Ocular Therapeutix, Inc. (NASDAQ:OCUL), a biopharmaceutical
company focused on the formulation, development, and
commercialization of innovative therapies for diseases and
conditions of the eye, today reported financial results for the
second quarter ended June 30, 2023, and provided updates on its
ophthalmology pipeline.
“The progress at Ocular Therapeutix over this
last quarter has been significant,” said Antony Mattessich,
President and CEO. “We reached the milestone of $15.0 million in
DEXTENZA net product revenues for the quarter and achieved revenue
growth of 24% over the same quarter prior year and 14% over the
previous quarter. This represents the third straight quarter of
sequential growth of in-market unit sales and gives us great
confidence in DEXTENZA’s ability to augment funding of our
fast-developing pipeline. As importantly, we now have a path
forward with OTX-TKI in wet AMD and expect to initiate our first
pivotal trial in the United States for wet AMD before the end of
this quarter. We were also able to secure a credit facility of
$82.5M that puts the funding in place to be able to initiate the
trial and extends our runway into 2025. We believe that our
successes in R&D and improved commercial performance have
positioned us well for the future.”
Business Updates
OTX-TKI (axitinib
intravitreal implant) for the potential treatment of wet AMD and
other retinal vascular diseases
- The Company
presented positive 12-month top-line data from its 21-subject
U.S.-based Phase 1 trial of OTX-TKI for the treatment of wet AMD at
the Clinical Trials at the Summit 2023 Meeting held in Park City,
Utah in June 2023.
- An 89% reduction in treatment
burden was observed in OTX-TKI treated subjects for up to 12
months.
- Subjects treated with a single
OTX-TKI implant continued to demonstrate sustained BCVA (mean
change from baseline of -1.0 letters) and CSFT (mean change from
baseline of +20.2 μm) in the OTX-TKI arm at 12 months, which was
comparable with the aflibercept arm (mean change from BCVA baseline
of +2.0 letters; mean change from CSFT baseline of -2.2 μm).
- 60% of the OTX-TKI subjects were
rescue-free up to Month 12. Four subjects received rescue therapy
for the first time at Month 12, which reflects the anticipated
waning of OTX-TKI’s therapeutic effect and potential disease
reactivation and helps establish a re-dosing timeline for
patients.
- Top-line data showed that a single
OTX-TKI implant was well-tolerated by subjects in the trial with no
drug-related ocular or systemic serious adverse events (SAEs)
observed through Month 12.
-
The Company intends to initiate the first of two planned pivotal
trials in wet AMD in Q3 2023. This pivotal trial will be a
prospective, multi-center, randomized, parallel-group trial that
will be run primarily at U.S. sites. This will be a superiority
trial that the Company designed after extensive discussions with
key opinion leaders and is consistent with the FDA’s current wet
AMD draft guidelines. The trial is planned to enroll approximately
300 evaluable wet AMD subjects who are treatment naïve in the study
eye. It will compare a single implant of OTX-TKI to a
single injection of aflibercept and assess the safety and efficacy
of OTX-TKI in subjects with wet AMD by measuring BCVA and CSFT.
OTX-TKI
(axitinib intravitreal implant) for the treatment of
non-proliferative diabetic retinopathy (NPDR).
-
In June 2023, the Company completed enrollment of the HELIOS trial,
a U.S.-based, double-masked Phase 1 clinical trial in 22 subjects
randomized 2:1 to either a 600 µg OTX-TKI single implant containing
axitinib or a sham control.
- The Company plans to present
interim 6-month data from the trial in Q1 2024.
- The Company has been in discussions
with the FDA for the clinical development of OTX-TKI in the
treatment of NPDR and has a potential pivotal design. Subject to
favorable interim data from the ongoing clinical trial and
obtaining the necessary financing to fund the trial, the Company
expects to be prepared to initiate a Phase 3 pivotal trial for NPDR
as early as Q1 2024.
