Bausch + Lomb Corporation (BLCO) Earnings Call Transcript & Summary

So good morning, everyone. Thank you for joining us here. To those joining us via the webcast, thank you for also joining us. This is a very important day for us at Bausch + Lomb and a defining moment in our journey to becoming the best eye health company in the world. You'll notice as -- as I slip the slides, you'll notice that this isn't your typical opening slide for an Investor Day, and that's quite intentional. Since I returned to Bausch + Lomb in 2023, one thing has been clear, we don't accept the status quo. We've changed how we operate, how we make decisions and how we compete. That mindset extends to also how we innovate. We're not chasing marginal gains. We're developing products and technologies that can truly change the standard of care and eye health. Our pipeline today is the strongest and most forward-looking it's ever been, built on real science and a clear sense of purpose. You hear from me plenty throughout the year. So I'm not going to do a lot of the talking today. This meeting isn't about me. It's about the exceptional team we have driving Bausch + Lomb forward. You'll hear directly from the scientists and commercial leaders shaping the future of our company. And I think you'll see why I am so confident in where we're headed. Of course, I'll be back at the end of the session to take your questions. But from now, I want you to hear from the people building our momentum every day. And before we get started, I wanted to highlight one critical theme you'll hear throughout the entire day, financial excellence. It is not a buzzword. It's a discipline and commitment that underpins everything we do. Sam will walk you through how we are driving execution, controlling costs and expanding margins to create sustainable value through 2028 and beyond. Thank you for being here and for your continued interest in Bausch + Lomb. With that, I'll invite Sam Eldessouky, our CFO, to come up and kick things off. Sam?

Thank you, Brenton. Good morning, everyone, and thank you for joining us today. We've made significant progress in the past 2 years, strengthening how we operate, guided by a purpose and driven by innovation to create durable value. You'll hear a lot more today about this. Over the next 15 minutes, I'll take you deeper into how we think about value creation and what that means for our future from driving our growth to meaningfully expanding our margin and to driving innovation in R&D that will set us apart. The story ahead is one of momentum and opportunity. First, let me start with the top line. We've delivered above-market growth and built on a strong momentum that we've seen across all our businesses with a strong product portfolio and execution with excellence, we are confident that we'll continue with that trend as we go forward. Second, we are at an inflection point in our margin expansion journey. As we move into the next phase, we will deliver meaningful margin expansion, supported by product portfolio, manufacturing and supply chain transformation and a focus on operational excellence and disciplined cost management. And third, the heart of our story is innovation. Our pipeline has never been stronger. We've built a robust pipeline of breakthrough differentiated products that we expect to deliver a meaningful value beyond 2028. You will hear more today from our team about how we think about the innovation and how it's shaping our future. So let me get into the details. On this slide, you'll see our 2028 financial plan targets, which reflect the confidence and momentum across our business. Let's start with the top line growth. But before I do that, I just want to frame the market for you. We operate in a market that's durable, that is growing at mid-single digits. So as I mentioned, we've been consistent in delivering above-market revenue growth, and we fully expect that momentum will continue. Building on our strong position, we expect continued above-market revenue growth with a CAGR of 5% to 7% through 2028. This growth reflects the momentum and strength of our durable businesses. In just a few minutes, I'll walk you through how we see the revenue growth playing out across each of our businesses. Next, let me turn to margin expansion, which is also a critical pillar of the value creation of our strategy. As I mentioned, we've reached an inflection point in our margin expansion journey. Our 2028 adjusted EBITDA margin target is 23%, which reflects approximately 600 basis points improvement from the midpoint of our 2025 guidance. Over the past 2 years, we've laid the foundation for margin expansion by launching new products and expanding our premium high-margin portfolio. We've also been driving operating leverage in our P&L through disciplined cost management. We've already begun to see the benefits in our Q3 results, which is a clear signal that our strategy is working. In the next few slides, I'll share more insights with you how we think about planning and building blocks for our margin expansion targeted by 2028. Building our above-market revenue growth and our margin expansion targets, we expect to deliver double-digit EPS growth. We continue to make strong progress on cash flow generation, we expect our cash flow conversion to continue to improve, reaching more than 50% by 2028. We've already seen the early signs of improvement in our Q3 results, which reinforce the confidence in the path ahead. Finally, maintaining strong balance sheet and improving net leverage remains a key priority for us. With our strong operational performance, expanding margins and growing cash generation, we expect net leverage to improve to 3.5x by the end of 2028. So in summary, our 2028 financial plan targets reflects the confidence and momentum we have in our business. And by the way, we included a slide in the -- of key financial assumptions in the appendix for you to inform your models as you update your models going forward. So now let me start by reaffirming our 2025 guidance, which you can see on this slide. As you think about our financial targets over the next 3 years, let's take a closer look at our initial view for 2026, which builds on the strong momentum we're seeing in 2025. We expect our revenues to once again grow faster than the market at 5% to 7% rate. This reflects the strength of our portfolio, our solid execution and durability of the markets we serve. We also anticipate continued margin expansion with an adjusted EBITDA margin of about 19% in 2026, which represent nearly 200 basis points of improvement from the midpoint of our 2025 guidance range. Looking ahead to 2028, we expect to continue to deliver above-market revenue growth and further margin expansion, which positions us well to achieve our 2028 adjusted EBITDA margin target of 23%. So together, our outlook reflects a business that's not only growing faster than the market, but also expanding profitability and building on a strong foundation of sustainable long-term value creation. On this slide, I want to go deeper into revenue growth in each of our 4 businesses. I'll start with consumer. Our consumer business has been solid with durable brands that leading their categories with a strong consumption trends. We expect this business to continue to perform well with a 5% to 7% CAGR. We expect to expand our leadership in high redness relief with the launch of LUMIFY Lux and strengthen our #1 position in eye vitamins with launch of AREDS3. We also expect our consumer drive portfolio to continue its market-leading growth with Artelac and new formulations of Blink. You will hear more about the consumer business from John and Mayssa later today. Our contact lens business is already the fastest growing in the market, led by our Daily SiHy franchise. We're very excited about our contact lens innovation, which will be manufactured on our existing lines and expect to have a meaningful impact beyond 2028. I know that Yang and Bryan are very excited to share with you the future innovation in our lens business. And over the past 2 years, we have transformed our pharma business. Today, we are the market leader in dry eye disease with 2 very strong brands: MIEBO and XIIDRA. MIEBO is continuing its exceptional performance, and our international pharma business is delivering durable growth. Andrew and Mayssa will share more details with you on this opportunity. And it was very exciting why you'll hear on the pipeline from them later today. Finally, we see the highest trajectory in our surgical business, driven by our premium IOL portfolio, new product launches and increasing consumables pull-through. Luc and Kelly will share with you more insights on our surgical business. So taken together, our story is about delivering consistent above-market revenue growth in each of our 4 businesses. We have accomplished that in the past 2 years, and we are excited to continue the trend in the next 3 years. Now let me spend some time on how we think about margin and expanding our margins. We've been laying the foundation for this margin expansion over the past 2 years. So this is not something that just started today. There's been ongoing work for the past number of years. And as we demonstrated in our Q3, we're seeing early results. So we're clearly just getting started with our margin expansion story. We expect to drive margin expansion from product mix and manufacturing efficiencies and operating efficiencies and P&L leverage. We're doing that while we're continuing to invest in R&D and pipeline. So let me break this down for you. First, we expect product mix and manufacturing efficiencies to drive approximately 250 basis points of margin expansion. Our strategy has been focused on shifting our portfolio towards high-growth, high-margin products. One example of that is in our pharma business with the launch of MIEBO, also our shift to a premium IOLs in our surgical business and in our consumer and lens businesses, the expansion of our brands as well as the scaling of our Daily SiHy lenses. Our second lever is operating efficiencies and P&L leverage. That's mainly impacting the SG&A line item. So for anyone who's doing their models on the fly, you can adjust your SG&A line items, which we expect to drive approximately 400 basis points of margin expansion. This is an area where we have significant opportunity ahead of us as we transition from our launch phase to growth phase, with our products while maintaining a disciplined cost management and executing our Vision '27 initiatives, which is a very important part of our story. We kicked off the work around Vision '27 in the beginning of the year. Brent announced it over the summer, and that's an area where we're actually executing and driving part of that 400 basis points. So we'll continue to focus on advancing our R&D pipeline, which has a substantial opportunity ahead. We expect our R&D investments to modestly increase over time by approximately 8% of revenue. Now I want to move to cash. We've been very deliberate in our actions to drive stronger cash flow performance. Our Q3 results clearly demonstrates the impact of that focus, reflecting the success of our working capital initiatives, which delivered a significant increase in adjusted cash from operations and a strong cash flow to EBITDA conversion. Looking ahead, we expect to continue this progress with adjusted operating cash flow to EBITDA conversion reaching more than 50% by 2028. The strength in cash generation is driven by disciplined execution, improved earnings growth, efficient working capital management and a continued focus on operational access. Now moving to our leverage, reaching investment grade also remains a key priority for us. As we continue to deliver above-market revenue growth, expand our margins and increase our cash flow, we expect to reduce net leverage to around 3.5x by the end of 2028. So in summary, our strategy and financial targets are built to deliver profitable growth, strong cash generation and a clear path to delevering the balance sheet. Our capital allocation strategy is designed to drive long-term value. We have 3 clear priorities. First, as you know, we're focused on strength of our balance sheet by continuing to delever. Our goal remains achieving an investment-grade rating over time. Second, we are continuing to invest in our business, driving commercial and operational excellence, expanding capacity and advancing our R&D pipeline. And third, we are focused on strategic M&A and business development opportunities. We will pursue opportunities that make strategic and financial sense. This can be new innovation, category expansion or geographic reach. So taken together, this disciplined capital allocation framework gives us a transparent road map for our long-term value creation, balancing financial strength and innovation like growth to deliver sustainable returns. I want to take a minute to reflect on this slide because what truly sets us apart at Bausch + Lomb is the significant value ahead of us. In the next 3 years, we are building our momentum. We are executing to deliver above-market revenue growth and driving adjusted EBITDA margin expansion of around 600 basis points. And most importantly, we are unlocking the next wave of value creation through R&D innovation with a potential peak sales of $7 billion. This pipeline isn't something that happened overnight. It's a result of years of disciplined execution and innovation and a testament to the strength of our strategy and our team. So over the next couple of hours, our team will dive deeper into the pipeline. As you will see, the scale of the opportunity here is remarkable. Now let me leave you with 3 key takeaways. First, we are delivering durable above-market revenue growth built on the strength of our brands, our global scale and our ability to execute with excellence. Second, we are focused on meaningful margin expansion through disciplined cost management, increased premium mix and improved operating leverage. And third, we have a significant upside potential beyond 2028, fueled by R&D innovation that can transform our growth profile. So in short, we are moving from a position of strength. We're unlocking greater profitability and investing in innovation that will drive growth as we change the standard of care and eye health. We are confident in where we stand today, and we're even more confident in where we're heading next. So now, let me turn it over to Dr. Yehia Hashad, our Head of R&D and Chief Medical Officer, to discuss R&D innovation in more detail. And I'll be back for Q&A at the end of the session. Thank you.

