Earnings call transcript: Ocular Therapeutix Q3 2025 sees mixed results, stock dips

Ocular Therapeutix reported its Q3 2025 earnings, revealing a slight miss on revenue forecasts with actual revenue at $14.54 million compared to the expected $14.63 million, a surprise of -0.62%. The company’s EPS also fell short of expectations, coming in at -$0.38 against a forecast of -$0.37. The market reacted negatively, with the stock price declining by 7.27% to $11.25 in pre-market trading.

Key Takeaways

• Ocular Therapeutix ended Q3 2025 with $345 million in cash, bolstered by $445 million from recent equity financing.
• Development of XPAXLY, an anti-VEGF therapy, is underway with promising trial designs.
• The stock fell 7.27% following the earnings release, reflecting investor concerns over the revenue miss.
• The company anticipates a strong cash runway extending into 2028.

Company Performance

Ocular Therapeutix has made strategic advancements in its product pipeline, particularly with XPAXLY, targeting the $15 billion global anti-VEGF market. Despite the earnings miss, the company maintains a robust cash position, ensuring financial stability for ongoing projects. The focus on innovative trial designs and potential market expansion through new therapies positions Ocular Therapeutix as a competitive player in the ophthalmology sector.

Financial Highlights

• Revenue: $14.54 million, slightly below the forecast of $14.63 million.
• Earnings per share: -$0.38, compared to the forecast of -$0.37.
• Cash reserves: $345 million, with additional $445 million from equity financing.

Earnings vs. Forecast

The company reported an EPS of -$0.38, narrowly missing the forecast of -$0.37. The revenue also fell short of expectations, coming in at $14.54 million against a forecast of $14.63 million. The EPS surprise was 2.7%, indicating a minor deviation from expectations. This performance contrasts with previous quarters where expectations were more closely met.

Market Reaction

Following the earnings announcement, Ocular Therapeutix’s stock experienced a 7.27% drop, trading at $11.25 in pre-market activity. This decline reflects investor disappointment over the revenue miss and the EPS shortfall, despite the company’s strong cash position and strategic initiatives. The stock remains within its 52-week range but shows volatility in response to the earnings results.

Outlook & Guidance

Ocular Therapeutix is optimistic about its future, with key data from the SOL1 trial expected in Q1 2026 and the SOLar trial results anticipated in the first half of 2027. The company is preparing for potential commercialization of its products, aiming to expand its market presence through innovative therapies that address unmet needs in retinal diseases.

Executive Commentary

Dr. Pravin Dugel, CEO, emphasized the company’s commitment to innovation, stating, "We are bold in our science. Courageous in our strategy, and relentless in our pursuit of excellence." He also highlighted the strategic goal of expanding the treated population with XPAXLY, saying, "Our goal with XPAXLY is not simply to compete for share within today’s treated population, but also to expand that population."

Risks and Challenges

• Revenue growth: The slight miss on revenue forecasts raises concerns about future growth prospects.
• Market competition: The company faces strong competition in the anti-VEGF market.
• Clinical trial outcomes: The success of ongoing trials is crucial for future product launches.
• Regulatory approvals: Securing approvals for new therapies remains a significant hurdle.
• Investor sentiment: The recent stock decline may affect investor confidence in the short term.

Q&A

During the earnings call, analysts inquired about the potential attributes of the initial Wet AMD label and the company’s confidence in securing a broad DME-inclusive label. There was also a focus on patient enrollment strategies for NPDR studies and the rationale behind trial design and endpoint selection.

Full transcript - Ocular Therapeutix Inc (OCUL) Q3 2025:

Conference Call Operator: Good morning and welcome to the Ocular Therapeutix third quarter 2025 earnings conference call. At this time, all participants are in a listen-only mode. After the prepared remarks, we will conduct a question-and-answer session. To ask a question, please press star one. As a reminder, this conference is being recorded and will be available for replay on the investor relations section of the Ocular Therapeutix website. I would now like to turn the call over to Ocular’s Vice President of Investor Relations, Bill Slattery. Please go ahead, Mr. Slattery.

Bill Slattery, Vice President of Investor Relations, Ocular Therapeutix: Good morning, everyone, and thank you for joining us today. Earlier this morning, we issued a press release and filed our quarterly report on Form 10-Q outlining our financial results and business updates for the third quarter of 2025, along with several updates to our registrational programs for XPAXLY, also referred to as OTX-TKI, in wet AMD, and Nonproliferative Diabetic Retinopathy. Ocular’s Executive Chairman, President, and CEO, Dr. Pravin Dugel, will summarize recent business highlights before we move to our question-and-answer session. Joining Dr. Dugel for the Q&A portion of the call will be Donald Notman, Chief Financial Officer and Chief Operating Officer; Sanjay Nayak, Chief Strategy Officer; and Steve Meyers, Chief Commercial Officer. We refer everyone to this morning’s press release and our Form 10-Q for a comprehensive update of third quarter 2025 financial and business results.

