with VUITY was when they turned on the direct consumer campaign, it nearly doubled their scripts from 3,000 new scripts per week to up to 6,000 new scripts per week, and therefore that supports our strategy behind a direct consumer campaign.
Speaker Change: We are evaluating both influencer campaigns as well as, you know, a celebrity spokesperson.
Speaker Change: And we'll continue to evaluate that as we get closer to launch. What we see is when you're selecting influencers and celebrities, you do wanna do that fairly close to launch, just because they do tend to go in and out of favor over time.
Speaker Change: Thank you, Sean. Okay. Thank you.
Speaker Change: Your next question comes from the line of Mark Goodman with Learning Partners. Please go ahead.
Mark Goodman: Yes, two questions. One is, can you remind us what the incentive is for the optometrist?
Speaker Change: has to recommend the product.
Speaker Change: And then second of all...
Speaker Change: You know, thinking about the VUITY launch, you know, help us with expectations for how to think about your launch for the ramp and prescriptions and sales. I mean, should we be expecting it to do as well or not as well or better or, you know, just help us, you know, kind of set the expectations right now. Thank you.
Speaker Change: This is John Olson, the Commercial Officer.
Speaker Change: when they're prepped.
Speaker Change: one number of pixels, so how many pixels do you have?
Speaker Change: And what we see is...
Speaker Change: the majority of the Tresbio South.
Speaker Change: So I really look for and I feel solution for presbyopia. So our eye drop provides the opportunity for more patients to be going to practice surgery, no longer being an optometrist.
Speaker Change: Our patients that are buying reading glasses off the shelves, really value and bring more people into the
Speaker Change: That then results in the sitting fees, as well as the revenue.
Speaker Change: The other benefits we talked about in one of our target groups are contact awareness.
Speaker Change: So, there are over 10,000 people that are pressed behalf.
Speaker Change: And eventually, they can take these kinds of actions to do the right thing for themselves.
Speaker Change: This gives an opportunity for us to keep those people safe.
Speaker Change: and they continue to come to practice.
Speaker Change: year.
Speaker Change: Good evening.
Speaker Change: All right. All of the NCs. Thank you.
Speaker Change: So, we'll be back.
Speaker Change: potential or value you have for the practice.
Speaker Change: All right.
Speaker Change: Again, we think Acuity did a good job opening up this market. Ultimately, the product did not work, but they did drive 3,000 new scripts per week in the beginning.
Speaker Change: And then they increase that to 5,000 new scripts per week after DTC. Obviously, we are not the size of Allergan, but we're gonna put the potential marketing power behind this product, have a launch. I think anything in that realm would be good.
Speaker Change: We've tied them.
Speaker Change: Our guidance as to when we expect to launch, as you heard us talk about, to the fourth quarter.
Speaker Change: Up next here.
Speaker Change: That's the logical and always be aware time that will take to, we expect it will take to get those products out of the door.
Speaker Change: So, early in that quarter, we'll start with samples, and it's a product that lends itself obviously extremely well for sampling with that very rapid onset. So, remember that our clinical trial was truly a day one.
Speaker Change: Endpoints on that same day one. So first product first time that a patient actually ever see the product within 30 days. We get those very high efficacy results that we've shared before.
Speaker Change: So, we look at that fourth quarter truly as a rollout quarter, where we'll start with heavy sampling that then will lead to that transition where patients are going to start filling scripts.
Speaker Change: Thanks.
Speaker Change: Your next question comes from the line of Joe Catanzaro with Piper Sandler. Please go ahead.
Joe Catanzaro: Great. Hey, everybody. Thanks for taking my questions. Congrats on the progress here. So, within the ECP survey, you queried physicians on...
Joe Catanzaro: you know, how often they perform retinal exams. And, Sean, I think you mentioned expectations around requirement for a retinal exam. So, wondering where those expectations stem from relative to the safety profile you observed in comparison to beauty.
Speaker Change: And maybe more generally, how the language around retinal risk might compare to beauty. Thanks, and I have a follow-up.
Speaker Change: I take that one.
Speaker Change: So our expectation is that our label will be very similar to that of the UIDs.
Speaker Change: Which has a general recommendation, not a requirement, but a general recommendation for an eye exam when using a presbyopia eye drop.
Speaker Change: We know that the ciliary body is, or overstimulation of the ciliary body, is what's often connected to the retinal side effects.
Speaker Change: So, we believe that our data shows and the MOA shows that we don't have that impact. At the same time, we believe that the FDA will not go as far as to not have that same general, again, recommendation on our label.