So good morning, everyone. I'm Yehia Hashad, the Head of R&D and Chief Medical Officer. In case I look a little bit more aged than this picture. I just would like really to start by saying it's a very rewarding day for me because the incredible work of my colleagues over the past 2 years is today being highlighted. And I actually -- we might have spoken in several conferences about some of our opportunities. But today, we are thrilled to share with you the science and the data behind our pipeline assets and how we believe that they can disrupt the way we are treating many eye diseases. We also have our commercial colleagues that they will speak to the market opportunity of these assets. But first, I would like to briefly explain to you how we transformed our R&D organization to build the future of eye care and bring meaningful solutions to the patients around the world faster. Rebuilding the R&D organization was a significant undertaking over the past couple of years with several imperatives. First, recruiting and hiring the best, brightest minds in the eye care industry. They are owned and grounded -- they are down to the promise of groundbreaking work. and have a longer track record of bringing innovations to the market. You will be hearing for some of them today about these technologies. Second, we launched new R&D innovation and the external evaluation hubs to evaluate opportunities at their earliest stage and included also a disease biology group that are able to do evaluation and run quick validation tests for any science we like. We also strengthened our formulation group, and we strengthened our material innovation group. With that, we were able to move from just simple formulation eye drops into a much more complex eye drops like combination therapies. We also introduced drug delivery systems, and on the innovation -- material innovation side, to be able to work beyond the standard work of material. We enhanced our portfolio analytics, and we can focus our investments where they have the highest return and the most impact to our patients. Our R&D organization now is a growth engine with approximately 1,000 scientists, engineers and clinicians across global 12 sites, and we are all united by one purpose, helping people see better, to live better. Over the past 2 years, we delivered more than 20 new launches, the highest in our history in Bausch + Lomb. And currently, we have more than 60 active programs in different stages of development with many of them are true game-changing potential. Our strategy is simple but impactful. First, we accelerate launches to sustain growth from now through 2032 and get innovations to the patients around the world faster. Second, we reload the pipeline with projects that have a true disruptive potential, not incremental advantages over current therapies, but truly redefining the segments. And we have a holistic view on our businesses. So we look at the opportunities that can help ensuring the growth of each business unit. I will give you just a brief and a preview of what you will be hearing in detail today, and we will go business by business. On the consumer side, brand extension with science-backed clinically differentiated products is best represented by our consumer. So the first one is our newest PreserVision formulation AREDS3, which is a prime example of advancing science to benefit patients by targeting all stages of age-related macular degeneration. AREDS2 were approved for the intermediates and the late-stage, age-related macular degeneration. With AREDS3, we are able even to expand the population into the early stage, which is a much bigger population for that, still in collaboration scientifically with the National Eye Institute. Moving to LUMIFY, one of our best brands and products. I'm sure we have in the audience here many LUMIFY users, which shouldn't be a surprise, noting how popular and have its sustained popularity existing. But we plan to build on this success with a new formulation that incorporates hyaluronic acid. LUMIFY by itself is the #1 redness relief product. By adding the hyaluronic acid, it will have the luxurious feel, the much thicker feel of the eye drop once the user is putting it into the eye. And then on the Blink franchise, we are not only expanding the Blink franchise by preservative-free formulations, but we are also working on introducing a new bottle technology that would improve dosing precision and significantly upgrade the user experience. If you know how difficult sometimes to put eyedrops for many patients, it is difficult, try to put the eye drops and not have the drop falling on your sheet or aside. This technology will help for more precision of the dose. Now moving to pharma. And please here notice a very intentional theme. First, as I mentioned, we are not interested in incremental improvements to existing therapies. We are focused on elevating the standard of care. We are developing first-in-class dual action, fixed dose combination, eye drop that combining the active ingredients present in XIIDRA and MIEBO to address both the inflammatory and the evaporative components of the dry eye. You will hear more about the innovation in the technology on the formulation and also how we are going to address this from an unmet medical need. Second one is strangely that one of the most commonly presented symptom at the ophthalmologists or ODs is pain, whether this pain is postoperative, whether this pain is associated with dry eye disease, whether pain is due to ulcer or scratch in the cornea, but it's one of the most commonly presented symptoms. And until now, we do not have an approved treatment for neurosensory pain -- to address neurosensory pain, apart inside the operating room where we can use anesthetics. We aim to change this by introducing the first neurosensory target therapy for ocular surface pain for this area, expanding our also ocular surface segment. Moving to glaucoma. We all know about the glaucoma diseases actually as we have to lower the intraocular pressure, which is the right thing to do because it's the only modifiable risk factor. However, glaucoma is also a neurodegenerative disease because the rise in the intraocular pressure can affect the ganglion cells and can affect the photoreceptors in the retina. And this is a big problem because even patients that lower their IOP, they still lose vision, and they still lose visual field. We aim to change that as well. By introducing the first product that in addition to lowering the intraocular pressure have shown in a proof-of-concept study that we will show you some very exciting data that can improve low luminance visual acuity and improve visual fields. Moving to retina. One of the biggest investments area overall. And actually, despite of the presence of many great products, still there are huge unmet medical needs in retina. We are focusing on geographic atrophy and intermediate AMD. And geographic atrophy in particular, there are 2 approved treatment, but none of them have shown the potential for functional improvement. And this is one of the target areas that we are working on. And the second area also, frequent injection is still a burden for the patients and burden for the health care system. And we are addressing this as well by long-acting delivery system that is unique and biodegradable and polymer-free. For the geographic atrophy and the intermediate AMD, intermediate AMD has no available treatments until now. And we aim to introduce the first precision medicine as well as gene silencing that can be used in ocular use through our small interference RNA platform and also the collaboration with Character Bio on the precision medicine. This is another example of how we are bringing cutting-edge science to the ophthalmology community. Moving to the surgical. Again, with the great success we had with the introduction of our premium IOLs, we are expanding on this segment by the introduction of enVista Beyond or EDOF, extended depth of focus. This is a pure refractive optics and has no diffractive rings, which results in a much better clarity on vision and less dysphotopsia. This will be a great addition to our premium segment. The second one, we are expanding into new disease areas, glaucoma. And we are expanding with ELIOS, which should bring a truly implant-free approach to the minimally invasive glaucoma surgery. We're simplifying the surgery to be even used in with the cataract surgeons during the cataract surgery and does not add time to the surgery as well as it can be very easily done as well. I think our KOLs will speak more about this part. Some of them have used it already. Moving to our new phaco and vitreoretinal platform. It offers an enhanced fluidics. What does this mean? Enhanced fluidics, if you ask the surgeons, and I hope they are going to speak about that is the most important things during the surgery because it maintains the pressure inside the eye constant and you can operate in a much relaxed way during the surgery. It has also a lot of multifunction hand pieces to make the surgery much more efficient. We're having an equipment outside that's seeNOVA. If you would like to have a look on it, actually, it's present in outside booth. And then moving also to seeLyra, which combines the femtosecond precision with live optical coherence tomography or what we call live OCT, which give a lot of guidance to the surgeon during the surgery, and it also has a soft docking, which is great for accuracy and for patient comfort. Each of these technologies were done with the surgeon and the patient in mind and focusing on 3 goals: one, smarter surgery; two, fewer compromises; and three, better visual outcomes for patients. Does anybody recognize this sound? Believe it or not, this is -- was the sound when we dial to the Internet in 1999. Also, in 1999, sounds like a long time ago, these were some of the popular things that you see here on the screen. This should make some of us, like myself, feel significantly aged. Although I must say the Backstreet Boys have made quite a comeback. But don't worry, I'm not going to sing. I won't that way. So the point here I want to make that believe it or not, since 1999, we have not witnessed any new contact lens material breakthrough innovations. It's a quite very long time. And actually, we are aiming to change that. So we plan to introduce our new bioactive technology platform, with the introduction of the first material breakthrough in over 25 years. We call it Project Halo and Yang and Bryan will actually tell you more and will reveal more data and where we are with this program. It's a very exciting program for us. And while it is very exciting, but it's not the extent of our pipeline in the contact lens. While the opposites, we are concurrently working on 3 extensions of our highly successful silicon hydrogel portfolio, each targeting different audience. So we have our cost competitive daily disposable SiHy lens would provide the eye care professionals with a new option for price-conscious patients and also expansion geographically to some countries that really looking for such innovations. It's easy to say this, but actually, it was a substantial work from our R&D colleagues to come up with such a solution. Second, we are also introducing our premium frequent replacement lens offering, which would introduce a new level of comfort in a category that has maintained steady growth. And finally, myopia. Myopia is one of the rising pandemics especially in the Asia region, but it's also here. And it's widely now coming up because of the use of tablets and the continuously looking at the screens in front of us. We don't have much time to look beyond the screens. And it's a big issue for the younger generation because progression of myopia can start as early as 4, 5 years old and continues all the way up to adolescence. And there are some treatments and modalities that can treat this, but still we are lacking the best-in-class, especially that we are dealing with a very specialized population, which are children. So we aim actually to come with the best-in-class by our contact lens technology that is tailored for the children and actually have different dioptric powers that matches the progression of the disease for the children. As you can see, all the technologies I mentioned in our pipeline on the contact lenses are all produced on our current manufacturing lines, which was an additional challenge that we gave to the R&D team, and they manage and succeed to overcome it. What does this mean? It means that we also have the potential for a lot of cost savings and margin expansions on the site. Earlier, I mentioned that we have built an innovation engine that can sustain our growth through 2032. This slide helps you to paint the picture well. The cadence of the anticipated launches is very much by design with new product introduction on a regular basis that will keep the attention of patients, customers and consumers and fuel the growth for Bausch + Lomb. I also mentioned here, which is clear, the holistic nature of our pipeline by investing on all business segments. I want to leave you with 3 main takeaways. The transformation of R&D organization has undergone. It's just not about creating new products. It's about redefining what's possible in eye care. Our focus will remain on these 3 pillars. Investments in talents and capabilities. Second, innovations that elevate the standard of care in eye health. And third, sustained growth through steady rhythm of launches across all categories as illustrated in my prior slide. And now I would like to invite my colleagues, John Ferris, Mayssa Attar, to give you more details about the consumer products that you will be hearing.

All right. Good morning, everyone, and thank you, Yehia. I'm John Ferris, President of our Consumer Business Unit, and I'm here this morning with Mayssa Attar, my colleague, who leads our pharmaceutical and consumer R&D organization. And we're going to review how our disciplined strategy, strong execution and trusted brands are enabling this business to drive customer loyalty and deliver steady, consistent growth. Okay. Our consumer business is firing on all cylinders as we leverage our history of innovation and deep consumer trust in the Bausch + Lomb brand. Today, we are the #1 global consumer eye health company. And we continue to outperform the market, growing faster than our peer group, whether consumer eye care or more broadly OTC companies in general. We operate in an attractive category with tailwinds for durable mid-single-digit growth, including a growing consumer interest in self-care, an aging global population and an increasing prevalence of eye conditions, including dry eye. Importantly, looking forward, we are well positioned to continue to lead in this space. Winning in a consumer business happens at the brand level, and we have a best-in-class portfolio of category-leading brands with strong momentum. And I believe we have the best team in the business, with the commercial and scientific capabilities to execute our winning playbook. Our brands are backed by superior vision science and are highly recommended by eye care professionals and pharmacists. And in fact, PreserVision, LUMIFY and Biotrue are all #1 doctor-recommended brands in the must-win U.S. market. And fueled by innovation that creates premium value, we employ a modern brand building approach that combines clinical proof with social proof and digital commerce, all of which are now increasingly powered by AI to drive loyalty and growth. So today, we're going to highlight 3 of our most important growth brands for you, PreserVision, LUMIFY and Blink. Okay. So starting with PreserVision, our largest consumer brand. And it's important to remember that this brand is much more than a vitamin. It's the standard of care for supporting vision health in people with age-related macular degeneration or AMD, which is the leading cause of vision loss in older Americans. We created and have led this category for more than 2 decades. And today, we have a commanding market share over 90%, even several years after the entry of private label store brands. Our leadership here can be traced to a long-standing collaboration with the National Eye Institute and 2 landmark clinical studies AREDS and AREDS2. These studies led to the formulation of PreserVision, the most studied and most recommended brand in the category. And even with our significant market share, though, we still have a meaningful opportunity to serve millions of more patients with AMD. First, more than 60% of the 11 million people in the current target market of intermediate to advanced AMD are not yet using AREDS2 vitamins. And second, based on previous science, AREDS2 vitamins aren't widely recommended for the 17 million people with early-stage AMD. So combined, our addressable market here could be almost tripled in size to 28 million people. That's why we're launching PreserVision AREDS3, our next-gen formula next year in 2026 to meet the needs of people at all stages of this condition, early, intermediate and advanced and Mayssa will now share more about the science behind this innovation.

Thank you, John. I'm thrilled to be here to represent the efforts of our consumer and pharmaceutical R&D scientists. Late-stage AMD is a vision-threatening disease. And when patients progress to the late stages, the treatment burden is high. It involves intraocular injections. These can be as frequent as every month. With PreserVision, we aim to slow progression to the late stage. Nutrition is a critical modifiable risk factor that has been shown to slow the progression of AMD. With PreserVision AREDS3, we aim to incorporate the latest nutritional science. PreserVision AREDS3 combines AREDS2 plus our proprietary vitamin B complex. This vitamin B complex that we have designed with specific vitamin Bs at specific levels is designed to help AREDS2 work even better so that we can expand the patient population that can benefit. Research suggests that B vitamins offer extra support. This includes boosting cell metabolism, supporting a healthier immune response and reducing oxidative stress. The scientific literature teaches us that these actions should improve overall retinal health and reduce the risk of AMD. The science we've generated to date behind PreserVision AREDS3 is compelling. And so I am so excited to share with you what our scientists have discovered. Okay. So we have 2 lines of evidence that indicate human genetics supports the inclusion of B vitamins in AREDS3. Let's focus on the 3 graphs here at the top. We tested the effects of AREDS3 on human retinal cells from AMD patients. And if you compare these 3 graphs that depict the gene expression profile after exposing retinal cells to different supplements, what you see if you start on the left, after B vitamins alone, then AREDS2 alone and finally, AREDS2 plus the B vitamin complex. What you're seeing are very distinct transcriptomic signatures. This means different genes are being turned up or being turned down. And importantly, we see a synergistic effect on the differential gene expression if you look at AREDS2 plus B vitamins compared to either supplement alone. And these changes in gene expression are related to retinal health. The second line of evidence comes from our partnership with Character Bio. You'll hear more about that partnership later. Human genetic analysis using their proprietary database identified a genome-wide significant association implicating vitamin D biology in AMD progression. This supports a protective role for vitamin D against this disease. We plan to work with the National Eye Institute to test these beneficial effects that we've characterized in patients with the novel AREDS3 formula as part of the AREDS3 clinical program.

Okay. Thanks, Mayssa. Now let's shift to a category where we're not just the leader, we completely disrupted the status quo. LUMIFY truly is a redness reliever like no other. I'd like to say there's literally magic in the bottle, helping eyes look whiter, brighter and more beautiful. And when you think about it, who doesn't want that. With its novel mechanism of action and favorable safety profile, LUMIFY has redefined this category and become a staple in beauty routines embraced by millions of consumers that we call beauty enthusiasts. And that's been a key part of our value creation here. Rather than position LUMIFY as a traditional redness reliever, our insights-led marketing team saw a much larger opportunity. They built a premium-priced, beauty-oriented brand that's powered by our always-on marketing engine with influencer collaborations, beauty partnerships and, of course, digital commerce. Today, LUMIFY is the #1 doctor-recommended brand and currently holds well over 60% market share. Yet with all that success, only 3% of the addressable market of beauty enthusiasts has yet discovered LUMIFY and our ambition is to reach all of them. That's why we recently launched a preservative-free version and our next-gen product, working named LUMIFY Lux will further drive market penetration. If you haven't tried LUMIFY yet, you don't know what you're missing, and we do have samples outside the room. I know you'll love it because we hear it every day from doctors, celebrities, influencers and most importantly, everyday consumers. But you don't have to take it from me. Here's a short video to show you in their own words how consumers love LUMIFY. [Presentation]

Okay. So as Brent opened this morning, we're always looking to push beyond good enough. In this case, that means taking something that's magical and trying to make it even better. LUMIFY Lux is -- builds on our current formulation by adding hyaluronic acid for a more luxurious feeling drop. So helping your eyes not only look their best, but feel their best as well. We're developing this product to appeal to both loyal LUMIFY users and those who haven't yet tried LUMIFY, giving us even more runway for growth. Okay.

So our novel LUMIFY formulation combines our proven redness-relieving molecule, brimonidine with hyaluronic acid. As with LUMIFY and LUMIFY preservative-free, low-dose brimonidine acts to constrict blood vessels to relieve redness quickly with a long-lasting effect. And because safety is critical as we innovate an ocular aesthetics product, it's important to note, brimonidine is backed by nearly 30 years of safe patient experience. We've added hyaluronic acid to the new formulation. Hyaluronic acid is a natural component in tears. It attracts 1,000x its weight in water, which helps keep the eye moisturized. Hyaluronic acid also provides viscosity and elasticity, which helps protect the eye from the mechanical stress of blinking. The constituents of this new formulation have allowed us to reduce the preservatives by 60% and these scientific insights that we've gained during the development and manufacturing of the novel LUMIFY formulation have enabled us to file for patent protection. So how does this novel formulation perform into consumers? To answer that question, we have successfully completed a Phase III randomized controlled trial. It was a robust study with 578 participants, of which 289 were treated with the new LUMIFY formulation. The study was 4 weeks long with a 1-week follow-up conducted at 11 sites and the data reveal a best-in-class outcome. That was so I could warm you guys out. There we go. All right. We observed redness relief as early as 30 seconds with sustained redness relief through 10 hours when comparing to baseline redness. And when we asked about the feel of the formulation, remember, that's what we were going for here. We were thrilled that 84% of study participants indicated that comfortable, cool or refreshing would be the first word they would use to describe the feel of this new product. These data demonstrate a compelling clinical profile and support NDA submission in the first half of 2026.

