Aldeyra Therapeutics, Inc. (ALDX) Earnings Call Transcript & Summary

Good morning, and welcome to the Aldeyra Therapeutics conference call. [Operator Instructions] I would now like to hand the conference call over to Bruce Greenberg, Vice President of Finance, Interim Chief Financial Officer and Treasurer. Thank you. Sir, please go ahead.

Thank you, and good morning, everyone. With me are President and Chief Executive Officer, Dr. Todd Brady; and Kelly Mizer, our Vice President of Commercial Strategy and Operations. Joining us on today's call is Dr. John Berdahl, a specialist in diseases of the anterior segment at Vance Thompson Vision and Professor of Ophthalmology at the Stanford School of Medicine. This morning, we issued a press release reporting top-line results for the Crossover clinical trial of reproxalap for the treatment of dry eye disease. A copy of the press release is available on the Investors & Media section of our website, www.aldeyra.com. The press release should be read and considered in conjunction with the slides presented and the prepared remarks made on today's call. Please turn to Slide 2. This presentation and various remarks, which may be made during this presentation, contain forward-looking statements regarding Aldeyra; its investigational new drug candidate, reproxalap; and its plans and expectations including the planned submission of a new drug application. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause Aldeyra's actual results, performance or achievements to be materially different from any future results, performance or achievements, expressed or implied by the forward-looking statements. These statements are based upon the information available to Aldeyra today and reflect Aldeyra's current views with respect to future events and are based on assumptions and subject to risks and uncertainties, including the development, clinical and regulatory plans or expectations for Aldeyra's investigational new drugs, including reproxalap and systems-based approaches. The risks that result from earlier clinical trials, portions of clinical trials or pooled clinical data may not accurately predict the results of future trials or the remainder of a clinical trial and Aldeyra's continuing or post-hoc review and quality analysis of clinical data, including p-value's estimates. Aldeyra assumes no obligation to update these statements as circumstances change. Future events and actual results could differ materially from those projected in the company's forward-looking statements, including the current and potential future impact of the COVID pandemic on our business, results of operations and financial position. Additional information concerning factors that could cause results to differ materially from our forward-looking statements are described in greater detail in the press release issued this morning and in our filings with the Securities and Exchange Commission. I would now like to turn your attention to Slide 3 and introduce Dr. Brady.