During today’s call, certain statements we will be making constitute forward-looking statements under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Actual results may differ materially as a result of a variety of factors, including risks and uncertainties identified in the risk factor section of our annual report on Form 10-K and our other SEC filings. With that, I’d like to hand the call over to Dr. Pravin Dugel to review our recent updates. Pravin?

Good morning, everyone, and thank you for joining us today. At Ocular Therapeutix, we are courageous, bold, and opportunistic. We make decisions from a position of confidence. We refuse to accept the status quo. Not in how we develop drugs, not in how we design trials, and not in how we think about the retina market. Our purpose is clear. To redefine the retina experience for patients, physicians, and payers around the world. 2025 has been a transformative year for Ocular Therapeutix. We’ve advanced two registrational studies in Wet AMD, SOL1, and SOLAR, each designed to answer distinct, clinically relevant questions. As our momentum continues, we are thrilled to announce today that SOLAR has reached its target randomization of 555 subjects, an important milestone that reflects exceptional execution and strong investigator enthusiasm for XPAXLY. In addition to SOL1 and SOLAR.

We designed a long-term extension trial, SOLEX, which goes well beyond simply providing long-term safety data and may provide further evidence that XPAXLY treatment should be started early to obtain the greatest visual benefits. Equally important, we’ve unveiled our registrational Helios program in diabetic retinopathy, which we believe represents the next frontier. In our mission to deliver long-lasting, clinically impactful, and genuinely sustainable therapies for retinal diseases. This is a bold initiative to pursue a single broad superiority label that captures the entire spectrum of diabetic retinal disease, including nonproliferative diabetic retinopathy (NPDR) and diabetic macular edema (DME). With two complementary, strategically designed studies, Helios 2 and Helios 3, we intend to address both populations within one unified program. If the Helios trials are successful, we expect that we would not need any additional studies to market XPAXLY for use across the spectrum of diabetic retinal disease.

At our recent investor day, I described how Ocular is now positioned to redefine this field through a strategic triad. Number one. The potential for a superiority label that may set XPAXLY apart from all other anti-VEGFs in both Wet AMD and diabetic retinal disease. Number two. Expanding the market to potentially capture the vast untapped opportunity across Wet AMD and diabetic retinal disease. Number three, potential for immediate adoptability made possible by a product profile that seamlessly integrates into today’s retina practice. Today, I’d like to elaborate on each of these pillars, how they define our strategy, guide our execution, and position Ocular to lead a potential generational shift in retinal therapy. Let’s start with superiority. To date, no approved therapy in Wet AMD has demonstrated superiority to an anti-VEGF. Each successive entry. Has only been incrementally longer lasting.

This has led to an increasingly commoditized landscape, a market where differentiation has eroded and pricing pressures have intensified. More recently, biosimilars have turned what was once a breakthrough in the field into one defined by step therapy restrictions and rapid discounting that encourages a pricing race to the bottom. We believe XPAXLY has the potential to break this cycle. SOL1, our phase three superiority trial in Wet AMD, was designed under a SPA agreement with the FDA and remains on track for top-line data in the first quarter of 2026. If successful, we expect XPAXLY could be the first and only therapy with a superiority label compared to a single dose of anti-VEGF. This superiority label extends beyond Wet AMD and now includes diabetic retinopathy, where we will initiate two superiority trials, Helios 2 and Helios 3. Achieving a superiority label would put us in a category of one.

Why does this matter? Because a superiority label not only defines a clinically differentiated asset, but it also fundamentally changes market dynamics. It can potentially insulate us from the pricing compression and formulary step therapy that plague me-too agents. When a product demonstrates superiority and is approved by the FDA, it can become a premium drug chosen first by the physician, not forced to be a later-line option by the payer. We believe this is the Holy Grail of retina: superior outcomes, improved durability, and a pricing model that rewards innovation. We are proud that both SOL1 and Helios 2, in Wet AMD and NPDR respectively, are designed under formal FDA agreements and anchored in superiority endpoints. These are not marketing terms. They have substantive statistical meaning as agreed by a regulatory body, giving us a path to pursuing claims that no other company currently possesses.

The second pillar of our triad is market expansion. Today, the global annual anti-VEGF market is estimated at roughly $15 billion. That figure tells only a fraction of the story. It reflects patients who are currently treated, not those who should be. In Wet AMD, up to 40% of patients discontinue therapy within just the first year, often due to the burden of monthly or bi-monthly injections. In diabetic retinopathy, the situation is even more staggering: fewer than 1% of the 6.4 million NPDR patients in the U.S. receive treatment, even though anti-VEGF drugs have been shown to work in this indication. The gap between what’s possible and what’s practiced represents what we believe is the largest expansion opportunity in retinal medicine.

