Sight Sciences, Inc. ($SGHT)

Good afternoon. I'm Ray. I'm part of the Medtech research team here at Bank of America, and it's my pleasure to introduce Paul Badawi from Sight Sciences here today. Welcome, Paul. Thanks for being here.

Our mission at Sight is to develop transformative interventional technologies that procedurally elevate the standard of care, allowing eye care providers to elevate the standard of care and empower patients to keep seeing. We are an interventional eye care leader. We are active, commercially active in 2 large growing segments in eye care anterior segment, glaucoma and dry eye disease. Glaucoma is the world's leading cause of irreversible blindness and dry eye disease is one of the leading causes, if not the leading cause for a visit to an eye care provider. Some exciting news at Sight Sciences. Late last year, the middle of October, I believe, we announced we're pioneering a new category in eye care, reimbursed procedural dry eye. We announced our first 2 payer successes, 2 MACs, Novitas and First Coast established fee schedules for TearCare. So we're very excited to be building that business as we seek additional market access. We have a very strong balance sheet to drive commercial growth, selective investments as we -- on the TearCare side and reimbursed dry eye as we drive additional market access and also prove the business model within First Coast and Novitas and make targeted commercial investments there and also continue to scale our growing interventional glaucoma business led by OMNI, developing -- further developing the combo cataract market and also developing the stand-alone glaucoma market. Very strong gross margins historically and continuing. We also have a history of very disciplined operating expense management. Something unique that's developing right now is as we pioneer reimbursed dry eye and we continue to scale interventional glaucoma, we're developing this really unique intersection as we build a leading interventional eye care company. There's an intersection between our 2 businesses. There's an intersection of our customers. There's an intersection of our patients. A lot of high-volume surgeons, high-volume glaucoma surgeons, high-volume cataract surgeons, have lots of dry eye patients, a lot of glaucoma patients also have dry eye disease. And so there's a really interesting overlap as we scale these 2 businesses. We call it the intersection of intervention. Internally, we call it IX. It's kind of this third proprietary value driver within Sight. We believe strongly and a number of our interventional-minded customers believe strongly that early intervention for patients is better. Patients do better. If you intervene earlier, the long-term outcomes are better. There's -- it's one thing to have an interventional mindset, but then actually activating that interventional mindset and performing cases is another exercise. That's the market development that we're focused on. So this is kind of a strategic road map of how we do it, how we partner with our customers to move from an understanding of intervention and the benefits it can have for patients to identifying those patients, educating them on the benefits and ultimately performing those procedures. So EMBRACE, starting with EMBRACE -- EMBRACE procedural intervention as a better alternative to medication management, identify those patients who can benefit from procedural intervention, educate them, educate those patients. And ultimately, when you do this well, you can activate intervention, whether that's a glaucoma, minimally invasive glaucoma procedure in the operating room or a procedural dry eye intervention in the office. So here's a snapshot of glaucoma. Again, it's the world's leading cause of irreversible blindness. Right now, it's still standard of care is mostly daily eye drops and maybe in-office lasers. There is a need for more procedural intervention earlier, a large and underserved market, about a $6 billion addressable U.S. market, over 4 million patients in the U.S. have been diagnosed with glaucoma. Our flagship technology, OMNI. It's a very comprehensive MIGS procedure. It allows the surgeon to access the entire circumferential disease outflow pathway that causes glaucoma through a single bloodless sutureless clear corneal incision. Very comprehensive procedure, safe, efficacious, user-friendly, long-term proven clinical outcomes. Our technologies, our minimally invasive glaucoma technologies have been used, as you can see there, and about 390,000 procedures to date. So very well established. It's clinically very proven. We've got very robust data, retrospective data, prospective long-term data going out to 3 years, significant real-world evidence, proving the consistency of outcomes when a surgeon does treat the underlying cause of disease, the disease outflow pathway comprehensively, they see consistently good outcomes. Those outcomes led to a very strong indication for use from the FDA. I think we have one of the strongest labels in MIGS. Our technology OMNI is indicated for lowering intraocular pressure in adults with primary open-angle glaucoma. So large market opportunity, both for combo cataract as well as stand-alone. Here's a snapshot showing the different market opportunities. Again, our label allows us to educate on all of these benefits of OMNI in combo cataract, both mild, moderate and severe as well as stand-alone, mild, moderate and severe. They're all significant opportunities today. Most of MIGS is done in combination with cataract. So you see that mild to moderate combo cataract, about a $4 billion opportunity. There's an opportunity for expanding that combo cataract market. And then the stand-alone market, which you can see down below, also very significant. Actually, the stand-alone is on top, combo cataract is on bottom there. So today's market, most of the revenue in MIGS is combination cataract. While there is a much bigger market opportunity in stand-alone, most of the revenue, there's very little revenue in stand-alone. So that's the opportunity to develop the stand-alone market, bring patients back to the operating. They likely already had cataract surgery. They may have had MIGS at the time of cataract surgery. There's an opportunity to bring them back for a stand-alone minimally invasive glaucoma procedure. So in total, about a $6 billion market opportunity. Here, it's a breakout of what I was just getting at in combo cataract and standalone. Again, market-wise, 90% of revenue in MIGS, combo cataract, 10% of revenue in MIGS is stand-alone. Our mix is maybe a little bit different. I think we have a higher mix of stand-alone, about 85% of our OMNI revenue is done in combination with cataract and about 15% is done in stand-alone. We