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What changed in EyePoint, Inc.'s 10-K — 2022 vs 2023

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Paragraph-level year-over-year comparison of EyePoint, Inc.'s 2022 and 2023 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2023 report.

+546 added−676 removedSource: 10-K (2024-03-08) vs 10-K (2023-03-10)

Top changes in EyePoint, Inc.'s 2023 10-K

546 paragraphs added · 676 removed · 388 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

171 edited+60 added−88 removed250 unchanged
Biggest changeUncertainty around the extent and length of time of the Pandemic, and any future related financial impact cannot be reasonably estimated at this time. 5 Our Pipeline and Commercial Products The following table describes the stage of each of our programs: DEVELOPMENT PROGRAM STATUS PARTNER EYP-1901 – vorolanib in bioerodible Durasert • Wet AMD • NPDR • DME Phase 2 clinical trials underway in wet AMD and NPDR DME Phase 2 trial anticipated in Q4 2023 or Q1 2024 Partnered with Betta Pharmaceuticals in China, Hong Kong, Taiwan and Macau COMMERCIAL PROGRAMS STATUS PARTNER YUTIQ – chronic non-infectious uveitis affecting the posterior segment Commercial Ocumension – Asia Alimera – EU, Middle East, Canada, Australia and New Zealand DEXYCU – Treatment of inflammation following ocular surgery Commercial, but no longer actively marketed due to loss of pass-through reimbursement by CMS effective January 1, 2023 Ocumension – Asia Strategy Our goal is to become a leader in the development and commercialization of innovative sustained delivery therapeutics to help improve the lives of patients with serious eye disorders.
Biggest changePipeline The following table describes the stage of each of our programs: DEVELOPMENT PROGRAM STATUS PARTNER EYP-1901 – vorolanib in Durasert E ™ • wet AMD • NPDR • DME Phase 2 clinical trials underway in wet AMD, NPDR and DME Partnered with Betta in China, Hong Kong, Taiwan and Macau EYP-2301 – razuprotafib in Durasert E ™ Preclinical development Unpartnered Strategy Our goal is to become a leader in the development and commercialization of innovative sustained delivery therapeutics to help improve the lives of patients with serious eye disorders.
No treatment is typically administered at the NPDR stages. A treatment with a sustainable dosing regimen that slows or prevents progression of NPDR to PDR or DME could help reduce the vision threatening effects of diabetic eye disease. Market Opportunity in Diabetic Macular Edema (DME) DME is triggered by DR, a well-known complication of diabetes.
No treatment is typically administered at the NPDR stages. A treatment with a sustainable dosing regimen that slows or prevents progression of NPDR to PDR or DME could help reduce the vision threatening effects of diabetic eye disease. Market Opportunity in Diabetic Macular Edema DME is triggered by DR, a well-known complication of diabetes.
Intellectual Property In February 2020, we entered into an Exclusive License Agreement with Equinox Science, LLC (Equinox), pursuant to which Equinox granted us an exclusive, sublicensable, royalty-bearing right and license to certain patents and other Equinox intellectual property to research, develop, make, have made, use, sell, offer for sale and import the compound vorolanib and any pharmaceutical products comprising the compound for the prevention or treatment of wet AMD, DR and RVO (the Original Field) using our proprietary localized delivery technologies, in each case, throughout the world except China, Hong Kong, Taiwan and Macau (the Territory).
In February 2020, we entered into an Exclusive License Agreement (Equinox License Agreement) with Equinox Science, LLC (Equinox), pursuant to which Equinox granted us an exclusive, sublicensable, royalty-bearing right and license to certain patents and other Equinox intellectual property to research, develop, make, have made, use, sell, offer for sale and import the compound vorolanib and any pharmaceutical products comprising the compound for the prevention or treatment of wet AMD, DR and RVO (the Original Field) using our proprietary localized delivery technologies, in each case, throughout the world except China, Hong Kong, Taiwan and Macau (the Territory).
A generic version of an approved drug is approved by means of an abbreviated NDA, or ANDA, by which the sponsor demonstrates that the proposed product is the same as the approved, brand-name drug, which is referred to as the reference listed drug, or RLD.
A generic version of an approved drug is approved by means of an abbreviated NDA, or ANDA, by which the sponsor demonstrates that the proposed product is the same as the approved, brand-name drug, which is referred to as the reference listed drug (RLD).
Once the FDA accepts for filing an ANDA or 505(b)(2) application containing a Paragraph IV certification, the applicant must within 20 days provide notice to the RLD NDA holder and patent owner that the application has been submitted and provide the factual and legal basis for the applicant’s assertion that the patent is invalid or not infringed.
Once the FDA accepts for filing an ANDA or 505(b)(2) application containing a Paragraph IV certification, the applicant must within 20 days provide notice to the RLD NDA holder and patent owner that the application has been submitted and provide the 20 factual and legal basis for the applicant’s assertion that the patent is invalid or not infringed.
Once the CTA is approved in accordance with the EU Clinical Trials Directive 2001/20/EC, or Clinical Trials Directive, and the related national implementing provisions of the relevant individual EU Member States’ requirements, clinical trial development may proceed. In April 2014, the new Clinical Trials Regulation, (EU) No 536/2014, or Clinical Trials Regulation, was adopted.
Once the CTA is approved in accordance with the EU Clinical Trials Directive 2001/20/EC (Clinical Trials Directive), and the related national implementing provisions of the relevant individual EU Member States’ requirements, clinical trial development may proceed. In April 2014, the new Clinical Trials Regulation, (EU) No 536/2014, or Clinical Trials Regulation, was adopted.
Phase 1 clinical trials generally are intended to evaluate the safety, metabolism and pharmacologic actions of the drug, the side effects associated with increasing doses, and, if possible, to gain early evidence of effectiveness. 18 • Phase 2 clinical trials generally are controlled studies that involve a relatively small sample of the intended patient population and are designed to develop initial data regarding the product’s effectiveness, to determine dose response and the optimal dose range, and to gather additional information relating to safety and potential AEs. • Phase 3 clinical trials are conducted after preliminary evidence of effectiveness has been obtained and are intended to gather the additional information about dosage, safety and effectiveness necessary to evaluate the drug’s overall risk-benefit profile, and to provide a basis for regulatory approval.
