Q2 2025 Glaukos Corp Earnings Call

Operator: Welcome to Glaucos Corporation's second quarter 2025 financial results conference call. Copies of the company press release and quarterly summary document, both issued after the market closed today, are available at www.glaucos.com. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during that time, simply press star, then the number one on your telephone keypad. This call is being recorded, and an archived replay will be available online in the investor relations section at www.glaucos.com. I will now turn the call over to Chris Lewis, Vice President of Investor Relations and Corporate Affairs.

Welcome to glaukos Corporation, second quarter, 2025 Financial results conference call.

Copy of copies of the company's press release and quarterly summary document both issued after the market closed today are available at www.golo.com.

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

If you would like to ask a question during that time, simply press star, then the number 1 on your telephone keypad.

This call is being recorded and an archived replay will be available online in the investor relations section at www.glo.com.

I will now turn the call over to Christopher Lewis, Vice President of Investor Relations and Corporate Affairs.

Chris Lewis: Thank you, and good afternoon. Joining me today are Glaucos Chairman and CEO, Tom Burns, President and COO, Joe Gilliam, and CFO, Alex Thurman. Similar to prior quarters, the company has posted a document on its investor relations website under the Financials and Filings Quarterly Results section titled Quarterly Summary. This document is designed to provide the investment community with a summarized and easily accessible reference document that details the key facts associated with the quarter, the state of the company's business objectives and strategies, and any forward statements or guidance we may make. This document is designed to be read by investors before the regularly scheduled quarterly conference call. As such, for this call, we will make brief prepared remarks and transition into a question and answer session.

Thank you and good afternoon.

Joining me today are black host chairman and CEO, Tom Burns, president and coo, Joe Gilliam, and CFO Alex Thurman.

Similar to Prior quarters. The company has posted a document on its investor relations website under the financials and filings, quarterly results, section, titled, quarterly summary.

This document is designed to provide the investment community with a summarized and easily accessible reference document that details the key facts associated with the quarter, the state of the company's business objectives and strategies, and any four statements or guidance we may make.

Chris Lewis: To ensure ample time and opportunity to address everyone's questions, we request that you limit yourself to one question and one follow-up. If you still have additional questions, you may get back into the queue. Please note that all statements, other than statements of historical facts made on this call, that address activities, events, or developments we expect, believe, or anticipate will or may occur in the future are forward-looking statements. These include statements about our plans, objectives, strategies, and prospects regarding, among other things, our sales, products, pipeline technologies, and clinical trials, US and international commercialization, market development efforts, product approvals, the efficacy of our current and future products, competitive market position, regulatory strategies, and reimbursement for our products, financial condition, and results of operations, as well as the expected impact of general macroeconomic conditions, including foreign currency fluctuations on our business and operations.

This document is designed to be read by investors before the regularly scheduled quarterly conference call. As such, for this call, we will make brief prepared remarks and then transition into a question-and-answer session.

Chris Lewis: These statements are based on current expectations about future events affecting us and are subject to risks, uncertainties, and factors relating to our operations and business environment, all of which are difficult to predict and many of which are beyond our control. Therefore, they may cause our actual results to differ materially from those expressed or implied by forward-looking statements. Please review today's press release and our recent SEC filings for more information about these risk factors. You'll find these documents in the investor relations section of our website at www.glaucos.com. Finally, please note that during today's call, we will also discuss certain non-GAAP financial measures, including results on an adjusted basis. We believe these financial measures can facilitate a more complete analysis and greater transparency into Glaucos's ongoing results of operations, particularly when comparing underlying results from period to period.

To ensure ample time and opportunity to address everyone's questions. We request that you limit yourself to 1 question and 1 follow-up. If you still have additional questions, you may get back into the queue. Please note that all statements other than statements of historical facts made on this call, that address activities events or developments. We expect believe or anticipate will or May in the future are forward-looking statements. These include statements about our plans objectives strategies and Prospects regarding among other things. Our sales products pipeline Technologies and clinical trials, us and International commercialization Market development, efforts product, approvals the efficacy of our current and future products, competitive market position regulatory strategies, and reimbursement for our products, Financial condition and results of operations, as well as the expected impact of General macroeconomic conditions, including foreign currency fluctuations, on our business and operations.

These statements are based on current expectations about future events affecting us in our subject to risks uncertainties and factors relating to our operations and business environments. All of which are difficult to predict and many of which are beyond our control. Therefore, they may cause our actual results to differ materially from those expressed or implied by 4.

Looking statements.

Please review today's press release on the recent SEC filings. For more information about these risk factors, you'll find these documents in the investor relations section of our website at www.globus.com.

Chris Lewis: Please refer to the tables and our earnings press release available in the investor relations section of our website for reconciliation of these measures to their most directly comparable GAAP financial measure. With that, I will turn the call over to Glaucos Chairman and CEO, Tom Burns.

Finally, please note that during today's call, we will also discuss certain non-gaap Financial measures including results on an accepted basis. We believe these Financial measures and facilitate facilitate a more complete analysis and greater transparency into glucose is ongoing results of operations. Particularly when comparing underlying results from period to period, please refer to the tables and our earnings press release available in the investor relations section of our website, for reconciliation of these measures to their most directly comparable, gaap Financial measure.

Tom Burns: Okay. Thanks, Chris. Good afternoon, and thank you all for joining us. Today, Glaucos reported record-second quarter of consolidated net sales of 124.1 million, up 30% on a reporting basis or 29% on a constant currency basis versus the year-ago quarter. As a result of our strong performance, we are raising our full-year 2025 net sales guidance range to 480 to 46 million, compared to 475 to 45 million previously. Our second quarter record results reflect a sustained growth acceleration in our business, driven by growing iDOS TR adoption and utilization, along with our broader intervention on glaucoma, or IG, initiatives globally. While we are in the early stages of these IG efforts, our focus remains on driving new standalone intervention therapies designed to slow disease progression and reduce drug burden for the benefit of physicians and patients.

With that. I will turn the call over to glows chairman and CEO Tom Burns.

Okay, thanks Chris. Good afternoon and thank you all for joining us.

% on a reported basis for 29% on a constant currency basis versus the year ago quarter.

As a result of our strong performance, we are raising our full year 2025 net sales guidance range to $480 million to $460 million, compared to $475 million to $450 million previously.

Our second quarter record results. Reflect a sustained growth acceleration in our business driven by growing eidos TR adoption, and utilization along with our broader Interventional, glaucoma or IG initiatives globally.

Tom Burns: We continue to be encouraged with the increasing levels of clinical interest for this paradigm-changing evolution. Within our US glaucoma franchise, we delivered record-second quarter net sales of 72.3 million on strong year-over-year growth of 45%, driven by growing contributions from iDOS TR, which generated sales of approximately 31 million in the second quarter. iDOS TR, a first-of-its-kind intracameral procedural pharmaceutical designed to continuously deliver glaucoma drug therapy for up to three years, continues to build commercial momentum supported by positive clinical outcomes and surgeon feedback that reaffirms our view that with the launch of iDOS TR, we are pioneering a brand new therapeutic category that has the potential to reshape glaucoma management as we know it today.

While we are in the early stages of these IG efforts our Focus remains on driving new Standalone. Intervention therapies designed to slow disease progression and reduce drug burden for the benefit of Physicians and patients.

We continue to be encouraged by increasing levels of clinical interest for this paradigm-changing evolution.

Within our us, glaucoma franchise, we delivered record second quarter. Net sales of 72.3 million on strong year-over-year growth of 45%.

Driven by growing contributions from high dose TR which generated sales of approximately 31 million in the second quarter.

Idols, TR

Tom Burns: Operationally, our teams continue to make great progress in the execution of our detailed launch plans for iDOS TR, including first, growing a universe of trained surgeons and accounts; second, expanding utilization of the installed active surgeon base; third, broadening and streamlining market access among MAX, commercial, and Medicare Advantage payers; fourth, expanding the robust body of clinical evidence; and fifth, accelerating marketing investments to support increased patient awareness and education. Shifting to our US stent business, as anticipated, the five MAC LCDs implemented in the fourth quarter of 2024 continued to cause some transient turbulence in the market during the second quarter as surgeons navigate restrictions when using two MIGS surgical devices in the same procedures. We expect this MIGS market headwind will continue over the course of 2025 as providers continue to navigate the impacts associated with these LCDs until anniversaries later this year.

The first of its kind intra cameral, procedural pharmaceutical designed to continuously deliver glaucoma drug therapy for up to 3 years continues to build commercial momentum supported by positive clinical outcomes, Insurgent feedback. That reaffirms our view that with the launch of items TR, we are pioneering a brand new therapeutic category that has the potential to reshape glaucoma management as we know it today.

Operationally, RTS continues to make great progress in the execution of our detailed launch plans for high-dose TR, including the first...

Growing the universe of trained surgeons and accounts; second, expanding utilization of the installed active surgeon base.

Third, broadening and streamlining Market access among maxed commercial and Medicare Advantage payers.

...expanding the robust body of clinical evidence and death-accelerating marketing investments to support increased patient awareness and education.

Shifting to our us stent business as anticipated. The 5 Mac LCD is implemented in the fourth quarter of 2024, continued to cause some transient turbulence in the market during the second quarter as surgeons navigate restrictions when using 2 makes surgical devices in the same procedures.

Tom Burns: As a reminder, our second quarter US glaucoma results also reflect the expiration of royalty payments associated with the Hydrus Microstent, which concluded in late April. Earlier this month, CMS issued its proposed rules for 2026, which, as drafted, largely maintain the 2025 APC assignments and modestly increase facility fee rates associated with our procedures across both the hospital outpatient and ASC settings. In contrast, CMS has proposed reductions in physician fee reimbursement for several Category 1 CPT codes across ophthalmology, including for cataract and surgical MIGS procedures specifically, along with several other specialties. These stem primarily from a major revision in how CMS allocates indirect practice expenses within its RVU methodology, particularly impacting services performed in the facility of outpatient setting. We intend to support our customers and societies as they educate CMS on the proper assumptions associated with this proposed methodology shift.

We expect that market headwinds will continue over the course of 2025 as providers navigate the impacts associated with these LCDs until they anniversary later this year.

As a reminder, our second quarter U.S. glaucoma results also reflect the expiration of royalty payments associated with the hydro micro stud, which concluded in late April.

Earlier this month, CMS issued its proposed rules for 2026, which, as drafted, largely maintained the 2025 APC assignments and modestly increased facility fee rates associated with our procedures across both the hospital outpatient and ASC settings. In contrast, CMS has proposed reductions in physician fee reimbursement for several Category 1 CPT codes across Ophthalmology, including for cataract and surgical procedures specifically, along with several other specialties.

These stem primarily from a major revision, and how CMS allocates indirect practice expenses within its rvu methodology, particularly impacting Services performed in the facility of patients setting.

Tom Burns: Beyond that, we believe these proposed changes further support a more diversified practice mix that includes intervention of glaucoma treatment and underscores the value of our standalone therapies, such as iDOS TR and Astanifodin, which, as procedures covered by Category 3 codes, are currently unaffected by this proposed physician fee rule. Moving on, our international glaucoma franchise also delivered record net sales of 31.3 million on year-over-year growth of 20% on a reporting basis and 15% on a constant currency basis. This strong growth was once again broad-based as we continue to scale our international infrastructure and execute our plans to drive MIGS forward as a standard of care in each region and major market in the world. Last month, we were pleased to announce EU NTR clearance for Astanifodin, along with several of our other leading trabecular microbypass MIGS technologies.