Thank you, Bruce. The positive results announced today, achievement of the primary endpoints of ocular redness and Schirmer test, in addition to the achievement of secondary endpoints for all assessed symptoms demonstrate rapid and broad activity of reproxalap over approximately a 24-hour period of dosing. Importantly, reproxalap also achieved multiplicity-controlled statistical superiority over vehicle for the greater than or equal to 10 millimeters Schirmer test responder analysis, which per published literature and per draft U.S. Food and Drug Administration guidance correlates with symptomatic improvement and is consistent with the symptomatic improvement demonstrated in this trial. Overall, in a single trial, we claim success for all 3 dry eye disease sign endpoints that we intend to submit as pivotal to a new drug application. And at least by extension of the responder analysis results, symptomatic improvement occurring as soon as a single day of drug administration. To our knowledge, the Crossover outcomes represent the first time that an adequate and well-controlled trial resulted in claims for success across 3 dry eye disease endpoints. In addition to our knowledge, we've demonstrated for the first time the enhanced statistical power of a Crossover design in dry eye disease, at least for a drug candidate with a potentially rapid mechanism of action. Today, I'll review the clinical results of the Crossover trial and then introduce Kelly Mizer, our Vice President of Commercial Strategy and Operations, to present data from recent market assessment initiatives for reproxalap in dry eye disease and the commercial implications of the clinical package that we've generated to date, which we continue to believe is unparalleled in terms of breadth and onset of activity. We're pleased to have with us on the call today, Dr. John Berdahl, a practicing ophthalmologist at Vance Thompson Vision and Assistant Professor at Stanford School of Medicine, specializing in anterior segment diseases, including dry eye disease. Dr. Berdahl will lend perspective on the limitations of currently available therapies for dry eye disease, and at the end of today's presentation, will be available for questions on standard of care and unmet medical need across the dry eye disease landscape. Turning to Slide 4. Based on previously completed Phase II and Phase III clinical trials, including the Phase III TRANQUILITY and TRANQUILITY-2 trials, we've disclosed that we intend to submit a dry eye disease new drug application or NDA, based on 2 trials each for symptomatic improvement and improvement in 3 objective signs of dry eye disease, ocular redness, Schirmer test and the Schirmer test responder analysis. All 3 endpoints are specifically noted in the draft FDA guidance for dry eye disease or have been successfully used as a basis for approval by other companies. The Crossover trial described on Slide 9 -- I'm sorry, Slide 5, was designed to support the clinical data previously announced and also to be an adequate and well-controlled trial that could be submitted as pivotal for the 3 multiplicity-controlled dry eye disease objective signs that we intend to submit to the NDA. Inherent in dry eye disease is substantial patient-to-patient variability, meaning that one patient may respond to any therapy markedly differently than another patient possibly due to unmeasurable baseline differences in disease characteristics. Different from parallel-group trials, the Crossover trial was designed to reduce interpatient variability by exposing each patient to separate treatment periods with reproxalap and vehicle. To our knowledge, an adequate and well-controlled Crossover trial in dry eye disease has not been previously performed, perhaps because most investigational dry eye disease drugs require at least weeks to demonstrate even modest activity in crossing patients over therapeutic arms with more than double the time needed to run a single trial, resulting in trials lasting many months. For potentially rapidly acting drugs however, the Crossover design is feasible. Slide 6 illustrates the Crossover design consisting of 2 days of 1 treatment, followed by a 2-week washout period of no treatment, followed by 2 days of the other treatment, for a total per patient duration of less than 3 weeks. Patients were equally randomized to receive either reproxalap first or vehicle first. 63 patients were randomized in total, 32 to receive reproxalap followed by vehicle and 31 to receive vehicle followed by reproxalap. As was the case in previously disclosed clinical trials, each visit consisted of 2 days, 4 doses of test article on day 1, followed by a 90-minute dry eye chamber on day 2. For day 1, Schirmer test was measured approximately 10 minutes before and after the final dose. The pre-dose measurement was designed to assess the effect of the first 3 doses on tear production, whereas the post-dose measurement was designed to assess acute activity within minutes of dosing. For day 2, ocular redness was measured approximately every 10 minutes in a dry eye chamber, test article was administered just before the chamber and 45 minutes after chamber entry to assess prophylactic and treatment activity, respectively. The dry eye chamber, which is described in draft FDA guidance on dry eye disease, is an acute exposure to temperature and flow controlled low or no humidity air during forced visual tasking. The primary endpoint of Schirmer test on day 1 and ocular redness in the dry eye chamber on day 2 are presented on Slide 7. Both endpoints were achieved. And reproxalap was highly statistically significantly superior to vehicle, with a p-value of 0.0004 for ocular redness and 0.0005 for Schirmer test. The results indicated activity of reproxalap across 2 different objective dry eye disease signs as well as acute onset of activity over approximately 24 hours of dosing. For ocular redness, given the numerical superiority of reproxalap over vehicle at all time points assessed, and because test article was administered prior to the dry eye disease chamber, a prophylactic effect of reproxalap was demonstrated. Likewise, because test article was also administered within the chamber, a treatment effect of reproxalap was also observed. Slide 8 features the primary endpoints graphed differently to show the means of the within-patient differences between reproxalap and vehicle, which serve as a surrogate for clinical relevance. Said another way, for both ocular redness and tear production, on average, any particular patient responded more favorably to reproxalap than that same patient did with vehicle at each time point assessed. For Schirmer test, within-patient mean difference between reproxalap and vehicle was favorable to reproxalap before the fourth dose of test article on day 1, indicating a positive effect at the first 3 reproxalap doses on tear production. Reproxalap was also numerically more favorable to vehicle after the fourth dose, indicating acute activity, reproxalap on tier production, that occurred within minutes of drug administration. Both time points were individually statistically significant in favor of reproxalap over vehicle. For ocular redness, within-patient scores were numerically favorable for reproxalap versus vehicle for all time points and statistically favorable for reproxalap for the majority of time points in the chamber, including the first time point assessed, 10 minutes after chamber entry, and at all time points following the second dose of test article. Additionally, overall time points in aggregate before the within chamber dose, reproxalap was statistically superior to vehicle, indicating the potential redness-reducing activity of reproxalap within minutes after only a single dose. The greater than or equal to 10-millimeter Schirmer test responder analysis is presented on Slide 9. The proportion of patients with scores of 10 millimeters or more during reproxalap treatment was statistically greater than that during vehicle treatment, with an odds ratio of approximately 1.6. The 10-millimeter responder analysis is described in the draft FDA guidance on dry eye disease and has been correlated with clinically relevant symptomatic improvement. Thus, the responder analysis results imply that only after a single day of dosing reproxalap may be associated with improvement in symptoms. In fact, per the FDA draft guidance, drugs with 2 trials demonstrating statistical superiority over vehicle for the responder analysis are not required to demonstrate symptomatic improvement over vehicle for marketing approval. Consistent with the Schirmer test responder analysis results, as shown on Slide 10, secondary endpoints were achieved for all dry eye disease symptoms assessed within the dry eye chamber. Similar to the ocular redness results, both prophylactic and treatment effects were demonstrated for all symptoms tested in the dry eye chamber. And the overall effect within the chamber was highly statistically significant in favor of reproxalap over vehicle, with p-values ranging from 0.0068 to less than 0.0001. For every symptom measured in the dry eye chamber, reproxalap was numerically lower than vehicle at each time point, including the first time point assessed 10 minutes after chamber entry. Ocular itching was assessed before and after the chamber and was statistically lower after reproxalap treatment than with vehicle treatment, yielding a p-value of 0.0003. As is summarized on Slide 11, the Crossover trial allows for the claim of success for each of the 3 objective sign endpoints that we intend to submit as pivotal for the dry eye disease's NDA. Aside from achievement of the primary endpoints, the secondary endpoint of Schirmer test responder analysis and secondary endpoints for all symptoms assessed, a key learning from the Crossover trial is that the high degree of patient-to-patient variability in dry eye disease can be reduced with a Crossover design, which is feasible for drugs with a potentially rapid activity. The results of the Crossover trial suggest that the activity of reproxalap is indeed rapid, statistically reducing ocular redness in the dry eye chamber at the first assessed sign point by 10 minutes, statistically increasing tear production within a single day of dosing and reducing a wide range of symptoms within 90 minutes in a dry eye chamber. And for redness in particular, prophylactic and treatment activity of reproxalap was demonstrated. The Schirmer test responder analysis implies rapid and clinically relevant symptomatic improvement that may occur as soon as after a single day of dosing consistent with the symptom results observed in the trial. Our regulatory guidance remains unchanged. We intend to submit the dry disease NDA this quarter following a pre-NDA meeting that has been scheduled. And as we've disclosed previously, we believe that the NDA clinical package is expected to encompass acute and chronic assessments as well as parallel group and Crossover clinical designs, offering what is expected to be an unprecedented breadth and unparalleled analysis of rapid and sustained activity of reproxalap across a combination of challenge and field-based assessments. As reproxalap has continued to generate successful results in clinical trials over the past year, we've initiated a comprehensive set of activities focused initially on scientific exchange and market research to obtain feedback from eye care providers on reproxalap and understand market considerations and characterize the potential commercial advantages of reproxalap from the perspective of ophthalmologists, optometrists and patients as we develop our commercialization strategy. To describe our efforts along these lines and present our key conclusions, I'd like to turn to Slide 12 and introduce Kelly Mizer, our Vice President of Commercial Strategy and Operations.