Our goal with XPAXLY is not simply to compete for share within today’s treated population, but also to expand that population by reducing burden, increasing adherence, and improving long-term outcomes. We believe we can achieve this through three key drivers. First, durability. XPAXLY is designed to deliver sustained suppression of VEGF for up to 12 months following a single injection. This could allow physicians to see their patients less often while maintaining disease control. Second, flexibility. The ability to tailor dosing intervals between six and 12 months, providing real-world adaptability across diverse, heterogeneous patient needs. Third, confidence. Data from both SOL and Helios programs, combined with FDA-aligned trial designs and our planned long-term open-label extension in Wet AMD, may provide the evidence base physicians and payers need to support early, consistent use.

Even modest improvements in adherence could translate into hundreds of thousands of additional patients retaining vision and a market opportunity significantly larger than what is measured today. At our investor day, we showed analyses demonstrating how we plan to move the current treatment discontinuation spiral towards a treatment retention cycle with XPAXLY in Wet AMD. Expanding treatment into diabetic retinal disease accelerates that market expansion even further. This includes NPDR, a disease three times as prevalent as Wet AMD, with no standard of care in use today and DME. This is not hypothetical incremental growth. This is redefining the market. The third pillar of our triad is the potential for immediate adoptability. When we talk to retina specialists, one theme is clear: workflow matters. They want innovations that improve outcomes without requiring alterations to practice dynamics. XPAXLY was designed precisely with that in mind. It requires no surgery.

There is no need for concomitant steroids, and we believe no additional monitoring is needed. XPAXLY will be administered by retina specialists who are familiar with intravitreal injections and perform these tasks every day with Eylea, Vabysmo, or Lucentis. The experience itself will also be familiar. We are conducting all our registrational trials and expect to launch with a prefilled injector. Just like the prefilled syringes used with most commercial anti-VEGF injections today. Moreover, the single hydrogel is designed to be fully bioresorbable, intended to leave no remnants behind without active drug. The procedure and the post-injection experience are similar to current anti-VEGF injections, except that XPAXLY could last up to 12 months. This makes XPAXLY not just innovative, but also easily adoptable. Patients may benefit from fewer visits and longer durability.

Physicians benefit from a potentially better drug with the same workflow, and payers benefit from reduced utilization, predictability, fewer patient dropouts, and potentially better long-term outcomes. XPAXLY can allow retina specialists to see more patients less frequently. It can enable a more predictable schedule for patients, and even if patients need to reschedule a visit, there should be enough drug on board to cover them until they can get in to see their physician. Ultimately, XPAXLY may help alleviate the burden that often leads to treatment discontinuations or problems with adherence. The bottom line is that we believe XPAXLY can simplify, optimize, and even scale modern retinal practices. Importantly, this view isn’t just ours. It is shared by the stakeholders who matter most when it comes to patient access and value. Over the past several months, we’ve spent significant time engaging with payers representing more than 75% of U.S.

commercial lives and over 25% of Medicare Advantage lives to walk them through our clinical strategy, study designs, and endpoints. We have been extraordinarily pleased with the feedback we have gotten from these conversations. On superiority, one payer described the potential of a product with XPAXLY’s expected durability as game-changing, while another noted that it could be clinically preferred ahead of the entire anti-VEGF class. On market expansion, one comment captured it best. "Avoiding blindness. Is invaluable and less costly." On adoptability, another payer noted, "There is value in consistent, sustained, and uninterrupted therapy." These conversations affirm what we already believe. Payers can see the potential of the product with XPAXLY’s target profile to deliver meaningful clinical differentiation, expand access, and redefine value in retina by improving outcomes while potentially reducing the overall burden of care.

Turning to our SOL registrational program for XPAXLY in Wet AMD, our success to date is built on outstanding execution. In SOL1, I could not be more pleased with how the study is running, including retention, trial conduct, and safety monitoring. As it relates to retention to date, more than 95% of patients remain on the study. That’s almost every participant staying engaged over the course of the study, which is unheard of for retina trials. As it relates to rescues to date, per our mass review, over 95% of rescue events have met the prespecified protocol-defined criteria. Let me repeat that. Over 95% of all rescue events have occurred exactly as designed. That level of compliance under masking is exceptional. Simply put, patients are staying in the trial, and physicians are waiting until patients meet the predefined thresholds before administering rescue treatment in the vast majority of cases.

This speaks to the discipline of our sites and the clarity of our protocol, which is likely to yield a robust data set when we receive top-line data in the first quarter of 2026. These details matter. Protocol adherence ensures that when we unmask data, we will be looking at a clean, reliable data set that can withstand the highest level of regulatory scrutiny. Just as importantly, the SOL1 trial is watched over by an independent data safety monitoring committee, and there have been no safety signals to date. This is also worth repeating clearly. There have been no safety signals to date as observed by an independent data safety monitoring committee. SOLar continues to progress in parallel with its six-month screening and loading phase, serving as an innovative patient enrichment strategy designed to de-risk the study population.

