EyePoint, Inc. (EYPT) Earnings Call Transcript & Summary

Good afternoon. Thanks for listening. My name is Jay Duker. I'm the President and CEO of EyePoint. I'd like to thank Goldman Sachs for inviting us to present today. And we are a publicly traded company, and I will be giving some forward-looking statements. If you'd like our full legal disclaimers, I invite you to go to our website. EyePoint is the leader in sustained-release drug delivery for retinal diseases. Our lead asset is called DURAVYU, which consists of vorolanib, a small molecule tyrosine kinase receptor inhibitor, which is best-in-class. It's patent protected. It's in our patented Durasert E sustained delivery technology, which makes the inserts fully bioerodible. We are currently in 2 pivotal Phase III trials in wet age-related macular degeneration. The first trial is called the LUGANO trial, and we announced several weeks ago that the trial is now fully enrolled with over 400 patients randomized. The second trial is called the LUCIA trial. We announced it's 60% enrolled as of several weeks ago, and we've updated our guidance to have full enrollment in the LUCIA trial in the third quarter of this year. In addition, we're the only TKI program to be in diabetic macular edema or DME. We had highly positive efficacy and safety data from our Phase II VERONA trial in DME. And in fact, we've had favorable safety profile across multiple indications with over 190 patients treated with DURAVU to date. Our cash looks great. We currently have $318 million at the end of the first quarter, which gives us a runway into 2027, approximately a year post data from the Phase III trials. This is our pipeline. Again, we are in Phase III and 2 wet AMD trials, LUGANO fully enrolled, LUCIA by 3Q. We have positive Phase II DME data, and we will be updating our DME plan later in the year for pivotal trial. And in addition, we have EYP-2301, which is the small molecule called razuprotafib that we've been able to put into sustained release. This is a TIE-2 agonist, and we will be advancing it for serious retinal diseases. We have some pretty good treatments for wet age-related macular degeneration. They're safe and effective, but they all lack one thing, which is durability. And there's significant evidence that we need more durability in wet AMD. Many patients are chronically undertreated. And in the long term, many patients lose vision because they are undertreated. The short-acting current anti-VEGFs put a great burden on patients, on practitioners, on families and on society, and missed visits can result in permanent visual loss. There is evidence that even one missed visit in scheduled therapy could result in significant visual loss. The fact that we have an aging population with increased lifespan only means there's going to be more and more patients who get wet age-related macular degeneration and require long-term therapy. Diabetic macular edema is another area for which we have good treatments, anti-VEGFs that are safe and effective. Durability is needed. Diabetic macular edema typically affects working age people who have multiple concurrent clinical problems, have to go to multiple doctor visits and the significant burden of intravitreal injections, especially in the first year means that patients can be very noncompliant in this disease. DME is prevalent. About 1/4 of the patients will develop it. Currently, the market is about $3 billion. And again, up to 51% have delayed or missed visits, resulting in significant visual loss. So our solution is DURAVU. DURAVU, again, is a small molecule tyrosine kinase inhibitor that is in our patented delivery system that we call Durasert E, E for erodible. The Durasert delivery system has already been in 4 FDA-approved products and a non-erodible form. Durasert E is -- each insert is tiny. It's about 15,000 to the vitreous cavity, and it's delivered in the retina specialist office with a standard intravitreal injection. Durasert E provides continuous dosing, what we refer to as zero-order kinetics. Zero-order kinetics means after initial burst of the drug, you get a steady-state release for the lifetime of the insert. In humans, we believe the inserts will last a minimum of 6 months in all patients, and the majority of patients should have the drug depleted by month 9. These are solid injectable inserts. They're in a bioerodible matrix, and they are designed to erode drug fully before the matrix goes away. What you don't want is your matrix to go away before the drug is fully eluded because you will then have free drug particles in the eye, which can be a problem. We have favorable safety profile across multiple indications. And again, this is a fully erodable matrix. Vorolanib is a small molecule tyrosine kinase inhibitor, selectively inhibits all VEGF signaling because it inhibits all VEGF receptors. In addition, it inhibits PDGF, which should lead to an inhibition of fibrosis. In the long term, there are 3 reasons why wet AMD patients lose vision. The first is noncompliance. The second is fibrosis. And our drug should tackle both of those problems. Durasert E, again, 15,000 of the vitreous cavity for each insert, but our scientists have been able to manufacture this in a way that it is now 94% drug, only 6% matrix. We have shown in animals and now in humans looking at our diabetic macular edema