Phase 1 clinical trials generally are intended to evaluate the safety, metabolism and pharmacologic actions of the drug, the side effects associated with increasing doses, and, if possible, to gain early evidence of effectiveness. • Phase 2 clinical trials generally are controlled studies that involve a relatively small sample of the intended patient population and are designed to develop initial data regarding the product’s effectiveness, to determine dose response and the optimal dose range, and to gather additional information relating to safety and potential AEs. • Phase 3 clinical trials are conducted after preliminary evidence of effectiveness has been obtained and are intended to gather the additional information about dosage, safety and effectiveness necessary to evaluate the drug’s overall risk-benefit profile, and to provide a basis for regulatory approval.
Under the Betta License Agreement, the Company granted to Betta an exclusive, sublicensable, royalty-bearing license under certain of the Company’s intellectual property to develop, use (but not make or have made), sell, offer for sale and import the Company’s product candidate, EYP-1901, an investigational sustained delivery intravitreal anti-VEGF treatment that combines a bioerodible formulation of the Company’s proprietary sustained-release technology with the compound vorolanib (the Licensed Product), in the field of ophthalmology (the Betta Field) in the Greater Area of China, including China, the Hong Kong Special Administrative Region, the Macau Special Administrative Region, and Taiwan (the Betta 9 Territory).
Under the Betta License Agreement, the Company granted to Betta an exclusive, sublicensable, royalty-bearing license under certain of the Company’s intellectual property to develop, use (but not make or have made), sell, offer for sale, and import the Company’s product candidate, EYP-1901, an investigational sustained delivery intravitreal anti-VEGF treatment that combines a bioerodible formulation of the Company’s proprietary sustained-release technology with the compound vorolanib (the Licensed Product), in the field of ophthalmology (the Betta Field) in the Greater Area of China, including China, the Hong Kong Special Administrative Region, the Macau Special Administrative Region, and Taiwan (the Betta Territory).
In consideration for the rights granted by Equinox, we (i) made a one time, non-refundable, non-creditable upfront cash payment of $1.0 million to Equinox in February 2020, and (ii) agreed to pay milestone payments totaling up to $50 million upon the achievement of certain development and regulatory milestones, consisting of (a) completion of a Phase 2 clinical trial for the compound or a licensed product, (b) the filing of a new drug application or foreign equivalent for the compound or a licensed product in the United States, European Union or United Kingdom and (c) regulatory approval of the compound or a licensed product in the United States, European Union or United Kingdom.
In consideration for the rights granted by Equinox, we (i) made a one time, non-refundable, non-creditable upfront cash payment of $1.0 million to Equinox in February 2020, and (ii) agreed to pay milestone payments totaling up to $50 million upon the achievement of certain development and regulatory milestones, consisting of (a) completion of a Phase 2 clinical trial for the compound or a licensed product, (b) the filing of a new drug application (NDA) or foreign equivalent for the compound or a licensed product in the United States, European Union, or United Kingdom and (c) regulatory approval of the compound or a licensed product in the United States, European Union, or United Kingdom.
In 31 addition, we could be subject to regulatory actions and/or claims made by individuals and groups in private litigation involving privacy issues related to data collection and use practices and other data privacy laws and regulations, including claims for misuse or inappropriate disclosure of data, as well as unfair or deceptive acts or practices in violation of Section 5(a) of the Federal Trade Commission Act (FTC Act).
In addition, we could be subject to regulatory actions and/or claims made by individuals and groups in private litigation involving privacy issues related to data collection and use practices and other data privacy laws and regulations, including claims for misuse or inappropriate disclosure of data, as well as unfair or deceptive acts or practices in violation of Section 5(a) of the Federal Trade Commission Act (FTC Act).
Further, the European/UK data protection laws (including laws on data transfers as set out above) may also be updated/revised, accompanied by new guidance and/or judicial/regulatory interpretations, which could entail further impacts on our compliance efforts and increased cost. 32 Foreign Corrupt Practices Act In addition, the U.S.
Further, the European/UK data protection laws (including laws on data transfers as set out above) may also be updated/revised, accompanied by new guidance and/or judicial/regulatory interpretations, which could entail further impacts on our compliance efforts and increased cost. Foreign Corrupt Practices Act In addition, the U.S.
The federal civil False Claims Act prohibits any person from, among other things, knowingly presenting, or causing to be presented, a false or fraudulent claim for payment of government funds, or knowingly making, using, or causing to be made or used, a false record or statement material to an obligation to pay money to the government or knowingly concealing or knowingly and improperly avoiding, decreasing, or concealing an obligation to pay money to the federal government.
The federal civil False Claims Act prohibits any person from, among other things, knowingly presenting, or causing to be presented, a false or fraudulent claim for payment of government funds, or knowingly making, using, or causing to be made or used, a false record or statement material to an obligation to pay money to the government or knowingly concealing or knowingly and 28 improperly avoiding, decreasing, or concealing an obligation to pay money to the federal government.
A marketing authorization, irrespective of its route to authorization, may be granted only to an applicant established in the EU. 22 The centralized procedure provides for the grant of a single marketing authorization by the European Commission that is valid for all 27 EU Member States and three of the four European Free Trade Association States, Iceland, Liechtenstein and Norway.
A marketing authorization, irrespective of its route to authorization, may be granted only to an applicant established in the EU. The centralized procedure provides for the grant of a single marketing authorization by the European Commission that is valid for all 27 EU Member States and three of the four European Free Trade Association States, Iceland, Liechtenstein, and Norway.
Although we are not directly subject to HIPAA, other than potentially with respect to providing certain employee benefits, we could be subject to criminal penalties if we or our affiliates or agents knowingly obtain individually identifiable health information maintained by a HIPAA-covered entity in a manner that is not authorized or permitted by HIPAA.