OTX-TIC
(travoprost intracameral implant) for the treatment of primary
open-angle glaucoma or ocular hypertension.
- The Company has
recently completed enrollment of its U.S.-based Phase 2
prospective, multi-center, randomized, controlled clinical trial
evaluating the safety, tolerability, and efficacy of OTX-TIC for
the treatment of subjects with primary open-angle glaucoma (OAG) or
ocular hypertension (OHT) compared to DURYSTA®.
- The Company has
designed the Phase 2 clinical trial to evaluate whether OTX-TIC can
demonstrate a clinically meaningful decrease in intraocular
pressure while preserving endothelial cell health.
- The Company has started a pilot repeat-dose sub-study in the
Phase 2 clinical trial that is being run to evaluate the safety of
a repeat, sustained release dose of OTX-TIC 26 μg, in a small
sub-set of subjects with OAG or OHT. These subjects will be
followed for at least 6 months after their enrollment in the
sub-study to monitor and evaluate their endothelial cell
health.
- The Company plans to
report top-line data from the single-dose portion of the Phase 2
clinical trial in Q1 2024.
OTX-DED
(dexamethasone intracanalicular insert) for the short-term
treatment of the signs and symptoms of dry eye disease and OTX-CSI
(cyclosporine intracanalicular insert) for the chronic treatment of
dry eye disease
- In Q2 2023, the
Company initiated a small study to evaluate the performance of
OTX-DED versus fast-dissolving collagen plugs and no inserts at all
in order to identify a potential placebo control for future trials
of these product candidates.
- The Company plans to
use the results of this study to inform the next steps for both the
OTX-DED and OTX-CSI programs.
DEXTENZA
(dexamethasone ophthalmic insert) 0.4mg approved for the treatment
of ocular inflammation and pain following ophthalmic surgery and
ocular itching associated with allergic
conjunctivitis.
-
Net product revenue of DEXTENZA for Q2 2023 was $15.0 million,
approximately 24% ahead of Q2 2022 net product revenue of $12.1
million and approximately 14% ahead of Q1 2023 net product revenue
of $13.2 million.
-
The Company believes that DEXTENZA is currently used in less than
5% of cataract procedures and that growth will be driven by a
continued focus on sales to ASCs, specifically strategic accounts
that own and control multiple ASCs, and the revised pricing and
discounting strategy that was implemented in Q3 2022.
Expanded Board of
Directors
-
In July 2023, the Company added Dr. Adrienne Graves to its board of
directors. A visual scientist by training and a global industry
leader in ophthalmology, Dr. Graves brings extensive experience to
her role. As the former CEO of Santen Inc., the US subsidiary of a
130-year-old Japanese pharmaceutical company, she successfully
established a strong global presence, bringing multiple ophthalmic
products through development to approval and commercialization and
leading global teams through successful acquisitions and
partnerships.
Closed $82.5 million Credit
Facility
- The Company has closed on an $82.5
million credit facility with Barings, LLC. The credit facility was
fully funded at close (approximately $80 million after the original
issue discount) and, after repayment of the MidCap debt and related
fees and expenses, the Company realized net cash proceeds of
approximately $51.6 million. The debt has a six-year term and bears
interest at the one-month SOFR (secured overnight financing rate)
plus 6.75%, with a SOFR floor of not less than 1.5%. The new credit
facility requires the Company to make interest payments on a
monthly basis until maturity, at which time the Company shall also
be required to repay the entirety of the principal in a bullet
payment. Additionally, the credit facility carries a royalty fee
equal to, in the aggregate, the funded loan amount requiring the
Company to pay the lenders installments against the fee equal to
3.5% of U.S. DEXTENZA net revenues until such time as Barings has
received total payments (inclusive of interest payments, principal
prepayment fees and contingent revenue interest payments) equal to,
in the aggregate, the funded loan amount. The royalty fee is
reduced to either 20% or 30% of the funded loan amount, depending
on the circumstances, if a change of control were to occur within
12 months of the closing. Any balance of the royalty fee is payable
in connection with a change of control thereafter. The credit
facility includes customary affirmative and negative covenants as
well as a $20 million minimum liquidity requirement. Concurrently
with the closing, the Company repaid an aggregate of $26.2 million
to MidCap Financial Trust and our other lenders to satisfy its
obligations under its prior credit facility and the maturity date
of the Company’s existing $37.5 million convertible notes was
extended to a date three months following the maturity of the new
credit facility.