Speaker Change: We actually believe that that's a good thing. One of the questions earlier was what's in it for eye care professionals. I think that eye exam is one, as we know, that's actually a catch phrase for most patients if you do a non-related eye exam.
Speaker Change: So that's a positive for eye care professionals. It's also a positive, obviously, for patients, to just make sure that you have your eye checked out on an annual basis. And as we say, or as we found in the survey, it is standard practice.
Speaker Change: So, your annual standard eye exam almost always includes a retina exam, so it's not something that needs to get done in addition, it's not something new, something that all, if not most eye care professionals already do.
Speaker Change: So again, we we feel that it's not a herbal actually positive in there
Speaker Change: Bye-bye.
Speaker Change: Great. That's really helpful. Maybe my follow-up. So I guess maybe if you have any updated thinking on ex-US, ex-China opportunities or where that stands, whether you sort of pursue that on your own, look for partnerships and any sort of gating factors you see there to pursuing that.
Speaker Change: Yeah, great, great question. What we can definitely say is that, you know, following first our results and frankly now seeing Goxcel repeat that.
Speaker Change: There's definitely a lot of interest for markets beyond.
Speaker Change: U.S. and China. We are phasing those discussions in an appropriate way. Obviously, our focus is to make sure that we get to the market in the U.S. in the best way possible.
Speaker Change: But you can imagine that those discussions are ongoing time to go purchase DVD You know those discussions usually take a little bit of time and we'll keep the market updated as we progress that
Speaker Change: Your next question comes from the line of
Speaker Change: Hey, guys. Thanks for taking my questions. Just two for us. Can you speak to the recent Phase 3 study readout in China? What's the timeline for approval and how big do you model the opportunity beyond the 400,000 addressable patient population that you've identified?
Speaker Change: And then, the second question, maybe if you could speak to commercial launch readiness ahead of the August 2025 PDUFA date, at time of launch, how many other approved
Speaker Change: eye drop treatments for presbyopia do you expect on the market? And if you could frame how you expect LNZ100 to be positioned among those competitors. Thank you.
Speaker Change: This is Dan, so I will take the majority of that question and perhaps Mark can speak to the data if you want clarity around that and how we think about it.
Speaker Change: How we think about the economics and modeling of the opportunity, first of all, there are $15 million in development milestones that are outstanding, that are in the agreement, as well as $80 million in commercial milestones.
Speaker Change: that are to be obtained based upon net sales in the region. In addition to that, royalties in the five to 15% range on net sales in China. So those are the economic terms that are in the agreement.
Speaker Change: The overall projections and revenue, we're not guiding there at this time, and as far as timeline for their approval, we would guide you to keep an eye on their website where they'll be providing updates on their regulatory guidance. We will not be guiding on their behalf.
Speaker Change: The first part of your question was about the data specifically from Coraxel, so if Mark would like to add any comments, go ahead.
Mark: Yes, thank you, Dan. The data really was very validating.
Mark: Overall, incredibly similar.
Mark: very strong data, and really no surprises whatsoever. So, it's good to see that in a somewhat different
Mark: world, different population, we had the same result, very clinically similar and relevant. I really don't have anything more to say than that.
Speaker Change: And then turning to the commercial launch readiness.
Speaker Change: So, we're very well positioned from our commercial launch readiness here at Lens.
Mark: So, as we shared, our commercial leadership team is in place.
Speaker Change: We've now hired both of our regional directors for our sales team reporting to our vice presidents.
Speaker Change: And we'll continue to build out that DELS organization as we progress to the potential approval and PDUFA dates next year.
Speaker Change: Other things that will continue to progress is our commercial operations. We highlighted that we have contracted with our 3rd party logistics supplier. And we'll continue our wholesaler negotiations. Again, all working towards that potential approval date.
Speaker Change: In terms of competition, really, we see ourselves as the next product to be approved and it's a presbyopia eyedrop with our PDUFA data out there.
Speaker Change: Really, in terms of competition, as the only acyclidine-based eye drop, we see our product as a potential category of one and really the best in class potential as we look towards our potential approval.
Speaker Change: I'm just adding a little additional color there. If you look at what's, obviously, beauty is still on the market, but...
Speaker Change: Again, or at least stop promoting that probably about nine months and 12 months after launch a couple of years ago now.
Speaker Change: Following a, as we noted earlier, actually very strong initial launch.
Speaker Change: Very interesting and promising run rate.
Speaker Change: But then patients and doctors caught on that the
Speaker Change: So it's not the target profile that patients are after. So if you think about the target profile.
Speaker Change: But you want a product that works rapidly, to put it in your eye, it works almost immediately.