Although we are not directly subject to HIPAA, other than potentially with respect to providing 29 certain employee benefits, we could be subject to criminal penalties if we or our affiliates or agents knowingly obtain individually identifiable health information maintained by a HIPAA-covered entity in a manner that is not authorized or permitted by HIPAA.
We may obtain health information from third parties that are subject to privacy and security requirements under HIPAA and we could potentially be subject to criminal penalties if we, our affiliates, or our agents knowingly obtain or disclose individually identifiable health information maintained by a HIPAA-covered entity in a manner that is not authorized or permitted by HIPAA.
We may obtain health information from third parties that are subject to privacy and security requirements under HIPAA and we could potentially be subject to criminal penalties if we, our affiliates, or our agents knowingly obtain individually identifiable health information maintained by a HIPAA-covered entity in a manner that is not authorized or permitted by HIPAA.
The Company retained rights under the Company’s intellectual property to, among other things, conduct clinical trials on the Licensed Product in the Betta Field in the Betta Territory. In consideration for the rights granted by the Company, Betta agreed to pay the Company tiered, mid-to-high single-digit royalties based upon annual net sales of Licensed Products in the Betta Territory.
The Company retained rights under the Company’s intellectual property to, among other things, conduct clinical trials on the Licensed Product in the Betta Field in the Betta Territory. 10 In consideration for the rights granted by the Company, Betta agreed to pay the Company tiered, mid-to-high single-digit royalties based upon annual net sales of Licensed Products in the Betta Territory.
The main regulatory standard for ensuring pharmaceutical quality is the Current Good Manufacturing Practice (cGMPs) regulation for human pharmaceuticals. Manufacturing of our clinical trial materials (CTM) and of our commercial products is subject to these cGMPs which govern record-keeping, manufacturing processes and controls, personnel, quality control and quality assurance, among other activities.
The main regulatory standard for ensuring pharmaceutical quality is the Current Good Manufacturing Practice (cGMPs) regulation for human pharmaceuticals. Manufacturing of our clinical trial materials (CTM) and of our commercial products is subject to these cGMPs which govern record-keeping, manufacturing processes 11 and controls, personnel, quality control and quality assurance, among other activities.
Even if such additional information and data are submitted, the FDA may decide that the NDA still does not meet the standards for approval. Data from clinical trials are not always conclusive and the FDA may interpret data differently than the sponsor. FDA approval of any application may include many delays or never be granted.
Even if such additional information and data are submitted, the FDA may decide that the NDA still does not meet the standards for approval. Data from clinical trials are not always conclusive and the FDA may interpret data differently than the sponsor. FDA approval of any application 18 may include many delays or never be granted.
Specifically, the FDA requires that drug-device combination products comply with certain provisions of the Quality System Regulation (QSR), which sets forth the FDA’s manufacturing quality standards for medical devices. In addition to drug safety reporting requirements, the FDA also requires that we comply with some device safety reporting requirements for our drug-device combination product. 20 Advertising and Promotion.
Specifically, the FDA requires that drug-device combination products comply with certain provisions of the Quality System Regulation (QSR), which sets forth the FDA’s manufacturing quality standards for medical devices. In addition to drug safety reporting requirements, the FDA also requires that we comply with some device safety reporting requirements for our drug-device combination product. Advertising and Promotion.
The actual protection afforded by a patent, which can vary from country to country, depends upon the type of patent, the scope of its coverage and the availability of legal remedies in the country. Patent term extension may be available in various countries to compensate for a patent office delay or a regulatory delay in approval of the product.
The actual protection afforded by a patent, which can vary from country to country, depends upon the type of patent, the scope of its coverage, and the availability of legal remedies in the country. Patent term 13 extension may be available in various countries to compensate for a patent office delay or a regulatory delay in approval of the product.
The sponsoring company, the FDA, or the IRB may suspend or terminate a clinical trial at any time on various grounds, including a finding that the patients are being exposed to an unacceptable health risk. Further, success in early-stage clinical trials does not assure success in later-stage clinical trials.
The sponsoring company, the FDA, or the IRB may suspend or terminate a clinical trial at any time on various grounds, including a finding that the patients are being exposed to an unacceptable health risk. Further, success in early-stage clinical trials does 17 not assure success in later-stage clinical trials.
The targeted action date can also be shortened to six 19 months of the 60-day filing date for products that are granted priority review designation because they are intended to treat serious or life-threatening conditions and demonstrate the potential to address unmet medical needs.
The targeted action date can also be shortened to six months of the 60-day filing date for products that are granted priority review designation because they are intended to treat serious or life-threatening conditions and demonstrate the potential to address unmet medical needs.
A major public health interest defined by three cumulative criteria: (i) the seriousness of the disease (for example, heavy disabling or life-threatening diseases) to be treated, (ii) the absence or insufficiency of an appropriate alternative therapeutic approach, and (iii) anticipation of high therapeutic benefit.
A major public health interest defined by three cumulative criteria: (i) the seriousness of the disease (for example, heavy disabling or life-threatening diseases) to be treated, (ii) the absence or insufficiency of 21 an appropriate alternative therapeutic approach, and (iii) anticipation of high therapeutic benefit.
Moreover, under a final regulation effective January 13, 2021, HRSA newly established an administrative dispute resolution (ADR), process for claims by covered entities that a manufacturer has engaged in overcharging, and by manufacturers that a covered entity violated the prohibitions against diversion or duplicate discounts.
Moreover, under a final regulation effective January 13, 2021, HRSA established an administrative dispute resolution (ADR), process for claims by covered entities that a manufacturer has engaged in overcharging, and by manufacturers that a covered entity violated the prohibitions against diversion or duplicate discounts.
Further, we are focused on bringing new mechanisms of action to the treatment of disease in addition to the current standard of care. Unlike many chronic diseases that are treated with drugs addressing multiple mechanisms of action, most retinal diseases are currently addressed using a single mechanism of action.