SOLar is the first trial of its kind to include an extensive six-month screening and loading phase specifically designed to exclude patients with early persistent fluid or significant retinal fluid fluctuations, which can otherwise introduce variability and disrupt non-inferiority trials. I am thrilled to share this morning that SOLar has now reached its target randomization of 555 subjects. This marks yet another significant milestone for Ocular and reflects the remarkable speed and execution of our clinical team, along with the overwhelming enthusiasm and engagement from investigators across the world. The exceptional pace and scale of recruitment across the SOL program underscore the strong demand among retina specialists and patients for more durable therapies like XPAXLY that can potentially deliver better long-term outcomes while reducing the treatment burden.

To maintain our commitment to both patients and investigators, we will continue to allow randomization of previously enrolled subjects currently in the loading phase of the trial. We continue to expect top-line data for SOLar in the first half of 2027. We will refine our guidance at the appropriate time. Taken together, the SOL program has been designed to generate a comprehensive efficacy and safety package that addresses the most important questions retina specialists will have, giving them the confidence to use XPAXLY immediately upon launch if approved. After subjects have completed two-year follow-up in either SOL1 or SOLar, they will have an opportunity to enroll in our SOLx study for an additional three years. In this open-label extension, all enrolled subjects will transition to every six-month treatment with XPAXLY. To be clear, this study is a strategic initiative, not a regulatory requirement.

We believe SOLx could generate valuable insights into the potential long-term benefits of using a non-pulsatile treatment like XPAXLY in addition to providing long-term safety data. The study is designed to assess key outcomes such as vision preservation, antifibrotic activity, and most importantly, the potential consequences of delaying XPAXLY treatment in the control arm patients. SOLx outcomes may further expand XPAXLY’s potential by highlighting the need to start XPAXLY treatment early or risk worse long-term visual outcomes. By reducing the treatment burden and potentially improving long-term outcomes, we believe the data from SOLx could increase both short-term and long-term patient retention significantly. Let’s now turn to diabetic retinal disease, which we define as both diabetic retinopathy and DME, or diabetic macular edema, where our innovation extends to how we think about trial design, endpoints, and label strategy. Our Helios program represents a bold, differentiated approach to this disease.

We are pursuing a broad diabetic retinopathy label that also encompasses DME, a complication within the diabetic retinopathy continuum. We believe the strategy allows us to capture the full spectrum of diabetic eye disease with a single registrational program. The unmet need here is staggering. Diabetic eye disease affects more than 100 million people globally, yet the majority remain undertreated. Even among NPDR patients without DME, disease progression leads to irreversible vision loss if left unmanaged. Current treatment paradigms are largely reactive, waiting until vision-threatening complications occur prior to intervention. We believe that must change. Our Helios 2 and Helios 3 phase 3 trials are designed as superiority studies to demonstrate that early, infrequent treatment with XPAXLY can meaningfully alter the course of disease. Helios 2 is being conducted under a SPA agreement with the FDA, underscoring our continued commitment to regulatory alignment and scientific rigor.

Together, these two trials will evaluate 6 and 12-month dosing intervals, providing flexibility to address diverse patient needs. A key innovation in these studies is our primary endpoint, an ordinal two-step DRSS endpoint at week 52. Historically, phase 3 DR trials have relied on binary diabetic retinopathy severity score, or DRSS, endpoints, counting only the percentage of patients who achieve a greater than or equal to two-step improvement or those who achieve a greater than or equal to two-step worsening, not both. While straightforward, this method discards valuable clinically relevant data. Our ordinal analysis, by contrast, captures the entire spectrum of patient responses: improvement, stability, and worsening, allowing every participant to contribute data to the statistical analysis. This approach offers several distinct advantages. It reflects real-world treatment goals to both improve disease and prevent worsening. It increases statistical powering, allowing more efficient studies with a smaller sample size.

It potentially provides a higher probability of success compared to other endpoints considered. It aligns fully with FDA guidance, as confirmed in our SPA for Helios 2. We evaluated other endpoints such as vision-threatening complications, or VTCs. Those present major limitations. VTCs are binary and event-driven, which require much larger sample sizes and longer durations to reach statistical power. They also reflect late-stage disease progression rather than early therapeutic benefit. In short, ordinal DRSS is not only more clinically relevant with a potentially higher probability of success. It is also agreed to with the FDA from a regulatory standpoint. It’s the right endpoint to demonstrate XPAXLY’s disease-modifying potential in DR. Since announcing this endpoint at our investor day, the feedback from both investigators and the broader retina community has been outstanding.

We believe this approach represents the future of diabetic retinopathy trial design, and we expect this ordinal endpoint will become the new gold standard for the field moving forward. Unlike our Wet AMD program, the Helios 3 trial employs sham injections, and there are important regulatory reasons for that distinction. DR trials have very different regulatory requirements compared to the 2023 FDA draft guidance for Wet AMD. Sham should not be used in Wet AMD or even in center-involving DME studies because they require subjective visual acuity primary endpoints, where sham injections may not provide adequate masking and could influence outcomes. In DR, however, outcomes are based on objective retinal photographs, not subjective patient responses. Moreover, since there is no universal standard of care for NPDR, sham control is not only acceptable but necessary to ensure global regulatory alignment, particularly in countries without approved therapies for this population.