Thank you, Todd. In anticipation of potential positive regulatory outcomes, we have completed a commercialization road map to prioritize our key go-to-market preparations and have initiated several of these efforts, with an initial focus on scientific exchange and market research. Over the last 12 months, we have been focused on our publication strategy, which has resulted in 6 publications and 1 abstract that was recently presented at ASCRS in Washington, D.C. In addition, we have engaged with approximately 40 ophthalmologists and 25 optometrists to obtain feedback on reproxalap's product profile as we continue to build our commercialization strategy. Complementing these efforts, we partnered with ClearView Healthcare Partners on a U.S.-focused blinded market research project that investigated the current clinical landscape in dry eye disease and tested the product profile of reproxalap with eye care professionals and patients suffering from dry eye disease. I'll share some of the high-level findings in the following 3 slides. Briefly, the product profile for reproxalap was viewed as highly favorable among both patients and eye care professionals given its potential rapid onset of action and the improvements in redness and dryness symptoms observed across a number of clinical trials. Pending FDA approval, reproxalap has the potential to address significant unmet need for the approximately 18 million patients diagnosed with dry eye disease in the U.S. And we believe reproxalap could be the first dry disease drug label to include multiple objective sign endpoints, which could be a benefit to the many patients awaiting a therapeutic option with a more rapid onset of action. Turning to Slide 13. A study by White and colleagues found that for patients prescribed lifitegrast and cyclosporine, approximately 60% and approximately 70% of these patients discontinued treatment within the first year, respectively. The median time to discontinuation was approximately 1 month for lifitegrast and 3 months for cyclosporine. We believe the low adherence and high discontinuation rates seen in this study demonstrate the need for faster acting agents in dry eye disease, as suggested by these authors. And given the data reviewed here today, we believe reproxalap could help address this unmet need and advance the standard of care in dry eye disease. Slide 14 summarizes the market research findings when we examined the product profile of reproxalap with 40 eye care professionals that treat and manage dry eye disease. Overall, eye care professionals found the profile highly favorable given the potential rapid onset of action and observed reduction in redness and dryness symptoms. Of note, rapid onset of action was seen as the highest driver of value. Now looking at Slide 15, patients were equally impressed with the product profile and highlighted the reduction in dryness symptoms as a key area of focus for them, followed by the improvement in redness. The order of preference was reversed. That is redness was perceived as more important than symptom control for a subset of these patients for which redness was the key complaint. Overall, we at Aldeyra were highly encouraged by these market research findings. On Slide 16, you'll see a summary of some dry disease therapies noting indications and key data from their respective labels. Given both the acute and chronic data we've generated across symptoms and a number of objective signs, we believe we have the potential to build upon currently available therapeutic options and address the substantial unmet need not addressed by standard of care today, which is generally considered by eye care providers and patients to be inadequate. Now I'd like to introduce you to Dr. John Berdahl, who will share his perspective on some of the clinical limitations of currently available therapies for dry eye disease.