Further, we are focused on bringing new mechanisms of action to the treatment of disease in addition to the current 6 standard of care. Unlike many chronic diseases that are treated with drugs addressing multiple mechanisms of action, most retinal diseases are currently addressed using a single mechanism of action.
On July 10, 2017, we entered into the Amended Alimera Agreement, pursuant to which we (i) expanded the license to Alimera to our proprietary Durasert sustained-release drug delivery technology platform to include uveitis, including chronic non-infectious uveitis affecting the posterior segment of the eye, in the EMEA and (ii) converted the net profit share arrangement for each licensed product (including ILUVIEN) under the original collaboration agreement with Alimera (the Prior Alimera Agreement) to a sales-based royalty on a calendar quarter basis commencing July 1, 2017, with payments from Alimera due 60 days following the end of each calendar quarter.
On July 10, 2017, we entered into an amended and restated collaboration agreement with Alimera (the Amended Alimera Agreement), pursuant to which we (i) expanded the license to Alimera to our proprietary Durasert ® sustained-release drug delivery technology platform to include uveitis, including chronic non-infectious uveitis affecting the posterior segment of the eye, in EMEA and (ii) converted the net profit share arrangement for each licensed product (including ILUVIEN) under the original collaboration agreement with Alimera (the Prior Alimera Agreement) to a sales-based royalty on a calendar quarter basis commencing July 1, 2017, with payments from Alimera due 60 days following the end of each calendar quarter.
Other states have laws requiring pharmaceutical sales representatives to be registered or licensed, and still others impose limits on co-pay 30 assistance that pharmaceutical companies can offer to patients. In addition, several states require pharmaceutical companies to implement compliance programs or marketing codes.
Other states have laws requiring pharmaceutical sales representatives to be registered or licensed, and still others impose limits on co-pay assistance that pharmaceutical companies can offer to patients. In addition, several states require pharmaceutical companies to implement compliance programs or marketing codes.
The patent claims to methods of use relate primarily to disease indications where activation of Tie2 and associated vascular stabilization are potentially beneficial. The potential expiration dates of the patents and applications in this portfolio range from 2027 to 2041.
The patent claims for methods of use relate primarily to disease indications where activation of Tie2 and associated vascular stabilization are potentially beneficial. The potential expiration dates of the patents and applications in this portfolio range from 2027 to 2041.
By 2050, the estimated number of people with AMD is expected to more than double from 2.07 million to 5.44 million. White Americans are expected to continue to account for the majority of cases.
By 2050, the estimated 7 number of people with AMD is expected to more than double from 2.07 million to 5.44 million. White Americans are expected to continue to account for the majority of cases.
The governments of the EU Member States influence the price of pharmaceutical products through their pricing and reimbursement rules and control of national healthcare systems that fund a large part of the cost of those products to consumers.
The governments of the EU Member States influence the price of pharmaceutical products through their pricing and reimbursement rules and control of national healthcare systems that fund a large part of the cost of 27 those products to consumers.
Although the discussion below focuses on regulation in the U.S., we currently out-license certain of our products and may seek approval for, and market, other products in other countries in the future.
Although the discussion below 16 focuses on regulation in the U.S., we currently out-license certain of our products and may seek approval for, and market, other products in other countries in the future.
The data do not need to 23 show that the product is effective in the pediatric population studied; rather, if the clinical trial is deemed to fairly respond to the FDA’s request, the additional protection is granted.
The data do not need to show that the product is effective in the pediatric population studied; rather, if the clinical trial is deemed to fairly respond to the FDA’s request, the additional protection is granted.
The HTA Regulation will apply to all EU Member States from January 12, 2025. 29 The HTA Regulation provides that EU Member States will be able to use common HTA tools, methodologies, and procedures across the EU.
The HTA Regulation will apply to all EU Member States from January 12, 2025. The HTA Regulation provides that EU Member States will be able to use common HTA tools, methodologies, and procedures across the EU.
The key elements of our strategy include: • Advance EYP-1901 through Phase 3 clinical development for wet AMD, NPDR and DME • Advance EYP-1901 into clinical trials in additional indications, potentially including Myopic Choroidal Neovascularization (CNV) and retinal vein occlusion (RVO) • Expand product pipeline through in-license, partnership or acquisition with initial focus on molecules that can be delivered using our Durasert technology. • Leverage our drug delivery technologies through research collaborations and out-licenses with other pharmaceutical and biopharmaceutical companies, institutions and other organizations.
The key elements of our strategy include: • Advance EYP-1901 through Phase 3 clinical development for wet AMD, NPDR and DME • Advance EYP-1901 into clinical trials in additional indications, potentially including myopic choroidal neovascularization (CNV) and retinal vein occlusion (RVO) • Advance EYP-2301 into clinical development for serious retinal diseases • Expand product pipeline through in-license, partnership or acquisition with initial focus on molecules that can be delivered using our Durasert ® technology. • Leverage our drug delivery technologies through research collaborations and out-licenses with other pharmaceutical and biopharmaceutical companies, institutions and other organizations.
In addition, each clinical trial must be reviewed and approved by, and conducted under the auspices of, an Institutional Review Board, or IRB, for each clinical site.
In addition, each clinical trial must be reviewed and approved by, and conducted under the auspices of, an institutional review board (IRB), for each clinical site.
Healthcare Reform The Patient Protection and Affordable Care Act, as amended, which we refer to as the Affordable Care Act, or ACA, is a sweeping measure intended to expand healthcare coverage within the U.S., primarily through the imposition of health insurance mandates on employers and individuals, the provision of subsidies to eligible individuals enrolled in plans offered on the health insurance exchanges, and expansion of the Medicaid program.
Healthcare Reform The Patient Protection and Affordable Care Act, as amended, which we refer to as the Affordable Care Act is a sweeping measure intended to expand healthcare coverage within the U.S., primarily through the imposition of health insurance mandates on employers and individuals, the provision of subsidies to eligible individuals enrolled in plans offered on the health insurance exchanges, and expansion of the Medicaid program.
