OK, good afternoon, everyone. Welcome to Guggenheim Healthcare Innovation Conference. My name is Yatin Suneja, one of the biotech here, one of the biotech analysts here at Guggenheim. It is my pleasure to welcome our next presenting company. We will be chatting here with Oculis. From the company, we have a few executives here, but I will be having a discussion with the Chief Executive Officer, Riad Sherif. Riad, thank you so much for joining us. It would be great if you could introduce Oculis to our audience. What are your key assets? What are some of the upcoming milestones? And then I have prepared some Q&A for you that we can go into more detail.
Yeah, OK, thank you. Thank you for your invitation. Very happy to be here to introduce Oculis. Oculis is a biopharma company with two franchises, one in neuro-ophthalmology and one in ophthalmology. Publicly listed in Nasdaq since two years and a half, and with three candidates, the three of them are in phase three. With the upcoming milestones, the first one is coming in Q2 2026, then the second half of 2026, then in 2027, then in 2028, so we have a very nice news flow upcoming in the next two years, well-financed. We just raised more than $100 million, so strong balance sheet, which brings us into 2029.
Very good. Maybe we'll start with the key asset first, OCS-05. Can you maybe describe the mechanism? I think it has a unique mechanism. Also, I think the area that you're going after, acute optic neuritis, is relatively new. It'll be good for us to understand the mechanism. What data have you generated? What alignment have you reached with the FDA? Where are you going?
Yeah, of course. So OCS-05 is a new class. It's a neuroprotective drug. It has been discovered a few years ago with high throughput screening, where we screened more than 5,000 peptide-like molecules. And really, the aim was to identify a biology which promotes survival of the neurons. And in fact, really, the product went into three steps. One is screening. And the aim for us was to identify the biology which promotes survival for the neurons and oligodendrocyte. And this is what we saw on the bench. Then we went into the in vivo. And we tested this biology into three animal models: glaucoma, acute optic neuritis, and multiple sclerosis. And consistently, what this product showed us is in a situation of injury, which could be inflammation, it could be apoptosis, it could be oxidation, the retinal ganglion cell is preserved. OK?
And in multiple sclerosis, we did function also. And then, based on this data and the whole preclinical package and the talks and so on, we went to human. We did the phase one, healthy volunteers, and then a phase two, which is ACUITY data. ACUITY trial is a trial in an indication, which is called acute optic neuritis. As you know, acute optic neuritis is an inflammation of the optic nerve. It's typical of MS relapse. And in fact, two-thirds of patients are already MS patients. And in the remaining third, at least half of them will convert into MS. And in fact, acute optic neuritis is just the first onset of MS. So therefore, we are talking about between 85%- 90% of the patients are MS patients. And acute optic neuritis is a relapse of MS. For this patient today, we do not have any drug, actually.
We do not have anything indicated for acute optic neuritis. And we treat them just with steroids to reduce inflammation. But they will lose their retinal ganglion cells. And they will lose color vision. They will lose contrast, at least after the first crisis. If they have more crisis, then they really start to lose materially vision. So therefore, what we did, we did the trial comparing OCS-05 plus steroid versus placebo plus steroid. Yeah, and of course, it was first in patients. So therefore, safety was important. Safety came up very clean, which is great for us and for patients. And in terms of efficacy, we measured three endpoints. One is LCVA, which is the FDA regulatory endpoint, which is low contrast visual acuity. The second is the structure. Into the retina, we measured a layer, which is called GCIPL.
GCIPL gives us the status of the retinal ganglion cells, and here, the aim is not to reduce the thickness, as we do in DME or with AMD, because of edema and inflammation. Here, the goal is to keep the thickness. Because if we lose the thickness, it means we are losing substance. We are losing cells. Like cells are dying.
Correct.
And then the third endpoint, which is really important, it is in fact a regulatory endpoint. And it is important for us for other indications after is neurofilament. And neurofilament is a biomarker, is a very well-characterized biomarker, which was used as a regulatory endpoint for ALS. And it's a very well-characterized biomarker for progression of MS and all diseases such as Alzheimer and so on. And extremely pleased with the data, because we have been able first to show that we improved the vision by more than three lines. So we doubled the vision, more than 18 letters at month three. The second, we were able to preserve the retina and preserve the retinal ganglion cells by more than 40% in GCIPL layer. And we have been able to show that we had much less, dramatically less neuronal axonal damage when we compare neurofilament in the active versus placebo.