All right. Thanks, Mayssa. Now let's turn to dry eye, one of the fastest-growing and largest consumer eye health categories, driven by an aging global population, environmental and lifestyle factors, including heavy digital device use and looking around this room, I can see that I'm not the only one who may be as guilty of that. So in the U.S. alone, over 150 million adults experience dry eye symptoms. Yet data shows only about 1/3 are currently treating those symptoms with over-the-counter products. And consumers often turn to OTC products as the first line of treatment, so making this a prime space for innovation. But they're looking for more than just symptom relief. They want solutions that fit seamlessly into their lives, okay? Today, we are the fastest-growing OTC dry eye company globally, anchored by our Blink brand in North America and our well-developed Artelac brand in international markets. And although we are relatively new to this space in North America, in just 24 months since the acquisition of Blink, we've successfully repositioned this brand as a modern dry eye brand for the modern causes of dry eye. And this strategic shift has paid off. Blink is now the fastest major growing OTC dry eye brand in the U.S. market. But as a consumer insights-driven company, we're also thinking about the user experience. Data indicates 40% of consumers struggle to administer eye drops. And I know I'm one of those that Yehia was describing with the eye drops running down his face. So that's why we're developing an innovative delivery solution that can be used with Blink and all of our eye drops. Again, challenging the status quo is just not being good enough for patients.

Okay. So as John mentioned, within the dry eye consumer space, we're introducing new formulas to address the needs of different segments of this heterogeneous dry eye population. From our Blink line of eye drops, we have Blink Triple Care preservative-free, our most advanced OTC dry eye drop formulation. Blink Triple Care combined hyaluronic acid with nano emulsion lipids to help address the symptoms from both aqueous deficient and evaporative dry eye. This innovative, clinically proven formula delivers long-lasting and immediate hydration to help maintain eye comfort throughout the day. In addition to this new formulation, we are also exploring innovative new delivery technology to further improve the consumer experience. More than 70% of consumers surveyed expressed interest in improved packaging and delivery systems. So we're developing a new bottle that improves dosing precision and helps patients to beat the blink reflex, making it easier to get the product in the eye. This delivery technology has potential to become a platform across multiple consumer and pharmaceutical products.

Okay. So to sum up, with our clinically differentiated innovation, we expect our consumer business to continue our track record of market outperformance with these new products driving growth for our 3 most important brands and delivering peak sales in excess of $1.3 billion on these brands alone. So in closing, here are 3 key takeaways I want to be sure you take away from this talk today. First, we have a proven ability to execute and deliver durable growth above the market in this business. Second, we have an industry best portfolio of winning consumer brands with clear runway for growth. And third, our pipeline is strong with meaningful near-term innovation designed to address the unmet needs of millions of more patients. Now thank you. And now please welcome Andrew Stewart to join Mayssa on stage and provide an update on our Pharmaceuticals business.

Thank you, John. Good morning, everyone. I'm Andrew Stewart. I'm our Global President of the Pharmaceutical business here at Bausch + Lomb. And together, my colleague and I, Mayssa, are going to take you through what I believe is a really exciting transformation, not only within our pharmaceutical business, but within our company. Today, we're going to talk about new innovative therapies in dry eye, in ocular surface pain, in glaucoma and advancing the science within retinal disease. But first, let me take a step back and talk a little bit about our heritage as a global leader in ocular surface. Today, in the pharmaceutical business, we already offer 2 very compelling solutions in both MIEBO and XIIDRA. And now we're going to advance that dry eye business with the first dual-action therapy that can target both inflammation and evaporation in a single drop. In ocular surface pain, we're pioneering a first-of-its-kind neurosensory therapeutic. For back of the eye and glaucoma, Yehia mentioned before, we're moving beyond traditional approaches. And we have many great solutions for lowering IOP, but the first-in-kind product to help with visual acuity associated with glaucoma. And in retina, first-in-class therapeutics with novel targets in both intermediate AMD and geographic atrophy. We have multiple programs transforming how retinal disease is treated today and will truly help GA patients see better to live better and will underscore the depth of our R&D information, our pipeline and our science. Our commercial execution continues to be a real differentiator at Bausch + Lomb. We have the highest-rated field force recognized for both expertise and consistency. MIEBO continues its exciting journey with record-breaking quarter-over-quarter acceleration in growth. It's been one of the fastest launches in eye care history, and it remains the only product clinically studied with diagnosed patients with meibomian gland dysfunction, has unparalleled coverage for the treatment of a dry eye and for evaporation. And last week alone, more than 30,000 people picked up a prescription for MIEBO. This reflects both strong prescriber adoption and best-in-class field force execution. Patient feedback for MIEBO continues to be consistent. Recently, we just published a Phase IV study. And in that Phase IV study, patients and physicians have the same consistent remark. It works immediately, and it is both silky and smooth. XIIDRA remains on a solid growth path with more than 8% TRx growth year-over-year and steady volume gains, supported by clear promotion and field force execution as one of the primary drugs designed on the ocular surface for inflammation. Our work as the unquestioned leader in dry eye isn't done yet, and we're going to continue to grow this market responsibly. We're excited about the momentum and the benefits we're seeing from these efforts. Together, they demonstrate how our commercial model isn't just performing, but it's scaling and positions us to replicate our success in dry eye across the expanding pharma pipeline. Dry eye disease, and let's take a step back and expand a little bit on the comments that you heard from John just a few minutes ago. Dry eye disease remains one of the largest opportunities for Bausch + Lomb, and it's a highly underpenetrated category. Nearly 150 million U.S. adults have symptoms of dry eye, yet only about 7% of those will actually be diagnosed and receive a prescription therapy. Well, that means 93% of patients are living with dry eye. They're either undertreated or they're not satisfied with the current options that they have with over-the-counter products. And even among those who are treated with a prescription, 90% of those will discontinue therapy within a year, underscoring the need for a better tolerated, more effective solution. And looking ahead, this market is going to double by 2030 and a lot for the reasons that you heard about earlier, certainly, an aging population, definitely increased screen time. But in addition to that, pollution factors, travel, all of the different environmental concerns that all of you should never feel your eyes, and our dry eye solutions have the ability to help you by growing awareness for this condition. With our comprehensive platform, including both prescription and over-the-counter products, we're uniquely positioned to continue leading this market and to help grow it as we move forward in the future. Now before I turn this over to Mayssa, we've had the pleasure of working together for more than 10 years. And the revolution and transformation happening at Bausch + Lomb is more than just the products, the pipeline and the portfolio. It's truly about the people, and you'll hear that when Mayssa walks you through the science and what we have to share with you today.

Thank you, Andrew. You can see we have a great team and great colleagues here. So dry eye is a complex multifactorial disease. Patients can experience similar symptoms but with very different underlying causes. Tear evaporation and ocular inflammation are key disease drivers. At Bausch + Lomb, we have MIEBO and XIIDRA, the only 2 eye drops approved on the basis of Phase III studies in which they demonstrated a statistically significant effect on both a dry eye sign and a symptom. The active ingredients in these drugs work in very different ways. MIEBO forms a monolayer on the surface of the eye and is thought to reduce tear evaporation, while lifitegrast, the active in the XIIDRA formulation needs to penetrate tissues to exert its anti-inflammatory effects. Current eye drops only address a single cause of the disease. There is no therapy that tackles multiple disease drivers at once in a single drop. To be clear, there's a reason for this. As with any combination therapy, it's not just enough to show regulators that each component part delivers a therapeutic effect when combined. Rather, clinical data must show and characterize the contribution of specific elements to an overall advanced therapeutic effect that is superior to either component. For this reason, we see a clear opportunity to elevate the standard of care, formulating a combination of XIIDRA and MIEBO active ingredients to introduce the first dual-action dry eye drop. This will simplify treatment for eye care professionals and deliver better outcomes for patients. Specifically, we anticipate faster and more effective relief for greater improvement in the signs and symptoms of dry eye. So how are we going to do this? The first technical challenge was to formulate the true proven active ingredients in MIEBO and XIIDRA together in a single eye drop. Our scientists have accomplished this, and they've begun to characterize the benefits in preclinical models. On the left in the slide here, you see nonclinical pharmacokinetic data, comparing how much better the active ingredient in XIIDRA, lifitegrast penetrates ocular tissues when formulated with the MIEBO active ingredient. Why does this matter? Recall, lifitegrast needs to penetrate tissues to exert its anti-inflammatory effect and drug development breakthroughs often involve discovering a way to deliver the lowest effective dose for a therapeutic effect. With this new formulation in the cornea and even more so in the conjunctiva, lifitegrast is delivered far more efficiently into ocular tissues. The unique properties of this new formulation allow us to reduce the total lifitegrast dose by delivering it in a smaller drop. This reduces the potential for side effects related to the XIIDRA active ingredient while delivering 2 mechanisms of action in a single drop. Together, in an unprecedented manner, these actions will help heal the ocular surface damage caused by dry eye. That is why we will be the first to demonstrate contribution of elements to enable approval of a combination dry eye therapeutic. Overall, this uniquely formulated combination therapy is designed for superior efficacy to XIIDRA or MIEBO alone. And for that matter, any other eye drop -- dry eye drop that exists today. Today, we are testing these attributes in an ongoing Phase II study with a data readout anticipated in the second half of 2026.

Now I'm going to go through 2 different disease areas for ocular pain and glaucoma, where we're developing novel therapeutics to address important unmet needs. First, ocular pain, leading reason why patients will visit an eye care professional today. Treatment options are limited. Many patients with chronic ocular surface pain and including 20% to 30% of patients with either dry eye disease or corneal disease will often show up within an ECP's practice and another 5% to 15% postsurgical patients who are inadequately treated. Patients cycle through multiple different therapies without meaningful relief. And about 10% to 15% of those patients will also have acute ocular surface pain after cataract, after refractive surgery. And for those patients and others with short-term conditions like corneal abrasions, infections, dry eye flares, current options like steroids, NSAIDs, they're just not sufficient and they're not getting at the root cause of eye pain. Both acute and chronic ocular surface pain represent significant unmet needs and an opportunity for Bausch + Lomb to do better, providing longer-lasting and more effective solutions. Next, turning to glaucoma. And I mentioned earlier, there's great therapies today that lower intraocular pressure and help with glaucoma. However, no currently approved therapies impact the neurodegenerative aspects of this disease. They don't help with vision. And so that's the most important part of why an ECP will want to treat a patient, help a patient and continue them on their journey to better eye health. And while there's 4.2 million Americans with glaucoma, there are 35% of that population that have vision impacting glaucoma, which creates the biggest challenge. And Mayssa is going to take you through both those programs now.

All right. Thanks, Andrew. The ocular surface and particularly your cornea is the most densely innovated tissue in the body. That means it's one of the areas most sensitive to pain. On the cornea and the conjunctiva in the terminals of sensory neurons, the TRPV1 nociceptor is a primary sensor for ocular pain. By blocking, also known as antagonizing TRPV1, we stop the signaling cascade that leads to pain. This is in contrast to the activity of a recently approved dry eye neurosensory agent, which activates neural signaling. Here, our tactic is to block it. At Bausch + Lomb, we have 2 distinct TRPV1 antagonist molecules. BL1312 is a first-generation molecule that achieved clinical proof of concept in reducing ocular pain in postsurgical patients. In a second study that was somewhat different, it failed to replicate the efficacy. So we're going to talk a little bit about that. We have a second molecule, BL1332. It's 100x more potent and it's water soluble. So now I'd like to share with you the data that informed our development strategy and specifically how we're using BL1312 clinical data to guide our strategy to maximize efficacy with BL1332. Let's look at some data. So the graph on the left simulates human corneal concentrations of BL1312, so the first molecule after topical ocular administration with dose regimens used in the 2 different clinical studies. The teal top line in the graph shows corneal levels after 2.5% BL1312 was administered 4 times per day. This was the dose regimen that was effective in ocular pain relief in postsurgical patients. And this successful proof-of-concept study validates that blocking the TRPV1 pathway does work to relieve ocular pain. The lower red dash line depicts BL1312 concentrations in the cornea from the second study that explored a lower dose of 1.5% and a lower dose frequency of only 2 times per day. And this dose regimen was not effective in treating pain relief. These results teach us that to maximize pain relief, we need to maximize delivery of TRPV1 blocking activity to ocular tissues. This is achieved with a more potent molecule. That is why we are developing BL1332. So now let's examine the graph in the middle of the slide, which presents data from a nonclinical study to evaluate pain relief. In this animal study, we applied capsaicin, the active and pepper spray to induce an eye wiping response as a surrogate response for pain. The Y-axis that you're seeing depicts the eye wipe response to a capsaicin challenge in the presence of different eye drops. You can see BL1332 is significantly more effective at blocking the pain response than either the placebo vehicle or BL1312. This confirms that increased potency of BL1332 translates to increased in vivo efficacy. The next step is to test this finding in patients. So to that end, we have successfully completed a Phase I study for BL1332, where the highest dose was safe and well tolerated. This sets us up to initiate our Phase II proof-of-concept study in patients, which we will do in the first half of 2026. Now let's move to glaucoma. As both Yehia and Andrew mentioned, today, we treat the risk factor of IOP, but glaucoma is ultimately a neurodegenerative disease. The loss of retinal cells and optic nerve injury is what causes glaucoma-associated vision loss. Studies have shown that most patients with mild to moderate glaucoma have macular damage and difficulty seeing in low light. And there is no therapy approved to treat or prevent vision loss associated with glaucoma. The LoGTS study showed that patients treated with brimonidine were less likely to develop visual field loss compared to those treated with timolol, even when IOP was decreased to the same extent. Brimonidine is an alpha-2 adrenergic agonist. Alpha-2 adrenergic agonists are thought to preserve and improve vision via 2 mechanisms: Neurofunctional enhancement and neuroprotection. Our goal is to fully realize the potential of these mechanisms with BL1107. So why is BL1107 better than brimonidine to realize the beneficial vision effects of alpha-2 pharmacology. It's because BL1107 is designed to target vision-threatening disease. Let me tell you why I say that. First, BL1107 is a prodrug that is lipophilic, which helps it penetrate tissues deep in the eye. The graph at the top shows nonclinical pharmacokinetic data that demonstrate when BL1107 is administered as an eye drop, we detect the prodrug and little active drug in the tears. That means the prodrug is available to penetrate deep into ocular tissues, delivering the active drug to the retina as shown in the second graph, where we see the majority of drug detected in the retina is the active moiety. Another BL1107 attribute is its receptor selectivity and potency. The lower graphs compare 2 different alpha adrenergic receptors, alpha-2A and alpha-2B for BL1107 versus brimonidine. BL107 is more selective and potent to alpha-2B, while brimonidine is more selective and potent to alpha-2A. This is important since alpha-2B is the most widely expressed alpha receptor in the retina, where we need the drug to work to improve and protect vision. Overall, it's BL1107's molecular attributes of enhanced retinal penetration combined with selective and potent alpha-2B agonism that should maximize vision effects. And so that's why today, for the first time, we are really excited to present positive proof-of-concept data in glaucoma patients treated with BL1107. In addition to lowering IOP, for the first time, we show 15 letter gains, which is an approvable endpoint after treatment with an eye drop. The graph on the left show that under low light conditions, patients treated with BL1107 show a greater proportion of 15-letter gainers than patients treated with timolol in both the study eye and the treated fellow eye. The top graphs depict the study eye and the lower graphs are the treated fellow eye. What you see, the green bars represent 2 BL1107 doses on days 1, 4 and 14, and they depict the percentage of patients gaining vision, while the gray bars represent vision gains with timolol. You can see in the study eye, there were no patients that gained vision with timolol. This is remarkable. Today, we treat IOP. If approved, everyone will treat with BL1107. Let me show you another piece of data. Moving to the graph to the right, we see that patients treated with BL1107 showed statistically significant improvement in visual field mean deviation on day 14 compared to timolol. Currently, we have a larger Phase II study ongoing that is powered to demonstrate these visual neuroenhancement effects with data anticipated in the second half of 2026. These data will guide our Phase III study design. If approved, BL1107 could define an entirely new category of glaucoma therapy, the first with a neuroenhancement mechanism of action aimed at protecting and improving vision while also lowering IOP.