obviously have an effort underway to expand the stand-alone market. We have got a team, a really good team dedicated to expanding that market. Here's the patient journey. Here's the unmet need. As you can see, cataract and MIGS, cataract is very high-volume surgical procedure, often presents -- patients can present with glaucoma. They might get MIGS at the time of cataract surgery, they might not. After a few years after cataract surgery, there's millions of patients who have had cataract surgery, either had glaucoma at the time of cataract surgery, got MIGS, didn't get MIGS, developed glaucoma after cataract. So they're pseudophakic, they're stand-alone. They could benefit. Think of a patient who's 2 to 3 years out following cataract surgery on, say, 2 to 3 medications, should you allow that patient's pressure to continue climbing, should you offer them another medication or should you surgically intervene with something that is consistently reliable and can help get the pressure down and the reliance on medications down. We believe, obviously, that minimally invasive intervention is a better option. We have a number of surgeons who also believe the same. Moving on now to interventional dry eye. This is a new category that we're excited to be creating reimbursed procedural dry eye intervention. Here's a snapshot of dry eye disease, what it looks like. Historically, most practitioners believe that dry eye was an aqueous deficient problem. The reality is the majority of dry eye disease is due to obstructed meibomian glands. Within the eyelid, the glands produce oil that coats the tear. That oily layer helps prevent the tears from evaporating prematurely. When these glands are diseased, as you can see here, the oil becomes hardened, obstructed. There's no good oil coating the tear anymore and your tears evaporate too quickly, leading to signs and symptoms of dry eye disease. So this here, what you're seeing meibomian gland disease is by far the #1 cause of the dry eye disease category. And we have a very elegant clinically proven technology and procedure that helps address the disease that you're looking at. We are working on creating with our customers a new order of care. Here is the case for the TearCare system. You shouldn't wait for intervention. Right now, the market dominated by artificial tears when those fail or other at-home remedies, patients move on to prescription Rx. Eventually, if that doesn't work, then you start working towards procedures. Our clinical data proves -- let me click through all of this here. Our clinical data proves that intervening earlier with TearCare is better for patients. We have a long-term 2-year RCT, the SAHARA trial, where we randomized TearCare against the market-leading therapeutic RESTASIS. We went head-to-head. Our 6-month endpoint, very successful. We're successful on our primary signs endpoint showing superiority and showing clinically and statistically significant improvements in every sign and every symptom at 6 months. We then followed patients crossed over the RESTASIS patients to TearCare, looked at the 12-month outcomes, again, further improvement, significant improvements in all signs and symptoms. We followed the original TearCare cohort out to 24 months to prove durability of treatment effect. The summary is the typical TearCare patient depending on severity of disease, moderate or severe will need somewhere between 1 to 2 treatments per year. So we knew that this data would be necessary to secure coverage. We wanted to show superiority to the gold standard. We wanted to show durability of treatment effect. And with that data, we've begun productive conversations with payers. Here's a snapshot of the opportunity, a large market, 19 million dry eye disease patients. As I mentioned, the majority suffer from meibomian gland disease. So we estimate there's a 7 million to 8 million moderate to severe MGD patient opportunity in the U.S. Here's a snapshot of the procedure. It's in office. Devices are affixed the eyelids, 15 minutes of melting to melt the oily obstructions in all 4 eyelids. Then the eye care provider after the melting cycle, eye care provider will come and evacuate lid by lid, evacuate all of those melted obstructions from the patient's eyelids and from the patient's glands. The results are very near term. Patients feel better immediately and those results last. So it's a nice, elegant in-office procedure, user-friendly for both the doctor and for the patient. I talked about our RCT. I'll skip it to save time, but we were very successful in all 3 phases of the SAHARA RCT, Stage 1, Stage 2 and Stage 3. All of those have been published. That is the foundation of the clinical evidence that's driving our payer coverage conversations. We're excited to be growing TearCare. Two objectives: commercialize with excellence within the covered territories of Novitas and First Coast. Team -- our IDE team is doing a great job creating this category, the matrix, the sales excellence, the marketing excellence we're very proud of. Some of the metrics on launch, how efficient the sales reps are, how fast they get to certain revenue generating milestones. It's a really interesting model. We're proving it in Novitas and First Coast. In parallel with that, we are working on expanding coverage within both MACs as well as commercial payers. There is a tremendous category here that needs to be created. We're excited to be creating it because millions of patients deserve to have better dry eye treatments, procedural dry eye treatments. So lastly, here's a snapshot of our performance, 23% revenue CAGR from '20 to '25. Obviously, there, you see some flattening of our growth. We had on our interventional glaucoma business, we had to work through some Medicare challenges in LCDs historically. We are excited that, that is now behind us. We are operating in a more normalized environment. We are back to growth in interventional glaucoma. We are back to growth in mode in interventional dry eye. So we have two growing interventional businesses. There are synergies between these businesses, the intersection of intervention. There are millions of patients who can benefit from intervention. We're excited to be back in high growth mode. We achieved finally double-digit growth for the first time in a while. Excited for IG to be growing again and for TearCare to be in really exciting growth mode as we build that category out over the coming years. Lastly, behind the two interventional businesses that we're excited to be building. We've got a really exciting pipeline of other interventional technologies that we believe will be transformative to patient care in the years ahead. With that, everybody -- our technologies help everybody to keep seeing. Thank you all.