For the first time ever, we have a product which shows neuroprotection in a disease where consistently everyone failed. And for us, acute optic neuritis now becomes a core indication, of course. We are going to advance in phase III. But when you think about the biology and when you think about what we have shown, this is just the tip of the iceberg. Even if the tip actually is pretty big, because when you see the size of the optic neuropathies, we are talking about a base case scenario, like just a base case scenario of a $6 billion-$7 billion market where zero competition, and this is the only product which worked, and it's going to phase I II.
Got it.
This is just the tip of the iceberg.
Yeah. So for these crises, what are the durations for these crises? How often do patients get these crises? And then these issues, whether there is pain or the loss, is it a progressive loss or it keeps happening in the background?
Yeah. So basically, this is like a relapse of MS, which is well-documented. It is at least half of MS patients will experience at least once in their life an acute optic neuritis. It is an inflammation. It is an acute inflammation. So therefore, it comes with pain. And it comes with a rapid loss of vision. It's not progressive. It's rapid. The population is a young population. It's typical MS. Average age is 32 years. Two-thirds are women. It's a typical MS population. It's rapid. And then there is a recovery phase after month one. And then what we know with what we recover at month three will remain flat.
I see. I see. OK, so you did the phase study. What is the plan? What is the registration agreement that you have with the FDA? I think you're going to do two studies, right? PIONEER-1 and PIONEER-2 . What are these studies, the size and scope? When will you be able to enroll them?
Yeah. Yes, absolutely. So we met with FDA. We align fully about now the upcoming trials. We are going to do PIONEER-1 and PIONEER 2 , which are the two phase III in acute optic neuritis. The trials are very similar to what we did with Acuity. In terms of population, we are going to optic neuritis. In terms of criteria, inclusion/exclusion. In terms of treatment, it will be a five-day IV infusion similar to Acuity. It will be the same dose. It was three milligrams per kilo. It will be three milligrams per kilo, comparing OCS-05 plus steroid versus steroid plus placebo. So it's really similar. In terms of endpoint for registration, there are two endpoints. One is mean change, and one is responders, which we did in Acuity as well.
Mean change in LCVA?
Mean change, LCVA, and responders, LCVA.
Yeah. OK.
So it's really similar.
Yeah, it's similar.
At month three.
OK. So you do five infusions and then.
Five infusions.
Daily?
Five days IV, and then read out at month three.
How many patients per study? And what will be the recruitment time frame?
We are finalizing the sample size. It will be between 180 and 200 per trial. Recruitment time is estimated to be 12 months. Basically, it will be 12 months after the first dose. Then unmasking at month six.
OK. Are there other secondary or anatomical endpoints that you are looking for, just like?
Yeah, we will do again GCIPL. And we will do again neurofilament.
OK. In terms of the primary endpoint of mean change in LCVA, what are the expectations? Like how much of a difference you need or how the studies are powered? What is meaningful here?
Yeah, so the study is extremely well-powered because the drug effect is so huge, actually. So in Acuity, we had 18 letters difference. We are assuming that because it's a phase three, because we want to be conservative, we are assuming the half.
I see.
OK? So therefore, and with this, we have a power which is higher than 98%. It's very well-powered.
OK, OK. OK, yeah, no, I think that's good. Two years. OK, can you now put in perspective the commercial? So I think you walked me through some of the numbers, right? But specifically within the AON, how should we think about the pricing, the market dynamic, and what would be needed from a commercial build standpoint?
Yeah. So perhaps I will go to all optic neuropathies. So in terms of optic neuropathies, we have two types. One is AON, acute optic neuritis. And the other one is called NAION. AON, we have between 30,000-35,000 patients. NAION, more or less the same, 30,000-35,000 patients. So in total, we have between, let's say, 60,000-70,000 patients per year in the U.S. I'm just focusing on the U.S. market. On the U.S. market, when we see the pricing for all four indications, the lowest is $100K, and the highest is $400K. So this is what I was saying. Even if you go to the lowest price and you go to 60, you have $6 billion. And in this market, we have zero competition. So therefore, this is on the market sizing. In terms of prescriber, we have in the U.S. 420 neuro-ophthalmologists.
Very small population will be able to deliver multibillion assets. It's the dream scenario in terms of launching a new product in a disease where we don't have any option.
In terms of the size of the market obviously could be very substantial. How should we think about the duration? So are the patients only going to get that five doses in what time frame? I know it's five days, but it's one year. Will they come for repeat treatment?
