Devices here at Bank of America. Next up, as part of the healthcare conference, we have RxSight. We have Ron Kurtz, CEO, and Mark Wilterding, CFO. Thank you both for being here today.
Thanks for having us, Stephanie.
Maybe we can just start out with Q1 results since you just reported the other week. You know, results came in above the street, and the revenue guide was reiterated. Maybe you can just talk about the drivers of the Q1 performance and decision to maintain the guidance at this point.
Yeah, it was a good start to the year. I think, you know, in line with our expectations, maybe a little bit ahead. I think what was the most encouraging from our perspective was the stability we saw in LAL sales. That's something, you know, we've been looking for the last several quarters, and we saw some signs of that, both in the, in the unit volumes themselves, but also in the utilization rates.
I would say in terms of the last part of your question, the decision to not raise guidance, it's still pretty early in the year. I think we wanna, you know, just be mindful of that and took that into consideration when deciding what to do with the guidance.
I will say the guidance, the range that we gave, you know, was a large one for a reason, and, you know, we think it can accommodate both positives and negatives over the course of the year. For that reason, we chose to keep it intact.
Makes sense. Just thinking about the growth rate for the rest of the year to be expected to improve. Maybe you can just talk about the drivers and sort of the underlying assumptions of the full year guidance and cadence.
I think that's right. From a growth rate perspective, we mentioned that we anticipate growth rates to improve sequentially by quarter as we go through the year. Part of that is driven by the expectation of improving fundamentals, but a big part of it is also driven by the fact that we'll have easing year-over-year comparisons, especially as we get into the back half of the year. Our expectation is for LAL growth and continued stability, I'd say, as we go through the year.
Then maybe just a higher level question of just how you would describe the level of adoption with LAL therapy over the last few years and maybe what's been surprising, I guess both to the positive and negative over the last few years?
Yeah. I think that, you know, if we go back to introduction, really when we started to, after our IPO in 2021, we saw a steady and then fairly rapid adoption, to where we, you know, on a volume basis, have come up to about 10% of the overall premium market by volume, about 15% by revenue. That's been on the good side. Obviously more recently, the rate of growth has slowed, primarily as we have transitioned from a rapid increase in the installed base to having growth more driven by same-store sales, that's obviously been the focus more recently.
Yep. Then you recently decided to make changes in your commercial approach to deepen practice engagement and drive utilization versus focusing on LDD placements. How are these changes going relative to your expectations, and what types of benefits are you seeing from them?
Absolutely. You know, it's a natural transition to make, and we've made changes both programmatic and organizationally, structurally to accommodate those. I think that we've had good progress. We continue to refine the engagement programs that we have with our customers to, you know, learn from what we've done, measure, and then refine, as well as to strengthen the team as we identify potential areas of improvement so that we can continue to leverage the installed base that we have, which is quite large, to drive overall utilization.
What's the receptivity been like from practices as you make these changes?
Generally very positive. I think that, you know, if we get into a little bit more detail, you know, practices who purchased our technology, but may not have adopted it fully, there's generally a reason for that. Either they weren't fully, you know, haven't reached clinical, full clinical expertise or the way to integrate it in their practice.
We've been able to take the learnings from some of our more successful practices and transmit those to practices that have continued room for growth. We've also been able to drive engagement by simply connecting the different personnel within a practice to the clinical results that they're achieving.
With, with our technology uniquely, the care is distributed typically between a surgeon who's implanting the LAL and then, a typically an optometrist that's employed by the practice to do the light adjustments after surgery. Sometimes the connection between The information flow between the post-op care to back to the surgeon and the surgery counselors aren't perfect.
The unique thing about our technology is that we have the ability to capture data on our Light Delivery Device after the procedures are done, then we can take that data and present it to the surgeon, to the surgery counselors, the rest of the practice. Given the stellar clinical results, that's very invigorating to the practice. That's an example of the sort of engagements that we've put in place.
Got it. You know, it sounds like you've made good progress, but I guess there's still work to do on the expansion of these changes. How long does sort of rolling that out more broadly among your existing base of users take?
Well, what we said is that, you know, our first step was to develop the programs, organize ourselves structurally to be able to drive adoption. We're in the process of, you know, taking the lessons we've learned, refining those, and now looking to scale that across our user base. You know, that's a process that we're in right now. We're looking forward to continue to do that over the course of this year and beyond. I would say we're in the early innings, have some very positive indicators.
Thinking about utilization, which has been around 8 LALs per LDD per month, you expect that to be stable for the rest of the quarters of 2026. I guess what does it take for utilization to return to growth and kind of thinking about the expansion, and rolling out the, I guess, changes more broadly?
Yeah. Yeah, fair question. If you think about it, utilization is a function of two things, right? It's LALs, and for the Q1, we placed and sold, I should say, about 27,500 units, and divided by the installed base of LDDs the previous quarter. For us, that was about 1,115 or so. And that's right. It yields about, you know, 8.1 from a utilization perspective. Our guidance implies that it does stay right around that range as we progress through the year. That's the stability that we were talking about.
I think just to put it in perspective, because we've got about 1,100 LDDs installed, if you were to sell just one additional, you know, LAL through those, it's 1,100 a month, roughly 3,000 a quarter. That's what the team was driving for, that direction, certainly. We know that it's possible to grow that utilization. We've been there before, we're working with the teams to put the various initiatives in place, like Ron was talking about earlier, to be in a position to do that sustainably.
Makes sense. Also just wanted to touch on sort of the health of the premium IOL market overall. Curious how you would describe that today and just sort of what are the main factors shaping demand for LALs from both the patient and practice perspective?