Finally, our design strategy enables us to pursue a single unified DR label that encompasses both NPDR and DME. Because DME is a complication affecting a subset of DR patients, all patients with DME inherently have underlying retinopathy. In Helios 2 and Helios 3, we plan to include patients with non-center-involved DME. Subjects with non-center-involved DME demonstrated improvement with XPAXLY in our Helios phase 1 study. We believe this approach eliminates the need for separate DME trials and may position us to address the full diabetic eye disease spectrum with a single registrational program. By focusing on a superiority-driven DR label that captures the entire continuum of disease, we believe XPAXLY can unlock a market opportunity that is not just incremental but transformative for patients, physicians, and payers worldwide.

We ended the third quarter of 2025 with approximately $345 million in cash, which does not reflect approximately $445 million in net proceeds from our October equity financing. We were thrilled to see the enthusiasm for participation in our recent financing, validating the bold opportunistic decisions we have made to date. Every decision that is made in this company is made from a position of confidence in our drug, XPAXLY, and in our clinical strategy, and in our market potential. Our confidence is compounded by consistently positive feedback we are hearing externally, including from payers who represent the vast majority of covered lines in the U.S. These discussions have reinforced the excitement we have seen from investors and further validated our triad-based strategy. These perspectives underscore that the market is already preparing for a future potentially defined by XPAXLY, one where potentially better outcomes, lower burden, and cost efficiency converge.

Following our recent financing, we are now in an enviable position with an expected cash runway into 2028 and the financial flexibility for top-line data from both SOL and Helios registrational programs. Advance SOLx our long-term extension trial. Invest in manufacturing capacity and infrastructure, and prepare for commercial launch and global expansion in anticipation of a potential XPAXLY approval. We are operating from a position of increased strength. Every capital decision we make is proactive, not reactive, made from conviction, not constraint. When you put it all together, our science, our trial design, our execution, and our strategic vision, the path forward is clear. We are building Ocular Therapeutix around the triad that defines how we intend to redefine the retina experience. Potential superiority label, setting a new standard of durability that transcends incremental improvements, creating lasting competitive differentiation and potential insulation from pricing and step therapy pressures.

Market expansion, transforming a $15 billion treated market into a much larger addressable opportunity by reducing burden, improving adherence, and reaching millions of untreated patients with Wet AMD and DR. Immediate adaptability, delivering a product that fits seamlessly into existing practice. No surgery, no concomitant steroids, no change in workflow. Simply a better, longer-lasting treatment that aligns with how retina specialists already work. This triad isn’t a marketing pitch. It’s the blueprint of how we intend to redefine retina. Period. To summarize today’s key points: Number one, SOL1 remains on track for top-line data in the first quarter of 2026. With exceptional retention and trial integrity reaching statistical significance, SOL1 has the potential to enable a superiority claim on the XPAXLY label in Wet AMD. Number two, SOLar has now reached its target randomization of 555 subjects and is rapidly progressing toward top-line data in the first half of 2027.

Built on a real-world design with a de-risking patient enrichment strategy. Number three. Our Helios program will initiate imminently, leveraging a novel ordinal endpoint established per the SPA agreement for Helios 2 with the FDA. We believe this is the optimal endpoint that increases statistical power and provides us a greater probability of success compared to other endpoints. Number four. We continue to pursue a broad diabetic retinal disease label, including DME, that could significantly expand XPAXLY’s reach. Number five. Our financial strength gives us the flexibility to obtain top-line data from each of our SOL1, SOLar, and Helios programs, pursue our SOLx open label extension study, and prepare for commercialization with confidence. Number six. Finally. Through the triad of superiority. Market expansion, and immediate adaptability, we’re building a company. Positioned not just to participate in the retina market but to redefine it. At Ocular Therapeutix.

We are bold in our science. Courageous in our strategy, and relentless. In our pursuit of excellence. Thank you for your time and your continued support. Operator, we are now ready to take questions.

Conference Call Operator: Thank you. We will now be conducting a question-and-answer session. If you would like to ask a question, please press Star 1 on your telephone keypad. A confirmation tone will indicate that your line is in the question queue. You may press Star 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the Star keys. We ask that panelists limit themselves to one question so that others have an opportunity to do so as well. One moment, please, while we pull for questions. Our first question comes from Kazin Ahmed with Bank of America. Please proceed with your question.

Good morning. Thank you for taking my question, and thanks for the very detailed update. I maybe wanted to get a sense of how you’re thinking the initial label for Wet AMD could look like because you’re doing a lot of work. Among SOL1, SOLar, and SOLx. So what would the initial label look like, and what do you think would be attributes of the label that you would think would be competitive that may need to be added on later as more data comes in? Thanks.