data that we have no delay in the onset of our drug release. In animals, we've shown the drug reaches the choroid within hours and within a day is at therapeutic levels. The zero-order kinetics results in no fluctuations, which should mean no fluctuations in control of the fluid, which is important for long-term visual acuity. We have no free floating drug particles in the eye. And interestingly, we don't need cold storage. We can be shipped and stored at room temperature, which is a real advantage when you think about how big the freezers that retina specialists have to have with all the current FDA-approved products. Also, very important, we have no PEG. PEG has been implicated as the cause of potential vasculitis in sensitive patients. And we know -- we don't have any PLGA. PLGA releases into an acidic environment and has the potential to cause corneal toxicity. We've completed 4 studies so far, the DAVIO Phase I wet AMD trial, the DAVIO 2 Phase II wet AMD trial, PAVIA NPDR trial and VERONA Phase II DME trial, a total of 191 patients treated with our drug with no safety concerns. We've had no DURAVYU-related ocular or systemic SAEs reported to date. There has been good to excellent efficacy shown through these 4 trials. I'm now going to talk a little bit about our exciting wet AMD program, the LUGANO and LUCIA trials. These trials are designed as a noninferiority primary endpoint. This is an established approval FDA pathway. The last 4 wet AMD approvals have been with a noninferiority design. We had a non-inferiority robust Phase II trial, which showed excellent results and our Phase III program was modeled after that. We've had proactive FDA interaction, both at a Type C meeting in 2022 about our pivotal program and again, at an end of Phase II meeting in April 2024 with agreement with the FDA on the trial design and written alignment on our masking and our non-inferiority margin of minus 4.5 letters. This is also what we refer to as a [ clinical ] trial design. Doctors are used to the on-label 2-milligram EYLEA control arm. They know how it's going to behave in a drug against it. They will know how to use this in the real world. To review the DAVIO 2 Phase II wet AMD results, we had 2 doses of our drug, 2 milligrams and 3 milligrams versus an on-label EYLEA 2-milligram control, and there was essentially no change in visual acuity at the primary endpoint. The 2-milligram arm was minus 0.3 letters worse than EYLEA. The 3-milligram arm was minus 0.4 letters worse. When you did this as a p-value, the p-value for these being identical to control was 0.0009. So we had essentially the same control of vision that on-label EYLEA had. I've emphasized safety already, but the reduction in treatment burden was about 80%, depending on how you measured it. Reduction in treatment burden can refer to a retrospective look back on how many injections did these patients receive leading into the trial. And we had about a 90% reduction in treatment burden looking at this way versus how many shots withing the trial did the patients get after the load. And we had about an 80% reduction looking at it that way. And this was a tough to treat group in our Phase II. They were previously treated patients who on average had about 10 injections a year normalized leading into the trial. In the United States, on average, patients receive about 6 injections a year, so this truly was a needy VEGF-mediated disease patient population. 2/3 of the eyes made it about 6 months after our drug was inserted without any supplement and about 50%, they did a full year. We had excellent anatomic control. Anatomy is measured on optical coherence tomography or OCT with a normal foveal thickness of about 300 microns. Anything above 325 is considered to be abnormally thick. You can see from this slide that the anatomic control was less than one standard deviation of the test. So this went on to inform our Phase III trial design, which you can see on this slide. The Phase III trial design consists of 2 arms: DURAVYU 2.7 milligrams, which is our higher payload insert with 94% drug payload against on-label aflibercept control. All patients get randomized on day 1. They receive aflibercept at day 1, week 4, week 8. 30 minutes later, then they either receive their first dose of DURAVYU or they receive a sham. Patients come in monthly and are evaluated monthly. Every other month, the DURAVYU arm gets a sham, the aflibercept arm gets another aflibercept. And then at week 32, a second injection of DURAVYU is given. We are hoping for a label of every 6 months. This is a 2-year trial, but we expect to submit the NDA at the end of 1 year. Again, the primary endpoint is noninferiority change in visual acuity between the DURAVYU arm and the control arm with a blend of week 52 at week 56. LUGANO is fully enrolled. LUCIA should be fully enrolled in 3Q of this year. A couple of announcements to make about this as well. We're really proud to announce that the EMA has approved our protocol. So we now have approval of the 2 largest regulatory agencies in the world. Some of you may be aware that the EMA barrier to approval for clinical trials is somewhat higher than the FDA. And that also leads us to be optimistic that should our trials prove to be positive that we could get approval in Europe. We have now the first European site in the Czech Republic