Second Quarter Ended June 30, 2023 Financial
Results
Total net revenue, which includes both gross
DEXTENZA product revenue net of discounts, rebates, and returns,
which the Company refers to as net product revenue, and
collaboration revenue was $15.2 million for the second quarter of
2023, an increase of approximately 24% over second quarter 2022 net
revenues of $12.3 million and an increase of approximately 13% over
first quarter net revenue of $13.4 million. For the second quarter
of 2023, DEXTENZA net product revenue grew to $15.0 million from
$12.1 million over the comparable period in 2022 while
collaboration revenue grew to $0.2 million from $0.1 million.
Research and development expenses for the second
quarter of 2023 were $15.1 million versus $13.1 million for the
comparable period in 2022, driven primarily by an increase in
expenses associated with clinical trial programs.
Selling and marketing expenses in the second
quarter of 2023 were $11.2 million as compared to $10.1 million for
the comparable quarter of 2022, reflecting primarily an increase in
field force personnel.
General and administrative expenses were $8.2
million for the second quarter of 2023 versus $7.8 million in the
comparable quarter of 2022, primarily due to an increase in
personnel-related costs, including stock-based compensation and
professional fees.
The Company reported a net loss for the second
quarter of 2023 of $(20.7) million, or a loss of $(0.26) per share
on both a basic and diluted basis, compared to a net loss of
$(18.8) million, or a net loss of $(0.24) per share on a basic
basis and a net loss of $(0.25) per share on a diluted basis for
the comparable period in 2022. The net loss in the second quarter
of 2023 included a $1.1 million non-cash item attributable to a
change in the fair value of the derivative liability associated
with the Company’s convertible notes, decreasing total other
expenses as the price of the Company’s common stock decreased
during the quarter. Non-cash charges for stock-based compensation
and depreciation and amortization were $5.1 million in the second
quarter of 2023 versus $4.8 million for the comparable quarter in
2022.
As of August 3, 2023, the Company had approximately 79.4 million
shares outstanding.
2023 Financial Guidance
- The Company
anticipates DEXTENZA net product revenue guidance for the full year
2023 to come in at the upper end of the current $55 and $60 million
range provided by the Company. The current range represents
anticipated growth of approximately 10% to 20% over 2022. The
growth is anticipated to be driven by sales of DEXTENZA for the
treatment of post-surgical inflammation and pain in the ASC
setting.
- Existing cash and
cash equivalents of $66.6 million as of June 30, 2023, plus the net
cash received from the borrowing under the Barings Credit Facility
after the repayment of the MidCap Credit Facility and reflecting
the $20.0 million minimum cash covenant in the Barings Credit
Agreement, is expected to fund planned operating expenses, debt
service obligations and capital expenditure requirements into 2025.
This estimate is based on the Company’s current operating plan
which includes estimates of anticipated cash inflows from DEXTENZA
product sales, and cash outflows from operating expenses, including
clinical trials. The Company’s planned operating expenses exclude
expenses necessary to complete the first of two planned pivotal
trials for OTX-TKI for the treatment of wet AMD and expenses to
initiate the second of our two planned pivotal clinical trials for
OTX-TKI for the treatment of wet AMD or any other pivotal trials
for our other product candidates, including OTX-TKI for the
treatment of NPDR, which we do not intend to commence unless we
obtain additional financing.