We intend to support our customers and societies as they educate CMS on the proper assumptions associated with this proposed methodology shift. Beyond that, we believe these proposed changes further support a more diversified practice mix that includes interventional glaucoma treatment and underscores the value of our standalone therapies such as iDose TR and iStent infinite, which, as procedures covered by Category III codes, are currently unaffected by this proposed position fee rule.

Moving on our International, glaucoma franchise, also delivered record, net sales of 31.3 million on year-over-year, growth of 20%, on a reported basis and 15% on a constant currency basis.

This strong growth was once again, brought based as we continue to scale, our International infrastructure and execute our plans to drive Banks forward as a standard of care in each region and Major Market in the world.

Tom Burns: Of note, this clearance provides a broad label for Astanifodin, indicated for patients with all stages of open-angle glaucoma in both combo cataract and standalone procedures. These important milestones, which mark our company's long-awaited first approvals under the new EU regulatory framework, will not only help us maintain and grow our presence in Europe but also advance and accelerate our broader IG initiatives globally. We plan to commence commercial launch activities for Astanifodin in our key European markets at the upcoming ESCRS annual meeting in September. As previously discussed, we continue to expect the trialing of new competitive products in some of our major international markets may become an increasing headwind as we progress through 2025. And finally, our corneal health franchise delivered net sales of 20.6 million on a year-on-year growth of 4%, including Vertrexza net sales of 17.9 million.

Of our other leading tacular micro bypass makes, Technologies has noted that this clearance provides a broad label for a persistent, infinite indicator for patients with all stages of open angle glaucoma, in both combo cataract and standalone procedures.

These important Milestones, which Mark our company's long waited first approvals under the new EU regulatory framework will not only help us maintain and grow our presence in Europe, but also advance and accelerate our broader IG initiative as globally.

We plan to commence commercial launch activities for Rise to an Infinite in our key European markets at the upcoming ESCRS Annual Meeting in September.

As previously discussed, we continue to expect the trialing of new competitive products in some of our major international markets may become an increasing headwind as we progress through 2025.

Tom Burns: As discussed previously, our second quarter results reflect the continued impact of Vertrexza realized revenues as a result of our entry as a company into the Medicaid Drug Rebate Program, or MDRP. Shifting gears to our corneal health pipeline and FDA's ongoing NDA review for Epioxa, our next-generation corneal cross-linking eye-link therapy for the treatment of keratoconus, a rarely diagnosed sight-threatening disease. During the second quarter, we completed several important review-related milestones, including a successful pre-approval inspection or BAI at our Burlington, Massachusetts facility, along with a productive post-mid-cycle review meeting with the agency as we continue to progress towards the established PDUFA date of October 20th, 2025. Alongside this regulatory review, our commercial and market access teams continue to make solid progress in the preparation and planning of the Epioxza commercial launch targeted for next year.

And finally, our Coral Health franchise delivered net sales of $20.6 million on a year-on-year growth of 4%, including sales for Trex, which totaled $17.9 million.

As discussed previously, our second quarter results reflect the continued impact to Trexa realized revenues as a result of our entry as a company into the Medicaid Drug Rebate Program (MDRP).

Shifting gears to our cornea Health Pipeline and fda's ongoing NDA review for epio our next Generation. Cornering of cross-linking, I link therapy for the treatment of keratin, rarely diagnosed

Sight threatening disease during the second quarter. We completed several important review related Milestones, including a successful pre-approval, inspection or Pai at our Burlington Massachusetts facility along with a productive post mid-cycle review. Meeting with the agency as we continue to progress towards the established Padua date of October 20th. 2025

Tom Burns: As a reminder, this potential approval would provide keratoconus patients in the ophthalmic community with the first FDA-approved surgery-free topical drug therapy that's catalyzed by pulse oxygen and light that does not require the removal of the corneal epithelium, the outermost layer of the front of the eye. An Epioxza approval would also provide us with the opportunities to launch this pharmaceutical therapy supported by the right long-term pillars to optimize patient access, a persistent and at times frustrating challenge for us historically with Vertrexza. Because we believe Epioxza, which is designed to preserve the corneal epithelium, streamline the procedure, improve patient comfort, and shorten recovery time, represents a potentially breakthrough treatment advantage and advancement for keratoconus patients. We anticipate some potential transient disruption with our US corneal health franchise as the market transitions from Vertrexza to Epioxza following targeted approval, which is reflected in our latest full-year guidance outlook.

Alongside this regulatory review, our commercial and market access teams continue to make solid progress in the preparation and planning of the epoxy commercial launch targeted for next year.

As a reminder, this potential approval would provide keratos patients in the Absalon Community, with the first FDA approved surgery, free topical, drug therapy, that's catalyzed by pulse oxygen and light that does not require removal of the core and let the feeling of the outermost layer of the front of the eye. And antioxidant approval would also provide us with the opportunity to launch. This pharmaceutical therapy supported by the right long-term, pillars to optimize patient access a persistent, and a times frustrating challenge for us. Historically with for trexa,

Because we believe at AXA, which is designed to preserve the corneal epithelium, streamline the procedure, improve patient comfort, and shorten recovery time, represents a potentially breakthrough treatment advantage and advancement for care and committed patients.

We anticipate some potential transient disruption with a US corneal Health franchise as in the market transitions from for traxa to epiaa following Target approval, which is reflected in our latest full year. Guidance Outlet,

Tom Burns: Beyond Epioxza, we continue to advance several other important clinical programs across our five novel therapeutic platforms. Within our Asten surgical glaucoma platform, we are advancing patient enrollment in a PMA pivotal trial for Astenifodin in mild to moderate glaucoma patients, as well as a 510K pivotal trial for the Presserflow MicroShunt. Within our iDOS platform, we're advancing the phase 2B3 clinical program for iDOS TREX, our next-generation iDOS therapy, with patient enrollment already underway and now expect an FDA decision regarding readministration for iDOS TR in early 2026. Within our iLink platform, in addition to the ongoing Epioxza NDA review, we are also advancing phase two trials for our third-generation iLink therapy. Within our iLution platform, we remain on track to file a US FDA IND and commence a clinical trial for iLution Demodex blepharitis later this year. We filed it.

Beyond FBio, we continue to advance several other important clinical programs across our five novel therapeutic platforms.

Within our, in surgical glaucoma platform, we are advancing patient. Enrollment in a PMA pivotal trial for ice and infinite in mild to moderate. Glaucoma patients as well as a 510k pivotal trial for the professor flow microshot.

Within our eidos platform where advancing a phase 2, B3 clinical program for I do, T-rex our next Generation, eidos therapy with patient enrollment already underway. And now, expect an FDA decision regarding re Administration for eidos TR in early 2026

Within our Island platform, in addition to the ongoing epio NDA review. We are also advancing Phase 2 trials for our third generation Island therapy.

Within our dilution platform, we remain on track to file a US FDA IND and commenced a clinical trial for elution. Demodex bluffer later this year.

Tom Burns: Within our retinal platform, we are advancing a first-injury clinical development program for GLK401, our intramural multi-kinase inhibitor retinal program in wet ND patients, where we now also have an open US FDA IND. So as you can see, we have a lot to be excited about when it comes to the significant potential value that we believe our pipeline programs may create. At the same time as we consistently discussed, we continue to prioritize the cadence of our investments as we strive to strike the right balance of risk-based spending while maintaining our strong capital position both now and in the future. This disciplined approach has enabled us to stay active on the business development front with a focus on transactions that complement and enhance our existing organic growth initiatives.

Finally, within our retinol platform, we are advancing a first in human clinical development program for GOP 401 our intra. Vitral multi inhibitor retinol program and went in the patients where we now also have an open us FDA IND.

so as you can see, we have a lot to be excited about when it comes to significant potential value, that we believe our pipeline programs May create

At the same time as we consistently discussed, we continue to prioritize the cadence of our investments as we strive to strike the right balance of risk-based spending while maintaining our strong capital position both now and in the future.

Tom Burns: During the second quarter, we put the strategy to work with the small acquisition of Mobius Therapeutics, whose lead compound Mitosol is the only FDA-approved ophthalmic formulation of mitomycin C, or MMC, which is often utilized as an adjunct in late-stage glaucoma filtration procedures. This addition helps to solidify our supply chain as it's being utilized alongside the Presserflow MicroShunt in our active 510K study. It will also support our broader late-stage glaucoma tertiary care efforts over time and further add to our deepening relationship within the glaucoma specialist community. We also continue to invest operationally to support our long-term growth plans with the purchase of an additional building at our Lisobrio headquarter campus during the second quarter. Excluding these two one-time investments, our underlying cash and equivalents grew by more than $4 million in the second quarter.

This disciplined approach has enabled us to stay active on the business development front with a focus on transactions that complement and enhance our existing organic growth initiatives.

During the second quarter, we put the strategy to work with a small acquisition of Mobius Therapeutics, whose lead compound, Mtool, is the only FDA-approved Obama formulation.

of minimize and see, or MMC, which is often utilized as an adjunct in late stage, glaucoma filtration procedures,

This Edition helps to solidify our supply chain. As it is being utilized, alongside the presser flow microshunt and our active 5G case study

It will also support our broader late stage glaucoma tertiary care efforts over time. And further add to our deepening relationship within the glaucoma specialist community.

We also continue to invest operationally to support our long-term growth plans with the purchase of an additional building and our lease at headquarters campus.

During the second quarter.

Tom Burns: So in conclusion, I'm very pleased with another record quarter and sustained strong momentum in our business as we continue to successfully advance our mission to truly transform vision by pioneering novel droplets platforms that can meaningfully advance the standard of care and improve outcomes for patients suffering from sight-threatening chronic eye diseases. Our foundation is strong, and we are ideally positioned to continue transforming vision for the benefit of patients worldwide. So with that, I'll open the call for questions. Operator.

Excluding these 2 1-time Investments, our underlying cash and equivalents grew by more than 4.

So in conclusion, I'm very pleased with our record quarter and sustained strong momentum. In our businesses, we continue to successfully advance our mission to truly transform vision by pioneering novel droplet platforms that can meaningfully advance the standard of care and improve outcomes for patients suffering from sight-threatening chronic eye diseases.

Our foundation is strong, and we are ideally positioned to continue transforming vision for the benefit of patients worldwide.

So with that I'll open the call for questions, operator.

Operator: At this time, if you would like to ask a question, press star, then the number one on your telephone keypad. To withdraw your question, simply press star one again. We kindly ask that questions are limited to one-on-one follow-up for today's call. We will pause for just a moment to compile the Q&A roster. Your first question comes from Tom Steffen with Steeple. Please go ahead.

At this time, if you would like to ask a question, press star, then the number 1 on your telephone keypad. So withdraw your question, simply press star 1 again.

We kindly ask that questions are limited to 1 and 1 follow-up for today's call.

We will pause for just a moment to compile the Q&A roster.

Your first question comes from Tom Stefan with Stifel. Please go ahead.

Tom Steffen: Great. Hey, guys. Thanks for taking the questions. Nice quarter. One sort of near term, just on 2025 sales guidance, you beat Street and 2Q on Revs by, I think, eight, nine million. But on the guide, you only raised by 3 million at the midpoint. Tom, you made some comments on OUS Glaucoma and corneal health within the guide. But Tom or Joe, can you talk about the components of this year's revenue guide and then maybe why more of the upside wasn't flushed through for the full year?

Great. Hey guys, thanks for taking the questions. Nice quarter. Um, 1 sort of near-term, just on 2025 sales guidance, uh, you beat street in 2q on revs by I think 89 million. Uh, but on the guide you only raised by 3 million at the midpoint, uh, Tom, you made some comments on, oh, us, glaucoma and Coryell health.