Next, we're going to move into our retina pipeline and our programs that are in early-stage intermediate and advanced age-related macular degeneration. AMD is another major unmet need. More than 17 million Americans have early-stage AMD, about 1.5 million have late-stage AMD. And we know today, nearly 1 million patients with some form of geographic atrophy will show up in a retinal practice. As AMD progresses to geographic atrophy, patients lose central vision. That's the most important part needed for reading, recognizing faces, living independently and effective therapies for early intervention and disease modification in AMD remain limited with a significant opportunity for innovation. And while there are 2 approved therapies today for geographic atrophy, they're only available in the United States. These drugs were approved because they do help slow the progression of lesion growth, but they do have a high treatment burden, and they don't really have a meaningful impact on vision. And vision is really what matters to patients and physicians treating these diseases. For this reason, there is still a critical need for treatments to help reduce injection burden, so patients will be motivated to continue with therapy. And that's the opportunity that we're pushing for, developing the next-generation AMD therapies that are improving vision, not just slowing disease progression.

Okay. So let me share with you our strategy for how we're approaching AMD and its complexity. Why is AMD complex? It's a heterogeneous patient population with many implicated disease mechanisms, no animal model that fully replicates the disease biology, and it's a very slow progressing disease. All of these factors have made it challenging to select pharmacological targets that ultimately impact the disease in patients. And finding out whether the preclinical science translates to human patients is slow and expensive. And that's a big problem. Since we all know, lack of translation is the single biggest reason most experimental drugs fail and don't make it to market. So for this reason, we knew our strategy had to start with human data. That would be the way to successfully elevate the standard of care in both intermediate AMD and GA. By starting with human data, we would be able to identify pharmacological targets that were most likely to help patients. Only then once we had selected targets based on human patient data, would we design the optimal molecule and combine it with a best-in-class drug delivery. To further our strategy, we sought out partners that could provide complementary technologies to enable our strategy. The first partnership I'll discuss is Character Bio. We believe precision medicine will transform how age-related macular degeneration is treated by helping us to better match therapies with patients. Our partnership with Character Bio provides exclusive access to their integrated patient data platform and AI-powered analytical engine to drive novel intermediate AMD and GA discovery and development. This one-of-a-kind platform is a strategic advantage. It includes multimodal data -- multimodal imaging data like OCT and fundus photography as well as electronic health records and genomics for thousands of patients. The patient data are longitudinal, which means we track patients' disease progression over years. And by applying machine learning to these data, we're able to discover drugs linked to biological pathways associated with specific types of disease progression. And we have made great progress to date. We've identified more than 100 novel gene locations representing potential pharmacological targets associated with AMD progression. In 2026, we anticipate committing to specific targets and beginning to design therapeutics with the goal of choosing our first development candidate in 2027. And it's important to note that the development candidates we identify will be differentiated with an accelerated development pathway. I say this for 2 reasons. First, these development candidates are more likely to succeed in the clinic since their selection is based on actual human patient data. So the #1 reason drugs fail, preclinical science not translating to patients is greatly derisked. Second, the data platform enables accelerated clinical development since trial enrollment is streamlined through our ability to recontact patients and eye care professionals already in the database. Additionally, we can use this platform to support our other efforts in AMD to realize the benefits of these proprietary insights across our efforts at Bausch + Lomb, as you saw earlier with the AREDS3 program. Our next partnership is with City Therapeutics, which has deep expertise in the emerging therapeutic modality of RNA interference. We're combining our disease biology and ocular drug development expertise with City's ability to engineer differentiated small interfering RNA drugs. So why do we like this modality as our entry point into genetic medicine? Within cells, RNA interference naturally regulates genes by interfering with messenger RNA. And messenger RNA carry instructions to make proteins. RNA interference can silence disease-associated genes by stopping the synthesis of the proteins they encode. RNA interference therapeutics harness the power of this process by delivering specially designed small interfering RNA drugs or siRNAs that selectively target and degrade the mRNA proteins involved in disease. We believe the eye is an ideal for RNA interference therapeutics because it's a small, confined space. This allows for localized delivery via a direct injection, so we're ensured good target engagement, while we are also able to minimize systemic exposure and the accompanying side effects. City's technology addresses historical challenges we've seen with siRNA drugs. They design molecules that are more potent, specific and efficient. And importantly, and this is really important, their targeting ligand technology enables better delivery to target tissues. So let's now look at the power of this technology by focusing on the bottom of the slide. Here, you see histology data from a mouse eye that received intravitreal administration of one of our prototype molecules. In the first panel, you see the different layers of retina following saline administration. While in the second panel, you start to see some red staining indicating drug distribution after the novel siRNA alone molecule was administered. And in the last panel, you see staining after administration of a molecule that combines the novel siRNA molecule with its targeting ligand. And this is important because you can see broad staining because the drug is well distributed across all layers of the retina. Better distribution of the siRNA drug throughout the retina enables better silencing of genes that cause GA. This should result in better efficacy. We expect to select our development candidate in the second half of 2026, which will be an important step toward bringing this next-generation genetic medicine into the clinic. Finally, I want to share our BL1107 sustained release implant program. In geographic atrophy, we've heard patients need treatments that are more efficacious. That means therapeutics with better anatomical outcomes like greater reduction in the slowing of GA lesion growth and even more importantly, therapeutics that preserve vision. Patients also need therapeutics with a lower treatment burden, therapeutics with longer intervals between doses with fewer safety risks than today's options. In 2 clinical trials, brimonidine slowed lesion growth, but the treatment effect was small, and alpha-2 adrenergic agonist like BL1107 that has better retinal penetration and more selective and potent alpha-2B agonism should have a better treatment effect. Additionally, BL-1107 can be formulated as a sustained release implant, delivering the therapy for 3 months or more. And we're developing this implant in partnership with a best-in-class long-acting delivery company, Ripple Therapeutics. Their technology can chemically engineer BL-1107 into a controlled release implant without the use of polymers. These properties ensure consistent, safe and durable drug release. We anticipate identifying a development candidate in 2026. This program positions Bausch + Lomb at the forefront of next-generation long-acting ocular therapeutics. Thanks.

Thanks, Mayssa. So you've heard a lot about our science this morning and really our enthusiasm and our excitement for our pipeline and our portfolio from the front to the back of the eye. As we change the culture of our company, not only do we have the assets that you heard about today, but also the people capable of delivering this transformation. Together, our assets in development can exceed $4 billion in sales. More importantly, they position us to deliver sustainable, high-margin growth through this decade and into the next. I'd like to leave you with 3 key takeaways. So first, as I mentioned when I started my presentation, explaining the strength of our commercial footprint and extending our franchise leadership as the unquestioned leader in dry eye from nutraceuticals and over-the-counter global products that you heard about from John earlier through prescription therapies, diagnostics that you'll have a chance to see in the back of the room later, we are setting the stage for future enhancements in next-generation therapies from consumer through prescription. Second, we're expanding from our front-of-the-eye platforms into breakthrough innovations that treat ocular surface pain and glaucoma, programs that go beyond symptom control and really address the underlying disease biology. We've mentioned this in a couple of different times. Changing the paradigm to vision impacting glaucoma is an absolute game changer for patients and physicians who treat them. Third, we're building a powerful platform in retina from precision medicine in AMD and siRNA long-acting implants and advancing multiple programs with the potential to shift the standard of care. Together, this is how Bausch + Lomb is advancing the science in every aspect of eye health. With that, we're going to pause here. We're going to take a short break. When you go outside, there are some product displays where you'll have an opportunity to interact with several of our products, not exactly the surgical ones, but we'll have a chance to interact with the products a little bit further, and we'll be back here in about 30 minutes. [Break]

Ladies and gentlemen, please welcome to the stage Vision Care President, Yang Yang and Vision Care R&D Vice President, Bryan Reed.

So welcome back. We hope those of you in the room get a chance to explore our product showcase during the break. Let's move on to Vision Care. My name is Yang Yang, President of Global Vision Care. Joining me on stage is Bryan Reed, Vice President of Vision Care R&D. So consistent with our company goal, Bausch + Lomb Vision Care also strives to deliver above-market growth. And we have been demonstrating that as the fastest-growing company in the industry with our existing portfolio. Today, we will focus on how we're going to build on that success with exciting developments in our pipeline, which will be meaningful for eye care professionals and patients and position Bausch + Lomb for long-term sustainable growth. You heard it here earlier this morning, there hasn't been a breakthrough innovation in lens material in over 25 years. Historically, the product cycle in lenses has been very long. In fact, the last major innovation of lens material happens before the turn of the 21st century. However, although innovation has been slow and deliberate, Bausch + Lomb has always led the way, setting the standards for material science and wear experience. Now we are changing the game again, introducing Project Halo, the first bioactive contact lens material. [Presentation]

Okay. As you've just seen in the video, our history in contact lens innovation started in 1971 when Bausch + Lomb launched the first mass-produced soft contact lens. Then in 1999, Bausch + Lomb introduced the first silicone hydrogel lens known today as a SiHy lens designed to increase the oxygen flow to the eye and support extended lens wear. Now we are creating a bio -- new bioactive contact lens, which will be a platform that offers the benefits of bioactivities. And our first offering on this new material platform will be Project Halo made with hyaluronic acid or HA. What we're trying to accomplish here is not just a coating on the lens. This is also not us just soaking the lens in the HA solution. This will be an entirely new change to the structure of the lens material by polymerizing HA into its backbone. There will also be HA in the solution, and that's exactly how you get the benefit of double-dosed bioengineered HA, which will provide the ultimate wearing experience. It's truly one-of-a-kind technology that creates a new segment of contact lenses.

Thanks Yang. And creating a first-of-its-kind technology was no small feat. This project started as an idea at a poster session innovation that Brent attended shortly after rejoining Bausch + Lomb. He was very excited about the concept and challenged our team to develop this breakthrough technology and to do so on an existing manufacturing platform, which made the challenge even more daunting. I appreciate Brent's commitment to innovation and the faith that he and Yehia put into our highly capable internal development team to transform that idea into the bioactive lens today. Along the way, we've overcome numerous challenges by thinking outside the box. And we have used predictive modeling validated by over 10 internal clinical studies to optimize the material and the design to where it is today. Now before we get into the benefits of the lens, let's first talk about HA as a molecule. HA is a high molecular weight polysaccharide that acts as nature of sponge. And as Mayssa mentioned earlier, holds up to 1,000x its weight in water. To help put that in perspective, a quarter teaspoon of HA can hold 1.5 gallons of water. HA is so naturally throughout the body, including in the eyes and helps to keep everything hydrated and lubricated. Because of these amazing properties, it's often used in moisturizing creams, lotions and ointments. It is also used in other Bausch + Lomb products like our multipurpose solutions, our dry eye drops, as you heard earlier, our latest LUMIFY product. Going back to that sponge analogy, if you think of the lens like a sponge, we're making the structure of the lens out of HA and then we are soaking that lens in HA. So this double dose of HA gives the lens some very unique properties that we will talk about next. So you probably heard us refer to this lens previously as the biomimetic lens because we are intentionally building a lens out of bioengineered HA to help mimic the naturally occurring molecule in the body. However, this lens is designed not just to mimic the body, but to actively interact with its biology. The lower graph here shows us the latest in vitro data for this lens. Initially, HA is fully retained within the lens matrix until exposed to a natural enzyme in our eye called hyaluronidase. Upon exposure, there is a steady linear release of HA from the lens surface, continuing out through 19 hours of testing. So why is this important? Recent studies show that up to 70% of contact lens wearers experience dryness symptoms after wearing their lenses all day. This lens provides a controlled wave of hydration all day long and supports end-of-day comfort when patients need it most. The unique properties of this lens go beyond hydration to address other user needs. The upper graph shows that in lab studies, corneal epithelial cells conditioned with HA-containing solutions maintained their metabolic activity after exposure to dry conditions and were more protected than solutions without HA. This double dose of HA also supports tear film stability by reducing evaporation to help fight dryness symptoms and improve comfort. As we saw earlier, 25 years ago, material innovation was about improving patient health by incorporating silicone to boost the oxygen permeability of lenses. However, with the lens structure made out of HA, this bioactive lens achieves a 65% higher oxygen permeability than you'd predict based on a traditional hydrogel. As you can see from the graph on the lower right, the percentage of oxygen available in the cornea, this lens is delivering a healthy oxygen permeability that patients expect. It is comparable to leading SiHy lenses on the right side of the graph, and it is better than traditional hydrogels on the left side of the graph. And the ingenious part is that our scientists have figured out a way to do this without requiring any silicone. The data further supports that this lens doesn't fit into any existing category. It creates a new category of its own. And there's one more feature that sets this lens apart. The bioactive lens is the lowest coefficient of friction that we've ever measured at Bausch + Lomb, which is a measure of resistance to movement. So why does that matter? The average person blinks 14 times per minute or more than 13,000 times in a 16-hour day, reducing friction between the eyelid and the lens surface on each one of those blinks is key to long-term comfort. The graph shows how other Bausch + Lomb and competitive products compare this bioactive lens. This shows all other lenses show an increase of 50% to over 100% more friction. So in summary, you can see that we're delivering on everything that today's lenses have to offer, but we're adding the added benefit of bioactivity as we continue to innovate what a new lens could be. And this is just the beginning. Project Halo will be the first lens in this new bioactive category. We're very excited to announce that we've just started our first external performance clinical study in October.