Basically, in terms of treatment, you get five. It is really the treatment for the acute phase. It is a cycle of treatment. If the patient has a second crisis, they will get again the treatment. In fact, just in terms of market sizing, 20% of patients will have a second crisis in the next 12 months.
Got it.
They will receive again.
Yeah, it's like Tepezza. You get a cycle. And if you.
Tepezza or Oxervate is really the same.
It's the same. OK. I think so then you are also going after the second indication and NAION, right? What is the plan there?
The plan there, so back really to the biology of this product. This product, as I say to you, really promotes survival. Perhaps just to complete what we discussed about the mode of action. It's promoting survival by activating a protein which is called SGK2. SGK2 activates FOXO3. FOXO3 promotes survival. Therefore, in different types of injuries, this product was able to promote survival. Therefore, in NAION, which is a disease which is multifactorial, it could be the risk is higher with diabetes, higher with cholesterol, higher with hypertension, high altitude. New drugs like GLP-1 is well characterized. For this situation, retinal ganglion cell is suffering. What we would like is really the same process in terms of giving this product to preserve the retinal ganglion cell during the injury period. Therefore, the treatment will be similar.
Correct.
As acute optic neuritis. Now, the disease and the profile of patients is different because here we are talking about a population of more than 50 years. But it will be the same treatment in terms of acute phase. The only difference between acute optic neuritis and NAION is the duration of the treatment will be longer in NAION, and the endpoint will not be LCVA. It will be BCVA.
OK. And then are you going to go straight into phase two slash three? Or you have to do a phase two and then go into a registration?
It will be a phase II, III. It will be powered with a phase III model in terms of statistics. The aim is to use it as a phase III. This is a PIONEER 3.
Yeah, this is the PIONEER-3. What are the timelines? When will you start doing the alignment?
So the aim is to start the middle of the next year. And more or less, it will be a two-year trial like PIONEER-1 and PIONEER-2. So we will have every six months a phase III read out basically.
Got it. Very good. Then let's discuss. I think I want to discuss the third asset first for the dry eye disease program that you have, Licaminlimab. Can you tell us where the asset came from? And then walk us through the mechanism and then the disease that you're going after.
Yeah, so in dry eye, inflammation plays a key role. In fact, it's really the core issue, and this is why we have irritation and pain and redness and so on. At the same time, as you know, dry eyes remains a big market on one hand, but totally unsatisfied. This is one side. The second point is multifactorial disease, which means difficult to address, and we see it in the phase 3s of dry eye. We see it also in commercial, and really, our thinking was, OK, we have a product which is a TNF inhibitor, so therefore, it works in inflammation. We know it, so very validated biology. However, we wanted to have something which is targeting the right patient, and we identified the biomarker, which is a SNP on the TNF receptor, which allows us to know who will respond in advance and who will not respond.
We are going only to this population. We are talking about 20% of the population. When you see the dry eye universe, we have 30 million dry eye patients, 10 million need the drug, two million will be positive to our biomarker. We align with FDA. The primary endpoint will be patient TNFR1 positive who are patient positive to this. It's really, for the first time, a product which is a genotype-based development where we are not going to all-comers. We are really avoiding, which has been the case in dry eye, which is trial and error, which has been always the case. Even in phase III in dry eye, trial and error. In clinical practice, trial and error. It does not work. Therefore, we are going to something completely different, precision medicine, genotype-based development. We select our patient.
We know our product works between five to seven times more than all-comers in this population. And five to seven times more in this population versus if we compare on the same endpoint versus Xiidra, for example. We deliver at day 15 seven times in this population what Xiidra delivers at day 42. The same endpoint in staining. Same.
So much faster acting also.
Exactly. So faster and stronger. And we know them in advance. So this allows us to have the risk phase three because we know it will work. It allows us to have a smaller phase three because the drug effect is more important. So we are not talking anymore about 500 patients and so on, which is a typical phase three dry eye. We are talking about 160 patients. And then with the payer also makes sense because the test is very easy to implement, is available in the U.S., very easy to implement. And we should have a much better access.
Yeah. Do we know why the TNFR1 genotype patients are more sensitive to your drug or to the mechanism?
It's just inhibition.
Just an SNP?
It's just a SNP, yeah.
OK.
Just to complete the response, it is really nothing to do with dry eye per se. It's inflammation, so if this patient has psoriasis, they will respond better, so it's really inflammation.
I see. OK. And then what have you generated data in this disease, in dry eye disease? What exactly have you generated? I know you're running a PREDICT study also, just.