Slow but progressive changes in the small blood vessels of the retina may cause no symptoms or only mild vision problems in early stages. The disease progresses from NPDR to proliferative diabetic retinopathy (PDR). At any stage, retina bleeding and fluid accumulation lead to DME which can cause blindness.
Slow but progressive changes in the small blood vessels of the retina may cause no symptoms or only mild vision problems in early stages. The disease progresses from NPDR to proliferative diabetic retinopathy (PDR). At any stage, retina bleeding and fluid accumulation leads to DME which can cause blindness.
The USPTO, in consultation with the FDA, reviews and approves the application for patent term restoration. European and Other International Government Regulation In addition to regulations in the U.S., we are subject to a variety of regulations in other jurisdictions governing, among other things, clinical trials and any commercial sales and distribution of our products.
Patent and Trademark Office (USPTO), in consultation with the FDA, reviews and approves the application for patent term restoration. European and Other International Government Regulation In addition to regulations in the U.S., we are subject to a variety of regulations in other jurisdictions governing, among other things, clinical trials and any commercial sales and distribution of our products.
There are also two approved biosimilar Lucentis mediations approved by the FDA. In 2021, the FDA approved Susvimo, a first-of-its-kind port delivery system (PDS) with ranibizumab for the treatment of patients with wet AMD. However, in the Fall of 2022, Susvimo was taken off the market by Genentech via a voluntary recall.
There are also two FDA-approved Lucentis biosimilars mediations approved by the FDA. In 2021, the FDA approved Susvimo, a first-of-its-kind port delivery system (PDS) with ranibizumab for the treatment of patients with wet AMD. However, in the Fall of 2022, Susvimo was taken off the market by Genentech via a voluntary recall.
Human clinical trials in the U.S. cannot commence until an IND, application is submitted and becomes effective. A company must submit pre-clinical testing results to the FDA as part of the IND, and the FDA must evaluate whether there is an adequate basis for testing the drug in initial clinical studies in human volunteers.
Investigational New Drug (IND) Application. Human clinical trials in the U.S. cannot commence until an IND, application is submitted and becomes effective. A company must submit pre-clinical testing results to the FDA as part of the IND, and the FDA must evaluate whether there is an adequate basis for testing the drug in initial clinical studies in human volunteers.
The last expiring patent covering the vorolanib compound licensed to us by Equinox Science and used in EYP-1901 expires in September 2037, but EyePoint has filed an additional patent application for EYP-1901 that, if issued, would extend coverage of EYP-1901 until at least 2041.
The last expiring patent covering the vorolanib compound licensed to us by Equinox Science and used in EYP-1901 expires in September 2037, but the Company has filed an additional patent application for EYP-1901 that, if issued, would extend coverage of EYP-1901 until at least 2041.
Other legislative changes relating to reimbursement have been adopted in the U.S. since the Affordable Care Act was enacted. For example, on August 2, 2011, the Budget Control Act of 2011, among other things, created the Joint Select Committee on Deficit Reduction to recommend to Congress proposals for spending reductions.
Other legislative changes relating to reimbursement have been adopted in the U.S. since the Affordable Care Act was enacted. For example, the Budget Control Act of 2011, among other things, created the Joint Select Committee on Deficit Reduction to recommend to Congress proposals for spending reductions.
The maximum period of restoration is five years, and the patent cannot be extended to more than 14 years from the date of FDA approval of the product. Only one patent claiming each approved product is eligible for restoration and the patent holder must apply for restoration within 60 days of approval.
The maximum period of restoration is five years, and the patent cannot be extended to more than 14 years from the date of FDA approval of the product. Only one patent claiming each approved product is eligible for restoration and the patent holder must apply for restoration within 60 days of approval. The U.S.
The 340B program, which is administered by the Health Resources and Services Administration, or HRSA, requires participating manufacturers to agree to charge statutorily defined covered entities no more than the 340B “ceiling price” for 26 the manufacturer’s covered outpatient drugs.
The 340B program, which is administered by the Health Resources and Services Administration, or HRSA, requires participating manufacturers to agree to charge statutorily defined covered entities no more than the 340B “ceiling price” for 25 the manufacturer’s covered outpatient drugs.
Such claims are to be resolved through an ADR panel of government officials rendering a decision that could be appealed only in federal court. An ADR proceeding could subject us to onerous procedural requirements and could result in additional liability.
Such claims are to be resolved through an ADR panel of government officials rendering a decision that may be appealed to federal court. An ADR proceeding could subject us to onerous procedural requirements and could result in additional liability.
We believe that EYP-1901, if approved as a potential six-month sustained delivery maintenance therapy, has the potential to offer wet AMD patients a convenient and effective treatment option with a unique mechanism of action. Market Opportunity in Non-Proliferative Diabetic Retinopathy (NPDR) Diabetic retinopathy (DR) is a frequent complication of diabetes mellitus.
We believe that EYP-1901, if approved as a potential six-month sustained delivery maintenance therapy, has the potential to offer wet AMD patients a safe and effective treatment option with a unique mechanism of action. Market Opportunity in Non-Proliferative Diabetic Retinopathy Diabetic retinopathy (DR) is a frequent complication of diabetes mellitus.
We source the active pharmaceutical ingredient (API) vorolanib from Betta Pharmaceuticals and various raw materials and components for both EYP-1901 and its injector from third-party vendors. We established a relationship with a U.S.-based contract manufacturing supplier for vorolanib to develop the process for manufacturing vorolanib and to become the U.S. supplier of vorolanib for use in EYP-1901.
We source the active pharmaceutical ingredient (API) vorolanib from Betta and various raw materials and components for both EYP-1901 and its injector from third-party vendors. We established a relationship with a U.S.-based contract manufacturing supplier for vorolanib to transfer the process for manufacturing vorolanib and to become the U.S. supplier of vorolanib for use in EYP-1901.
In November 2020, California voters approved the California Privacy Rights Act (CPRA) ballot initiative which introduced significant amendments to the CCPA and established and funded a dedicated California privacy regulator, the California Privacy Protection Agency (CPPA). The amendments introduced by the CPRA went effect on January 1, 2023, and new implementing regulations are expected to be introduced by the CPPA.