This is a very exciting milestone for Project Halo, indicates the product is on track to be available in 2028. And it really leveraged our nearly 2 centuries heritage in Vision Care by combining our superior optic expertise with breakthrough material innovation. So eye care professionals and patients will have a lens that is designed not just for vision, but for comfort, performance and biology. And there is one breaking piece I cannot miss to mention here is that we will manufacturing this lens on our existing production lines. To bring forward a material as innovative as this one, typically, it requires significant capital investment. In our case, we don't need to, making this lens a high-impact, high-margin product at launch. I hope you are just excited as we are about this new material and what it could mean for the Vision Care market. Now while the new material is incredibly exciting, it's not the full extent of our pipeline. Our pipeline is designed to drive sustained revenue growth across all market categories with multiple shots on goal. To that end, we're working on 3 additions to our highly successful SiHy material. Number one, we are developing a next-generation SiHy disposable lens. The goal is to bring an accessible innovation to the world. Number two, we're working on a premium monthly SiHy. And that will provide unmatched comfort for the 30-day lens wearers. Number three, we're working on a make for kids myopia control lens and a lens designed -- especially designed to slow down the progression of myopia with comfort. And just like the HA lens, all of this product will be manufactured on our existing platform, requiring minimum capital investment and driving margin expansion. Our total assets in development represents a revenue opportunity of about $1.3 billion, doubling the size of our contact lens business today. So let's take a closer look at each. At Bausch + Lomb, our portfolio is designed to address a wide range of unmet needs around the world. If you take a look at the daily SiHy market, it's projected to grow at 10% CAGR through 2028, shows strong patient interest in the benefits of a daily SiHy lens. So the purpose of our next-generation daily disposable SiHy lens is to provide an affordable option to those patients and consumers around the world. And thanks to our R&D and manufacturing colleagues, we will be able to make this lens our existing platform, making the lens a lot more accessible, expanding our global reach and profitability.

Well, Yang makes this sound easy, but striking the balance between high performance and a low-cost SiHy product and being able to produce it on our existing manufacturing platform was an enormous challenge. It required multiple iterations of materials and predictive modeling until we hit a breakthrough, resulting in a chemistry with high surface wettability that delivers exceptional comfort and performance. In addition, we are also leveraging the homeostasis benefits from our INFUSE ULTRA ONEday lens, which includes moisturizers, electrolytes and osmoprotectants to support a comfortable wearing experience all day long. We plan to begin our first excellent performance clinical study next year with launch planned in 2029.

Let's move to our next product. Although there has been a big shift of contact lens wearers from FRP offerings to daily disposables. Insights show roughly 60% of the contact lens wearers entering the market end up with an FRP offering. And that -- but if you look at the satisfaction of our patients, there's still a gap between the comfort the patient feels on the last day of the month and the beginning of the month. So following our design philosophy of serving a wide range of patients and consumers. We wanted to offer a lens that performs as well as on day 30 as it does on day 1. So we are working to develop a premium SiHy monthly lens to provide unsurpassed the comfort over the full 30 days with the goal of becoming the premium monthly lens in the market.

Bausch + Lomb is known for its proven optical designs and they've been applied to this lens to deliver crisp, clear and stable vision for the wearer. But what really sets this lens apart is that the material is optimized to balance hydration and breathability and most importantly, resist deposits, which are a main contributor to reduced comfort at the end of the month. The other unique part of this lens is we specifically engineered it to seamlessly integrate with our lens care products, allowing the wearer to recharge their lenses with comfort-enhancing ingredients each night throughout the month. Our first external performance clinical study is scheduled for next year with launch planned in 2029.

Finally, myopia where near sightedness is increasingly referred as a global pandemic. It's projected to affect over 50% of the global population by 2050, especially among children and adolescents, driven by increased screen time and reduced outdoor activities. While we're designing this lens, we wanted to make sure this is a lens designed for kids. Unlike some of the existing offerings in the marketplace today, this lens is especially designed to address the unique needs of this vulnerable population. So we will pair our cutting-edge optical designs with our existing premium daily SiHy material, which has been overwhelmingly successful with lens wearing experience. The goal is to provide a healthy daily disposable myopia control lens with exceptional comfort. It will effectively slow down the progression of near sightedness for children and adolescents, at the same time, provide them with clear vision without compromising their daily activities.

So aside from our premium material, our cutting edge design is special because it's designed specifically for kids with a customizable approach that balances their myopia control needs with their daily vision needs. It's a novel 2-zone design with a central zone for clear vision to meet the dynamic needs of children and a peripheral zone that contains the therapeutic plus power with the stop signal to stop the progression of myopia. It is differentiated from competitors in 2 key areas in the optical design. First, it offers the customization of 2 lens options with different zone diameters. The eye care practitioner can use these to optimize clear vision while maintaining myopia efficacy. No other soft contact lens for myopia control offers this option. Second, dose adjustment is built directly into the lens. This means that we are adjusting the amount of plus power in the peripheral zone based on a patient's refractive correction. As a result, the lens delivers an appropriate myopia stop signal across the entire power range without compromising vision. With this premium offering and optical design, children can continue enjoying an active lifestyle while helping to reduce the risk of the complications from myopia progression. The first registration clinical trial for this lens is planned to begin next year in the first half with market entry in 2029.

So as I said at the top of the presentation, one of the goals of Bausch + Lomb Vision Care is to deliver above-market revenue growth. And we have done so consistently with our existing portfolio in the last 6 quarters. Our team continues to drive momentum in Daily SiHy while maintaining strong performance across our legacy products. But there is so much more to come. In the fastest-growing Daily SiHy market, we're still in the early stage of our growth journey with significant amount of opportunities ahead from geographic expansion and the line extension. As you just heard, we're building a powerful and a meaningful portfolio to lead the next wave of innovation. We're driving segment creating material innovation. We're entering new categories, and we're addressing all wearers needs with our comprehensive portfolio. All of this will support our long-term durable leading growth. Okay. In summary, Bausch + Lomb Vision Care is well positioned to lead the next wave of innovation. We're creating a new category of contact lenses, and we're building a comprehensive portfolio. Each pipeline product is purposely designed to address unmet needs and to unlock new growth in Vision Care. And we're doing it all efficiently, leveraging our existing manufacturing capabilities to expand margin and to maximize return on investment. With that, I'll turn it over to Luc and Kelly to discuss Surgical. Thank you.

Thank you. Thank you, Yang and Bryan. Good morning, everyone. I'm Luc Bonnefoy, President of Bausch + Lomb Surgical, and I'm here together with Kelly, my partner, Head of R&D. Today, we will cover how we are transforming the surgical business. This includes developing innovative new equipment and delivering those products reliably to the market. Our goal is to be the best. In many cases, we are or are developing best-in-class products. Now we are innovating around how we go to market, focusing on reliability, premium service and speed. The goal is for surgeons to view us as a reliable and dependable partner to cover their needs. Our Surgical business has a proven track record of strong performance and above market growth. We'll maintain our lead by providing superior service, reliability and best-in-class product. Our large product offering set us apart from competitors. We are a one-stop shop for all of surgeon needs, helping drive loyalty, retention, but also recovering revenue streams. As we move into more premium category with upcoming launches, we streamlined our manufacturing supply chain, we will position -- we will be positioned to deliver better service for customers as well as also margin benefits. Let's start with our one-stop shop approach. Bausch + Lomb and Alcon are the only 2 companies that provide a full spectrum of devices for cataract surgery. Our capital equipment offerings enable us to enter a practice from a position of strength. For example, when we place a piece of equipment in one OR, we have a captive market for at least 5 years. This allow us to establish and reinforce relationship between the sales reps and the surgeon, helping us to build a competitive moat. While in OR, supporting our piece of equipment, we help to demonstrate a suite of best-in-class products, reinforcing Bausch + Lomb as go-to brand. To build and maintain the trust and confidence of surgeon, it is not enough to have the best product today. We also have to deliver new products to meet their evolving needs. Looking at 2028 and beyond, we expect a steady stream of launches, bringing not only incremental sales but also higher profitability. First, by expanding in premium category where we were not playing before. Second, entering new high profitability segments and also by launching next-generation product with best-in-class potential. Together, all these efforts position Bausch + Lomb Surgical to continue to owns the OR. Kelly will provide in a moment a little bit more insight about the innovations. Like I said in the introduction of this presentation, we want to change how we go to market, and we want to improve our service to surgeons. While driving growth and EBITDA margin expansion across our portfolio, we established a comprehensive strategy to build a more durable, reliable, resilient and robust supply chain. This includes transition machine packs, assembly and custom packs to a low-cost supply base. At the same time, we streamlined production capacity and optimize partnership of select products. Together, we believe these efforts will drive cost efficiencies, increase pull-through sales and strengthen our level of service to increase customer loyalty. Going back now to the first pillar of our margin expansion strategy. We are expanding our premium IOL offering, that is a pure incremental business for us and because we want to benefit from a market with a projected CAGR growth of 10% through 2030. These efforts mean we will soon have the most comprehensive premium IOL portfolio in the industry. The last piece of the puzzle to complete our comprehensive IOL portfolio that is today under development is enVista Beyond. Let me turn it over to Kelly to speak more about this innovation.

Thank you, Luc. As Luc mentioned, Beyond is the final piece of our premium offering, and we're very excited to announce today that we've completed enrollment in the clinical studies. It's an extended depth of focus, premium lens that allows enVista Beyond to deliver better depth of field compared to monofocal lenses. With its pure refractive technology, enVista Beyond delivers greater performance versus Vivity and Symfony to the patient with fewer dysphatopsias like Halos. Not only that, this IOL performs better versus Vivity and Symfony with less desentration or displacement of the IOL from the optical axis of the eye and tilt or angular misalignment of the IOL to the optical axis. This allows for better tolerance in surgical technique for the physician. Moving forward, we will continue to explore early opportunities in accommodating and adjustable IOLs as our premium lenses come to market. Next, I'd like to talk about another significant growth opportunity for us. Elios is the first clinically validated excimer laser system that enables surgeons to perform minimally invasive glaucoma surgery. We know glaucoma is a huge unmet medical need. Approximately 80 million people around the world are living with this disease and many of whom don't even know they have it, with less than half of all cataract surgeons performing minimally invasive surgery for glaucoma today. Elios has potential to change this paradigm. This innovative product offers opportunity for cataract surgeons who were not previously performing this procedure to do so with ease. It takes only 2 to 4 cases before a surgeon is proficient in using it. In fact, you'll hear later from the panel discussion from physicians who have already had this experience. Elios is implant-free and delivers lasting results with a safety advantage compared to other products due to its nonthermal laser ablation. With 10 simple micro channels in the trabecular meshwork, we see lasting IOP reduction and improvement in medication burden. All of these factors result in a novel, easy-to-use product with a better experience for patients and surgeons. Thankfully, we don't have to rely only on limited data to know Elios works. We have years of experience as it's already been on the market in Europe, where its success is backed by extensive clinical data, including 8 years of follow-up. As you can see on the left-hand graph, we have sustained reduction of IOP over 20% post procedure over years. In the middle, you can see immediate and long-term medication reduction after Elios. Up to 80% of patients no longer need medication, and a picture is worth a thousand words. You can see on the right here, microchannels that remain in the trabecular meshwork so we know it continues to work. Next, we have a short video that will show you how and why Elios is the next generation of glaucoma technology. [Presentation]

Moving from glaucoma into cataract surgery, we have another innovative product in our pipeline, seeNOVA. Those of you in the room here today have seen this machine on display in the back, where we have already begun preliminary testing and are really excited about the progress to date. We know our current system is reliable and provides great results for patients and physicians, including features like adaptive fluidics to maintain the IOP in the eye. Building on that legacy, our new best-in-class cataract and retina combo system will expand the physician market with key new features. Just to highlight a few, dual-mode aspiration means the same vacuum control that B&L users know and love, but will also add a flow control option for surgeons who are initially trained on this or for which it is the preferred mode. This can be switched mid-surgery for -- to allow for better physician choice. Another feature is the laser-based illumination, which will be noticeably brighter and improve contrast compared to current options like halogen, xenon or LEDs. We've received very positive feedback on this from doctors already. This new platform will allow for future innovation, of course, whether it's improving the Trocar System and blades or adding new features to change the phaco paradigm. We anticipate securing approvals in the EU, U.S. and Canada in 2028. To learn more about this innovative technology around seeNOVA and why it's different and better than what's existing in the market, let's watch another short video. [Presentation]

Before I hand it back to Luc, I want to touch on seeLYRA, our next-generation Femtosecond Laser. seeLYRA builds on 15 years of experience with Victus, driving better patient outcomes, greater workflow efficiency and use of space in the OR and enhanced safety, thanks to better visibility for surgeons. In particular, seeLYRA ensures perfect optical beam alignment under all operating conditions with an active beam steering system. All necessary optical beam lines are highly integrated into the Femtosecond Laser, the OCT and the visible camera. For workflow purposes, it has a smaller footprint, less than half of that of previous generations and no longer has a fixed patient bed. The flexible supporting arm has been tested to show durability with mechanical, electrical and optical stability over the expected service life of 10 years. We expect to secure EU approval for seeLYRA in the second half of 2026. And this is just the beginning. The next evolution of this machine will include a combination Femtosecond Laser and phaco machine that will integrate the systems perfect for in-office surgeries. Now I'll pass it back to Luc to talk about the commercial opportunity for these products.