Within the guide but, uh, Tom or Joe, can you talk about the components of this year's Revenue guide? And then maybe why more of the upside wasn't flushed through for the full year.

Joe Gilliam: Yeah, Tom, it's Joe. And if Tom wants to add something at the end, he can. Obviously, you did the math pretty quickly there. The fact is we're pleased to be able to be in a position to raise guidance off the back of what was an exceptional second quarter, as you noted. And that was really driven by outperformance across the board, but largely by iDOS in particular. And I think when you parse back some of the commentary from Tom and I'll elaborate a bit more, you'll find that really it was a full beaten brace in the context of iDOS, which is at its obviously the core of the growth story as we sit here today. But several data points as you think about updating your models for the second half of the year.

Yes. Um it's it's Joe and um and if Tom wants to add some at the end he can obviously um you did the math pretty quickly there. The fact is we're we're pleased to be able to be in a position to raise guidance off the back of what was an exceptional. Second quarter is, as you noted and that was really driven by outperformance across the board but largely by eidos, um, in particular and I think when you, um, parse back some of the commentary from Tom and all elaborate a bit more, you'll find that, that really, it was a full beat and raise in the context of eidos, which is at the opposite of the core of of the growth story as we sit here today. But but several data points that you think about updating

Joe Gilliam: You know, first on the international glaucoma side, obviously, we continue to be off to a strong start this year and had some currency benefit in the second quarter. And we're now expecting that you'll have sort of low double-digit growth for the remainder of the second half on a year-over-year basis. So largely unchanged there in terms of our expectations of our growing scale and competitive products launching in key markets that present headwinds as we move forward relative to obviously the strong first half results. On the cornea side, you know, Tom, I think, elaborated on this, but I'll repeat it. You know, when we go into the second half here, we enter a period with, I'll call it, less visibility or predictability as we navigate the transition from Vertrexza to Epioxza, assuming the latter is approved as expected in October.

Your model is the second half of the year. Um, you know, first on the international, glaucoma side, uh, obviously we continue to be off to a strong start, um, this year and had some currency, you know, benefit in the second quarter. And we're now expecting that you'll have sort of low double digit growth for the remainder, um, of the second half on a year-over-year basis. So it largely unchanged there in terms of our expectations of our growing scale and and competitive products launching in key markets that present headwinds, as we move forward, relative to the strong first half, uh results.

On the cornea side, you know, Tom, I think elaborated on this, but I'll repeat it.

You know, when we go into the second half here, we enter a period with I'll call it less visibility or predictability as we navigate the transition from photo Rex to fio.

Joe Gilliam: So you know, our current expectations are for flat to low single-digit growth, if you will, in Q3, followed by a material disruption or headwind in Q4 as patients forego Vertrexza in favor of Epioxza for all the reasons that Tom articulated. And that leaves you obviously on the US glaucoma side, where you know, we continue to expect the same dynamics around the LCD headwinds and the Hydros royalty expiration and then the generation of probably a mid-single-digit decline for, I'll call it, the non-iDOS revenues in the second half. And when you put all that together, it's going to imply continued sequential iDOS expansion in Q3 and Q4 and an overall expansion of our expectations for the full year on the iDOS front.

Q3 was followed by a material disruption or headwind. In Q4, as patients will opt for Trexa in favor of Epio, for all the reasons that Tom articulated.

And that leaves you obviously, on the US, glaucoma side where, um, you know, we continue to expect the same Dynamics, around the LCD, headwinds, and the hydras, um, royalty expiration. And then the generation of probably a mid single digit decline for, I'll call it. The non eidos revenues in the second half, uh, and when you put all that together, it's going to imply continued sequential. I do expansion in Q3 and Q4 in an overall expansion of our expectations for the for the full year on the eidos front,

Tom Steffen: That's great. Appreciate that. And then, you know, pivoting a bit more kind of big picture, just on interventional glaucoma, you know, approaching 18 months into the iDOS launch. So kind of just wanted to ask about the state of the union with interventional glaucoma. What are the learnings, the puts and takes around those broader IG efforts? And Joe or Tom, where does the bullishness, your bullishness stand kind of in terms of the long-term opportunity with IG? Thanks.

That's great, appreciate that. Um, and then, you know, pivoting a bit more kind of big picture just on interventional glaucoma—you know, approaching 18 months into the Eidos launch. So, I kind of just wanted to ask about the state of the union with interventional glaucoma. What are the learnings, the puts and takes around those broader IGFs? Then, Joe or Tom, where does the bullishness—your bullishness—stand kind of in terms of the long-term opportunity with IG? Thanks.

Joe Gilliam: Well, I can start off here. I'm sure Tom will have some views as well. Obviously, if you think about this as being part of the kind of the birthright of us as a company over the years. But I'll start, Tom, by acknowledging some of the foundational work that you recently did on this paradigm shift. And I'm glad you asked the question. I think it was a good state-of-the-state snapshot, but also a bit of an indicator of how far we've come over these last 18 to 24 months in terms of building the standalone market opportunity. Hopefully, you all have visibility and awareness of just how pronounced the shift in momentum towards the interventional approach to glaucoma care has changed since we began our efforts in support of it, you know, a year and a half ago.

Joe Gilliam: The underlying movement, if you will, largely led by Glaucos in partnership with physicians to be proactive on behalf of patients now that tools like iDOS TR and Asten Infinite really enable a risk-benefit equation that makes sense is rapidly gaining traction. And it's worth reminding investors what this means for, I'll call it, the next decade in ophthalmology, as the 12 to 13 million diagnosed and treated glaucoma eyes in the US also increasingly seek an interventional approach to care. I mean, if you compare that to cataract surgery, which is the mainstay of our industry today, that does about 5 million procedures annually, it's hard not to see how bright the future is for Glaucos and our industry overall as we improve the standard of care for patients.

Well, I, I can start off here, I'm sure Tom will have some views as well. Obviously, if you think about this as being part of the, the kind of the birthright of us as a company, uh, over the years. But but I I'll start, uh, Tom by acknowledging. Some of the foundational work that that you recently did, uh, on this paradigm shift and and, um, I'm glad you asked a question. I think it was a good State of the State snapshot but also a bit of, um, uh, indicator of How Far We've Come, uh, over these last 18 to 24 months in terms of building this Standalone Market opportunity. You hopefully um you all have visibility and awareness of just how pronounced the shift and momentum um towards Interventional approach and to glaucoma care has has changed since we began our efforts in support of it. Um, you know, a year and a half ago. The the underlying movement, if you will largely led by globos and partnership with Physicians to be proactive on behalf of patients, now that tools like eidos TR and ice and infinite,

Really enable a risk benefit equation that makes sense is is rapidly, gaining traction and it's worth. Reminding investors what this means for. I'll call it the next decade. And Opthalmology has the 12 to 13 million, diagnosed and treated glaucoma eyes in the US also increasingly seek an Interventional approach to care. I mean, if you compare that to cataract surgery, which is the Mainstay of our industry today, uh, that does about 5 million procedures annually. It, it's hard. Not to see how bright.

Joe Gilliam: And I have to give credit to our marketing team, our sales team, and the numerous other folks here at Glaucos that are driving this rapid change from both the top down and the ground up every day that's gotten us here.

the future is for for glaucos and and our industry overall is we improve the standard of care for patients and

I have to give credit to our our marketing team, our our sales team and the numerous other folks here at glow Coast that are that are driving this um, rapid change from both the top down and, and the ground up every day has got us here.

Tom Steffen: That's great. Thank you.

That's great. Thank you.

Operator: Your next question comes from Ryan Zimmerman with BTIG. Please go ahead.

Ryan Zimmerman: Thanks for taking the questions. Congrats on the quarter. And I appreciate you giving us the iDOS number and removing the guesswork on that one. Maybe just to start off with iDOS for a second, you've know, you've made progress on certain MAX, and others are still, you know, not fully there, I guess, is the best way to put it. Can you compare and contrast kind of the geographies in which MAX are fully covering iDOS without any disruption or any slowness? And how is the utilization, you know, amongst that physician base compared to, say, a territory or a state that's in a MAX that may not be fully there? And kind of your timelines and assumptions for when those ramp, Joe?

Your next question comes from Ryan Zimmerman with btig, please go ahead.

Uh, thanks for taking the questions, congrats on the quarter and uh appreciate you giving us the eye dose number. And removing the guesswork on that 1 um May maybe just to start off with with I dose for a second.

You know, you've made progress on certain Macs and, and others are still, you know, not fully uh, there I I guess it's the best way to put it.

Can you compare and contrast kind of the geographies in which Macs are fully covering I dose without any disruption? Or any slowness and and how is the utilization, you know, amongst that physician based compared to say a territory or a state that's in a Mac that that may not, you know, be fully there and and kind of your timelines and assumptions for when those ramps Joe

Joe Gilliam: Yeah, happy to touch on that, Ryan. And as you commented, we did disclose the 31 million approximate sales of iDOS in the second quarter, which was a significant step in the right direction. And the performance really was driven by a mix and a continued mix of both new starts and increasing utilization within those accounts who've been at it for a bit now. And really, to kind of dive in, I think, on the heart of some of your questions, while we saw growth nationwide in pretty much every geography, the acceleration continued to be faster in those MAX regions where the professional fee has been established for a bit. And that's really driven, again, by winding surgeon adoption over the course of 2025. That began to translate into procedures, given the typical scheduling backlogs that you see in ophthalmology, and I know you know well.

Joe Gilliam: And to put that into context, the Novus POS, the Indian and First Coast, which are the MAX who've had a professional fee schedule in place for a little bit, they represent a little over 50% of Medicare lives, those regions. But we saw over 80% of our iDOS volumes come from those areas in Q2. And that's a growing percentage of the overall mix. And so I think that's a trend that bodes well for our business as these other MAX finalize their iDOS and professional fees schedules here in the hopefully relatively near future. The second part of your question was kind of, you know, where do we go from here is the way I would summarize it.

Joe Gilliam: And I would just say that, you know, all the MAX now appear to largely be paying the J code properly, which is the first step in the journey, if you will, and continued progress that we've seen there. And as it relates to the professional fee beyond Meridian, Novus POS, and First Coast, we believe that NGS has made considerable progress. We're seeing increasing momentum that makes us hopeful that in the relatively near term, we'll see a professional fee get established in what is the third largest MAX region in the United States. We continue to make slow, and I'll call it methodical progress with Palmetto and WPS. We've really accelerated our advocacy and education efforts, both at the account level, but also with the MAX themselves.

And and to put that in the context um Nova cost radian and First Coast, which are the the max who had a professional fee schedule uh in place for a little bit, you know, they represent a little over 50% of Medicare lives uh, those regions but we saw over 80% of our Idol's volumes, come from those areas in Q2 and that's a growing percentage of the overall mix. And so I think that the trend that goes well for our business as these other Macs finalize their their items and professional fees schedules here um in the hopefully relatively near future. The second part of your question was kind of, you know, where do we go from? Here is the way I would, I would summarize it and and I I would just say that um you know, all the max now appeared, largely be paying the J J Code properly which is the the first

Step in the journey, if you will, and continued progress that we've seen there as it relates to the professional fee: Beyond Meridian, Novitas, and First Coast.

We believe that NGS has made considerable progress. We're seeing increasing momentum that makes us hopeful that in the relatively near term, we'll see a professional fee get established in what is the third largest MAP region in the United States.

Joe Gilliam: And we're starting to see the earliest signs of positive pro-fee payment flow, but there's still work to do in both of those important MAX. And then really, CGS, I would say, remains behind the others by a fairly considerable margin at this stage. And we are engaging directly with them and have been for some time. And eventually, it's the smallest MAX of all. We do expect them, obviously, to come around alongside the other MAX.