Dr. Pravin Dugel, Executive Chairman, President, and CEO, Ocular Therapeutix: Thank you, Kazin, and good morning. Thanks for the question. A very appropriate, great question. I’ll start out by saying, of course, we’re not in labeling discussions with the FDA as yet, but you can see that this company has strategically placed the clinical trials in such a way as to get, we believe, the best label in the history of our field. We expect our label to be a superiority label based on SOL1. We believe that it’ll have the flexibility of dosing every six months to every 12 months based on SOLar and SOL1. It will also have flexibility, obviously, of repeat dosing. That’s what we expect from the initial label. Again, we’re not in discussions with the FDA, as you can imagine.

However, the other thing also that I’d like to note is that although this will not be in the label, remember that in the masking arm of SOLar. We are going up against high-dose Eylea. So although the randomization is two to one, and although this is not for statistical analysis, we certainly will have the numeric data. So we believe that we’ll have a great competitive advantage versus the second generation of anti-VEGFs with high-dose Eylea as well. Kazin, thank you again for the question.

Conference Call Operator: Our next question comes from Tara Bancroft with TD Cowen. Please proceed with your question.

Hi, good morning. My question is on NPDR. One really quickly, for the expected patient populations in the Helios trials, can you tell us what percentage of the enrolled that you would expect to have that are non-center-involved DME? And then the real question is if you could maybe describe in a little more detail for us what is it that underlies your confidence in having a very broad DME-inclusive label beyond only the non-center-involved. Especially compared to a different approach of running separate DME trials altogether? Because in that, I think it would be helpful if you could also discuss whether the inverse could be true, that successful DME trials could be inclusive of NPDR at all or not. Thanks.

Dr. Pravin Dugel, Executive Chairman, President, and CEO, Ocular Therapeutix: Tara, good morning, and thank you for the question. Great question again. So as far as the first question is concerned, really a quick answer, the fact of it is that we don’t know when the time is appropriate. We certainly will guide you as to the stratification of our baseline patients that we have enrolled. In regards to the second question, the first thing to look at is the data from the Helios 1 study. Recall that with a single injection of XPAXLY, a single injection at week 48, every single patient with non-center-involving diabetic macular edema improved. Again, every single patient with diabetic macular edema improved with a single injection. We’ve looked at these patients in every which way that was presented in our investor day, including in terms of total volume, etc., etc.

Peter Kaiser showed you every single patient and every single patient with a single injection improved. On the other hand, every single patient who was not treated in the control group got worse. So we have great confidence. Based on the Helios 1 data that patients with non-center-involving diabetic macular edema will improve. Now, again, we’re not in labeling discussions, obviously, with the FDA, but what I can tell you is that historically, the FDA has given label. Based on the disease itself. If you recall, in my last company with Iveric Bio, we studied only patients with extrafoveal geographic atrophy. There wasn’t a single patient that we studied with center-involving geographic atrophy. And yet, when you see the label of that drug, you will see that it’s a broad label encompassing all of geographic atrophy. The same can be said of previous studies for diabetic retinopathy such as Panorama.

The same thing could be said for visual limitations in clinical trials that have not extended to the label, such as going all the way going back to Anchor and Marina. We have great confidence that we will have a broad label that will encompass all of diabetic eye disease and that we will not need to do another study for diabetic macular edema. Recall also that it doesn’t work the other way around because every single patient with diabetic macular edema will have diabetic retinopathy, but not every single patient with diabetic retinopathy will have diabetic macular edema. Again, we have great confidence that we will never need to do another diabetic eye disease trial again for retina. We believe that we will obtain a broad label that will encompass not only diabetic retinopathy but all of diabetic macular edema. Thank you, Tara, for that question.

Thanks so much. Yeah, that’s a fantastic proxy to Iveric Bio. That’s very helpful. Thanks so much.

Conference Call Operator: Burean, are you there?

Yes. Can you guys hear me?

Dr. Pravin Dugel, Executive Chairman, President, and CEO, Ocular Therapeutix: Yes, please go ahead with your question.

All right. Thanks for taking my questions. Maybe Pravin, on the SOLar study, could you just talk about what percentage of patients were randomized from the screening phase? And for SOLx, I understand on the open label extension, you’re going to enroll patients from SOL1. But are SOLar patients also going to be eligible to participate in SOLx? Thanks.

Burean, thank you again. Good morning to you, and thanks for the question. As far as SOLar is concerned, recall that what we have is a very thoughtful and long ramp. Recall also that if you look at every single study that has ever been done with an anti-VEGF, whether it be Lucentis, Eylea, Avastin, Bovu, anything, what you see is a curve when you plot the visual acuity with the number of injections that looks identical, which is that after two injections, the visual acuity improves and then it stabilizes. Now, what we could have done is simply to say after two or three injections, we’ll go ahead and randomize patients in SOLar because we’ll have a certain degree of confidence in regards to the stability. We didn’t do that. We went way above and beyond.