Yeah, so we did three trials. The three trials were positive, and the TNFR1 was identified in DED2, which is the second trial, and validated in DED3, and now we are really in the fourth trial.
I see. So that's the PREDICT study.
The fourth trial is PREDICT.
It's a PREDICT-1 study. OK. What is the endpoint? And then what exactly should we be expecting there?
So the endpoint is a composite endpoint of symptoms. The readout is at day 29. So therefore, it is a short trial, typical symptom trial. And it will be initiated this year. And it will read the second half of the next year.
Second half next year. Wow, you have a lot going on second half. What is the dosing frequency in PREDICT? And how was it similar or different to the other?
Three times per day.
Three times per day.
It seems similar.
Yeah. And that is, I mean, is there a potential to do less than three times a day in the future? Or it's just based on the.
Potentially. But this is a phase 3 we want to win.
OK. So just the PREDICT one is needed? Or do you need to do more study for a medicine?
We need to do more. But we will do them after. Really, I mean, with the data with the OCS-05, there is prioritization into the portfolio in terms of really driving OCS-05 as core. And then, of course, advancing the rest. But OCS-05 is the engine.
Yeah. Just one question going back on previous sector. How should we think about the price there? What are some benchmarks for us to think about?
I mean, the benchmarks are really between Oxervate, which is $100,000, and Tepezza, which is $400,000.
Yeah. So that sort of is.
So therefore, this is why I say to you.
So that's why I think you're.
The minimum.
The low end is.
$6 billion markets.
OK. Very good. Very helpful. Then on your third asset, OCS-01 in DME, maybe walk us through that program.
Yeah. So OCS-01 in DME is the first eye drop for retina, which consistently in four previous clinical trials showed efficacy in the typical endpoint CMT, which is retina, and BCVA, which is vision. The product is in phase three, fully randomized, two trials, 400 patients each. Readout is planned in Q2 next year.
This is also next year.
Yes. Next year is a big year. Next year is a big year. Readout in Q2 next year, both for both trials called DIAMOND-1 and DIAMOND-2. Really here, the advantage for this product is for the first time, really, we will be able to address early intervention. So today, think about it. When you take the universe of DME, 40% of patients are treated. 60% are really in wait and see. It's very rare in a disease where we say to a patient, you know what? You are sick, but let wait. When it will become worse, come back. Imagine you have heart disease and they say, you know what? Let wait.
Have a heart.
Why? So therefore, for the first time, we will be able to treat this patient early enough. And we have within the population which is treated, 40% of them are not responding appropriately to anti-VEGF. And for this population, our product could be used as a standalone or combined with it to drive more efficacy. So we are really talking about a patient population which is bigger than the patient population treated today. Like this product can generate a market, can create a market which is bigger than the current market.
Yeah. Yeah. What is the endpoint then? What are you looking at?
So endpoint to endpoint, one is mean change of BCVA. And the second one is responder analysis, which is the typical.
What have you shown in those four studies that you have completed?
We showed consistent significance in mean and significance in responders. In the very last trial, we saw 7.6 letters.
Yeah, that's what we did with.
Which is actually, when you compare with Anti-VEGF, is similar at the same time point.
Same time point. Yeah, at the same time point. OK. And then that would be the hope for the study about seven point? Is what you would like to show?
I think the aim is to show the same efficacy. So most probably, this product will show an efficacy which is strong. If I compare it with the same API, which is Ozurdex in an implant, it should show more efficacy, actually.
Got it. Very good. Then you have these three assets. How are you? So you mentioned that you are prioritizing OCS-05. How are you thinking about sort of BD in terms of are there assets that you think you could out-license? Or you need help from a pharma, from a commercialization perspective? How are you thinking about that?
What we always say, we say we would like to, so first, we would like to focus on the U.S. We partner ex-U.S. This is the first point. The second point, we didn't want to partner earlier because we wanted to execute a phase and then to be in a position of strength. Third, it is correct that with OCS-05 and all what OCS-05 can do, which is huge, we will be ready in terms of company to have options, in terms of commercial options, once we have the first readout, which is the DME.
Got it. Got it. Maybe final question. How is the balance sheet? How's the bond rate and capitalization?
Balance sheet is strong. We have cash till 2029. We can deliver the six phase 3s.
With this.
Therefore, very pleased with where we are.
Well, very good. Yeah, thank you so much. Indeed, a lot going on at the company.
Yes.
Thank you for your time.
Thank you.
Very interesting story.
Thank you very much.
Thank you. Thank you.