Conference Call & Webcast Information
Members of the Ocular Therapeutix management
team will host a live conference call and webcast today at 4:30 pm
Eastern Time to review the Company's financial results and provide
a general business update. A live audio webcast will be available
at www.ocutx.com. Interested parties may also register for the
webcast via this link. Analysts wishing to participate in the
question and answer session should use this link. A replay of the
webcast will be available via the company’s investor website
approximately two hours after the call’s conclusion. Those who plan
on participating are advised to join 15 minutes prior to the start
time.
About Ocular Therapeutix,
Inc.
Ocular Therapeutix, Inc. is a
biopharmaceutical company focused on the formulation, development,
and commercialization of innovative therapies for diseases and
conditions of the eye using its proprietary bioresorbable
hydrogel-based formulation technology. Ocular Therapeutix’s first
commercial drug product, DEXTENZA®, is an FDA-approved
corticosteroid for the treatment of ocular inflammation and pain
following ophthalmic surgery and ocular itching associated with
allergic conjunctivitis. Ocular Therapeutix’s earlier stage
development assets include: OTX-TKI (axitinib intravitreal
implant), currently in Phase 1 clinical trials for the treatment of
wet AMD and diabetic retinopathy; OTX-TIC (travoprost intracameral
implant), currently in a Phase 2 clinical trial for the treatment
of primary open-angle glaucoma or ocular hypertension; and OTX-CSI
(cyclosporine intracanalicular insert) for the chronic treatment of
dry eye disease and OTX-DED (dexamethasone intracanalicular insert)
for the short-term treatment of the signs and symptoms of dry eye
disease, both of which have completed Phase 2 clinical trials.
About DEXTENZA
DEXTENZA is FDA-approved for the treatment of
ocular inflammation and pain following ophthalmic surgery and
ocular itching associated with allergic conjunctivitis. DEXTENZA is
a corticosteroid intracanalicular insert placed in the punctum, a
natural opening in the inner portion of the lower eyelid, and into
the canaliculus and is designed to deliver dexamethasone to the
ocular surface for up to 30 days without preservatives. DEXTENZA
resorbs and exits the nasolacrimal system without the need for
removal.
Please see full Prescribing and Safety
Information at www.DEXTENZA.com.
Forward Looking Statements
Any statements in this press release about
future expectations, plans, and prospects for the Company,
including the commercialization of DEXTENZA® or any of the
Company’s products or product candidates; the development and
regulatory status of the Company’s product candidates, including
the timing and design of the Company’s planned pivotal trials of
OTX-TKI for the treatment of wet AMD; the Company’s cash runway and
sufficiency of the Company’s cash resources; 2023 financial
guidance, including estimated net product revenue; and other
statements containing the words "anticipate," "believe,"
"estimate," "expect," "intend", "goal," "may", "might," "plan,"
"predict," "project," "target," "potential," "will," "would,"
"could," "should," "continue," and similar expressions, constitute
forward-looking statements within the meaning of The Private
Securities Litigation Reform Act of 1995. Actual results may differ
materially from those indicated by such forward-looking statements
as a result of various important factors. Such forward-looking
statements involve substantial risks and uncertainties that could
cause the Company’s preclinical and clinical development programs,
future results, performance or achievements to differ significantly
from those expressed or implied by the forward-looking statements.