Thank you, Kelly. Clinically, my team and I manage a significant number of patients with dry eye disease. The dry eye disease is typically characterized by a variety of symptoms related to ocular discomfort, reduced tear production, diminished tear quality, and in some patients, ocular redness. Not only is dry eye disease persistently disturbing the patients, in many cases, reducing the quality of life, but it can also impair surgical outcomes and diminish the quality of vision over time. Before each surgery, we evaluate the ocular surface and treat dry eye when needed to optimize the surgical success and patient satisfaction. There are several challenges in managing dry eye disease patients. One big challenge is keeping patients on therapy given the delayed onset of action with today's approved therapy. I've been following the data Aldeyra has been generating. And I'm impressed by the breadth of the sign and symptom reduction reproxalap has demonstrated. Today's results showing increased tear production by Schirmer testing, redness reduction, and the multiple endpoints hit for symptomatic improvement, including dryness, demonstrate robust therapeutic activity and rapid onset seen as early as one day. I believe that a highly differentiated therapy such as reproxalap is eagerly anticipated in an advancement for patients suffering from dry eye disease.

Well, thank you, Kelly, and Dr. Berdahl for your important perspectives on the commercial potential of reproxalap and the clinical importance of continuing to innovate in the dry eye disease therapeutic space. Operator, I'd like to now open the call for questions.

[Operator Instructions] We'll be taking our first question today from Justin Kim of Oppenheimer & Co.

Congratulations on the results, team. It looks like the last piece might have fallen into place. And so just kind of curious, across the broad array of studies in dry eye conducted, do you intend for TRANQUILITY and this Crossover trial to maybe serve as the frontrunner of the 2 pivotal design trials assessing Schirmer tear test or sort of maybe optionality with your TRANQUILITY-1 and Crossover for redness, perhaps? Just kind of can you walk us through like how you think about the styling strategy, to what extent is that really just going to be dictated by the agency, et cetera?

Well, thank you, Justin. We appreciate your support. I agree that, at least in my opinion, approvability has been put to bed. The notion that reproxalap is active and is safe across a variety of different trial designs, acute and chronic, chamber, field-based studies, et cetera, I think, is solid. How we highlight the Crossover trial in the actual submission will depend in part on the pre-NDA meeting that's been scheduled. However, I think we can all agree at this point that the Crossover results will be largely front and center for a couple of reasons. Number one, the results are outstanding and I think definitive. Number two, the Crossover has in a sense demonstrated, at least in this case, that it can reduce the major problem in dry eye disease trials, which is variability from patient to patient. That one person's dry eye is apparently very different from another person's dry eye. And the way to get around that is to test each person with both test articles, that is drug and vehicle. And I think the results today demonstrate a very tight, well-controlled and adequate trial that, to our knowledge, at least in terms of this particular design, has never been run before. I would suggest that the Schirmer test results, the redness results and the Schirmer test responder results would be submitted as pivotal. From TRANQUILITY-2, we had prespecified primaries that included Schirmer test and a Schirmer test responder analysis from the Phase II trial. The last year, we had a prespecified primary using ocular redness. So I think the combination of the Phase II trial, TRANQUILITY-2 and the Crossover results are more or less definitive for 3 different signs of dry eye disease. Added to that are the 2 12-week symptom trials that we've disclosed for some time now.