Speaker Change: It needs to be a once-a-day product, so set it, forget it, you don't want to be messing with adding drops throughout your workday, and obviously it needs to work long. You really need to cover you for the full workday.
Speaker Change: That's the profile that patients and doctors are looking for. It's the profile, obviously, we hit. Clearly, a few of you didn't. And as we all know, Flossie recently got approved over a year ago, but recently announced that they will be launching with what is.
Speaker Change: you just look at the public data, effectively a similar clinical profile. So, a twice-a-day product that works for some patients but not many for a limited amount of time. So, while they'll be out there, and we expect them to be out there when we launch,
Speaker Change: We don't foresee a very different outcome for them if you compare it to beauty.
Speaker Change: Thank you.
Speaker Change: Your next question comes from the line of Lachlan Hanbury-Brown with William Blair. Please go ahead.
Lachlan Hanbury-Brown: Thanks for taking the question and congrats on the progress this quarter. I know you've been running education awareness campaigns with doctors for a while now, but I was wondering sort of how that will escalate or change as you get into launch over the next 10 months and then somewhat related.
Speaker Change: That's just one of the three pillars that you outlined for the launch. Wondering what or how much, if anything, you can do on the other two pillars prior to an approval, or do they sort of...
Speaker Change: require the approval so you have the brand name and the product to work on access.
Speaker Change: Great. Thanks, Lachlan. So I'll take the very first question on what we're currently doing and then Sean will provide more color on our three key elements of the commercial strategy and what we can do prior to launch, which is actually quite a bit.
Speaker Change: But we have assembled now a medical sales liaisons team. So, obviously, as we all know, that team can be and is out there. Currently talking to.
Speaker Change: So really, you know, sharing.
Speaker Change: the MOA of the product, so how does it start getting different than phyllocarbon?
Speaker Change: And that's what we continue to hear over and over again, that people are not enthusiastic about another pilot carpet product, given their experience with VUE and the fact that it's not pupil-selective. But, on the contrary, are very excited about the cycling profile. So we...
Speaker Change: Educator, MSL team, educates, doctors.
Speaker Change: the MOA on the probe file.
Speaker Change: Then we obviously talk about our clinical data. That theme, again, in a medical-to-medical discussion, and talk about a psychedelic.
Speaker Change: and it's clinical data.
Speaker Change: And thirdly, we'll start to talk about patient populations that initially would be the most attractive to use or to get onto the product.
Speaker Change: Again, that's a medical-to-medical discussion, the one that only the MSL team can have, and that's completely firewalled up from the rest of the organization, and Sean will talk to you about what we can do there prior to approval.
Sean: Yeah, so as we continue to progress towards that potential approval, our unbranded campaign will continue to accelerate.
Sean: Currently, the team at you this week is at the American Academy of Optometry at the convention with our unbranded booth and continuing to share that story on those three key colors. You can expect that we'll be continuing to be present at upcoming conventions.
Speaker Change: As well, as continue to grow our presentation opportunities at those conventions, as we announced earlier on the call. When we think of those 3 pillars that really aligns to the doctors to recommend us. And the pre work we can do on the unbranded side.
Speaker Change: The patient's request is by name, the second pillar, and the access, the third pillar.
Speaker Change: Really just diving a little bit more on the access side.
Speaker Change: Again, this will be less forward in terms of what people see externally, but on the back-end side, as we continue to highlight on these calls, we're putting a lot of that infrastructure in place well ahead of launch, so that way when the product is available, very quickly we can get the product into the consumer's hands so they can actually try it and so the eye care professionals can get comfortable with it.
Speaker Change: Really, those are the 2 that we'll focus on ahead of approval. The doctors recommend us as well as the access.
Speaker Change: The patients request this by name, and again, this is something where you want to make sure the doctors have some time with the product before we turn on the direct consumer advertising so they're comfortable and aware of it, and then we'll come forward with the patients to request this by name with those different DTC strategies we talked about earlier.
Speaker Change: You
Speaker Change: So, thanks. Hopeful.
Speaker Change: Hi, thanks. Good morning. So, in terms of your key targeted Presbios that you'll be going after when you launch,
Speaker Change: Are you still thinking about certain groups like contact lens wearers, people that had refractive surgery, or people that go to med spas? So how are you thinking about hitting those different groups once you activate the DTC?
Speaker Change: And then, you know, just back to the sampling, with aggressive sampling at launch,
Speaker Change: How long do you think it will take?
Speaker Change: for that transition to usage to occur. So how much is that gonna play into the initial revenue ramp? How long will the sampling go before people start using it? Thanks.