What we did was to say, "Okay, we will do three loading doses, and we’ll have a unique period, two observation periods, not one, but two, in order to weed out any patient who would be unstable with any fluctuations in the OCT of 35 microns or greater." After that, we went ahead and gave two more loading doses, and only then did we randomize. It’s a very long ramp. As far as the screen failures are concerned, Burean, that was your question. We haven’t guided you to that as yet. We will when the time is appropriate in terms of giving you the baseline details. But as of yet, I’m just absolutely thrilled to report, as we did this morning, that we’ve reached our target randomization of 555 patients.

This is a credit not only to our clinical team, which has been just absolutely outstanding in terms of execution throughout this entire process with SOL1, with SOLar, and you will see very soon with the Helios studies, but it’s also a credit to the patients and to the PIs. We’re incredibly grateful to both that we’ve reached this point of target randomization. In regards to the open label study, both studies, SOL1 and SOLar, will funnel patients into the open label extension. Again, we’ll have a lot of data that we will have in that open label extension. I think one of the most important things that we will have is what the crossover patients will do. Now, remember, the crossover patients will crossover after two years of pulsatile therapy. We don’t believe that those patients will ever catch up.

The reason for that is that we know that fibrosis can be detected as early as 90 days after pulsatile therapy. We believe that with two years of pulsatile therapy, that will limit the patient’s vision improvement. We will have data showing that for the best long-term outcomes, it is necessary to start XPAXLY from the very beginning. We believe that data will be very important. The other part related to this also is that in all studies, starting with the Seven Up study, for instance, long-term outcome has shown a gradual decline in visual acuity based on fibrosis and atrophy. We believe that with constant suppression that XPAXLY will provide, we will see continued visual acuity improvement and stabilization, which will also add to the long-term outcomes that will benefit from immediate treatment with XPAXLY and continuation of XPAXLY with long-term constant suppression of VEGF.

Thank you, Burean, for your question.

Conference Call Operator: Our next question comes from Colleen Coozy with Baird. Please proceed with your question.

Great. Good morning. Thanks for taking our questions and congrats on all the progress. Just as we’re getting still a little bit closer now to the SOL1 data, just what details would you expect to share in the SOL1 top line? Specifically, would you include six-month BCVA? And what do you think will be the most important data points from SOL1 that will help give us confidence in the read-through to SOLar? Thank you.

Dr. Pravin Dugel, Executive Chairman, President, and CEO, Ocular Therapeutix: Yeah, good morning, Colleen, and thank you for your question. A great question, which I’m sure is on everybody’s mind. Here’s what I would say. Look, what we have done and what we have said is that we are very strategic in terms of planning these studies and our expectations of what the goal of these studies are. The sole purpose of SOL1 is a superiority label. That’s what we’re pursuing. The purpose of SOLar is clinical relevance. The purpose of SOLx is to provide long-term data to support both of these things. We also recognize what the challenge of SOL1 is. We recognize the challenge there is to go ahead and show you data in our secondary and exploratory analyses that will give you even more confidence in the success of SOLar. We understand that challenge. We will absolutely meet that challenge.

We have not guided you as to what we will show you as yet, but we certainly understand what we need to do with a card turn in terms of the narrative of a positive SOL1 study. Let me also say that while we will provide you even more confidence in the success of SOLar, there should already be a great deal of confidence that SOLar will succeed based on several factors. First is the de-risk patient randomization that I’ve already spoken to, which has really the longest ramp, the most thoughtful de-risking that I’ve ever seen of any study. The second one pertaining to the trial design is the endpoint. It’s a 56-week endpoint. It’s a singular endpoint that we believe is absolutely optimal for us. Again, it’s a singular 56-week endpoint. To summarize, Colleen, what I would say is we understand the challenge.

We will absolutely meet the challenge. We will provide you even more confidence based on the SOL1 card turn that there will be a positive SOLar study. Thank you for your question.

Helpful. Thank you.

Conference Call Operator: Our next question comes from Sean McCutchen with Raymond James. Please proceed with your question.

Hey, guys. Thanks for the question. Maybe a quick one for me. Can you speak to the progress of getting the NPDR studies up and running? I know you’re using a similar site footprint to the Wet AMD program. And how do you anticipate that accelerating those studies? Thanks.

Dr. Pravin Dugel, Executive Chairman, President, and CEO, Ocular Therapeutix: Sean, good morning, and thank you for the question. Look, the process started immediately after the raise for NPDR. We are very fortunate that we have fantastic sites all over the world. You’ve seen the results of that based on the execution of SOL1 and SOLar. Yes, many of the same sites are being used. There are additional sites as well. We are very, very fortunate that we have people in this company, as you know, with an enormous amount of expertise. Many of the folks here have trained many of the people that run these sites and certainly know pretty much everybody around the world. So we’re in an envious position of being able to strategically pick the very best sites. You’ve seen that. Again, look, it’s easy to forget where we were, Sean, not long ago. We had a trial that everybody said was not recruitable.