Thank you. Lots of innovation in all our segments. In all our segments, we have big product to come and not in a long period of time. These premium products are all on track to launch in the next few years with Elios and seeLYRA expected to come to the market in -- sorry, with seeLYRA expecting to come to the market in '26 and beyond in '27 as well as seeNOVA in '28. With the addition of enVista Beyond to our Bausch + Lomb [ IWeb ] portfolio, we expect enVista platform to reach a potential of $300 million. We see potential peak sales also for Elios reaching $175 million as this innovative technology we expect to expand the numbers of surgeons offering minimal invasive glaucoma surgery together with cataract. seeNOVA is expected to reinforce our phaco equipment share and reach potential peak sales of $450 million as surgeons increasingly adopt this best-in-class system. Finally, seeLYRA is expected to reach a potential of $50 million as we believe its superior ease of use and safety combined together with better patient outcomes will drive adoption. In summary, 3 points to take away today for the Surgical business. Number one, we are driving growth in Surgical by building a one-stop shop portfolio. Number two, we are delivering on a steady stream of planned premium launches. And number three, we are driving margin expansion with a comprehensive strategy to optimize manufacturing as well as supply. Thank you. With that, it's my pleasure to welcome Dr. Cathleen McCabe [indiscernible] together with our panel of specialist.

Good afternoon, everyone. It's a thrill to be here with all of you today and especially exciting to be up here with such a distinguished panel of colleagues and friends who are all globally known thought leaders in eye care as well as having many accolades and awards among them. So I'm joined by Dr. Mark Schaeffer, who is a Doctor of Optometry, practicing in Birmingham, Alabama, a thought leader himself, a mentor, educator, scientist. Then we have Dr. Eric Donnenfeld here locally, Long Island, New York. cornea, cataract, refractive dry eye Specialist known globally, also named the #1 ophthalmologist in the United States 4 times in a row just recently, and we're honored to have him with us today. We have Dr. Lejla Vajzovic, who is a doctor or a professor of ophthalmology at Duke University, a retina specialist, clinician, scientist, educator mentor, all of the things that are wonderful about Lejla. And then Dr. Bill Trattler, who everyone also knows, global educator, cataract cornea refractive specialist from Miami, Florida, just south of me. And I am Dr. Cathleen McCabe. I am a cataract refractive surgeon on the West Coast of Florida. I also serve as the strategic medical adviser for Bausch + Lomb. So very, very happy to be here.

And the incoming President of ASCRS next year, okay?

Yes. And many, many other things I can say about all of us. But thank you, Eric, yes. So I'm so excited about what you have all heard. I mean, really, what is going on in the pipeline for Bausch + Lomb is incredible. I think there are so many things that we could have taken away from that and understand will really help our patients in our daily practice. But I want to kind of go from left to right and all around and hear from you, what did you find most exciting about what you just heard? And how is that going to impact your ability to take care of patients? And I'll start with you, Mark.

Thank you. So thank you for having us and letting us sit up here and just talk about what we do every single day and using your products continuously. But I'm in a practice where I'm in primary care, eye care, patients that come in are here for their comprehensive exams for glasses and contact lenses. So the majority of my day is getting patients seeing well in their exam lens. So what excites me most is the new bioactive lens. So seeing a new contact lens that's really a breakthrough in new materials, something that we haven't seen in a very long time, something that continues to deliver on the promise of we need a lens that works continuously that continues to push that comfort as we get to the end of the day because our days are getting longer, our hours are getting stretched, our time in front of screens, phones, devices. All of this contributes to a lack of homeostasis on the ocular surface, which leads to problems later on down the road, which leads to more issues. So having the ability to have a lens that's going to continuously provide hyaluronic acid onto the surface so that we can continue that comfort and that ability to see clearly and not actually feel the lens and feel that comfort, especially as we get to the end of the day, is really exciting for me.

Yes. I mean I think it kind of stands on its head when we think about contact lenses. We always think about the risk of contact lenses, how that may be actually a problem when patients are misusing their contact lenses or using them longer in the day. I think that now makes it something where maybe it's a solution for a lot of our ocular surface needs. And that's really a different paradigm entirely, isn't it?

I think so, too. I think dramatically so. And the reason why is because when we have a lens that's degrading as the day goes on, it provides more opportunity for that inflammation, that irritation so that patients either come out of their lenses. But when you have something that is so known and well known to help lubricate the surface like hyaluronic acid, when that is built into the material and the solution, it's going to continue that, especially as we get to hours 12, 14, 16, 18. I've got young kids so like I love being able to stay up late at night and read them bedtime stories that I don't want to have to think about taking out my lenses in order to do that.

So speaking of kids, let's just touch really quickly on myopia control. Like how important do you think that's going to be in the future?

It's so huge because it allows for us to protect their eyes not only from keeping their vision from getting worse, but also reducing the risk of things like glaucoma, macular degeneration, retinal detachments, things that keep them out of Lejla's chair and keeps them in my chair from out. Honestly, I like taking away your business because it's going to protect eyes. And nothing is more important to us as parents as protecting our kids. And if we can do that with a lens to keep them at a minus 1 or a minus 2 instead of a minus 6, a minus 8, that is absolutely game-changing for us so that we can help protect these patients long term.

Yes, we want to make them aware of it. We unlocked a new fear or Brent did on his interview this morning about myopia and myopia control for kids. Eric, what did you -- what did you take away as most exciting for you?

Well, that's great. I was so extraordinarily impressed. For years, I've worked with all the companies in ophthalmology. And for decades, Bausch + Lomb has been a sleeping giant. I would actually say that was probably hyperbolic, Bausch + Lomb was actually comatose. And to see the innovation that's taking place today is extraordinary that Brent and his entire team that you saw up here today has really invigorated and empowered and resuscitated Bausch + Lomb to a point right now where it's the most dynamic company in ophthalmology. And I'm just extraordinarily impressed by what I saw today and what I see for the future. And as an ophthalmologist, I'm the managing partner of a group of 170 ophthalmologists. I've been at leadership positions in ophthalmology. A strong Bausch + Lomb is extraordinarily important for the entire field of ophthalmology and optometry. I think it's -- they go hand in hand. So I was impressed by everything. But as a cataract, refractive and corneal specialist, I know that vision starts with a tear film. And without a good ocular surface, we're not going to have the quality vision that patients need. Every year, 2 million to 4 million contact lens wearers stop wearing contact lenses because of dry eye. Now your contact lens is going to make that a better -- less of a problem. But right now, Bausch + Lomb, by far and away, is the most important company in all of dry eye, which is one of the most important parts of ophthalmology and optometry. The most common reason why people come into eye doctors' offices, Miebo has been a game changer. Xiidra, I've been using for years was involved in the original FDA trials. And to combine both of them into one product is going to be extraordinary. And I'll go ahead [ and Lomb ] and Brent, I'll wag just some money on this. Your estimate of $700 million in sales top line, that's low. I mean that's way low. And I think that you're going to be seeing an extraordinary product. It's the only product that will address 2 parts of dry eye. It will treat the entire spectrum of dry eye, which is aqueous deficiency and meibomian gland disease. So kudos. This is going to be an extraordinary product, and I think will be the most important product in dry eye for the next decade.

Mark, do you agree?

I do. I think it's really important for us because when we're in that chair and we see a patient with ocular surface disease, a lot of times, it not just one cut and dry answer of what dry eye is. It's multifactorial. We typically see aqueous deficiency and evaporation and inflammation and all of the things. And so for us, it's really important to have the ability to have choice, but also be able to address it in multiple ways. And so right now, we have that difficulty of which one do we choose first. And so do we choose Miebo? Do we choose a Xiidra? Do we choose something else? Do we choose a procedure? Having the ability to have something that does both in one gives us the ability to choose something that's going to address multiple different areas of that so we can get our patients feeling better and seeing better and experiencing that quickly.

I think it's a fundamental thing of everything needs to be the easy button. And if we have the easy button for dry eye, which has been very, very complex with all the number of different treatments that we have, it's definitely going to be a winner. Is there something else that you were particularly excited about, Mark? And then we're going to move on to Lejla.

Yes, the neuro-protection there and the glaucoma medication. So for us, glaucoma disease is usually something where once we have a diagnosis, it's praying that the vision doesn't go away in a manner which is too quickly, right? Our job is to slow that down to a creep so that we can protect that patient's vision as they go on and as they age in life so that when they have the disease, are they going to affect their vision to where they can't drop to where they can't do the things they need to do and take away their function of life, having the ability to have a drop that's going to not only protect that, but improve that, I think, is something that we'll see dramatically address the way we're proactive against glaucoma and proactive in treating it, but also in making sure that our patients can continue to live full lives without having to think about a silent killer of vision.

I think having treatments for these diseases that we know robust a vision without having anything that's been able to improve vision in certain settings, glaucoma is one of them, but so is geographic atrophy. Do you have any thoughts on what was presented around that, Lejla?

Super exciting. First of all, as a retina specialist practicing in Academic Institution to [ Kai Center ], I very much appreciate not only the retina intervention innovations I saw today, but very much the entire portfolio. I'm just absolutely wowed by the innovation happening today at Bausch + Lomb. Focusing specifically on retina because I am a retina specialist, I find that my #1 unmet need in my clinic is exactly this AMD, intermediate to geographic atrophy. And yes, we do have now approved therapies for advanced AMD, geographic atrophy, which are quite burdensome. They do decrease the progression, but they do not save the vision or improve the vision. So I'm excited to see that Bausch is working on exactly that, preserving and improving vision. I'm excited to see that AREDS2, the #1 multivitamin that I prescribe as a retina specialist to my patients is now going to be expanded to AREDS3 to include vitamin B complex with this really genetic makeup or really precision medicine that is being looked at and seeing that vitamin B does help not only inflammatory portion, but also cell preservation. I'm excited to have that addition as a center and as an individual who was involved in NEI trials for AREDS2 formula and one that very much contributed to that. I'm excited to now be involved in AREDS2 and bring that to the market to all our patients. And then geographic atrophy. Now I hate the fact that the options we have currently involve monthly injections. That is such a burdensome option for our patients. We need longer duration options. We need biodegradable implants, and I'm excited to see that Bausch is working on that. We need also to address this from a genetic standpoint. I think some of the key partnerships that I saw today to address really genetic makeup, but also precision medicine is very applicable to multifactorial disease such as AMD. We need to really be better at understanding this disease at the biomarkers and what exactly along that disease pathway is really leading to progression and having data to analyze that and really target drug development based on that data is really promising. So I'm excited about the precision medicine that is taking place today. And lastly, I want to point out that, yes, gene therapy or gene therapy in ophthalmology has only exploded. I personally involved in over 10 clinical trials with gene therapy being developed for common retinal diseases. But all of those therapies are looking at viral vectors, which we know do cause inflammation in the eye, and we are trying to address that with various options. I am excited to see that we are genetically addressing that at Bausch, but looking at a different picture, looking at a small molecule such as interferon mRNAs and delivering that not in the operating, but actually in clinic with intravitreal approach. So lots of exciting options. GA is unmet need for sure, and I'm excited that, that's being addressed by even broader picture of intermediate AMD.

And I know we may have covered a lot of things you were excited about, Bill, but are there other things that really stood out to you in the portfolio as well?

Yes. So first of all, again, congratulations. There's so much innovation. We're seeing some key themes. The combination, again, of MIEBO and Xiidra is just -- works so well together. And if you think of another combination, which is the LUMIFY Lux, which is the combination of LUMIFY, which is so important as a medication for our patients, along with hyaluronic acid. And it's just a way for patients who have red eyes or coming and complain that their eyes are irritated and bothered, you can treat them with one drop and they feel more comfortable, but also the redness will go away. That's a major stigma for our patients. They tell us sometimes that they're going to the office and their eyes are red and they're told, is there something wrong with you? Do you have -- are you sick? Do you have a conjunctivitis? And so it is a problem. So having a great treatment that's now going to also be comfortable and lubricating should be really nice for our patients.

So talking about comfort, what -- can you tell us how are you anticipating having something to treat chronic ocular pain, such an unmet need. And can you speak a little bit to that?

Absolutely. So this is a huge innovation. So another thing that our patients come in all the time complain that their eyes are bothersome, they're irritated, they're uncomfortable. It could be an acute situation like a corneal abrasion. It could be dry eye and other situations, and they're coming in, they are uncomfortable, and we don't have a good treatment right now. We cannot give them anesthetics, that's delays healing and causes complications. And we just don't have a therapy for these patients right now. So if we can get a therapy that actually worked is effective, that could blunt and stop ocular surface pain, whether it's acute or chronic, it's going to be huge for our patients and huge for both optometry and ophthalmology.

So I wanted to go back to talking about more surgical things. And Eric, what about this Excimer Laser? I know you're an expert with Excimer Laser on the surface of the eye. What about using that precision and technology for MIGS procedures?

Well, I think one of the great misconceptions is that patients take their eye drops. Eye drops are not an effective way of managing glaucoma. It's important to have eye drops, and I think it's really -- I think the neuroprotective eye drop looks really exciting coming down, but patients just don't use them. And the model of having patients taking the eye drops with the problems of compliance, the problem of ocular surface disease. In Europe, it has already taken place. It's transformed Europe, and we have what's called interventional glaucoma. Interventional glaucoma means the doctor takes control of the glaucoma patient. We don't trust the patient. We trust ourselves. I know that if I deliver a treatment to a patient, they're going to get the desired effect. And the ELIOS machine is extraordinarily exciting. It's tissue -- it just makes 10 pulses into the trabecular meshwork. It allows outflow to improve. It's easy to perform. Every ophthalmologist can do this. And it's something that I think will change the way that glaucoma is managed. It's an extraordinarily effective treatment. We have a long track record. It's been in Europe for years, and we look very much forward to the launch here in the United States. And I think it will transform the way glaucoma is managed.