Such risks and uncertainties include, among others, the timing and
costs involved in commercializing DEXTENZA or any product or
product candidate that receives regulatory approval, including the
conduct of post-approval studies; the ability to retain regulatory
approval of DEXTENZA or any product or product candidate that
receives regulatory approval; the ability to maintain and the
sufficiency of product, procedure and any other reimbursement codes
for DEXTENZA; the initiation, timing, conduct and outcomes of
clinical trials; availability of data from clinical trials and
expectations for regulatory submissions and approvals;
uncertainties inherent in estimating the Company’s cash runway,
future expenses and other financial results, including its ability
to fund future operations, including clinical trials; Company’s
existing indebtedness and the ability of the Company’s creditors to
accelerate the maturity of such indebtedness upon the occurrence of
certain events of default; the Company’s ability to enter into
strategic alliances or generate additional funding on a timely
basis, on favorable terms, or at all; and other factors discussed
in the “Risk Factors” section contained in the Company’s quarterly
and annual reports on file with the Securities and Exchange
Commission. In addition, the forward-looking statements included in
this press release represent the Company’s views as of the date of
this press release. The Company anticipates that subsequent events
and developments will cause the Company’s views to change. However,
while the Company may elect to update these forward-looking
statements at some point in the future, the Company specifically
disclaims any obligation to do so, whether as a result of new
information, future events or otherwise, except as required by law.
These forward-looking statements should not be relied upon as
representing the Company’s views as of any date subsequent to the
date of this press release.
InvestorsOcular
TherapeutixDonald NotmanChief Financial
Officerdnotman@ocutx.comorICR WestwickeChris Brinzey,
339-970-2843Managing Directorchris.brinzey@westwicke.com
MediaICR WestwickeBen Shannon,
443-213-0495ben.shannon@westwicke.com
Ocular
Therapeutix, Inc.
Condensed Consolidated Statements of
Operations and Comprehensive Loss(In thousands,
except share and per share data)
(Unaudited)
|
|
Three Months Ended |
|
Six Months Ended |
|
|
June 30, |
|
June 30, |
|
|
2023 |
|
2022 |
|
2023 |
|
2022 |
Revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
Product revenue, net |
|
$ |
15,029 |
|
|
$ |
12,144 |
|
|
$ |
28,243 |
|
|
$ |
24,642 |
|
Collaboration revenue |
|
|
157 |
|
|
|
122 |
|
|
|
318 |
|
|
|
811 |
|
Total revenue, net |
|
|
15,186 |
|
|
|
12,266 |
|
|
|
28,561 |
|
|
|
25,453 |
|
Costs and operating
expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
Cost of product revenue |
|
|
1,304 |
|
|
|
1,155 |
|
|
|
2,517 |
|
|
|
2,454 |
|
Research and development |
|
|
15,094 |
|
|
|
13,100 |
|
|
|
29,842 |
|
|
|
26,200 |
|
Selling and marketing |
|
|
11,153 |
|
|
|
10,140 |
|
|
|
21,989 |
|
|
|
19,203 |
|
General and administrative |
|
|
8,205 |
|
|
|
7,787 |
|
|
|
17,332 |
|
|
|
15,344 |
|
Total costs and operating expenses |
|
|
35,756 |
|
|
|
32,182 |
|
|
|
71,680 |
|
|
|
63,201 |
|
Loss from operations |
|
|
(20,570 |
) |
|
|
(19,916 |
) |
|
|
(43,119 |
) |
|
|
(37,748 |
) |
Other income (expense): |
|
|
|
|
|
|
|
|
|
|
|
|
Interest income |
|
|
748 |
|
|
|
73 |
|
|
|
1,312 |
|
|
|
89 |
|
Interest expense |
|
|
(1,991 |
) |
|
|
(1,696 |
) |
|
|
(3,760 |
) |
|
|
(3,378 |
) |
Change in fair value of derivative liability |
|
|
1,131 |
|
|
|
2,773 |
|
|
|
(5,432 |
) |
|
|
9,731 |
|
Other expense, net |
|
|
— |
|
|
|
— |
|
|
|
(1 |
) |
|
|
(2 |
) |
Total other (expense) income, net |
|
|
(112 |
) |
|
|
1,150 |
|
|
|
(7,881 |
) |
|
|
6,440 |
|
Net loss |
|
$ |
(20,682 |
) |
|
$ |
(18,766 |
) |
|
$ |
(51,000 |
) |
|
$ |
(31,308 |
) |
Net loss per share, basic |
|
$ |
(0.26 |
) |
|
$ |
(0.24 |
) |
|
$ |
(0.66 |
) |
|
$ |
(0.41 |
) |
Weighted average common shares
outstanding, basic |
|
|
78,047,705 |
|
|
|
76,764,296 |
|
|
|
77,718,823 |
|
|
|
76,755,028 |
|
Net loss per share,
diluted |
|
$ |
(0.26 |
) |
|
$ |
(0.25 |
) |
|
$ |
(0.66 |
) |
|
$ |
(0.47 |
) |
Weighted average common shares
outstanding, diluted |
|
|
78,047,705 |
|
|
|
82,533,528 |
|
|
|
77,718,823 |
|
|
|
82,524,260 |
|
|
Ocular
Therapeutix, Inc.