We recruited way ahead of schedule in record time. Then people said, "Well, even if you did recruit that trial, there’s no way that the execution is going to be good. Doctors are going to do whatever they want. Patients aren’t going to stay." We’ve provided you data in our investor day and today, real numbers to show you how well the execution is taking place. We have a 95% on-protocol rate, over a 95% on-protocol rate, and over a 95% retention rate. Those things are absolutely unheard of for any trial in retina, let alone a trial that supposedly was impossible to recruit. Oftentimes, we forget that. We forget the level of execution that this team has provided.

That’s not only thanks to the clinical team, but that’s also thanks to the sites that they’ve selected and the personal relationship that all of the team has with not only the PI, but the entire site. So the answer to your question is we will give you guidance to the Helios progression. We’re very pleased with the way that it’s going, and you’ll hear more details to follow. Thank you, Sean, for the question.

Conference Call Operator: Our next question comes from John Willedon with Citizens JMP. Please proceed with your question.

Hi, this is Catherine on for John. I just have another quick one for the DR program. I’m wondering if there’s any risks associated with using the ordinal two-step DRSS endpoint, especially since you’re considering using a smaller patient population. Is there any concerns regarding a higher placebo effect given kind of patient variability? I wonder if you could speak to that. And how do these risks compare sort of to a traditional endpoint?

Dr. Pravin Dugel, Executive Chairman, President, and CEO, Ocular Therapeutix: Catherine, good morning. Thank you for the question. It’s a very appropriate and fair question, and it’s something that we’ve looked into quite a bit. What I can tell you without hesitation whatsoever is that we have great, great, great confidence with the ordinal endpoint. Now, if you look at the talk that was given by Peter Kaiser in our investor day, you’ll see that there are all kinds of scenarios that were put in, including the data that we have with the Helios one study. As you can see, the level of success achieved by the data in the Helios study was overwhelming. So in this particular case, given the drug that we have, given the data that we have, we are very confident that with the ordinal endpoint, that we will succeed.

Again, if you look back at the Helios one study, what I would say as a clinician who’s practiced for over 30 years and also with all the other clinicians that we have in this company is that we’ve really never seen a situation where a single injection of a drug, again, a single injection of a drug after week 48 has results where every single parameter is in favor of the drug. Remember, this was just the drug. This was not a combination of agents. Eylea wasn’t combined with this. This was simply XPAXLY and nothing else, completely transparent. What you will see there is not only in terms of the diabetic retinopathy score, but also in terms of diabetic macular edema.

Then we’ve looked at every single which way possible, including total fluid volume, including perfusion, and every single parameter favored the drug with a single injection after week 48. So we have great confidence in the endpoint, and we have great confidence in the success of both Helios 2 and Helios 3. Remember also that Helios 2 has an FDA-approved SPA going with it as well to validate that study and validate the study design. Again, I also want to repeat that both Helios 2 and Helios 3 are superiority studies. Catherine, again, thank you for the question.

Thank you.

Conference Call Operator: Our next question comes from Ye Chen with HC Wainwright. Please proceed with your question.

Good morning. Thank you for taking my question. For the Helios 2 trial, once started, how long do you think it will take to complete enrollment of 432 patients? Do you think NPDR patients would be relatively difficult to enroll because they are reluctant to get treatment in the first place?

Dr. Pravin Dugel, Executive Chairman, President, and CEO, Ocular Therapeutix: Thank you for your question and good morning to you. We have already seen a great deal of inertia to enroll these patients. In fact, we saw that before we even announced the trials. As I was asked earlier on by John whether we’re using the same sites or not, I said yes, there was a great deal of overlap, including other sites. The sites have already been demanding this study. There is such a need out there for these patients. And remember, what we’re enrolling is we’re enrolling advanced severe. Advanced. Nonproliferative Diabetic Retinopathy. A lot of these patients are symptomatic. They may not have lost vision, but they certainly have blurry vision, etc. They certainly are knowledgeable that there’s a threat to their vision.

There’s a great deal of need out there and a great deal of enthusiasm to have something that is absolutely sustainable, both by patients as well as the PIs. And this is completely sustainable. As you know, it’s a single injection. If it does what we expect it to do, that will last for a year. We know that this is a target that’s de-risked, that’s validated in other studies. We believe that this is a relatively de-risked study. And especially given what I just said about Helios 1, we’re very, very confident in the results. To answer your question, we don’t think that there’s going to be any issue whatsoever in completing these trials in a very efficient manner. This is already underway, and we will guide you when appropriate. Again, thank you for the question.

Conference Call Operator: We have reached the end of our question and answer session. There are no further questions at this time. I would now like to turn the floor back over to Dr. Dugel for closing comments.

Dr. Pravin Dugel, Executive Chairman, President, and CEO, Ocular Therapeutix: Thank you very much. I’d like to thank all of you for your time today. I’d like to thank all of you for your diligence and for joining us. We look forward to updating you on our progress. If you have any follow-up questions whatsoever, please reach out to Bill Slattery, our Vice President of Investor Relations, and have a great day, everybody. Thank you again for your time.

Conference Call Operator: This concludes today’s teleconference. You may disconnect your lines at this time. Thank you for your participation.

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