Ryan Zimmerman: Very helpful, Joe. And just sticking on the topic of professional fees for a moment and turning to the legacy MIGS business. So, you know, we all saw the proposals. You know, I remember many years ago, doctors were making, I think, close to $1,000 to implant a MIG. You know, we're now pushing around 100, maybe sub 100. We'll see kind of where the proposals land. I guess my question is more of a bigger picture question, though, on that topic, which is, you know, as the pro-fees have come down, how do you think about legacy surgical glaucoma and the broader appeal to, say, non-glaucoma ophthalmologists, the comprehensive ophthalmologist who maybe was your marginal customer, you know, who was doing MIGS? As that comes down, does that get offloaded to the glaucoma specialist? I'm just curious kind of how you're thinking about maybe some of those economic incentives.

We continue to make slow and I'll call it methodical progress of Paul Meadow and WPS. We've really accelerated our advocacy and education efforts um both of the account levels but also with the maps themselves. Um, and we started to see the earliest signs of positive profit payment flow but but they're still work to do um in in both of those important Macs. And then really CGS I would say remains behind the others um by a fairly considerable margin at this stage and and we are engaging directly uh, with them and have them for some time. And eventually it's the smallest Mac of all. We we do expect them obviously to come around alongside the other other Macs,

very helpful, Joe and and just sticking on the topic of professional fees for a moment and, and turning to the Legacy makes business. So, you know, we all saw the proposals, you know, I remember many years ago, doctors were making, I think close to a thousand dollars to implant to make, you know, we're now pushing around a 100, maybe sub 100. Um, we'll see kind of where the proposals land I guess. To. My question is more of a bigger picture question, though, on that topic, which is, you know, as the pro fees have come down. Um, how do you think about Legacy surgical glaucoma and the broader appeal to say non- glaucoma? Uh opthalmologist the comprehensive ophthalmologist who maybe was your marginal customer? You know who was doing mix um as that comes down. Does that get offloaded to the glaucoma specialist? I'm just curious kind of how you're thinking about maybe some of those economic incentives.

Joe Gilliam: Yeah, I think, Ryan, so there's a couple of things to unpack in your statement. The first one is, to a large extent, professional fees are about relativity in the context of the economics for that surgeon's time, whether that be in the context of cataract surgery, MIGS procedures, standalone procedures, or the like. And as you heard Tom say, and we know from the proposed rule, what you've seen across many therapeutic categories, not just ophthalmology, but many others, and it's certainly across the board in ophthalmology, is a wholesale shift in the way CMS is calculating the professional fee economics and the RVUs that drive them. And so I think there's an education process that has to happen led by the societies and the various groups that have a voice with CMS to help make sure that lands in the right spot.

Joe Gilliam: But where we land on it, I think, was articulated by Tom in the prepared remarks. The reality of what we're seeing unfold only emboldens the move towards standalone glaucoma therapy as a pathway for the average practice to continue to remain financially viable as they move forward here and face that. I mean, to put that historical statement in context, there was a point where cataract surgery pro-fees were over $2,000 a procedure. And today, obviously, in the proposed rule, they're in the 400s. So, you know, and obviously, doctors continue to do cataract surgery as the ubiquitous standard of care for that disease indication.

Yeah, I I think Ryan so um there's a couple things to unpack in in in your statement the first 1 is in a large to a large extent. Professional fees are about relativity in the context of the economics for that surgeon's time. Whether that be in the context of cataract surgery, makes procedures Standalone procedures, or, or the like and, and as you heard Tom say, and we know from the proposed rule, what you've seen across many, uh, therapeutic categories. Not just Ophthalmology, but many others and then certainly across the board and Opthalmology is a wholesale shift in the way. CMS is, is calculating, um, the professional fee economics and the RVs that, that, that drive them. And so I think there's an education process that has to happen. Led by the societies and the, the various groups that that have a voice with with CMS to help. Make sure that lands in the right, the right spot. But where I, where we land on it, I think was, was articulated by by Tom in the prepared remarks.

The, the the reality of what we're seeing unfold only. Um, emboldens the move towards Standalone, glaucoma therapy. Um, as a, a, a pathway for the average practice to continue to remain financially viable, as they move forward here and face that, I mean to put that historical statement context, there was a point where cataract surgery proceeds were over 2 thousand dollars of procedure,

Joe Gilliam: I think what you're going to see is more and more of those broader ophthalmologists leaning into what we've been talking about, which is interventional glaucoma, you know, paradigm shift and starting to really treat these patients proactively as a part of both doing the right thing for the patient and the right thing for the practice.

Tom Burns: Well, I agree as well. And Ryan, this is Tom. You look at the recurring changes and reductions in fees that are happening, as we've now seen over the last several years in cataract surgery. And we believe that's going to continue going forward. And I think not only do we have the immunization here under the current CMS provisions of the Category 3 code, so really high-paying standalone payments for iDOS and Asten Infinite, but I think as we go forward, these comprehensive ophthalmologists who right now are spending most of their time recruiting cataract patients with one-and-done procedures, this is catch and release, are going to start waking up to the value of looking at glaucoma as a long-term treatment pattern and what we're calling the forever patient.

Tom Burns: And with the forever patient now, with a statutory time of 20-plus years from the time of diagnosis to life termination, there'll be multiple opportunities for these surgeons to reenter and to reimplant with procedural pharmaceuticals and with stents. And I think that will start to really resonate with these comprehensive ophthalmologists, not only as a more advanced standard of care for patients to stop the progression of glaucoma, but as an offset to the chewing that's happening on the professional fee side for their cataract surgery procedures.

On the current CMS provisions of Category, 3 codes of really high-paying Standalone, uh payments for iOS and highest and infinite. But I think as we go forward, these comprehensive ophthalmologists who right now are spending most of their time, recruiting cataract patients, for 1 and done procedures. This is Catch and Release. Um, are going to start waking up to the value of looking at. Glaucoma is a long-term treatment pattern and what we're calling the forever patient and with the forever patient. Now, with the statutory time of 20 plus years from the time of Doc, diagnosis to life termination. They'll be multiple opportunities for these surgeons to re-enter to re-implant with procedural Pharmaceuticals and withstands and I think that will start to really resonate with these comprehensive ophthalmologists. Not only as a as a more advanced standard of care for patients to stop the progression of glaucoma but as an offset to the chewing that's happening.

Ryan Zimmerman: Yeah. Thank you for that complete answer there. Thank you.

On the professional Seaside for their cataract surgery procedures.

Joe Gilliam: Welcome.

Yeah. Thank you for the the that complete answer there. Thank you.

Welcome.

Operator: Your next question comes from Alan Gong with JP Morgan. Please go ahead.

Your next question comes from Alan, gong with JP Morgan. Please go ahead.

Rohan (for Allen Gong): Hi. This is actually Rohan on for Alan. Thanks for taking the question. I just wanted to ask about the ramifications of the proposed reimbursement to start off, just the higher facility fee offsetting the lower physician fees. How are you thinking about that and the impact for that next year? And do you view it as more of a rising tide that lifts all MIGS boats? I just want to get a sense for how you're thinking about it.

Hi. Uh, this is actually Rohan on for Allen. Thanks for taking the question. Um, just wanted to ask about the ramifications of the proposed reimbursement to start off. Um, just the higher facility fee, all setting, um, the lower physician fees, how how do you thinking about that and the impact for that next year? Um, and do you view it? As more of a rising tide that lifts all migs boats, or you just want to get a sense for how you think about it.

Joe Gilliam: Yeah. I think when you're talking about the proposed rule around the facility payments, and obviously, we are pleased to see those step up largely in line with the pace of inflation. So I think in general, that's a positive across the board for those folks who own and operate facilities and the manufacturers that provide tools and technologies and therapeutics into those facilities. I'm not sure I would call it out as a particular driver. As you think about the setup for 2026, it's more of a neutral than slightly positive event in the context of Glaucos and I think the other participants in the MIGS field.

yeah, I I think

talking about the

The facility. Um, uh, payments and, and obviously, we were pleased to see those uh, Step Up largely in line with the pace of of inflation. And so I think, in general, that's a positive across the board, for those folks who own and operate facilities and, and the, you know, the manufacturers that provide, um, tools and Technologies and Therapeutics into those facilities. I'm not sure I would call it out as a particular driver. Um, as you think about the setup for for 2026, it's more of a of a neutral to slightly positive event in the context of glow Co. And I think the other participants in the, in the, the mix field.

Rohan (for Allen Gong): Thanks. And just a quick follow-up as well on SG&A. There was a fairly big step up in the quarter. I just want to get a sense for what's driving that relative to expectations. And how are you thinking about SG&A growth for 2026? Is that 10% level still a good way to think about it, or should we expect something a bit higher?

Thanks and just a quick follow-up as well on um sgna there was a a fairly big step up um in the quarter, just want to get a sense for what's driving that um relative to expectations. And and how are you thinking about sgna growth?

Um, for 2026 is that 10% level still a good way to think about it. Um, or should we expect something a bit higher?

Chris Lewis: Hey, Rohan. This is Alex. Thanks for the question. And it is a great question. So you're right. There was a little bit of a step up in both SG&A and total opex year over year and during the quarter. We want to point out that within that number, I'm going to speak to the total opex as a predicate. So within the total opex number, there was about a $4 million one-time stock comp expense hit that occurred based on the triggering of certain performance awards that happened during the quarter. So if you exclude that and you look at that as on an adjusted basis, the opex would have grown around 16%. And as we've guided in the past, you know, we've always kind of said our opex this year would grow in kind of the mid-teens.

Chris Lewis: So that's kind of in line with what we spot, what we would have expected, excluding that stock comp expense. And then as you think about it on a go-forward basis, again, speaking as a total opex, you know, we would expect that third quarter to be roughly flat to our reported second quarter number, and then the fourth quarter may be a sequential step up from there. When you put all that together, you're looking at something for the full year in kind of the $460 million range, which is more the top end of the range that we were thinking about previously. And that, again, translates to about, you know, mid-teens growth year over year.

Hey Rohan. This is Alex, thanks for the question and it is a great question, so, you're right. There was a, a little bit of a step up in both sgna and total Opex, um, year-over-year and, and during the quarter, we want to point out that within that number, I'm going to speak to the total Opex as a, as a predicate. So within the within the total aspects number, there's about a $0 1-time, stock comp expense hit, uh, that occurred based on the triggering of certain, uh, performance awards that happened during the quarter, so if you exclude that and you look at that as on an adjusted basis, the Opex would have grown around 16%. And as we've gotten guided in the, in the past, you know, we've always kind of said our Opex this year would grow and kind of the mid teens. So that's kind of in line with what we spot. What what, what we would have expected, excluding that stock, comp expense, and then as you think about it on a go forward basis again, uh, speaking as a total Opex, um,

You know, we would expect that, um, the third quarter to be roughly flat to our reported second quarter number. Uh, and then the fourth quarter, maybe a sequential step up from there. When you put all that together, you're looking at something for the full year in kind of the $460 million range, which is more the top end of the range that we were thinking about previously. And that, again, translates to about, you know, mid-teens growth year-over-year.

Joe Gilliam: Thank you.

Operator: Your next question comes from Larry Biegelson with Wells Fargo. Please go ahead.

Basis Fargo, please go ahead.