Speaker Change: Great. So, a couple comments. So, looking at those key targets for PREZ-B OBS,
Speaker Change: So, you know, we commissioned a large market research survey to look at the consumers most interested. I think what's great to see is there's broad interest across the full population of presbyopes.
Speaker Change: But at the same time, we do want to promote and go directly to people that over-index on interest for eye drops for presbyopia. As we previously shared, those are people that are in contact lenses, those are people that have had refractive surgery, and those that have been to a med spa in the past 12 months.
Speaker Change: So, those will be the more primary targets of our DTC. And what we'll do is, you know, we've partnered and continue to partner with agencies.
Speaker Change: that work on
Speaker Change: You know, how do you promote directly to those core groups? So they look at, you know, different data that exists on their buying trends, on the websites they visit. So it'll be a very digitally focused way on how we target those.
Speaker Change: We'll also help target those by in our messaging to doctors, as you see in our unbranded campaign, we're already helping doctors to understand which patients are most interested.
Speaker Change: Each one of those groups are north of 10 million people, so those are all very valuable groups that have a lot of people and highlight the potential of an eyedrop for presbyopia.
Speaker Change: In terms of sampling, it's very important to talk about the sampling of this product because it's a little different than some other products.
Speaker Change: So, with this product in terms of sampling, it is a five-day pack.
Speaker Change: So, if you think about our product, it comes in those preservative-free single-dose vials.
Speaker Change: So, at this sample, you know, they're truly getting a five-day supply to use the product and it's very different than, let's say, products where they come in the multi-dose vials, where it could be almost a month's supply.
Speaker Change: So, I think that's very important. I think the other important thing here, too, is these samples will be given to the consumer at the optometrist and ophthalmologist location.
Speaker Change: So it's not going through your retail pharmacy, right? So they'll actually receive those.
Speaker Change: samples at the optometrist. They can immediately try it for five days. That's very similar to how contacts work, actually, where you get a five-day supply. And then, from there, we'll move right into the actual prescription. So, we don't see this one having that same effect that other samples do when it's a one-month supply or picked up at a retail pharmacy.
Speaker Change: Okay, great. And then just one more follow-up, just on the hiring of the sales force. So just confirming that you're not going to do that until after you have the approval. Will you have some contingency offers out there? And just maybe the size and structure of the sales force, how you're thinking about it. Thanks.
Speaker Change: Just to clarify on the sales force, we are already beginning to put that team in place. We've already hired our vice president of sales. We've hired our two regional directors. We'll continue to build that out ahead of the PDUFA date.
Speaker Change: So, it won't be brought on after PDUFA, they'll be brought on before PDUFA. And what we've shared is that, you know, our Salesforce team will be roughly 100 reps, calling on approximately 15,000 eye care professionals.
Speaker Change: that actually represent over 85% of all the beauty scripts.
Speaker Change: Okay, but you'll have all the sales reps in before, even prior to the approval, the entire process?
Speaker Change: Okay, okay. All right. Thanks a lot.
Speaker Change: Bye. Bye. Bye.
Speaker Change: Your next question comes from the line
Speaker Change: All right. Great. Thank you, guys. And congrats on the progress towards the potential approval and launch. Definitely exciting. We just had one follow-up on the Chinese market. Can you remind us if China had the same prescription experience with VUITY with aversion to pilocarpine, or are there any – is there any greater receptivity in that market for a novel mechanism?
Speaker Change: Thanks a lot.
Speaker Change: Thanks, Matt. So, beauty. Thank you.
Speaker Change: It was not launched anywhere beyond the U.S., so it wasn't therefore logically also not launched in China.
Speaker Change: So it's it's really an open market there
Speaker Change: Obviously, it's a product that is known for its glaucoma use, so it's definitely a great opportunity to highlight.
Speaker Change: As a partner, we'll do just like we do here.
Speaker Change: The fact that acycadine is very different from biocarbon, it has that
Speaker Change: the pupil selective mechanism.
Speaker Change: It has that very clean safety profile, at least shown in trials, and obviously, importantly, it works. So, very different from biocarbon, but the UD was never launched in China.
Speaker Change: Great. Very helpful. Thank you, guys. And congrats again.
Speaker Change: Thank you.
Speaker Change: That concludes our question and answer session, as I am showing no further questions at this time. With that, I will hand the call back over to Avskim Elpenick, CEO, for closing remarks.
Avskim Elpenick: Thank you, Tricia, and thanks, everyone, for dialing in today. Great to connect with you. And for everyone with dialing in, have a great rest of your day. Thank you.
Tricia: Ladies and gentlemen, that concludes today's call. Thank you all for joining. You may now disconnect.