Condensed Consolidated Balance
Sheets (In thousands, except share and per share
data) (Unaudited)
|
|
June 30, |
|
December 31, |
|
|
2023 |
|
2022 |
Assets |
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
66,606 |
|
|
$ |
102,300 |
|
Accounts receivable, net |
|
|
27,309 |
|
|
|
21,325 |
|
Inventory |
|
|
2,204 |
|
|
|
1,974 |
|
Prepaid expenses and other current assets |
|
|
4,593 |
|
|
|
4,028 |
|
Total current assets |
|
|
100,712 |
|
|
|
129,627 |
|
Property and equipment,
net |
|
|
12,830 |
|
|
|
9,856 |
|
Restricted cash |
|
|
1,764 |
|
|
|
1,764 |
|
Operating lease assets |
|
|
7,252 |
|
|
|
8,042 |
|
Total assets |
|
$ |
122,558 |
|
|
$ |
149,289 |
|
Liabilities and
Stockholders’ Equity |
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
|
Accounts payable |
|
$ |
3,572 |
|
|
$ |
5,123 |
|
Accrued expenses and other current liabilities |
|
|
24,598 |
|
|
|
24,097 |
|
Deferred revenue |
|
|
391 |
|
|
|
576 |
|
Operating lease liabilities |
|
|
1,713 |
|
|
|
1,599 |
|
Notes payable, net of discount, current |
|
|
2,083 |
|
|
|
— |
|
Total current liabilities |
|
|
32,357 |
|
|
|
31,395 |
|
Other liabilities: |
|
|
|
|
|
|
Operating lease liabilities, net of current portion |
|
|
7,689 |
|
|
|
8,678 |
|
Derivative liability |
|
|
11,783 |
|
|
|
6,351 |
|
Deferred revenue, net of current portion |
|
|
14,254 |
|
|
|
13,387 |
|
Notes payable, net of discount, net of current portion |
|
|
23,303 |
|
|
|
25,257 |
|
Other non-current liabilities |
|
|
104 |
|
|
|
93 |
|
Convertible Notes, net |
|
|
29,981 |
|
|
|
28,749 |
|
Total liabilities |
|
|
119,471 |
|
|
|
113,910 |
|
Commitments and
contingencies |
|
|
|
|
|
|
Stockholders’ equity: |
|
|
|
|
|
|
Preferred stock, $0.0001 par value; 5,000,000 shares authorized and
no shares issued or outstanding at June 30, 2023 and
December 31, 2022, respectively |
|
|
— |
|
|
|
— |
|
Common stock, $0.0001 par value; 200,000,000 shares authorized and
79,233,804 and 77,201,819 shares issued and outstanding at
June 30, 2023 and December 31, 2022,
respectively |
|
|
8 |
|
|
|
8 |
|
Additional paid-in capital |
|
|
670,921 |
|
|
|
652,213 |
|
Accumulated deficit |
|
|
(667,842 |
) |
|
|
(616,842 |
) |
Total stockholders’ equity |
|
|
3,087 |
|
|
|
35,379 |
|
Total liabilities and stockholders’ equity |
|
$ |
122,558 |
|
|
$ |
149,289 |
|
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