In November 2020, California voters approved the California Privacy Rights Act (CPRA) ballot initiative which introduced significant amendments to the CCPA and established and funded a dedicated California privacy regulator, the California Privacy Protection Agency (CPPA). The amendments introduced by the CPRA went effect on January 1, 2023, and new implementing regulations continue to be introduced by the CPPA.
The central retina area that is located between the main branches (superior and inferior arcades) of the central retinal vessels in the eye is known as the “macular area.” The retina beyond this is considered “peripheral retina.” The central retinal area can develop abnormal findings. These findings can be present in the non-proliferative or the proliferative forms of the disease.
The central retina area that is located between the main branches (superior and inferior arcades) of the central retinal vessels in the eye is known as the “macular area”. The retina beyond this is considered “peripheral retina”. The central retinal area can develop abnormal findings. These findings can be present in the non-proliferative or the proliferative forms of the disease.
The royalties are payable with respect to a licensed product in a particular country in the Territory on a country-by-country and licensed product-by-licensed product basis until the later of (i) twelve years after the first commercial sale of such licensed product in such country and (ii) the first day of the month following the month in which a generic product corresponding to such licensed product is launched in such country (collectively, the Royalty Term).
The royalties are payable with respect to a licensed product in a particular country in the Territory on a country-by-country and licensed product-by-licensed product basis until the later of (i) twelve years after the first commercial sale of such licensed product in such country and (ii) the first day of the month following the month in which a generic product corresponding to such licensed product is launched in such country.
Further, starting October 2022, the IRA establishes a Medicare Part D inflation rebate scheme, under which, generally speaking, manufacturers will owe additional rebates if the AMP of a Part D drug increases faster than the pace of inflation. Failure to timely pay a Part D inflation rebate is subject to a civil monetary penalty.
Further, the IRA establishes a Medicare Part D inflation rebate scheme, under which, generally speaking, manufacturers will owe additional rebates if the AMP of a Part D drug increases faster than the pace of inflation. Failure to timely pay a Part D inflation rebate is subject to a civil monetary penalty.
Coverage and Reimbursement Sales of any of our products and product candidates, if approved, depend, in part, on the extent to which the costs of the products will be covered by Medicare and Medicaid, and private payors, such as commercial health insurers and managed care organizations.
Coverage and Reimbursement Sales of any of our product candidates, if approved and once commercialized, depend, in part, on the extent to which the costs of the product will be covered by Medicare and Medicaid, and private payors, such as commercial health insurers and managed care organizations.
Product Distribution Channel We have established a distribution channel in the United States for the commercialization of YUTIQ and DEXYCU that provides physicians with several options for ordering our products. This includes agreements with a nationally recognized third-party logistics provider (3PL), several distributors and a specialty pharmacy provider for physicians who prefer to use a traditional buy-and-bill model.
Product Distribution Channel We previously established a distribution channel in the United States for the commercialization of YUTIQ ® and DEXYCU ® that provided physicians with several options for ordering our products. This includes agreements with a nationally recognized third-party logistics provider (3PL), several distributors, and a specialty pharmacy provider for physicians who prefer to use a traditional buy-and-bill model.
Our Product Candidates EYP-1901 for wet AMD, NPDR and DME EYP-1901 is an investigational product deploying a bioerodible Durasert insert of vorolanib, a selective and patent protected TKI, that potentially brings a new mechanism of action and treatment paradigm for serious eye diseases beyond existing anti-VEGF large molecule ligand blocking therapies.
Our Product Candidates EYP-1901 for wet AMD, NPDR and DME EYP-1901 is an investigational product deploying vorolanib, a selective and patent protected TKI, that potentially brings a new mechanism of action and treatment paradigm for serious eye diseases beyond existing anti-VEGF large molecule ligand blocking therapies. EYP-1901 utilizes our bioerodible Durasert E Ô technology.
Pre-clinical testing generally includes laboratory evaluation of product chemistry and formulation, as well as toxicological and pharmacological studies in several animal species to assess the toxicity and dosing of the product. Certain animal studies must be performed in compliance with the FDA’s GLP, regulations and the U.S. Department of Agriculture’s Animal Welfare Act. IND Application.
Pre-clinical testing generally includes laboratory evaluation of product chemistry and formulation, as well as toxicological and pharmacological studies in several animal species to assess the toxicity and dosing of the product. Certain animal studies must be performed in compliance with the FDA’s Good Laboratory Practice (GLP), regulations and the U.S. Department of Agriculture’s Animal Welfare Act.
Further, the Bipartisan Budget Act of 2018, among other things, amended the Medicare statute to reduce the coverage gap in most Medicare drugs plans, commonly known as the “donut hole,” by raising the required manufacturer point-of-sale discount from 50% to 70% off the negotiated price effective as of January 1, 2019.
Further, the Bipartisan Budget Act of 2018, among other things, amended the Medicare statute to reduce the coverage gap in most Medicare drugs plans, commonly known as the “donut hole,” by raising the required manufacturer point-of-sale discount from 50% to 70% off the negotiated price.
In addition, EyePoint has filed additional patent applications for technology relating to EYP-1901, that, if issued, could expire in 2043, and for a new injector designed for administration of DURASERT ® , that, if issued, could expire in 2042.
In addition, the Company has filed additional patent applications for technology relating to EYP-1901, that, if issued, could expire in 2043, and for a new injector designed for administration of DURASERT ® , that, if issued, could expire in 2042.
Most of our competitors and potential competitors are larger, better established, more experienced and have substantially more resources than we or our partners have.
Many of our competitors and potential competitors are larger, better established, more experienced, and have substantially more resources than we or our partners have.
We may obtain health information from third parties, such as health care providers who prescribe our products, and research institutions we collaborate with, who are subject to privacy and security requirements under HIPAA.
We may obtain health information from third parties, such as HCPs who prescribe our products, and research institutions we collaborate with, who are subject to privacy and security requirements under HIPAA.