Cemran (for Larry Biegelson): Hi. This is Cemran on for Larry. Thanks for taking the questions here. Just one on guidance. Any finer point on the cadence of sales in the back half? You know, as I think about the color that you've provided around iDOS and the different, you know, reimbursement updates with regards to the MAX, you know, should we be thinking about sort of an incremental step up in Q3 and, you know, something that's a little bit more Q4 weighted? And just sort of what would that exit rate imply for, you know, iDOS beyond this year?

Updates with regards to the max, you know, should we be thinking about sort of an incremental Step Up in Q3? And, uh, you know, uh, something that's a little bit more Q4 weighted. Um, and and just sort of what would that exit rate imply for, you know, eidos beyond this year?

Joe Gilliam: Yeah. Hi, Cemran. It's Joe. You know, I've probably given sufficient color in the context of the second half in totality. Maybe the best way to answer the question around the, I'll call it, the cadence from Q3 to Q4 is to dial in a bit on what you typically see in Q3. And as you know, in ophthalmology and certainly in our business, Q3 tends to be a seasonally down quarter, just given summer holidays on a global basis. And if I put a finer point on that in the context of our various franchises, you know, the corneal health business tends to be kind of flat to up a touch.

And it's, it's Joe. Um, you know, I I've probably given, uh, sufficient color in the context of the second half into totality. Maybe the best way to to answer the question around. Uh, the, the I'll call it the Cadence from Q3 to Q4 is the dial in a bit on what you typically see in in, in Q3

Joe Gilliam: But I think with lower device sales and some potential Epioxza, obviously related noise as anticipation grows for that product approval, the way to probably think about that is sequentially being a bit flat to what we saw in Q2 out of the cornea business. And international glaucoma usually takes a couple-million-dollar step down in Q3 relative to Q2. And then as it relates to the US glaucoma business, the non-iDOS-related portion typically also takes a step down of a couple million dollars from Q2 to Q3. But we would expect, obviously, some iDOS offset there to put you back into kind of positive territory, Q3 versus Q2 on the US glaucoma. You put all that together, I think where your model will land is sequentially, you know, down a bit relative to Q2.

Um, and as you know, uh, in Opthalmology, it's certainly in our business. Q3 tends to be a seasonally down quarter, just giving summer holidays, uh, on a global basis. And if I put a finer point on that, um, in the, the context of our, of our various franchises, you know, the the coral Health business tends to be kind of flat up a touch. Um, but I, I think with with lower device sales in some potential, fbio, obviously related to noise, is anticipation grows for that product, um, approval. Uh, the way to probably think about that is sequentially being a bit flat to what we saw in in Q2 out of the cornea business.

You know, International glaucoma, usually takes a couple million dollars, step down in Q3 uh, relative to Q2.

Joe Gilliam: And then as often as the case in ophthalmology, Q4, obviously, becomes the important, more important of the two as we exit the year and a lot of procedures get done.

Uh, and then it's a place, the US glaucoma business. The non eidos uh, related portion, uh, typically also takes a step down of a couple million dollars from Q2 to Q3, but we would expect. Obviously some eidos offset their, uh, to put you back in to kind of positive territory, 23 versus Q2 on, on the US, glaucoma, you put all that together. I think where your model will land is um, uh sequentially, you know, down a bit relative to to Q2. And then, as often as the case, um, in Opthalmology, uh, Q4 obviously becomes the important, um, uh, more important of the 2, as we exit the year and a lot of procedures get done.

Cemran (for Larry Biegelson): Okay. Great. That's very helpful. And just for my follow-up, so we do continue to hear from physicians and our surveys that a high percentage of iDOS cases are done in combo cataracts. Can you share a national percentage with us, and how is that trending versus your expectations?

Okay, great. That that's very helpful um and just for my follow-up. Uh, so we do continue to hear from Physicians and our surveys, that a high percentage of Idols cases are done in combo. Cataracts, can you share a national percentage with us and how is that trending versus your expectations?

Joe Gilliam: Yeah. I think there can be some noise in your sampling there, obviously. And it's not something that we track closely, nor are we able to. As you know, when a facility orders iDOS, at the end of that, there's no direct relationship to knowing whether or not they've done it in a combination of cataract surgery or not. But having said that, you know, we believe that the largest utilization continues to be in standalone procedures. And as reimbursement gets solidified, surgeons naturally start to look at it in both settings, meaning the patient where they're at. If they've got elevated pressure and they're looking to control that, whether that patient has, you know, comorbidity with cataract or not, they're increasingly turning to iDOS.

Yeah, I I think there there can be some noise in your sampling there, obviously. And it's not something that that we track, um, closely or nor we, um, able to, as you know, when, when um, a facility orders eidos at the end of that. Um, there's no direct relationship.

Joe Gilliam: So we would expect, certainly over the intermediate period, a little higher percentage being done in combination with cataract surgery than, say, at the beginning or certainly as we think about it over the next, you know, 3, 5, and 10-year period. But I wouldn't say that it's the dominant portion of what we're seeing today.

Ship of knowing whether or not, they've done it in combination with cataract surgery or not. But having said that, um, you know, we believe that the largest utilization continues to be in Standalone procedures, uh, and as, uh, reimbursement gets solidified, uh, surgeons naturally start to look at it in, in both settings where meeting the patient where, where, where they're at, um, if they've got elevated pressure and they're looking to control that. Um, whether that patient has, uh, you know, comorbidity with cataract or not, they're increasingly turning to to Ido. So we would expect, uh, certainly over the intermediate period, a little higher percentage. Um, being done in combination with cataract surgery and say at the beginning or certainly, as we think about it over the next, you know, 3 to 5 and 10 year period. Um, but I, I I wouldn't say that it's uh, it's the dominant portion of what we're seeing today.

Cemran (for Larry Biegelson): Great. Thank you.

Great. Thank you.

Operator: Your next question comes from David Saxon with Needham. Please go ahead.

Your next question comes from David Saxon with NEM. Please go ahead.

Rohan (for Allen Gong): Great. Thanks for taking my questions. Congrats on the quarter. A couple for me, one on iDOS, and then I'll have one on corneal health. So first for iDOS, specifically for the reimbursement, do you think we'll be at a place exiting the year where maybe six or all seven of the MAX are paying out the J code with an established pro-fee? And is there anything that needs to be done outside of just getting cases submitted for the four that are lagging to kind of catch up?

Great. Thanks for taking my questions. Congrats on the quarter. Um, a, a couple for me. 1 on eidos and then I'll have 1 on coronial health to First for eidos, uh, specifically for the reimbursement. Do you think we'll be at a place exiting the year where maybe 6 or all 7 of the Macs are paying the at the J Code with an established Pro fee? And is there anything that needs to be done outside of just getting cases to

Submitted, uh, for the four that are lagging to kind of catch up.

Joe Gilliam: Yeah, David. So just I think first of all, on the J code itself, we're already largely seeing all of the MAX increasingly paying those as they should. As it relates to the professional fee, which I think is the heart of your question, it is in large part a volume game because what the MAX do is educate themselves on the procedure, the cost, and resource utilization associated with that. And as they get more data points, they're able then to arrive at the appropriate crosswalk and pricing of that Category 3 code, and that's when they'll publish it. I think we, you know, as I noted earlier in the call, we've made an awful lot of progress with virtually all the MAX, probably with the lone exception being CGS. And so as I think about going forward, I certainly hope that that would be the case.

With that. And as they get more data points, they're able, then to arrive at the, the appropriate crosswalk and pricing of of that uh, Category 3 code. And that's when they'll publish it.

Joe Gilliam: I can only say that we'll be doing everything possible from an advocacy and education and driving those required volumes to get the MAX to a place where they feel comfortable pricing it in a manner similar to what we've seen, obviously, already out of Meridian, Novus POS, and First Coast.

I I think we, you know, as I noted earlier in the call, we've made an awful lot of progress um with virtually all the max probably with the the loan exception being uh CGS. And so as I think about going forward, uh I certainly uh hope that that would be the case. I can only say that we'll be doing everything possible from an advocacy and education and driving those required volumes to get the max to a place where they feel comfortable pricing it in a manner similar to what we've seen obviously already out of Meridian. Noventas and First Coast,

Rohan (for Allen Gong): Okay. Great. Thanks for that. And then on corneal health, so after Epioxza is approved, how are you thinking about rolling out the Epioxza cross-linking machine? My understanding is that it's going to be a different machine. So is that a trade-in? Is it a new purchase? And then over what period of time would you expect the installed base to convert over to the new machine?

Okay, great. Thanks for that. And then on Corno Health, so after FBX is approved, how are you thinking about rolling out the epoxy crosslinking machine? I understand it's going to be a different machine. So is that a trade-in? Is it a new purchase? And then over what period of time would you expect the installed base to convert over to the new machine?

Joe Gilliam: Yeah, it's a good question, David. I'm not going to get too deep into the particulars, obviously, certainly in advance of an approval in hand. I think when we get to that point, we'll give a lot more context. But you raised, you know, one of many pertinent points around what will be the rollout and transition period from Vertrexza as the standard of care today and what we expect with Epioxza. And as you heard Tom mention in the prepared remarks, you know, we do expect an impact from that transition over the course of certainly the fourth quarter and into early next year, part of which is driven by what you're describing around getting the new systems installed and out there.

Yeah, it's a good good question, David. I'm not going to get too deep into the particulars, obviously, certainly, in advance of, uh, of an approval and hand. I think when we get to that point, we'll give a lot more, uh, context. But you, you raised, uh, you know, 1 of of many, uh pertinent points around what will be the roll out and transition period from votrex.

Joe Gilliam: But really, the biggest driver of this is going to be simply the fact that most patients who are educated on the relative differences of the non-invasive, you know, procedure alternative that exists with Epioxza aren't going to want to defer to the extent they can to get access to what is a superior procedure from a patient perspective. And so we do expect there to be a bit of that, I'll call it, warehousing of patients post-approval until we're really fully up and running, both from a site of care perspective with the machines as you're describing, as well as a patient access perspective from a reimbursement standpoint.

As a standard of care today, what we expect, um, with that the OA. And as you heard, uh, Tom mentioned in the prepared remarks, you know, we do expect an impact, uh, from those that transition over the course of of, certainly the fourth quarter and into early next year, part of, which is driven by what you're describing around, um, getting the new systems installed and out there. But really the biggest driver of this is going to be simply the fact that most patients who are educated on the relative differences of the non-invasive. You know, procedural alternative that exists with epochs are going to want to defer to the extent that they can to get access to, uh, what is a, a superior procedure from the, from a patient perspective. And so we, we do expect there to be a bit of that. I'll call it warehousing of patients post approval, until we're really fully up and running. Uh, both from a, a, a site of care perspective with the, with the machines as you're describing, as well as a patient access perspective, from a, from a, from a reimbursement standpoint.

Rohan (for Allen Gong): Okay. Great. Thanks so much.

Okay, great. Thanks so much.

Operator: Your next question comes from the line of Joanne Wunsch with City. Please go ahead.

Your next question comes from the line of Joanne wooch with City. Please go ahead.

Cemran (for Larry Biegelson): Good evening. And thank you for taking the question. I'm catching up here a little bit with others reporting, so forgive me. But did you comment on the full-year guidance for iDOS based on what you were seeing in the market at this stage? And then for my second question, as we start to think about the Epioxza approval, how do you start to think about when that revenue may begin to ramp? And to your point, if patients are putting the procedure off until it is available, is there a waitlist that's starting, or is that too early? Thank you so much.

Good evening and um, thank you for taking the question. Um, I'm catching up here a little bit with others reporting. So forgive me. But did you um, comment on the full year guidance for eidos, uh, based on what you are seeing, um, in the Market at the stage and then for my second question,

Um as we think start to think about the EPA approval, um, how do you start to think about when that Revenue May begin to ramp and to your point, if patients are putting the procedure off until it is available? Is there a wait list at starting? Or is that too early? Thank you so much.