up and running and have now enrolled the first OUS patients in the LUCIA trial. This is a time line for the trials. And again, starting in January of this year, and you can see how rapidly we were able to enroll LUGANO. Again, we enrolled over 400 patients in about 7 months. It is, we believe, the fastest enrolling wet AMD trial recorded to date. LUCIA is started several months behind, but is enrolling at approximately the same rate. We then expect top line LUGANO data in mid-2026 top line, LUCIA data several months later, but they are identical trials. And if we are -- had a positive top line in safety at LUGANO, we have every reason to believe LUCIA will have a similar result. I'd now like to talk a little bit about diabetic macular edema. DME is also a prevalent problem worldwide. We did a Phase II VERONA trial in DME. The attempt here, of course, is to reduce the treatment and visit burden in diabetics without harming the visual acuity outcome. And you can see from this slide with the 4 approved products, how often the patients would need to come in for injections and at the bottom, what we hope to accomplish with DURAVYU with every 6-month dosing. The VERONA trial enrolled only active DME patients. They had to have decreased vision and they had to have significant fluid to be enrolled in the trial. So this is the first trial, which we enrolled patients that 100% had wet maculus. On day 1, the patients received aflibercept and then 30 minutes later, they either received 1.3 milligrams of DURAVYU or 2.7 milligrams of DURAVYU or they received just sham. The primary outcome of this study was not visual acuity. The primary outcome was time to first rescue. And so there were no other mandated injections in this trial after day 1, but the patients came in monthly and they could be subjected to supplemental injections if they met supplemental criteria. This is the top line result of the VERONA trial. The high dose, the 2.7 milligram dose, which is the dose we're using in the Phase III and our presumed go-to-market dose showed that the primary endpoint was achieved, extended time to first supplement versus the aflibercept control. We had early improvement in both best corrected visual acuity and anatomy measured by central subfield thickness on OCT with the improvement of 7 letters at the end of the trial and minus 76 microns dryer in CST. And again, safety looked very good, no SAEs reported due to the drug. This is the curve of visual acuity. And I'm only showing the first part of the curve here because no patients received a supplement before week 12. So this is directly head-to-head EYLEA versus DURAVYU. And you can see at week 12, the blue line, which is the high-dose DURAVYU 2.7 milligrams was significantly better than EYLEA. But I'd also like to point out week 4. Week 4 is directly head-to-head DURAVYU against a single EYLEA in a wet population. And look at the improvement in visual acuity and drying that occurred as early as week 4. And this was sustained for most patients throughout the study. So if you're a patient and you have a decreased vision in a wet macular due to DME, would you rather get better at 4 weeks? Would you rather get better in 6 months? I think most of us would pick 4 weeks. So this is an early and sustained effect in visual acuity through the length of the study. At the end of the study, all 3 arms ended up with the same visual acuity, which is fine because in the pivotal trial, we're going to likely do a non-inferiority. We don't have to be better than EYLEA. We just can't be significantly worse. Within this trial, however, there was a single outlier. And if you go back and look at the blue line again and look between week 20 and week 24, notice how the visual acuity drops. That drop was a single patient who lost 20 letters, and they were late coming in. That week 24 visit should have been a week 20 visit. And by the way, they did get supplemented at week 24 and their vision came back. But if you take that patient out of the equation and just look at the rest of the patients in the high dose, the high dose gained 10 letters, significantly better than EYLEA. And this is the anatomy. And once again, what's powerful about this is the anatomy and the acuity, the structure and the function match perfectly. The visual acuity improved in 4 weeks and the anatomy improved in 4 weeks. That tells you it's real. And this is again what retina specialists look for. They look for the improvement in anatomy because we know that the visual acuity can lag sometimes in this disease, especially when treated with anti-VEGFs, it can take many months for the vision to improve. But with a high dose, we had early and sustained improvement in both the vision and the anatomy. And that continued in the high dose and the low dose as well throughout the study with 75-micron improvement versus only a 43-micron improvement in the EYLEA arm. We then went on to do a subgroup analysis and said, let's just look at the eyes that were unsupplemented. They purely got our drug or they purely got a shot of EYLEA. Let's see how they did. The top is the visual acuity. And again, the blue line is 2.7 milligrams DURAVYU only after that single shot with EYLEA at day 1. Notice that the improvement in vision is 7 letters at week 4 and about 10 letters at week 8. It's very fast vision improvement, and it's sustained. The line is flat through the rest of the trial. What this tells you is when this drug works in DME alone, it works really well. These patients weren't gaining fluid or losing vision at the end of the trial. And again, look, the second graph at the bottom is the CST, early improvement of 120 microns. Now these eyes started at 420 microns. 