Medicare Part D prescription drug plans may use formularies to limit the number of drugs that will be covered in any therapeutic class and/or impose differential cost sharing or other utilization management techniques. Medicare Part D coverage is available for our products and may be available for any future product candidates for which we receive marketing approval.
Medicare Part D prescription drug plans may use formularies to limit the number of drugs that will be covered in any therapeutic class and/or impose differential cost sharing or other utilization management techniques. 26 Medicare Part D coverage may be available for any future product candidates for which we receive marketing approval and commercialize.
For example, other states, including Virginia, Colorado, Utah, and Connecticut have enacted privacy laws similar to the CCPA that impose new obligations or limitations in areas affecting our business and we continue to assess the impact of these state legislation, on our business as additional information and guidance becomes available.
For example, other states, including Virginia, Colorado, Utah, Indiana, Iowa, Tennessee, Montana, Texas, and Connecticut have enacted privacy laws similar to the CCPA that impose new obligations or limitations in areas affecting our business and we continue to assess the impact of these state legislation, on our business as additional information and guidance becomes available.
For more information about Medicare Part B, refer to the risk factor entitled “Our products may become subject to unfavorable pricing regulations, third-party reimbursement practices or healthcare reform initiatives, which could harm our business” set forth under the section titled “Risk Factors” in this Annual Report on Form 10-K. In the U.S.
For more information about Medicare Part B, refer to the risk factor entitled “Our products and product candidates, if approved and commercialized, may become subject to unfavorable pricing regulations, third-party reimbursement practices, or healthcare reform initiatives which could harm our business” set forth under the section titled “Risk Factors” in this Annual Report on Form 10-K. In the U.S.
Several states now require pharmaceutical companies to report expenses relating to the marketing and promotion of pharmaceutical products in those states and to report gifts and payments to individual health care providers in those states. Some of these states also prohibit certain marketing-related activities including the provision of gifts, meals, or other items to certain health care providers.
Several states now require pharmaceutical companies to report expenses relating to the marketing and promotion of pharmaceutical products in those states and to report gifts and payments to individual HCPs in those states. Some of these states also prohibit certain marketing-related activities including the provision of gifts, meals, or other items to certain HCPs.
On December 21, 2020, CMS issued a final regulation that modified existing Medicaid Drug Rebate Program regulations to permit reporting multiple Best Price figures with regard to value based purchasing arrangements (beginning in 2022) and provided definitions for “line extension,” “new formulation,” and related terms with the practical effect of expanding the scope of drugs considered to be line extensions (beginning in 2022).
CMS issued another final regulation that modified existing Medicaid Drug Rebate Program regulations to permit reporting multiple Best Price figures with regard to value based purchasing arrangements (beginning in 2022) and provided definitions for “line extension,” “new formulation,” and related terms with the practical effect of expanding the scope of drugs considered to be line extensions (beginning in 2022).
Durasert Technology Platform Our current Durasert technology platform uses proprietary sustained release technology to deliver drugs over periods of months to years through a single intravitreal injection. To date, four products utilizing successive generations of the Durasert technology have been approved by the FDA.
Durasert Technology Our current Durasert ® technology uses proprietary sustained release to deliver drugs in the eye over periods of months to years through a single intravitreal (IVT) injection. To date, four products utilizing successive generations of the Durasert ® technology have been approved by the FDA.
In Opthea’s randomized, double-masked, sham-controlled, phase 1b/2a trial, 153 patients with DME were treated with OPT-302 alone, in combination with intravitreal aflibercept injections, or with aflibercept alone.
In Opthea Limited's (Opthea) randomized, double-masked, sham-controlled, phase 1b/2a trial, 153 patients with DME were treated with OPT-302 alone, in combination with intravitreal aflibercept injections, or with aflibercept alone.
OTX-TKI – Ocular Therapeutics In February 2023, Ocular Therapeutics presented 10-month data for OTX-TKI demonstrating a favorable safety and efficacy profile in a controlled Phase 1 trial of patients that were measured dry at screening. OTX-TKI utilizes axitinib, a TKI, formulated in a hydrogel and delivered through an intravitreal injection.
AXPAXLI (formerly OTX-TKI) – Ocular Therapeutix, Inc. In February 2023, Ocular Therapeutix, Inc. (Ocular Therapeutix) presented 10-month data for OTX-TKI demonstrating a favorable safety and efficacy profile in a controlled Phase 1 trial of patients that were measured dry at screening. OTX-TKI utilizes axitinib, a TKI, formulated in a hydrogel and delivered through an intravitreal injection.
The Physician Payments Sunshine Act, implemented as the Open Payments program, and its implementing regulations, requires manufacturers of drugs, devices, biologics and medical supplies for which payment is available under Medicare, Medicaid or the Children’s Health Insurance Program (with certain exceptions) to report annually to CMS information related to direct or indirect payments and other transfers of value to physicians and teaching hospitals, as well as ownership and investment interests held in the company by physicians and their immediate family members.
The Physician Payments Sunshine Act, implemented as the Open Payments program, and its implementing regulations, requires manufacturers of drugs, devices, biologics and medical supplies for which payment is available under Medicare, Medicaid or the Children’s Health Insurance Program (with certain exceptions) to report annually to CMS information related to direct or indirect payments and other transfers of value to physicians, physician assistants, nurse practitioners, clinical nurse specialists, certified nurse anesthetists, certified nurse-midwives, and teaching hospitals, as well as ownership and investment interests held in the company by physicians and their immediate family members.
Starting January 2023, the IRA establishes a Medicare Part B inflation rebate scheme, under which, generally speaking, manufacturers will owe rebates if the average sales price of a Part B drug increases faster than the pace of inflation. Failure to timely pay a Part B inflation rebate is subject to a civil monetary penalty.
The IRA established a Medicare Part B inflation rebate scheme, under which, generally speaking, manufacturers will owe rebates if the average sales price of a Part B drug increases faster than the pace of inflation. Failure to timely pay a Part B inflation rebate is subject to a civil monetary penalty.