Yeah. The overall, you know, obviously, we look to some of the larger players to indicate the overall market. There's generally reported to be stability in the premium market. The overall cataract market was reported to be a little bit down in the Q1 . We saw that last year as well. Premium, as you would expect, has been more stable. We would, you know, that is the area where practices and physicians can offset reductions in reimbursements that have continued to hit ophthalmology practices. We would anticipate that that's gonna continue to be a strong focus for practitioners.
You know, within that space, we're offering a highly differentiated product that we would, you know, continue to drive adoption as we are doing.
Yeah. Maybe you can sort of expand on that a little bit more of just how you're thinking about sort of the competitive differentiation of your LAL offering, I guess also in the context of competitive launches in this space happening this year. Yeah, I guess just any impact on your business from those competitive launches that you would expect.
Yeah, you know, the history of premium IOLs has really been one where there has been a, you know, a new IOLs from different from the major companies in the presbyopia space, providing relatively short-term or transient effects. As surgeons try new IOLs and then typically find that they are similar to what has already been in the market. The big difference with the LAL, of course, is adjustability. And we really provide a level of outcomes that can't be achieved with other technologies. That's a differentiator.
Those clinical outcomes are our chief differentiator, and they're a primary focus of our re-engagement with practices to be able to demonstrate and optimize how practices achieve those outcomes routinely.
I know you expect the competitive dynamics to be transient, but do you assume any impact in your guidance or any headwind from the launches this year?
We do. We've tried our best to take that into consideration and we watch that carefully. Back to, you know, the comment I made earlier about the range of guidance that we have given, it does take that into consideration.
Okay. Also just wanted to touch on the international opportunity. Sounds like you're making nice progress there, laying the foundation for expansion. Maybe you can just talk about some of the progress that you've made and how we should think about the opportunity over the next few years.
Yeah. Just to level set, you know, the premium IOL market outside the U.S. is actually about twice as large as the U.S. opportunity. It's focused in about 20 individual markets. We've been, you know, pursuing first regulatory approval in those markets, primarily in Europe and Asia. We've had success with our approvals in the EU as well as in some of the smaller economies in Asia, Korea, Singapore, and now Australia. As well as, you know, continuing to make progress in some of the larger economies. We see that as very promising.
We're obviously early in the process, so we're at the stage where we're establishing, you know, the initial users who are gonna become our KOLs, generate data within the local community, which can drive further growth. Overall, we see the LAL technology as being quite promising outside the US just as it has been in the US.
Got it. I think we are just about out of time, so maybe we can wrap it up there. Thank you both for joining us.
Thank you.
Thank you, Stephanie.
Good afternoon. I'm Ray. I'm part of the med tech research team here at Bank of America. It's my pleasure to introduce Paul Badawi from Sight Sciences here today. Welcome, Paul. Thanks for being here.
The story with everyone. Our mission at Sight Sciences 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. Is there a way to enlarge this here? Anyone here? Yeah, thank you. That's much better. Much better.
Thank you. It's tiny. We're a interventional eye care leader. We are active, commercially active in two 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, in 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. two MACs, Novitas and First Coast established fee schedules for TearCare. 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 reimburse 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, further developing the combo cataract market and also developing the standalone 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 two 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. There's a really interesting overlap as we scale these two businesses. We call it the intersection of intervention. Internally, we call it IX. It's kind of this third proprietary value driver with Sight.
We believe strongly, 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 one thing to have an interventional mindset, then actually activating that interventional mindset and performing cases is another exercise. That's the market development that we're focused on.
This is kind of a strategic roadmap 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. Embrace, starting with embrace procedural intervention as a better alternative to medication management. Identify those patients who can benefit from procedural intervention. Educate them. Educate those patients.
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. 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 diseased 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, in 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 three years, significant real-world evidence proving the consistency of outcomes when a surgeon does treat the underlying cause of disease, the diseased 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. Large market opportunity both for combo cataract as well as standalone. 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 standalone, mild, moderate, and severe. They're all significant opportunities today. Most of MIGS is done in combination with cataract. You see that mild to moderate combo cataract about a $4 billion opportunity.
There's an opportunity for expanding that combo cataract market. The standalone market, which you can see down below, also very significant. Actually, the standalone is on top. Combo cataract is on bottom there. Today's market, most of the revenue in MIGS is combination cataract. While there is a much bigger market opportunity in standalone. Most of the revenue, there's very little revenue in standalone.
That's the opportunity to develop the standalone market, bring patients back to the operating room. 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 standalone, minimally invasive glaucoma procedure. 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 standalone. Our mix is maybe a little bit different. I think we have a higher mix of standalone. About 85% of our OMNI revenue is done in combination with cataract, and about 15% is done in standalone. We obviously have a effort underway to expand the standalone 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, you know, patient 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. They're pseudophakic, they're standalone. They could benefit. Think of a patient who's two-three years out following cataract surgery on, say, two-three medications. Should you allow that patient's pressure to continue climbing? Should you offer them another medication?
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. This here, what you're seeing, meibomian gland disease, is by far the number one cause of dry eye disease category. 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 two-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 followed patients, crossed over the RESTASIS patients to TearCare, looked at the 12-month outcomes. Again, further improvements, 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 one to two treatments per year. 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. 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. We estimate there's a $7 million-$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 to the eyelids. 15 minutes of melting to melt the oily obstructions in all four eyelids. The eye care provider, after the melting cycle, eye care provider will come and evacuate lid by lid, evacuate all of those melted oil 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. 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 Solutions and First Coast Service Options team. Our IDE team is doing a great job creating this category. The metrics, 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 at 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. Lastly, here's a snapshot of our performance, 23% revenue CAGR from 2020 to 2025.
Obviously there you see some flattening of our growth we had on our interventional glaucoma business. We had to work through some Medicare challenges and 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 in growth mode in interventional dry eye.
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, hope everybody, our technologies help everybody to keep seeing. Thank you all. We're just on time.