And Bill, I know you had a chance to go down to Panama and get your hands on it, too. And what did you think about how quickly or accessible it's going to be? How quickly it will be adopted?

Yes, absolutely. So interventional glaucoma is so important, but it is a challenge right now. Our devices we're using are very difficult at times to use and you have to get a lot of practice and it doesn't always go smoothly. And my experience is just so positive. It's such an easy procedure because it's just intuitive. You just place the probe right way you want to have it, step on the pedal and it makes a perfect opening in trabecular meshwork. And that, again, we have the long-term results that it works so nicely. So it's easy for the surgeon. So I think this will be adopted by surgeons much more easily than some of the other technologies that we have now.

And really, when you think about it, you have 10 opportunities to make a fenestration that's actually significantly larger than the 3 stents we might have been putting in there, each one of those. Instead of being 81 microns, it's 210 microns and you have 10 opportunities. So it makes sense. It would be very efficacious. And I know, Eric, you were in the BEYOND study for enVista, which we heard Kelly present to us that data and where we are with that. What do you think -- I know you're part of the study, but how do you think that fits into the portfolio? And what does it do for the entire breadth of the portfolio of IOLs?

Well, for those of you who aren't familiar with the different categories of IOLs, enVista Beyond is what's called an EDOF lens, extended depth of focus. It's a premium lens. Bausch + Lomb will charge a premium price for it. The doctors will do the same, and the patients will get a lens that gives them the ability to far away and mid-range vision with mono vision, maybe even a little bit more than that. But the key aspect of the BEYOND lens having put in about 25 or 30 of these lenses is that you know which patient got them in the FDA trial is that -- the problem with presbyopic lenses is they are wonderful for some patients, except when they're not. And what a presbyopic lens will do is they'll give them good vision, but they will have problems in certain number of cases of dysphotopsias, glare, halo, inability to drive at night. The enVista Beyond is the safest lens you can offer to a patient that will give them distance and good mid-range vision, even a close vision without the sacrifice of losing that distance quality of vision. The lenses we have in this category now are from other companies just aren't very good. This lens will transform the market. And the key for the enVista Beyond is that it will almost certainly bring in all the ophthalmologists who are not using presbyopic lenses but they'll feel the safety and the quality of vision that will grow the market. Right now, 7% of patients in the United States or about 350,000 patients a year get presbyopic IOLs. I could see that number doubling over the next 5 years as these lenses transform the way surgeons take care of patients.

And when you think about putting in a certain lens type, we often will go with one design and it has different optics in it. So how important is it that there's such a wide variety, and I'm going to ask that to Bill, within Bausch + Lomb kind of from the basic monofocal, what are the features of that entire platform that you think are important?

I just gives us confidence as a surgeon. So right now, you have the monofocal lens, it's a high-definition lens that gives beautiful vision for distance. And the enVista platform is also very forgiving. So some patients may have some irregularities in the cornea. But with this lens, the high-definition it gives -- makes patients see really, really well. And then also have, again, extending the platform to the BEYOND lens and then the enVi lens, which is the trifocal. Having all these choices is wonderful as a surgeon because, again, we can figure out what's best for each individual patient. And then going back to BEYOND which is what Eric shared, I have a lot of patients coming in, they share with me that they only wish they had gotten a lens that gave them range of vision because some doctors don't -- haven't bought into that concept yet. So they've only been offered a monofocal. They have a monofocal lens. So they can see distance great, but the reading glasses all the time. So having a lens that's easy, that's safe and -- really, I agree with Eric, drive the interest of all the other surgeons who are on the sidelines to start using this technology more.

That's great. And now that we're talking about cataract surgery, I think one of the exciting things that we saw and we see right outside the door here is seeNOVA and how that's kind of marrying our different surgeons together here, Leila, we get you back in the in the game here with the fact that now seeNOVA also has posterior segment. So tell us about what you think was exciting about that?

Yes. Super excited about that. As a retina specialist/surgeon who operates an academic institution, I trained the next generations of surgeons as well. And I'm really excited about this system. Why? Because it has everything in one interior segment and back part. It has optimal fluidics. I think we talked about choices in lenses and having choices for the patients, but surgeons as well. Having fluid choices in terms of vacuum versus flow base is critical for comfort of the patient, safety of the patient and precision of the surgery. So I do comment on having those options in one machine. I am a retina surgeon, so I love illumination. In order to do my job, I have to have really well led back part of the eye. And having superior illumination means I will be more precise in my retinal surgical maneuvers as well. So key superior illumination and really using laser-assisted illumination will be a game changing, I think, in this machine. And lastly, the smaller is always better in ocular surgery, and I love the fact that we're working in making instrumentation smaller and more precise for us. So overall, I think it's a complete package that's going to allow us to be more precise, safer and really ultimately delivering better care for our patients.

I love that. So I just want to say what I found really exciting about the pipeline too is precision medicine. To me, this whole concept that when drug delivery, we now start with a patient has a disease, we can start to target or find targets that make sense look at genetics, turn on and off genes using small interfering RNA. We can target the drug to the affected tissue and then we can have depot applications as well. That entire portfolio will allow us to be more efficacious and more efficient in developing drugs and treating patients. And I think it's going to be a complete paradigm shift for how we think about drug development and then drug delivery as well. I wanted to kind of wrap up our session by saying, Bausch + Lomb has great breadth and depth of products available today, great depth and breadth of products in the pipeline that we saw. But if you remember from [indiscernible] slide, he said there are 60 projects in development. So clearly, we did not see 60 today. So there's great breadth and depth of what's going on behind the scenes as well. And that's from pharma to over-the-counter to surgical to diagnostic to vision care. And when you think of that and having an eye care partner, how does that impact the ability of Bausch + Lomb to be your best eye care partner? And if we can just go down the road, we'll end with that?

Perfect. So Bausch + Lomb makes products that changes lives period, right? So whether it's a kid getting their contact lenses and being able to see for the first time or an adult who has dry eye disease that now doesn't have to carry around 6 different drops with them throughout the day because we're actually treating their disease. It changes the way that people that live their lives, whether it's the flexibility and freedom to do the things that they want to do in experience life. And so having the products that we have now gives us that opportunity, but we're still missing some things, right? You've seen some opportunities where patients aren't getting the things that they need in order to live a seamless life with their vision. Ultimately, they don't want to think about their eyes. They just want their vision to work for them and their eye health to work for them. So we still have products that are out there in our pipeline that are designed to address those needs. So having somebody that can do it all, that can give us opportunities, whether it's in dry eye, whether it's in glaucoma, whether it's in myopia control and other areas and geographic atrophy, whether any of those areas, we need those as partners because we can't do our jobs in exam lines if we don't have partners coming up with these products to give to our patients that they don't know exist yet. And so it's really great for us to have this in the public sphere so that people can see what's on the horizon, but there's even more to come, and this is only the tip of the iceberg. So it's super important for me as a practitioner to know that a company has my back and has my patients as the central focus of what they're doing and what they're creating, whether it's in a lab or whether it's through mergers and acquisitions, all of these things are so patient-centric that it's really great for me to know that I have that confidence in the company.

Thanks, Mark.

Yes. Well said. I wake up every morning looking forward to going to work because I love what I do. I love taking care of patients. And at the end of the day, what I'm looking for is I'm looking forward to something that makes patient care better. I always ask myself every time I think about what I'm doing when I stand in the podium, when I do research, when I work with my partners, I say to myself, is it good for patients? And what Bausch + Lomb has done is they have made a commitment to making patient care better. So I work with pretty much every company in ophthalmology right now, and I am converting a lot of my treatments now to Bausch + Lomb treatments because they're better products and also because I want to support a company that's supporting my profession. So thank you to Bausch + Lomb for really being innovative, for being dedicated and for having our patients' best interest at heart because you and I have a mutual commitment to providing better patient care and a company that has that commitment is a company that has my full support.

Really well said. To add to those amazing comments. I would say these are also the products I personally want to use, like we all have issues with dry eye. We will continue to have those issues, but we need better products. I'm excited to see some of the pipeline and options for that. But not only that, I take care of similarly adults and pediatric patients, and I love the fact that, Mark, you want to keep those patients in your seat and not my seat. I similarly want to keep my children actually from having to see a retina specialist down the road. And I love the fact that you have a breadth of innovation coming on from the youngest patient to the elderly patient. So I really appreciate the innovation that's happening, and I do want to provide care to all my patients with the latest. So thank you so much for that.

Amazing comments and amazing company. So I mean, we're up here today, just so excited about the future. And Bausch + Lomb is really showing us that they have a great set of products right now that really help our patients currently, but the pipeline is just so exciting for us as surgeons, for us as doctors taking care of patients and for the future. And so I feel so lucky that you're working so hard to make these products available to us to help our patients. So thank you.

And I just want to say as a physician and still practicing physician too, that I appreciate the priority that Bausch + Lomb has put on getting feedback about what our needs are and how we can actually deliver care more effectively because so often, I see that, that part is missing early in the development phase, and it's really very, very evident that it's a partnership between Bausch + Lomb and the physician community and patients, and that's really where everybody wins. So thank you.

Thank you to our esteemed doctor panel. That was very inspiring for me to listen to. So thank you for that. So now we're going to turn it into a Q&A portion of the meeting. Sam and Yehia are up here, but the whole team is up here as well, and they have microphones. So I'll direct traffic, but we're open to taking any questions anybody has. I think we have some roaming microphones as well.

Why don't we start on this side and we can work our way through the room.

It's Patrick Wood, Morgan Stanley. One high-level one and then a nerdy follow-up. High level, obviously, a big pipeline, a lot going on. The guidance as well, 5% to 7% and then a lot on the margin side. So I guess, 2-parter. One, what's giving you the confidence on that top line growth number? You've got a lot in the pipeline. What's kind of feeding that growth confidence? And then equally, second part on the margin side, it's a quick step-up in a short period of time. You've got a lot of investments going on. What's giving you the confidence there? Is that cost out? Is it operating leverage? A little bit more there would be great.

Yes. Thank you, Patrick. So the answer in part to both is similar. One is we have absolute confidence in the forecast that we provided, both the top line and margin. I've been doing this a long time. I wouldn't give it to you if I didn't have a strong conviction in doing it. But let me break it down a bit for you and then maybe, Sam, you could add some color. So on top line, I think our conviction comes from the fact that we've been doing it. We have been growing for at least the last 2 years above the market in that range and sometimes above that range. Even with some step backs this year with even a recall, we've managed to power through and deliver that kind of growth. Next year, I'm very confident we can deliver the '26 numbers that Sam already provided. We'll update that to more specific guidance in normal course in February. But really, really good comments because we've been doing it, right? That's the best predictor of future performance is past performance. I think on margin, slightly different, right? By design, when I came here in '23, I really wanted to focus on 3 things, right? It was selling excellence, really driving that top line growth that we've produced. It was around stabilizing our supply chain and Al Waterhouse and his team have done a really nice job there. Our back orders are now at historic lows. And then third was innovation, and you've seen the output of that innovation. So we've been delivering on all those things. On the third Q earnings call, I added the fourth dimension, which is financial excellence. And so that's not something that we just started in the third quarter. We started at the very beginning of the year with our Vision 27 initiative that Sam mentioned. And so we have a running start, right? We have hundreds of people that are working on tons of projects around the company to deliver that margin improvement. And we have a 3-year plan, and we're tracking it with a dedicated project management office with people that do nothing every day but track our margin improvement. And again, you're starting to see it. You see it in the third quarter. The second thing I would say to you is we just made a promise to our shareholders, and we take that very seriously. But I don't just take it seriously. Everyone sitting up at the front of the room here takes it seriously and the several hundred colleagues listening on the webcast today also take it seriously. And so when we make a promise, it's a real commitment. And so we are all in. I think we can not only do it, but Sam will get upset, I hope we can exceed it. But it's something that is absolutely an imperative for us to deliver that margin improvement.

Yes. So Patrick, I'm going to jump into the numbers right away, but I want to step back before I get into numbers and emphasize one point that Brent made, which is, when you look at the comments in between the top line and the margin discussion that we had this morning is the fact that what is needed to deliver on both of them, it's already in our hands. So we're actually working through initiatives either to deliver on the margins that already have launched, and we're seeing some of the results -- early results in our third quarter results or when you look at the top line and what we've been really able to do in the top line, we didn't talk about the innovation is coming beyond 2028. So we're talking about the products that we have in our portfolio today, which has been happening -- the shift has been happening for the last 2 years. So it's about execution right now for us. And we are at an inflection point with our margin, like I said. So let me now break the margin for you a little bit because when you think about the margin, it's 600 basis points, and it's a meaningful margin step up from where we are right now. And when you take that and you break it down -- I'll break it down between what we expect from the manufacturing and the product mix, and that's about 250 basis points. And we're seeing that shift in the manufacturing -- in the product mix already have taken place with the launch of MIEBO. We've seen the shift in the premium IOLs. We're scaling on SiHy. Our daily SiHy, our lens business has been the fastest growing for the last 6 quarters. So it's been really meaningful contributor to that. But also, we're seeing the initiative Vision 27, which have an impact and elements in our manufacturing, and we call it manufacturing transformation, and that's taking place already. Those are in-flight projects and execution has already taken place that's also contributing to that 250 basis points. When you now reflect on the remainder of the 250 basis points, there's about 400 basis points sitting in what I referred to in the middle of the P&L, which is the SG&A. And it's been our, I'll call it, the say-do mindset, right, which touches on the commitment that Brent touched on. We said that we will have about a 2-year runway around our launches. And we're exiting that 2-year runway right now. So we're exiting what we call investments in launches, investments into growth, and we're making that shift at this point. In addition to that, you're seeing also the initial 27, which we kicked off in the beginning of the year, you're seeing that start to pay dividends for us. And we're seeing that into the third quarter, and that will continue we build on as we go forward. So when you think about that 400 basis points, the way I think about it in the simplicity is about 200 basis points of that is coming from -- as we think about our efficiencies from Vision 27 and our exit of the launch to growth mode in selling and E&P. And there's probably another 200 basis points of that is coming from the G&A, which is mainly leverage as well as Vision 27.

I would also say one really important point, Patrick. The revenue growth targets with just a few exceptions, don't require any of the products that we -- most of these are '28 and beyond launches. And so we're just executing at this point, right? We're not relying on any real significant R&D risk to drive that revenue growth or that margin expansion. It's what we have today.