Joe Gilliam: Yeah. So hi, Joanne. First, on the iDOS guide, and a bit of a repeat, and you'll be able to see it in, I think, the remarks as they become available. But really, the punchline on iDOS is, as you weave your way through the second half across the various franchises, is that there's an implied, obviously, you know, it was the predominant part of the beat in the second quarter. And really, on the heels of that, we've effectively raised our guidance for the full year around iDOS, and we continue to see that growing momentum that you'd hope for around the utilization of that, in particular in those regions where the professional fee has been established in Novus POS and Meridian and First Coast.

Joe Gilliam: And as it relates to the Epioxza approval, you know, I think from a big-picture standpoint, there's a series of things that have to take place to where you're really running with any new drug, certainly in a rare disease category like keratoconus. And you know, as we make our way through 2026, we expect to methodically unlock some of those. An important moment along that journey is the establishment of a J code, which we would expect in mid-year. But even through the course of the year, you're educating, in this case, commercial payers, you're updating policies, you're doing all the blocking and tackling to get access for patients to a therapy that clearly they're going to want over the prior standard of care in the form of Vertrexza. And the last thing I think you referenced, no, there wouldn't be any formal waitlist at this point.

Yeah so uh hi Joanne, first on the Idaho's guide and a bit of a repeat and you'll you'll be able to see it and and I think the the remarks they become available but really the punchline on eidos is as you weave your way through the second half across the various franchises. Is that there's an implied obviously, you know, it was the it was the predominant part of the beat in the second quarter and um and really on the heels of that. We we've effectively raised our guidance for the full year around eidos and we continue to see that growing momentum, that, uh, that you would hope for around the utilization of that, um, in particular in those, uh, regions that, that where the the professional fee has been established in, in November to us and Meridian in First Coast,

And as it relates to the epio approval. Um, you know, I I think from a big picture standpoint, there's a series of things that, that have to take place to where you're really running with any new drugs, certainly in a, in a, you know, rare disease category like keratin. And, you know, as we make our way through 2026, we expect to to, to methodically unlock some of those. And then

Joe Gilliam: You don't have.A

Operator: pre-product product. And so those conversations aren't really happening, certainly not on behalf of GLAUKOS or our organization in any way, shape, or form. It's possible that some surgeons, just simply because of the public nature of the trial or their involvement in it, would be having some conversations with patients. But I'd say that's probably on the margin at this point. It is something we expect to be an important dynamic that will play out post-approval. So as you make your way through into, call it, November and December in the fourth quarter, you can expect that an increasing percentage of those patients will be having exactly that conversation with their physician. And we expect a significant portion of them can will try to defer and get access to Epiox just simply given the pain and the recovery time associated with Votrix versus Epioxin.

You you reference know there there there wouldn't be any formal wait list at this point, you don't have an approved product.

And so, those conversations aren't really happening, certainly not on behalf of of glaucos or our organization in any way, shape, or form. It's possible that some surgeons have just simply because of the public nature of of the trial where they're involved in it, um, would be having some conversations with with patients, but I'd say that's probably on the, on the margin at this point. It is something we expect to be a, an important Dynamic that will play out post-approval. So as you make your way through, and to call it November and December in the fourth quarter, you can expect that that, um, an increasing percentage of those patients will be having exactly that conversation with their physician. And we expect a significant portion of them who can will, will try to defer and get access to epoxy just simply give them the, the pain in the, in the recovery time, associated with butcher rexha.

Operator: Thank you. Your next question comes from Adam Mater with Piper Sandler. Please go ahead.

Thank you.

Your next question comes from Adam Mater with Piper Sandler. Please go ahead.

Speaker 3: Good afternoon. Thank you for taking the questions, and congrats on the quarter. Two from me, but both on EIDOS, and I'll ask them up front. So first, on the reimplantation decision from FDA. If I heard in the prepared remarks correctly, it's early 2026. I thought before it was, you know, potentially before year-end. So did we have a little bit of a wiggle there? And if so, you know, why the change in timing? And then secondly, for EIDOS Trio and the in-office opportunity, can you just put a finer point on timelines there and kind of what needs to be done to unlock the office opportunity for EIDOS? Thanks for taking the questions.

Good afternoon. Thank you for taking the questions and congrats on the quarter, um, 2 for me, both on Idaho, and I'll, I'll ask them up front. Um, so, so, first on the reimplantation decision from FDA.

Chris Lewis: Yeah. Adam, this is Tom. I'll be happy to take both those questions. So first of all, on the FDA's position with regards to EIDOS reimplantation, I guess the wiggle, as you call it there, was the FDA recently classified our petition as an NDA supplement. And so with that gave us a PDUFA date, which followed the statutory guidelines that they've set, which is now January 28, 2026, which gives us certainty now for understanding what the position will be. And so while we believe we've made a compelling case for reimplantation, as I've said in the past, I just want to alert the investment community that we are not at all counting on a positive outcome. It would be a very, a very formidable upside if we were able to have a positive outcome on the EIDOS reimplantation discussions.

Uh, if I heard in the prepared remarks correctly, it's early 2026. I thought before it was, you know, potentially before year-end, so did we have a little bit of a wiggle there? And if so, you know, why the change in timing? And then secondly, for Eidos Trio and the in-office opportunity, can you just put a finer point on timelines there and kind of what needs to be done to unlock the office opportunity for Eidos? Thanks for taking the question.

Yeah, and this is Tom. I'll be happy to take both those questions. So, first of all, on the FDA's position with regards to dose re-implantation, I guess the wiggle, as you called it, there was the FDA recently classified our petition as an NDA supplement. And so with that, it gave us a PDUFA date, which followed the statutory guidelines that they've set, which is now January 28, 2026. This gives us certainty now for understanding what the position will be.

Chris Lewis: Secondly, with regards to Trio, I think first it's important to note that we've already demonstrated that in our patient subset of a phase III clinical trial, we stratified, and we did a number of patients in-office using the current EIDOS applicator and EIDOS device in an in-office setting. Those data we are now stratifying, and we're pulling together for a submission for a peer-reviewed publication as we speak. And we think they replicate the safety and efficacy of EIDOS implantations that are done in the ASC. We are currently in the process of initiating discussions with MAX, as I've talked about before, with the intention of creating a non-facility payment code, which will allow for the reimbursement of EIDOS implantation in an in-office setting. And as I've stated previously, this will likely be a several months-long process.

And so why we believe we've made a a compelling case for reimplantation? As I said in the past, I just want to uh, to alert the investment community that we are not at all. Counting on a positive outcome. That would be a, a very, a very formal website. If we were able to to have a positive outcome on the iOS reimplantation discussions,

Secondly, with regards to Trio.

I think first, it's important to note that we've already demonstrated that in our patient subset of a phase 3, clinical trial, we stratified, and we did a number of patients in office. Using the current I dose applicator, and I dose device in an office setting those data. We are now, um, uh, stratifying. And we're pulling together for a submission for a peer-reviewed publication as we speak and we think they were replicate the safety and efficacy of eidos implantations that are done in the ASC. We are currently in the process of initiating discussions with Max. As I've talked about before, with the attention of creating a non- facility payment code.

Chris Lewis: With regards to EIDOS Trio itself, we've gone through several enhancements of the improved EIDOS applicator. We continue to optimize the final engineering design. And as I've said before, we're designing this new approach. With the with the existing EIDOS device, the applicator will target an approximately 1 millimeter incision. And by doing so, it should allow us to perform a closed chamber procedure, which can maintain chamber pressure and minimize dehiscence of aqueous humor. And that's aqueous humor that would kind of percolate out during the procedure. And we have a final design, which is now targeted to enter a US clinical trial by year-end. And while the design itself and the clinical trial is relatively short, the FDA has asked us to perform some additional testing over the period of one year. So we'll now be targeting the approval of the EIDOS Trio by year-end 2027.

Which will allow for the reimbursement of eidos, implantation and in office setting. And as I've stated previously, this will likely be a several months long process with regards to eidos Trio itself. We've gone through several enhancements of the of the improved iOS applicator. We continue to optimize the final engineering design. And as I've said before, we're designing this new approach with the with the existing iOS, um, device.

The applicator will Target at approximately 1 millimeter incision and by doing so it should allow us to perform a closed chamber procedure, which can maintain chamber pressure and minimize to hiss of aqueous humor and that's Equis humor that would kind of percolate out during the procedure. And we have a final design which is now targeted to enter a US clinical trial by year end.

And while the design itself and the clinical trial is relatively short, the FDA has asked us to perform some additional testing of over the period of 1 year. So we'll now be targeting the approval of the high dose Trio by year. End 2027

Chris Lewis: Let me just say this new product may aid in the transition for surgeons to in-office surgery, particularly as we establish non-facility payment codes at each of the individual MAX. It is the first of what I anticipate will be many development efforts that will be made to optimize in-office implantation of EIDOS. And I think the development of this product, as well as our subsequent products, comes at an enviable time. As we think about the recurring reduction of cataract surgical fees, the future and capacity constraints of ASCs, and the accelerating demographic patient demands of IG procedures are going to continually drive surgeons to perform in-office implantation. So back to Tom's initial question, where are we going? We have an incredible standalone opportunity in front of us. We are driving and creating a new marketplace, just like we've done previously, creating the global MAINS marketplace.

um Let me, let me just say this new product May Aid in the transition for surgeons to in office surgery particularly as we established not a facility uh payment codes that each of the individual Macs

it is the first of what I anticipate will be many development efforts that we'll be making to optimize in office implantation of eidos

and I think the development of this product as well as our subsequent products comes in an enviable time.

Chris Lewis: We intend to do so as we go forward in the future. It will be led, spearheaded by procedural pharmaceuticals and by our STEM combinations. And I would say as well, as you think about where this could go, I do believe that people will look for multiple mechanisms with single implantations. So we'll see surgeons, as they already are in the real world, starting to put in EIDOS with the iStent Infinite or even a competitive product to be able to reduce pressure, target pressures where they can arrest the progression of glaucoma. So I think we have an incredible opportunity in front of us. In-office implantation over the next 5 to 10 years will be an accelerant to get to the surgeons and patients to where I think they deserve to go.

As we think about the recurring reduction of cataract surgical fees, the future capacity, constraints of asc's and the accelerating the demographic. Patient demands of IG. IG procedures are continually Drive surgeons to perform in-office. Implantation! So back to Tom's initial question, where are we going? We have incredible Standalone opportunity in front of us. We are driving, and creating a new Marketplace, just like we've done previously. Creating the global makes Marketplace, we intended to do, so as we go forward in the future,

It will be led spearheaded by procedural Pharmaceuticals and by our stent combinations and I would say as well as you think about where this could go, I do believe that people will look for multiple mechanisms with single implantations and so, we'll see surgeons as they already are in in the real world starting to put in. I dose with, um, the istent infinite or even a competitive product to be able to reduce pressure Target pressures where they can arrest the progression of glaucoma. So I think we have an incredible opportunity in front of us. Uh, they have some Plantation over the next 5 to 10 years will be an accelerant to get to the surgeons and patients to where I think they deserve to go.

Speaker 3: It's a great color. Thanks, Tom.

It's a great color. Thanks Tom.

Chris Lewis: You're welcome.

Operator: Your next question comes from Richard Neuwetter with Truist Securities. Please go ahead.

Welcome.

Your next question comes from Richard, new Witter, with truist Securities. Please go ahead.