Got it. Got it. Understood. And could you remind us of maybe the progress for the safety study? How do you think the pace of enrollment has gone? And sort of where you stack up in terms of getting 1-year completers [ by the 120 days ] follow-up?

The safety trial is the final stepping stone to crossing over towards completion of the entire clinical package for reproxalap in dry eye disease. The safety trial remains on track. We have reiterated this morning our guidance along those lines that the NDA will be submitted at this quarter following a scheduled pre-NDA meeting. And so all in all, I think the safety trial continues to move along nicely.

Understood, understood. And maybe just a final question for Dr. Berdahl. As a clinician treating patients with dry eye, I was curious how you think about the patient experiences outlined from a commercial perspective as it relates to discontinuation rates and switching [ therapy process ]. When you sort of hear about the earlier median discontinuation rate of 1 month and 3 months for Xiidra and cyclosporine, respectively, do you see that as being driven by the sort of onset of efficacy, and that's the point at which you can sort of determine whether patients are failing to see those effects? Or is something also at play, like tolerability, with case disruption or other factors like maybe just patients in general in dry eye?

I think that -- thanks for the question. I think that, like Todd said, everybody's dry eye is different, and that's why the Crossover design is so impressive, because you look at 6 different symptoms, and it improved all 6 of them. Then you look at something like redness, which some patients have, and it goes away nicely with reproxalap. And so it really comes down to, are you fixing the problem that the patient has? And patients have multiple different problems with dry eye. And sometimes, the currently available therapies don't address the specific problem that's most bothersome to the patient. So I would say that that's what drives it, number one. Number two is, can the patient actually tell, has the onset of action been so long that a patient can't really experience the improvement because the improvement timeline was so low? And so I think that those are two of the big drivers.

Our next question comes from Yigal Nochomovitz of Citigroup.

I had 2 housekeeping and 1 conceptual. So housekeeping one is first. On the redness, can you just clarify whether those -- that was assessed by investigators or whether that was by computer imaging? And then just could you clarify, is there any particular reason why you did Schirmer on day 1 and redness on day 2?

Thank you for addressing the redness question. In terms of the method of assessment. In this trial, the redness was assessed by humans on-site in real-time. One of the things that we tried to do with the Crossover trial was minimize variability not from patient to patient exclusively, but also, in terms of the assessment. We largely had a very small subset of human graders assessing redness in real-time during the chamber. We think that allows for minimization of risk in terms of variability across digital photography, essential reading and so forth. Like the Phase II trial announced last year, the positive results in redness today reflect human assessment. I would say for the NDA submission, we would therefore intend to emphasize human grading over the automated grading, although both will be included in the package. The second question, about Schirmer on day 1 and redness on day 2 is that it's really not feasible to assess Schirmer in the chamber just given physical constraints and all the other things going on in the chamber, such as redness assessment and symptomatic assessment. Thus, we attended -- we assessed Schirmer on day 1. We wanted to assess Schirmer towards the end of day 1 for the reasons that I mentioned in my prepared comments. That is a pre-dose assessment at the end of day 1 allowed for measurement of the activity of the prior doses. And the post-dose assessment at the end of day 1 allowed for assessment or a measurement of the acute activity of that final dose. And as we reported today, reproxalap was superior to vehicle at both time points, indicating the activity of the prior 3 doses on day 1 as well as the acute activity of that final dose on day 1.

Okay. Got it. And then my conceptual question is, obviously, this is a 2-way crossover. So I guess I was expecting to see some sort of temporal data showing the redness scores decreased when the vehicle patients are switched to reproxalap, and then vice versa, the redness scores increased when the reproxalap patients are switched to vehicle. But apparently, the data aren't presented quite like that. So maybe that's not feasible, given the way you did the 2 weeks washout. But if you could just elaborate a little bit on whether seeing the data that way is possible because that will be additionally highly convincing, I think.

The surrogate for that kind of analysis is on Slide 8, where you can see the within-patient differences, that is within any individual patient, the difference between drug and vehicle. And those are averaged across all patients. And as I mentioned in my prepared comments and per your comments, that's a surrogate for clinical relevance. It's really impossible to test the effective drug and then immediately test the effective vehicle or vice versa because you do need a washout. You need a period of time during which patients are not on any therapy for the eye to recover, for patients to reset to their baseline values so that you can essentially run the experiment all over again with a different compound.

Our next question today comes from Kelly Shi of Jefferies.