Okay. Let's go to the middle table here.

[Craig Gordon,] please. Brent, when you look at the totality of the pipeline, what are you particularly most excited by focused on as you think about unmet medical need, pricing power, physician adoption?

Tough question. The esteemed KOLs had a tough time picking one. I may have the same. It's like trying to pick your favorite child. Look, if I had to rattle off the top of my head, Craig, I would say in pharma, clearly, a neuroprotective glaucoma is game changing. But the combo -- fixed-dose combination dry eye is a no-brainer for us. We have the permission to win there. We are the leader. Andrew detailed it already. We have the best field force. We already work with all the KOLs around education and training. We have diagnostics. We have OTC products. We have a lot of energy in that space. And I agree with Eric and Andrew is going to have to change his number, but that product is made for us as we are positioned today. Clearly, the retina programs much earlier and a little further out, but absolutely game changing once we bring some data over the next year or 2 into the profile of the company and what that can do to margins and everything else is just transformational. Contact lens, clearly, the innovation and Project Halo that Brian's team and Yang team talked about. I mean that was a post recession, as Brian said, I saw 3 years ago, and we challenged Brian and his team to bring that to market. And it's just such a proud moment for me to see that moving into full development. I think, Mark, you probably have never seen -- since you look younger than you are, but you've never seen a new material as you've been a professional. All right, in 1999 when we launched. So if he remembers ChryserVision in 1999, he was probably watching the shows that you had on -- he knew the Backstreet Boys too. But honestly, it's been a category starved of real breakthrough innovation, and we need innovation to bring more wearers and to expand the market in a responsible and healthy way. And so that's super exciting. I think enVista Beyond, as Eric and Bill mentioned, game changing for our premium IOL portfolio. And then in consumer, AREDS3, as discussed. I mean, to be able to have something for early AMD patients to slow progression is just so important. But it also, from a business perspective, really expands the market for a category where we have plus 90% market share. So big, big potential. But Yehia, any...

Well, I think you covered it well, Brent, but I have to say 2 things before I say my favorites. First, that I love all my children. So all of them, I love them very much. The second, all my children are very jealous. So if I say one is better, I am in big problem. However, I just -- again, I would like to mention that it's really the beauty of the development of products that can change lives is remarkable. And that's why we are focusing on products that is really not adding a week of duration or not adding another 10% or 5% of an improvement versus what is present. We are trying to address things that is not being addressed now, and this is the highest unmet medical need. Having said that, ocular surface pain is still one of the areas that I feel very much -- you cannot imagine if you have an irritation in your eye, how much this can disturb your life. I also, on the surgical side, and while Brent, I 100% suffer from the different types of far distance or intermediate. But also, I must say on the equipment side, just the glaucoma, and we are able now to treat the glaucoma with a very rapid procedure and how we can just do very rapid channels with Excimer Laser that is very gentle to the tissue. In the past, we used to create this through laser that burns, the trabecular meshwork and can cause even some fibrosis. Now to reach to this level of technology where we can use Excimer Laser with its precision and how gentle it is on the tissue is definitely a great innovation that can change a lot. And then on the contact lenses, myopia. I must say, I see a lot of children now, and I see a lot of adolescents now are a big problem. And I used to be a retina specialist. I saw a lot of complications from pathologic myopia, it's one of the worst things that you can see in a young person. He's still starting his life and just going to work and he just hit his macula with a new vascularization that is from myopia. So to be able to stop this at an earlier stage without any doubt is a great potential and option.

So if you can do it quickly, Mayssa, since many of these are your children on retina, let's just go to retina. What's your favorite?

So I want to amplify what Lejla and Cathy said. The precision medicine with the partnership with Character Bio will be transformational. It is a heterogeneous disease. Photoreceptors die for lots of different reasons. This is a way for us to really transform how we match the drug with the patient. We've already seen what this has done in oncology and immunology. AMD will be next.

Okay. Let's go to our next question at this table here.

Matt Miksic from Barclays and great overview and presentation and rundown today. Just to confirm something about the guide, obviously, margin expansion above the Street, sales growth above the Street. EPS growth on the Street right now is double digit, and that's kind of what you said. I mean it's just fair to say no reason why that upside doesn't drop down. That was just one thing to confirm...

Yes, Matt, I can definitely confirm that to you. And if you think about the margin expansion and the profitability that we have, and we put in the appendix a little bit more details for everyone to be able to update their models. But when you see the margin drop to the EPS, it is definitely a double digit. So I think if you do the math, I think based on where we are from the Street, we're probably -- again, you're probably in the range of about $0.40 or so higher than the Street.

That's great. And then on -- you mentioned M&A, disciplined M&A in the plan. I'm assuming that's baked into the leverage goals that you have, like some amount of M&A, but maybe not baked into the sales projections. Just a confirmation on that and...

That's absolutely true. And I think having sometimes been known for M&A, which I don't particularly, I'd rather be known as an operator, but it is what it is. The the best position to be in for M&A is when you don't have to do it. And there's nothing we need to do. There's only things we're excited to do because of the technology. And so there's nothing in the forecast related to any future M&A, both on the sales margin or cash flow. But I don't expect us to do big things. There'll be small IP-related kind of things.

Okay. And remiss not to ask if anything you'd share on areas of interest, areas of investment, white space or anything like that?

Yes. I mean we continue to look to find true innovation. Lately, we've been focused a lot more on our surgical business because the opportunity there, I think, is quite massive for us, and we have very ambitious goals for that business. Pharma, you see has a very robust pipeline already. Obviously, if we could find things that were quick adds to the existing bag, if you will, that would flow through right through to margin and profitability, that would be interesting. Something that's small that we could scale with very little additional cost to us would be appealing. In Vision Care, it's loaded. I mean, Brian's team, our internal depth of R&D is immensely strong. It's hard for us to find exciting things externally. And in consumer, the team executes on everything -- what we did with Blink and what John's team did with Blink gives me a lot of confidence to find other products if we can find the right ones.

Okay. Let's try to go maybe at the back of the room, Christy, if you can...

Kevin Joaquin from Evercore here in place of Vijay. Just one on the adjusted EBITDA margin target. You presented a slide earlier talking about the efficiencies and margin contribution, specifically from the surgical business. How should we think about the margin contribution from the other businesses like consumer, pharma and contact lenses?

Yes. And when I refer to the surgical business or efficiencies, it's really focused on -- I would think about the entire margin aspect of it. You'll see the contribution from the surgical showing up mainly on the gross margin with about the 250 basis points. And I think a lot of the work that our manufacturing and supply chain team and Al is doing is building on that capability and executing on that right now. So you'll see a lot of that happening with the product mix shift as well that we're seeing to premium IOL. So I think that surgical is going to be a big player as we think about it from a meaningful contributor to our gross margin. When you think through the SG&A side of it, it's pretty much across the board. I think you might find a little bit heavier weighting towards the pharma business because we had the most recent launches and as they sort of exit that launch phase. But really, when you look at it, it's really across the board between the different businesses as well as the, I'll call it, the G&A functions.

Okay. Why don't we go back to the middle of the room here?

Joanne Wuensch from Citibank. It strikes me the company is in a very different spot than from its IPO moment. And to quote, I think it was Dr. Donnafeld, who said this, there's a slumbering Bausch + Lomb that seems to have been woken. I'm paraphrasing. What do you think is...

I think it was more direct.

What do you think is the main driver that brought you here today? And what do you think is the real risk to executing upon this? I hear the confidence, but I think the risk is something that's worthy to address?

Yes. No, it's a great question, Joanne. Thank you. Look, I think the main driver of change is people. The talent within Bausch + Lomb that we've promoted and developed or those that we brought in over the last 3 years is really what's changing the paradigm for us. And with talent, right, comes culture. I always say this, the only investment you can make as a CEO that has unlimited compounding potential is talent. I can invest in a new pharmaceutical product that has a limited life of the intellectual property. We can put in a new IT system, but in 10 years, it will be obsolete. But talent contributes forever because A players recruit other A players and so on and so forth. And then that impacts culture. And we spent a lot of time over the last 3 years really focusing on this idea of grid -- what we call gritty ownership and accountability, eliminating bureaucracy, making individuals accountable for delivering decisions and empowering our teams to get stuff done. And that has a big impact. It had a big impact on the sales growth, to be honest, because we really just allowed people to focus on customers rather than internal meetings. In terms of risk, I mean, there are always the unknowns, right, like we had with tariffs, right, in the first half of the year. And so I think the biggest risk for us is just pure execution risk. I think the unknown risks are just things that could change in regulatory policies or reimbursement policies or things like that outside of our control. But the one thing I would say this year has taught us, whether it be the constant flurry of tariff changes that we've navigated quite well this year and are well prepared to deal with next year and beyond or even -- I don't like to talk about it much, but even the recall, how quickly we jumped on it, solved it and got back into the market and earned a lot of trust with customers for being so transparent and forthright about it. So when we see an obstacle, I think we're starting to build that muscle of really being able to overcome those obstacles. So that's what really drives my confidence in our team and our ability to deliver what we had. The thing that keeps me up at night is what I don't know that just may be around the next corner, but we'll conquer it when we find it.

Okay. Thank you. We have time maybe for a couple more questions. We'll start with Young here.

Young Lee, Jefferies. I wanted to hear a little bit more about, I guess, your view on the competitive landscape over the next 3-plus years? There's lots of new products coming out from competitors as well. For example, AT-IOLs, there's a new dry drug as well. You also have a lot of much bigger competitors out there. It sounds like you might be more nimble than some of them, but I wanted to hear your view on the competitive dynamics and if that's baked in or how much that's baked into your LRP?

Yes. So obviously, we take every competitor seriously, and we monitor them in great detail. But this is really about us and executing on what we have. When I look at the competitive environment, let's just pick one you mentioned like in dry eye, yes, there was a competitive launch in the third quarter, yet you saw all-time TRx growth at a high for both of our products during that quarter. So just a proof point that competition isn't an excuse that we're going to make. We're going to continue to win around competition. Even in surgical, right, even in the face of a recall on enVi, you see enVi still doing very well even when Alcon or others are launching improvements to their IOL portfolios as well. We continue to see good placement of capital equipment in the face of a very large competitor offering their new platform phaco equipment. And so sometimes we think of ourselves as a David and Goliath, and we're David and the underdog. But we really aren't when it comes to our product portfolio and our ability to execute in the marketplace and work with our great customers. So competition is a part of life. It inspires us to be at our best, but I don't think it worries me in terms of delivering the forecast.

Okay. Let's go to Robbie.

Robbie Marcus, JPMorgan. I feel like people are very comfortable with the top line. You've done a great job there. One of the areas that's been a little softer has been free cash flow generation. You put up a target for 50% adjusted operating cash flow to adjusted EBITDA. How do we think about that in actual dollars of free cash flow? I don't think many of us adjust it. So how do we think about maybe free cash flow over the time?

Yes. Great. I'll let Sam answer it. But remember, one thing that Sam said is more than 50 and more is important. Go ahead. I keep pushing them for higher.

I was going to start with that. So when you think about the cash flow and maybe the best thing to reflect on is the past to the future, right? And if you look at Q3, we're at probably about 66% conversion on an adjusted cash flow from operations to EBITDA. So you see the steps of the work, and we've been talking about this in terms of what we're going to be doing in terms of capital -- working capital initiatives. And again, what gives us the confidence not only in the margins and the top line, but also on the cash flow is we're seeing the work that we've been doing is paying dividends, and we're seeing those dividends coming through. So when you reflect on the cash, there's a couple of things that I'll highlight for you. One is the working capital initiatives that we're doing is not just a short term. They are transformational. They are changing. It's a mindset. It's a change in our process, it's change in how we're operating. And that's a long-lasting effect. And that's where we get to the more than 50%. When you think about other element of this, which is our CapEx, right? Our CapEx has been -- we've been running at a higher elevated CapEx level where this year, we're just going to be just under $300 million. And we're seeing that CapEx number continue to work its way down. And especially if you heard what Brian and Young were saying, I was probably the person having the largest smile in his face when they were talking because the fact that you're shifting your entire new innovation in the lens business to be manufactured on existing lines, that's huge, and it's very meaningful, not only from a margin perspective, but also from a cash flow perspective because one of the -- many of you guys follow lens companies and many of the challenges or the barrier to entry for those companies is the fact that they have to put CapEx upfront. So you're not going to need to put that level of CapEx upfront as we go forward. So we feel very good about how we think about the conversion, which is more than 50% as you think about -- and you can think about the 23% EBITDA margin, you think about the average of the 50%, and that probably will give you a sense of the dollar amount. Yes. The main element of when we think about the adjusted was maybe coming through our restructuring activities. That's the bigger player in terms of between reported and adjusted for our cash. And we were at a higher level from a restructuring point of view in 2025. Hopefully, everyone knows now why as we -- many of you guys were talking to say we are spending more restructuring, but we were actually doing a lot of work around Vision 27. I would expect that number to continue to work its way down as we move forward gradually.

All right. Thank you, everyone, for the questions. Maybe I'll hand it over to Brent for some closing remarks.

Great. Let me try to stand up here. So thank you all for coming. I really appreciate you spending this morning with us. It was an exciting day. And I really wanted to leave you with 3 things to define where we as Bausch + Lomb stand and where we're headed. First, we are executing the strategy we set in motion nearly 3 years ago. And I think it's clear it's working. The foundation we are building through our Vision 27 initiative gives us great confidence to raise the bar with a new standard financial excellence, which I started to talk about in the third quarter. Second, we're not just growing, we're outpacing the market. The revenue and margin targets we shared today aren't aspirations, they're absolute commitments, and we're on track to deliver sustained profitable growth year after year. Third, you heard directly from our R&D and commercial leaders writing our next chapter. Our pipeline is diverse, it's differentiated, and it's really designed to reshape the eye health industry. These also are on promises. There are products, there are platforms, there are science, there are technologies that will define our leadership for the years to come. So we've rebuilt the company, we've reignited our culture, and we certainly have restored our confidence. But the real growth story is still very much ahead of us. To my 13,000 colleagues, many who are listening on the webcast, thank you for believing in what's possible and proving every day that we can make it real. Thank you for joining us again this morning, and I hope you know that the best of Bausch + Lomb is still yet to come. Thank you so much.