Tom Burns: Excuse me. Thank you for taking the question. Just the first one. I was wondering if you could characterize the utilization trends or really anything, any kind of behavior you're noticing in situations where the PROPE is established by MAX and without. And if you could specifically talk to everything from, you know, doc training, if you're noticing more docs getting trained or accelerating doc training in those situations or regions, to whether or not you're seeing combo cataract use potentially differ in PROPE on or PROPE established situations. And then if you could also characterize the utilization differences between the national average and the regions where you have a PROPE. Thank you.

I excuse me. Thank you for taking the question. Um, just the first 1. I was wondering if you could characterize uh, the

The the utilization Trends or really, any anything, any kind of behavior and noticing in in situations, where the proof is established by by by Max. And and, and without, and if you could specifically talk that everything from, you know, doc training, uh, if if you know this thing more docs, uh, getting trained or accelerating doc, training in in those situations or regions to. Um, whether or not, this is a combo cataract use potentially differ in, you know, trophy on or proy, uh, uh, uh, uh, established situations. Um, and then, uh, as you could also, characterize the utilization differences between the national average and and the and the regions where you have a protein, thank you.

Operator: Yeah, Richard. And some of this will be a bit of a rehash from earlier in the call, but I'm happy to do it as you think about what's going on. I think the most important overall statement, and it's evidence of giving many of the answers to the questions you asked, is the continued acceleration in Novantos, Neuridian, and First Coast that is exceeding that of the overall country. So when you think about the performance that we just had in the second quarter and the fact that 50% of the Medicare lives are represented in those three MAX where you have an established professional fee, we saw over 80% of our EIDOS volumes come from those areas in Q2. And that's a percentage that's actually been increasing in recent quarters. The momentum there is driven by virtually everything that you just asked.

Yeah, Richard and and, and some of this will be, uh, you know, a bit of a rehash from earlier in the call but I'm I'm I'm happy to do it as you think about um, what's going on? I I think the most important overall statement and its evidence of giving many of the answers that you to the questions you asked,

Is there a continued acceleration in NovaTOSS, Knidian, and First Coast?

Uh, that is exceeding that of the overall country. So, when you think about the performance that we just had in the second quarter,

And the fact that 50% of the Medicare lives are represented in those three Max, where you have an established professional fee.

Operator: So we see a faster pace of doctor training and onboarding. We see overall increased utilization at an increasing number of accounts where they've moved past trying and trialing, and they start going into full adoption mode, at least within the Medicare fee-for-service arena. And we also see a widening of how they utilize it. In the early days to minimize both clinical distraction as well as reimbursement distraction, we really mandate that they do these in standalone procedures. And as they get their sea legs on both of those fronts, you see them start to expand into not just standalone procedures, but also utilizing it in combination with cataract surgery, really based upon the need for treating the glaucoma, irrespective of whether that patient has a cataract or not.

We saw over 80% of our Idols volumes come from those areas in Q2 and that's a percentage. It's actually been increasing in in recent quarters. The momentum there is driven by virtually everything that you you just asked. So we see a faster pace of Dr. You know training and and and onboarding we see, you know, overall increase utilization at an increasing number of accounts where they move past trying and trying and they start going into to full adoption mode at least within the Medicare fee for service Arena.

Operator: So I would tell you that in virtually every KPI or metric you might look at, those regions that are contained within Novantos, Neuridian, or First Coast, you're seeing outperformance relative to the other areas of the country.

And we also see, um, a widening of of how they utilize it. You know, in the early days to, to minimize both, uh, clinical distraction, as well as reimbursement, distraction, you know, we really mandate that. They, they do these in Standalone procedures and as they get their sea legs on both of those fronts, you see them, spark start to expand uh into not just Standalone procedures, but also utilizing it in combination with cataract surgery. Really based upon the need for treating the glaucoma uh irrespective of whether that patient has a cataract or not.

So I would tell you that um in in virtually every, you know, kpi or metric. You might look at

um those regions that are are are contained within uh novitas knidian or First Coast, you're seeing outperformance relative to the other uh areas of the country.

Tom Burns: That's really helpful. And just a quick follow-up. Thanks for the sequential color, 2Q to 3Q and then 3Q to 4Q. I just want to clarify, did you say that US glaucoma would be up quarter over quarter, 2Q to 3Q, where EIDOS is obviously up sequentially and COR or non-EIDOS is down, and that nets out to positive? Or just what's the directional trend on US glaucoma, quarter over quarter?

Operator: Yeah, I can confirm that. Obviously, procedure volumes in the third quarter are down, right? I mean, physicians are on vacation. There's a lot less activity in the third quarter than in the second. And that's just generally always been the case, at least certainly over recent years. And we do, and what we've seen in prior years is that non-EIDOS business, if you will, down a couple million dollars, which we would expect to get EIDOS offset. And I think that should put us back into the positive category on a sequential basis for the US glaucoma franchise.

What's the what's the directional trend on us? Global Market, quarter over quarter?

Tom Burns: Thank you.

Yeah, I can confirm that, I obviously, um, procedure volumes of the third quarter are down, right? I mean, Physicians are on vacation. Um, there's a lot less activity in the third quarter than in the second. Uh, and that's just generally always been the case at least certainly over over recent years and and we do at what we've seen in in Prior years is that non ideos business if you will, uh, down a couple million dollars which, um, we would expect to get Idols offset. And I, I think that should put us back into the positive category on a sequential basis for the US outcome of franchise.

Thank you.

Operator: Your next question comes from Michael Circone with Jefferies. Please go ahead.

Tom Burns: Good afternoon, and thanks for taking the questions. Just had a follow-up on the US iStent business. It looks like it might have declined about 10% in the second quarter. And Joe, I think in your walkthrough for 2H, you mentioned maybe mid-single-digit declines. And I don't know if I'm splitting hairs here, but you know what trends would kind of occur where that performance would improve somewhat off of a kind of high single-digit, low double-digit decline in 2Q?

Your next question comes from Michael Cerrone with Jeffrey's, please go ahead.

Good afternoon, and thanks for taking the, the questions just had a had a follow-up on the US Pi stand business. Um, looks like it might have declined about 10% in the second quarter and Joe, I think in your walk through for 2 H, you mentioned maybe mid single digit declines and, and I don't know if I'm, I'm splitting hairs here. But you know what trends would kind of occur where that performance would improve somewhat off of a kind of high single digit low? Double digit decline in, in 2q.

Operator: Yeah, it's a good question, Michael. I'd say there's two things going on there. The first one is when you land at the 10%, there's probably a little bit of false precision around the division of what was non-EIDOS versus EIDOS, even in the comparable period last year, the second quarter of 2024. I'll just reiterate what we said, which is I think the combined stint plus expiration of the highest royalty impact was a high single-digit year-over-year impact. Now, you raise a good point around the Q2 trend. And we had anticipated that Q2 was going to represent the peak of the headwind, if you will. Even when we sent guidance last quarter, we had made that assumption when we talked about the full year kind of being in that mid-single-digit headwind area.

Operator: And so the reason for that is there was a little bit of, it was a tougher comp, if you will, in the second quarter, given some of the dynamics and ordering patterns that happened in Q2 of last year in the non-EIDOS business that ease as we go forward here. And we're seeing some of those trends play out already as we make our way here through July. So I think we're confident that we've seen the peak of that headwind. And as we think about the remainder of the year, it should go back down to something that's in that mid-single digits, both for Q3 and Q4 as a headwind.

Yeah, it's a good question. Michael, I'd say there's, there's 2 things going on there. The the first 1 is um, when you land at the 10%, there's probably a little bit of false Precision around the division of what was non I dose versus eidos even in the, the comparable period last year, the second quarter of 20124, I'll just reiterate what we said, which is, you know, I think the combined, um, spent uh, plus uh, expiration of the hydros royalty impact was a high single digit year. Um, uh, impact now uh you you you raised a a a a a a, a good point around the Q2 Trend and we had anticipated that that Q2 was going to represent the peak of the headwind if you will. We even when we set guidance last quarter, we had made that assumption when we talked about the full year, kind of being in that mid single digit, um, uh, headwind, uh area. And so, we're the reason for that is there was a, a little bit of, um, uh, it was a tougher comp.

Tom Burns: Got it. That's really helpful, Joe. And then maybe a quick follow-up. I think in some of the prepared remarks at the opening of the call, you had mentioned X, some of the investments made in 2Q, you might have generated about $4 million of cash from operations. Just wanted to dig a little deeper there. And you know on an underlying basis, you know how are you thinking about cash flow generation in the near and midterm?

If you will in the second quarter and give us some of the Dynamics and ordering patterns that happen in Q2 of last year, and the non eidos business that uh, that ease as we go forward here. And, and we're seeing some of those Trends play out, uh, already as we make our way here through through July. So I think we're we're confident that we've seen the peak of that headwind. And as we think about the remainder of the year, it should go back down to something that's in that missed single digits, uh, both for Q3 and Q4 as a headline.

Got it. That's really helpful Joe. And then maybe a quick follow-up. Um, I think in some of the prepared remarks at the opening of the call, um, you had mentioned X, some of the Investments made, in, in 2q, you, you might have generated about million dollars of cash from operations, just wanted to dig a Little Deeper there and, you know, on an underlying basis, you know, how are you thinking about, uh,

Cash flow generation in the near and Midterm.

Tom Steffen: Hey, Mike, it's Alex. I'll take that one. And just to give you a little more flavor on the cash for the quarter and what Tom was saying in his prepared remarks, if you look at the change in cash between the end of the last quarter and the end of this quarter, that change was actually a decline of about $25 million. But as Tom mentioned in his remarks, there were two transactions that occurred in the quarter. The first was the purchase of a building adjacent to our headquarters. And the second was the acquisition of Mobius Therapeutics. The sum of those is about $30 million. So when you take that and take that out of the negative 25, you end up, it's actually $29 million. So you end up around a plus 4, 4 and a half of cash generation in the quarter.

Tom Steffen: And that's kind of the details around that. As we think about going forward, again, we continue to have the near-term goal to manage our business such that we march towards cash flow breakeven or maybe small amounts of cash flow generation. You know our goal continues to strike the right balance between our revenues and cash generation against the investments needed in both our new product launches and our rich pipeline that you heard about as well in Tom's prepared remarks.

Hey Mike. It's Alex. I'll take that 1 and and just to give you a little more flavor on the uh, cash for the quarter. And what Tom was saying is prepared remarks. Yeah, if you look at the changing cash between the end of the last quarter and the end of this quarter, that change was actually a decline of about 25 million. But as Tom mentioned, is remarks, there were 2 transactions that occurred in the quarter of the first was that uh, purchase of a building adjacent to our headquarters and the second was the uh the acquisition of of Mobius Therapeutics. Uh the sum of those is about 30 million dollars. So when you take that and and take that out of the negative -25, you end up. It's actually 29 million. So you end up around a plus 4, 4 and a half of cash generation in the quarter and that's kind of the details around that as we think about going forward. Again, we continue to uh have the near-term goal to manage, um, our business such that we, we March towards cash flow break even or, or maybe small amounts of cash flow generation, you know, our our

Operator: By the way, I think it's also worth adding that with Eidos growth, clearly comes, we have long-dated terms, as you expect with any new product launch. And so as we make our way through and you see this, there's a lag effect there to the cash flow benefit, the earliest of which you're starting to see, obviously, in the Q2 period that Alex was just talking about.

Call continues to strike the right balance between our revenues and cash generation against the Investments needed. In both our new product launches, and our Rich pipeline, you know, that you heard about as well in Tom's prepared remarks.