First, congrats on great test results. And I actually curious on the ocular redness endpoint. So the 2 trials actually give a positive outcome on this endpoint in the Phase II and the Crossover trial. So the patients enrolled on 2 trials is 156, and this one, the Crossover trial is 63. Just curious, because compared to Schirmer test and test basically like a smaller and combined from the 2 trials, so is there a potential risk FDA might ask for a larger-scale trial for ocular redness?

Kelly, thanks for the question. You're correct that we do have more patients in aggregate assessed with Schirmer test than with redness. I think it's important though to remember that for Crossover trials, you can essentially double the number of patients enrolled. And that correlates or is equivalent to a parallel-group trial. So in this case, we had 63 patients. But each patient was exposed to drug and vehicle, or effectively each patient was exposed to drug and vehicle. So you can double that number and estimate what a parallel-group trial might look like. When you consider that, I think the total number of patients is roughly equivalent across redness and Schirmer assessments. Typically, the FDA, at least with this division, will consider an adequate trial as a trial that includes at least 100 patients or so in a parallel-group setting. So I think we're well above that number. In aggregate, we're above that number with every trial we've run if you consider that you can double the Crossover number, as I just mentioned.

Our next question comes from Tom Shrader of BTIG.

Congratulations. It's so relentlessly positive, it's not easy to come up with a question. I guess my background question is, why is redness so much better this time? Do you have any read? I mean if you look at Slide 7, the p-value is tiny, and that's not patient-to-patient, right? Isn't that the mean for the group? But it's still the p-value is incredibly low. Do you have an understanding of why it's so variable?

We do. Thanks for the question, Tom. A couple of pieces of feedback based on your question. I think the first thing is, it's remarkable when you release clinical results and everything is consistent. So per the FDA's position, if you're improving symptoms, you should also be improving signs. And if you're improving signs, you should also be improving symptoms, particularly the sign of the responder analysis for Schirmer test. And that's exactly what we see here. And I think the reason we see that per my prepared comments is that we're running a crossover and minimizing the variability across patients. So each patient is his or her own control. So the inter-patient error term becomes very low, which is the answer to your second question. And that is, when you simply look at Slide 7 and you only look at mean scores, which is what we plotted here, the results are somewhat deceiving. In fact, it's a little unfair to reproxalap to plot the data this way because, statistically, what's really measured is what's shown on the next slide, Slide 8. And that is within each patient, what's the difference between drug and vehicle. And you can see, those differences are very clear and statistically significant across the majority of time points. I think it's also important to note that, statistically, the models consider both eyes. For redness, the models also consider 2 regions of each eye, that is the nasal and temporal region. So per patient, there are a variety of endpoints, not only 2 different treatment arms, but also multiple time points, 2 different eyes and 2 different regions per eye, which gives a very low p-value. That is we're quite certain about the differences between groups because there are so many different time points, endpoints, assessments per patient.

So just to be clear, that p-value is actually pulled from the data below patients compared against patients?

That's correct. The p-value is derived from a mixed model of repeated measures, that includes the repeated measures of treatment group and eye and region and so forth, so that all data are considered across all time points, and all repeated measures are assumed within each patient.

Got it. And then a broader question for Dr. Berdahl. As you get a new drug, does the label matter to you? Or what matters to you? Or is every drug more or less sampled, and you make up your own opinion between your own personal use? Or could a label -- what is the most compelling thing you could see in a label for you and your colleagues to say, I really want to try this one?

Yes. The first thing that matters to me is, did I solve my patient's problem? And that comes with experience and the individual patient using that. We took an oath to the patient, not to the label, but the label is very instructive for us because it allows the companies to help educate us on what we should expect in the aggregate for that individual patient that I'm taking care of in my clinic. The other thing that a label matters for is reimbursement. And so will insurance companies pay for the product? And so I don't think -- I don't dive into the label and say, oh, the label says this, and so I can or can't use it for this patient. I think about my experience, what the aggregate data says, and then the label acts as a guide. But probably the most important thing that a label does is allows a company to educate the populace of doctors on where it's likely to be most beneficial.

Our next question comes from Marc Goodman of SVB Leerink.

A couple of questions for the physician, Dr. Berdahl. Do you see enough data to know whether patients on this drug are more likely to stay on the drug? I mean, like when we were looking at that market research data, I guess the first question is RESTASIS eye [indiscernible], the discontinuation rates that were in that market research on the slide, is that your experience with those drugs? And then the question is really, do you see enough data here to know that maybe this drug, patients will stay on it longer? And then second question is, we've had some positive data. We've had some negative data. Clearly, there's enough positive data now to probably get the drug approved. Let's just assume the drug is approved. How do you and physicians look at a drug that's kind of had some positive, had some negative data. But it's approved, and clearly, it shows that it works. I'm just kind of curious, like when you talk to psychiatrists about depression drugs, they're so used to having so many negative studies out there, and it doesn't bother them. I am just curious how this plays out in the real world.