420 minus 120 is 300 microns on average, they were normal within a month after injection. And it was sustained throughout the study. So again, these are about 70% of the patients were rescue-free in the high dose and the results were really, really fabulous. Now I want to show a couple of cases. This first case is from the 2.7 milligram arm, and they did not get supplemented. This is purely with our drug. On the top left is the screening, and you can see this eye has swelling. If you've never seen an OCT before. These black areas in here, that's the fluid within the retina. Best corrected visual acuity is 50 letters. That's not great. 20/20 is 85 letters. And you can see between screening and day 1, the eye got worse, dropped 4 more letters and got more fluid. What did they ever receive before? They had 2 EYLEA injections 12 months and 10 months before enrollment. They had Vabysmo 7 months before enrollment. So Vabysmo probably were off by them, but you can see this active disease. And how did they do? Well, take a look. At month 1, that is a normal foveal contour, normal macula and improved about 20 letters at month 1 and stayed improved through month 6. Now you could argue, well, maybe that EYLEA did the job for that month 1. Well, maybe except that the EYLEA would have worn off by month 6. So that shows that immediate improvement in good longevity of our drug in this DME patient. The next case, I think, is even more impressive. If you look at the top right here, you can see this patient got Avastin 9 months before enrollment and then basically got monthly Vabysmo. So if you think the retina specialist has given monthly Vabysmo, why are they given a monthly because they feel like they need to. Otherwise, they would have extended the interval here. So how did they look 2 months out of the last Vabysmo? They had a cyst of fluid, they had 72 letters. And then several weeks later after screening when they actually got enrolled, they have even more fluid. Now at month 1, they had less fluid, not a lot less, still had some activity. You might say, okay, that was the EYLEA effect. Maybe. But at month 4, there are almost no normal foveal contour and look at the improvement of about 15 letters. That's 3 lines on the eye chart. And look at month 6, no fluid, no normal foveal contour, 80 letters. So here is 6 months after our drug went in, take a look at what they were 2 to 3 months after Vabysmo. I think you argue in this eye, our drug was better than Vabysmo for DME. So the summary of VERONA is we met the primary endpoint for both doses, immediately clinically meaningful results without a full load of aflibercept, just one. We got that significant improvement, and it lasted in the high dose through the length of the study. The subgroup analysis showed that the supplement free eyes were what was really driving the excellent result and continued favorable safety and tolerability. We have an end of Phase II meeting scheduled with the FDA for next month. We will update investors and analysts at the -- likely the end of the summer, early fall and what the plan is for DME. But at present, we intend to start the DME pivotal trial or trials in 2026. We're very proud of our new manufacturing facility. Our planning all along has been to grow EyePoint as a successful pharmaceutical company, not just thinking about the next clinical trial success, but long-term success and long-term drug development. We realized several years ago that our Watertown facility was not going to be adequate for commercial. And we sought out a new facility. We looked all over the United States, ended up with a site about 45 minutes west of Watertown in Central Massachusetts in a small town called Northbridge. We built a 41,000 square foot facility with 8 state-of-the-art clean rooms that opened in October. This is built to U.S. FDA and EMA standards. We actually had the FDA involved in some of the planning. So we had their sign-off on the plans. And we are in the midst of doing DURAVYU registration batches to support the future NDA filing. We would expect that this facility could fully support, if successful, the commercial activity for DURAVYU, both in the United States and ex U.S. We believe that we can make over 1 million inserts a year potentially in this center. So this has been a really, I think, terrific story of execution by EyePoint. I do like to brag that the first patient ever treated with DURAVYU was treated in January of 2021. And here we are about 4.5 years later, fully enrolled in one pivotal trial with another one about to fully enroll a brand-new manufacturing facility and really terrific efficacy and safety data for our drug. The green check marks show you some of the things we've done in the last year with upcoming events, the end of Phase II meeting for DME, full enrollment for the LUCIA trial we expect in 3Q and top line data for LUGANO mid-2026. Thank you again for the invitation. I appreciate you all listening. And if there are any questions, happy to answer them.