By the way, I think it's also worth adding that that with um, with eidos growth clearly comes. There's we have long dated terms as you expect with a with any new product launch and so as we make our way through and you see this, there's a lag effect there to the cash flow benefits. The earliest of which you're starting to see in the Q2 period that Alex was just uh just just talking about.

Tom Burns: Really helpful. Thank you.

Really helpful. Thank you.

Operator: Your next question comes from Mason Carico with Stevens. Please go ahead.

With Stevens, please go ahead.

Joe Gilliam: Hey, thanks for fitting me in here. I'll ask my two up front if that's easier here. When it comes to commercial payers, what are your expectations around how Eidos gets implemented into those coverage policies? I mean, is there an opportunity for it to be incorporated first line? Should we be thinking about it as a second or third line, potentially? And then as a second question, could you give us some insight into where Eidos margins stand today? Has that product become accretive to overall corporate gross margins? Thanks.

It's uh, for fitting.

You're all.

What are your expectations around how I do it into those coverage policies? I mean, is there an opportunity for it to be incorporated first line? Should we be thinking about it as...

A second or third line potentially. Um, and then as a second question, could you give us some insight into where do these margins stand? Today, is that product becoming a creative to overall corporate growth margins? Thanks.

Operator: Yeah, Mason, I'll start off and then Alex can answer the latter or the second question there. The good news is on the commercial payer policies, we actually have a pretty high number of policies that we can point to in support of this answer. I mean, in fact, both on the commercial policy standpoint as well as Medicare Advantage, over 50% of lives have a positive policy in place today. And the vast majority of the remainder are silent. And every day that goes by, we're adjudicating claims within those environments to get confidence that patients can have access with those policies or those plans. The reality of the existing policy framework is the majority of Eidos is either a second or third line procedure. And it's entirely consistent with DARISA that obviously has been approved for a couple of years now.

Yeah. Mason, I'll start off and then Alex can answer the latter for the second question there. Um, the good news is on the commercial pair policies. We we actually have a pretty high, um, uh, number of policies that we can point to in, in, in support of this answer. I mean, in fact, um, both on the commercial policy standpoint, as well as Medicare Advantage over 50% of of lives. Uh, have a positive policy in place today, uh, in the vast, majority of the remainder are silent and every day that goes by. We're we're adjudicating claims within, um, those environments to get confidence that that patients can have access, uh, with those, with those with those, um, uh, policies or those plans.

Operator: And so really, the policies themselves will differ, often requiring failure either on a single medication or two medications or a single medication and some form of an intervention prior to turning to Eidos. That's okay for us, obviously, out of the gate as we're launching the product. But you can imagine over time, we'll continue to work on evidence and education of these payers to drive the Eidos procedure closer and closer to first-line therapy, where we believe it'll ultimately ship along over the next decade plus.

The, the reality of the existing policy framework is the majority or have an eye dose is either a second or third line. Um uh procedure and it's entirely consistent with derisa that obviously has been approved uh for a couple of years now. And so really um the the policies themselves will differ often requiring, you know, failure either on a single medication or 2 medications, or a single medication in some form of an intervention, uh, prior to turning to to eidos

that's, uh, okay, for us, obviously out of the gate as we're as we're launching the product, but you can imagine over time, we'll continue to work on evidence and education of these payers that drive, the, the items procedure closer and closer to first line therapy where we, we believe that ultimately should belong over over the, the next decade Plus

Tom Steffen: And then, Mason, on the margin, you know it's a great question. Glad you asked it because we were really pleased to see the margins come in at 83% in the quarter and that represented really modest accretion both on a year-over-year and a quarter-over-quarter basis. And it also continues to be in this 82 to 84% range that we've been guiding to all year. And we've said for some time now that with Eidos, as you mentioned, you know that is a high-margin product. And with success in the commercialization of Eidos, we'd expect to see accretion in the gross margin over time. And we hope that we're starting to see it now and that we'll continue to see modest accretion over the remaining quarters of the year.

And then Mason on the margin, you know, it's a great question, I'm glad you asked it because we were really pleased to see the margins come in at 83%, a quarter and that represented really modest accretion both on a year-over-year or and a quarter of a quarter basis. And it also continues to be in this 82 to 84% range that we've been guiding to all year. Uh, and we've said, for some time now that with I dose, as you mentioned, you know, that that is a high margin product that was success in the commercialization of of eidos that we'd expect to see accretion in the gross margin over time. And we hope that we were starting to see it now. And and that will continue to see modest accretion uh, over the remaining quarters of the year.

Operator: Got it. Thank you.

Got it. Thank you.

Operator: Your next question comes from Anthony Petroni with Mizuho Group. Please go ahead.

Your next question comes from. Anthony petroni. With M mizuho group, please go ahead.

Ryan Zimmerman: Thanks. And I'll stick to two on Eidos here. And one may be just when you think about the cadence that we're seeing now, I mean, how much is from sort of early adopters here that have been with Eidos now maybe for a few quarters, them increasing utilization versus new physician adds? And then maybe just an update on managed care coverage for Eidos. It sounds like based on some channel checks, you're starting to see a little bit of movement there. No official formulary coverage, but there are some claims being processed. So anything you can share on the managed care firm for Eidos would be helpful. Thanks.

Uh thanks. And uh I'll stick to 2 on I dose here and 1 may be just when you think about um, the Cadence that we're seeing now. I mean, how much is is from, you know, sort of, sort of early adopters here that have been, you know, with I do now maybe for a few quarters them, increasing utilization versus new physician ads. And and then maybe just an update on Managed Care coverage, uh, you know, for I dose. It sounds like, based on some Channel checks, you're starting to see a little bit of movement there, no official, formulary coverage. But there is some claims being processed. So anything you can share on the Managed Care front for I dose would be helpful. Thanks.

Operator: Yeah, Anthony. You know, first, there's always a lag effect, as I mentioned earlier, around physician awareness, adoption, and then ultimately the procedure volumes associated with that. These folks, as you know, have backlogs in terms of procedures and when they get scheduled. And so what we're seeing is a mix of expanding, I'll call it, new physicians and the early dabbling, if you will, before they fully adopt, combined with increasing utilization of those early adopters. And really tying into the second part of your question, what we're starting to see in its earliest phases is for those earliest adopters who are now really going closer and closer to full scale, they're starting to expand into that broader patient population of commercially covered lives as well as Medicare Advantage lives. There's obviously a process with that. It's different than dealing with Medicare, as you know.

Yeah, Anthony. Um, you know, first the there's always a lag effect as we, as I mentioned earlier around, uh, physician awareness, adoption and then ultimately the, the procedure volumes associated with that, these folks, as you know, in in have backlogs in terms of procedures and when they get scheduled. And so what we're seeing is a, a, a mix of expanding, I'll call it, uh, new Physicians and the early, uh, dabbling if you will, before they fully adopt combined, with increasing utilization of those early.

Operator: And so the way we really continue to handle this is methodical crawl, then maybe walk, and ultimately hopefully jog and run as we make our way through the coming quarters and years on an account-by-account basis. You really have to make sure that even when you've got proper policies in place, that the account and the practice are doing benefits verification, contracting, prior authorizations, claim processing, and all the things associated with proper managed care lives, that they're doing it in the right way. You want to ensure that success. And so we are we're moving intentionally in a very methodical manner to make sure that they have a positive outcome, payer by payer and situation by situation as they continue to grow.

Early adopters, and really tying into the second part of your question, what we're starting to see in its earliest phases is for those earliest adopters, who are now really going closer and closer to full scale. They’re starting to expand into that broader patient population of commercially covered lives as well as Medicare Advantage Lots. There's obviously a process with that. It's different than dealing with Medicare, as you know. And so the way we really continue to handle this is...

Our way through the coming quarters and, and years on an account by account basis, you really have to make sure that even when you've got uh, proper policies in place.

Operator: Over time, we obviously expect this to be a significant portion of our business, especially the commercially covered lives, but we want to make sure that we set them up for success out of the gate here.

Tom Steffen: Thank you.

That the account, the practice are doing benefits. Verification Contracting, prior authorizations claim processing and all the things associated with proper Managed Care. Um, you know, lives that they're doing it, uh, in the right way, you want to ensure that success and so we are we're we're moving uh intentionally uh in a very methodical manner to to make sure that they have a positive outcome uh Pair by payer and situation by situation as they continue to grow over time. We obviously expect this to be a significant uh portion of our business, especially the commercially covered lives, but we want to make sure that we set them up for Success out of the gate here.

Thank you.

Operator: Your final question comes from Danielle Antalpy with UBS. Please go ahead.

Your final question comes from Danielle and Ty with UBS.

Let's go ahead.

Rohan (for Allen Gong): Hey, good afternoon, guys. Thanks so much for taking the question. Congrats on a strong quarter here. Just a question on where you're seeing physicians adopt EIDOS. Could you maybe talk a little bit about how they're balancing Eidos versus iStent and sort of what the decision pathway is to go with Eidos versus iStent? And maybe just because it could serve as a snapshot of five years from now, how these two different product lines are coexisting. Thanks so much.

Hey, good afternoon, guys, thanks so much for taking the question. Congrats on a on a strong quarter here. Um, just a question on where you're seeing, uh, Physicians adopt eidos, could you maybe talk a little bit about how they're balancing iOS versus istent and sort of what the decision pathway is to, to go with items? Versus I sent maybe just because it could serve as a snapshot of, you know, 5 years from now how these 2 different product lines are are coexisting. Thanks so much.

Operator: Yeah, thanks, Danielle. And obviously, it's still early days. And so you have to sort of focus in more on those physicians who are adopting and are at the phase that, to Anthony's prior question, are earlier adopters who are now moving into a part of their everyday practice paradigm and managing patients with glaucoma. And I think what you're starting to see for those folks who are in that is that Eidos becomes their foundational therapy. That's where they go first and foremost. That shouldn't be a surprise given how wide open that label is and the ability to treat patients up and down the disease spectrum. And they then turn increasingly to the iStent or iStent Infinite, whether that be standalone or in combination at times with Eidos, to manage those patients who are progressing. They may have failed on a few more therapies along the way.

Operator: And they want to make sure that they really take every chance to arrest the progression of that disease and hopefully avoid the progression towards a more invasive procedure like a TUBA track or other alternatives.

Yeah, thanks, uh, Danielle obviously it's still early days and so uh you have to sort of focus in more on those Physicians who are adopting and are at the phase that Anthony's prior question are are earlier adopters who are now moving into a part of their everyday, you know, practice Paradigm and managing patients with glaucoma. And I think what you're starting to see for those folks who are in that is that Idaho becomes their foundational therapy. That's where they go first and foremost, that shouldn't be a surprise given how wide open that label is and the ability to treat patients up and down the the disease spectrum. And they then turn increasingly to the Ice in or ice in infinite, uh, whether that be stand alone, or in combination at times, with, with Idaho's to manage, those patients, who are progressing. They may have failed on a few more therapies along the way, and they want to make sure that they, they really take every chance to arrest the progression of that disease. And hopefully avoid, um, the progression towards a more invasive. Um, procedure like a tube of trap or whether

Alternatives.

Operator: That concludes our question and answer session. I will now turn the call back over to the company for closing remarks.

That concludes our question and answer session. I will now turn the call back over to the company for closing remarks.

Chris Lewis: Okay. Thank you all for your time and attention today. And again, we thank you for your continued interest and support of Glaucos.

Operator: Goodbye.

Okay, thank you all for your time and attention today. And again, we thank you for your continued interest and support of Galos.

Goodbye.

Operator: Ladies and gentlemen, this concludes today's call. Thank you all for joining. You may now disconnect.

Ladies and gentlemen, this concludes today's call thank you all for joining. You may now disconnect