Yes, you bet. I might ask you to help me if I can't follow all those questions. But the first one is the discontinuation rate with Xiidra and RESTASIS consistent with my experience. Generally, yes. There's plenty of people that discontinue those drugs. I would say maybe not in our practice quite as high if -- and this is just my clinical impression as that study, but it is a real thing. The next question about, is there enough data here to say that you think that patients with this drug won't discontinue it? I mean the data is really promising. So I think the answer is yes. And it comes from hitting multiple fine endpoints and symptom improvements. So again, there's lots of variability. Some patients say, my biggest problem is my eyes look red all the time. Another patient says, my eye feel gritty all the time. Other people say that my vision fluctuates. And if you can take care of the problem that the individual patient has, then I think that they will stay on it. And it's a huge advantage that improvement comes quickly. The last question was -- I just had it. What was the last question again?

It was just about mixed data in a clinical trial and just getting into the real world, does not even matter.

Yes. That's right. I think that the data does matter. But our experience with the individual patient matters the most. We as clinicians, dry eye is a frustrating disease to treat because we don't have things that work every time on every patient. It's not like the satisfaction we get from cataract surgery, which essentially works every time. And so we understand that there are going to be failures. And we want more tools in our toolkit. And we want our patients to experience the benefit from the drug. And so because this happens quickly, because it happens, it seems to improve a wide array of symptoms and signs, I think that it's really promising. And some negative data out there does not shy us away from trying something to try and solve our problem. And I think that this will be very high on the list for dry eye patients.

I mean when these patients come in, what are they complaining about the most usually? Is it just the grittiness, the dryness of their eye, right? So -- or is it more burning? I mean what are people really complaining about?

Yes. I would say that people generally complain of this vague discomfort. And then we dive into, is that grittiness? Is that stinging? Is that burning? Is that vision fluctuation? But the #1 complaint is probably, my eyes feel tired or are just in general uncomfortable.

Yes. I'm sorry, one more question, and that is, if a drug is approved for helping the meibomian glands versus all of these other products, do you think that those are kind of a combination usage? And how do you think combination usage working here? .

Yes. I do think that for more aggressive or difficult to treat dry eye, there will be combination therapies. And that all goes in there. If there's -- if your oil layer is not protecting your tear -- your aqueous layer, you would have to create a whole bunch of aqueous layer to keep the eye lubricated well. And so yes, I do think that combination therapies in selected patients will be a viable treatment option. And most patients that have real dry eye, we're doing multiple things on. Maybe they're having punctal plug. Maybe we're doing some eyelid massage therapy. Maybe we're doing multiple drug treatments in addition to artificial tears. So it is not uncommon to use multiple modalities.

[Operator Instructions] Our next question today comes from Catherine Novack of Jones Research.

Just curious if you can give us a little bit more color on the discontinuations. Can you tell us what the reasons for discontinuation were and at what point during the trial they occurred?

Well, that's an excellent question because the key metric of tolerability in clinical trials is discontinuation rate. As we mentioned in this morning's press release, of the 63 patients that were randomized, 3 discontinued: 2 of those patients discontinued during vehicle, then 1 discontinued on drug. Obviously, that is a very favorable ratio. By and large, reproxalap is very well tolerated. And as we've said in the press release and in the slides for today's presentation, we are now in excess of 1,800 patients. We have 0 evidence of safety concerns as assessed by acuity or intraocular pressure or retinal exams or corneal exams. So I think we're in an excellent position in terms of both safety and tolerability.

Okay. And what were the reasons for the discontinuations?

They were varied, Catherine, and included -- mostly included scheduling. Some discontinued for other reasons. But amongst the 3 patients, I don't have exactly this data with me now.

Okay. And then I just wanted to ask about the previously mentioned 1-day Schirmer test trial. Is that still ongoing? And when are results expected for that? Would that be part of the potential FDA filing or NDA filing?

The one-day Schirmer trial that we've disclosed previously, I would say, is effectively on hold given the results that we announced today. We certainly don't need that trial at this point. I think the plan is to hold the pre-NDA meeting, which is coming right up, discuss the data with the agency. I think, in the very unlikely situation that there are remaining questions about the clinical package, we'll be prepared to initiate that trial effectively immediately. But again, I don't see that as a realistic possibility given the strength of the data that we announced today.

Our next question today comes from Yale Jen of Laidlaw & Co.

Congrats again on the outstanding outcomes. My first question is actually look at the Slide 7, that the tear production in the pre-dose -- pre-fourth dose level, and we already see a gap between the vehicle and the treatments. So do we anticipate this so-called prophylactic effect, also show a p-value which is much lower -- low p-value?

Yes. Yale, thanks for the very good point you just made. I didn't really talk about prophylaxis as it relates to Schirmer test. But I think you're absolutely correct that one way of interpreting the Schirmer data on Slide 7 is that there is indeed a prophylactic effect of drug. I think, overall, as you consider the data in the slides we presented today, at every time point, drug is superior to vehicle, whether that is the first time point or the last time point. In every case, however, drug was administered prior to assessment. And I think what that says is that whether it's the first dose of drug or the sixth dose of drug, it doesn't really matter. There are prophylactic and treatment effects which speaks to the potential acute onset of action of reproxalap in all cases here, whether it's in a chamber, whether it's in the field, whether it's early on or late on, I think you can see that the drug is prophylactically active and active as a treatment, and in both cases, acutely active.

Okay. Great. That's very helpful. Maybe a marketing question that although we -- let's assume the drug is approved, do you anticipate the adaptation by the physicians, would that be initially as a preferable second-line treatment after the first failure? Or would you be choosing -- shooting for mostly as a first-line patient for -- [indiscernible] the patients?

Let me turn that question over to Kelly to talk about first-line versus second-line options given the clinical package we've generated to date.

Yes. Thank you, Yale, for the question. Really good question. I think, first, based on the market research we conducted, highly favorable amongst eye care providers as well as patients. And we believe that it can be used first-line in some patients. However, and Dr. Berdahl noted this, the key piece will be insurance and coverage. And we are working on an access strategy to ensure access and appropriate placement on formulary plans to get this drug to as many patients as possible. One thing that is unknown, and I think it's unknown for a number of folks that are bringing therapies to market as well as those that currently have branded agents on the market, is the impact that generic cyclosporine is going to have with insurance plans and how that affects formulary tiering. And we have active plans to understand that, and we'll factor that into our commercialization strategy. But 100%, we are committed to having a robust access solution to get this therapy to as many patients as possible. And we do have the market research to support, that there is a wish to use this in first-line for some patients.

Okay. Great. And maybe last question for Todd, which is, given that the study -- earlier study has some failure, but certainly, 2 more successful outcome to come. And you have some hypothesis suggest what the first study -- the failure for the first study might be. At this point, if you look back, do you feel some of this hypothesis can be sort of validated or still remain too vague to assess that?

Well, I think we've cracked the code in theory on how to test a dry eye disease drug, at least how to test the dry drug that works rapidly. And that is by crossing patients over. The difference between individual patients is so large within dry eye disease that really the only way to assess activity is to compare each patient to his or herself. So I think we can hold up the Crossover results as possibly the most important results we've generated because we have reduced the variability from patient to patient. It's remarkable to me that no other sponsor, no other company has really tested an investigational dry eye disease drug in an adequate well-controlled trial in a crossover setting. And we're thrilled to be the first group to do this. So I think that by and large, today's results are key. They represent a well-controlled, tightly managed, low-error trial. And thus, I think the results are important, not only for reproxalap, but also the field of dry eye disease.

Okay. Great. And maybe the last one, just attached to that, which I think you mentioned a little bit earlier, is that Crossover study might only apply to fast-acting medication but not necessarily drugs, otherwise, sort of on set schedule. Would that be fair?

You're correct. The reason why we don't always use crossover trials in clinical development has to do with the time of the trial. Imagine that you had to treat a subject for 6 months and then wash them out and then treat them for another 6 months, that's an exceedingly long clinical trial. And thus, for crossover designs, the optimal approach is to test a drug that works quickly. Fortunately, reproxalap has shown to have a rapid onset in clinical trials. And thus, it's entirely feasible to test reproxalap in a crossover setting. Not every drug has that advantage of repetitive rapid onset of action. And that's why I think we haven't seen a lot of crossover trials in the industry.

There are no further questions registered at this time. So I'd like to hand back to Dr. Brady for closing comments.

Thank you, operator, and thank you all for joining us this morning. We genuinely appreciate your time and interest in Aldeyra and look forward to updating you on future developments as we continue to advance reproxalap and other novel therapies to improve the lives of patients with unmet medical need.

This concludes the call today. Thank you all for joining. You may now disconnect your lines.