FDA Approved Products Licensed to Others ILUVIEN for DME ILUVIEN is an injectable, sustained-release micro-insert based on our Durasert technology platform and delivers 0.19 mg of FA to the back of the eye for treatment of DME. DME is a disease suffered by diabetics where leaking capillaries cause swelling in the macula, the most sensitive part of the retina.
ILUVIEN for DME ILUVIEN is an injectable, sustained-release micro-insert based on our Durasert ® technology platform which delivers 0.19 mg of FA to the back of the eye for treatment of DME. DME is a disease suffered by diabetics where leaking capillaries cause swelling in the macula, the most sensitive part of the retina.
In January 2022 the FDA approved VABYSMO ® (faricimab), a bispecific antibody Ang-2 and VEGF-A inhibitor. Also in 2022, two ranibizumab biosimilars, Byooviz and Cimerli entered the market. The FDA also approved Beovu ® brolucizumab injection on October 8, 2019.
In January 2022, the FDA approved VABYSMO ® (faricimab), a bispecific antibody Ang-2 and vascular endothelial growth factor-A inhibitor. Also in 2022, two ranibizumab biosimilars, Byooviz and Cimerli entered the market. The FDA also approved Beovu ® brolucizumab injection on October 8, 2019.
We intend to continue this activity with partner compounds that could be successfully delivered with our Durasert and, potentially, Verisome technology platforms on a fee-for-service basis with the potential for future clinical and commercial milestones and royalties.
We intend to continue this activity with partner compounds that could be successfully delivered with our Durasert and, potentially, Verisome technology platforms with the potential for future clinical and commercial milestones and royalties.
Due to the drawbacks of frequent intravitreal injections, we believe the development of methods to deliver drugs to patients in a more precise, micro dose zero order release kinetics over longer periods of time with Durasert can satisfy a large unmet medical need 6 for both patients and physicians.
Due to the drawbacks of frequent intravitreal injections, we believe the delivery of drugs to patients in a more precise, zero order release kinetics over longer periods of time with Durasert ® can satisfy a large unmet medical need for both patients and physicians.
We face substantial competition for our FDA-approved products and our product candidates. Pharmaceutical, drug delivery and biotechnology companies, as well as research organizations, governmental entities, universities, hospitals, other nonprofit organizations and individual scientists, have developed and are seeking to develop drugs, therapies and novel delivery methods to treat diseases targeted by our products and product candidates.
Pharmaceutical, drug delivery, and biotechnology companies, as well as research organizations, governmental entities, universities, hospitals, other nonprofit organizations, and individual scientists, have developed and are seeking to develop drugs, therapies, and novel delivery methods to treat diseases targeted by our products and product candidates.
DEXYCU is administered as a single dose directly into the surgical site at the end of ocular surgery and is the first long-acting intraocular product approved by the FDA for the treatment of post-operative inflammation. DEXYCU utilizes our proprietary Verisome ® drug-delivery technology, which allows for a single intraocular injection that releases dexamethasone, a corticosteroid, for up to 22 days.
DEXYCU ® is administered as a single dose directly into the surgical site at the end of ocular surgery and is the first long-acting intraocular product approved by the FDA for the treatment of post-operative inflammation. DEXYCU ® allows for a single intraocular injection that releases dexamethasone, a corticosteroid, for up to 22 days.
In the EU, each EU Member State can restrict the range of medicinal products for which its national health insurance system provides reimbursement and can control the prices of medicinal products for human use marketed on its territory.
Different pricing and reimbursement schemes exist in other countries. In the EU, each EU Member State can restrict the range of medicinal products for which its national health insurance system provides reimbursement and can control the prices of medicinal products for human use marketed on its territory.
Some of these products and product candidates include the following: EYP-1901 for wet AMD, NPDR and DME FDA-approved LUCENTIS (ranibizumab), EYLEA (aflibercept), VABYSMO (faricimab) and off-label use of the cancer drug AVASTIN ® (bevacizumab) are the leading treatments for wet AMD. Lucentis, Eylea, and Avastin are also used in the treatment of NDPR and DME.
Some of these products and product candidates include the following: FDA-approved LUCENTIS ® (ranibizumab), EYLEA ® (aflibercept 2mg), EYLEA ® HD (aflibercept 8mg), VABYSMO ® (faricimab) and off-label use of the cancer drug AVASTIN ® (bevacizumab) are the leading treatments for wet AMD. Lucentis, Eylea, and Avastin are also used in the treatment of DR and DME.
CMS uses these submissions to determine payment rates for drugs under Medicare Part B.
CMS may use these submissions to determine payment rates for drugs under Medicare Part B.
VE-PTP is a negative Tie2 regulator that, when inhibited, can activate the Tie2 pathway leading to downstream signaling that promotes vascular health, stability and decreases vascular permeability and inflammation associated with a number of posterior segment eye diseases.
Some of the antibodies covered include both VE-PTP and VEGF binding domains. VE-PTP is a negative Tie2 regulator that, when inhibited, can activate the Tie2 pathway leading to downstream signaling that promotes vascular health, stability and decreases vascular permeability and inflammation associated with a number of posterior segment eye diseases.
Even if we conduct pharmacoeconomic studies, our product candidates may not be considered medically necessary or cost-effective by payors. Further, a payor’s decision to provide coverage for a product does not imply that an adequate reimbursement rate will be approved because HCPs negotiate their own reimbursement directly with commercial payors.
Even if we conduct pharmacoeconomic studies, our products may not be considered medically necessary or cost-effective by payors. Further, a payor’s decision to provide coverage for a product does not guarantee that an adequate reimbursement rate will be set, including because health care providers (HCPs) negotiate their own reimbursement directly with commercial payors.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeThe commencement and completion of clinical trials may be delayed or precluded by a number of factors, including: • decisions not to pursue development of product candidates due to pre-clinical or clinical trial results or market factors; • lack of sufficient funding; • delays or inability to attract clinical investigators for trials; • clinical sites dropping out of a clinical trial; • time required to add new clinical sites; • any orders from local, state or federal governments or clinical trial site policies resulting from the COVID-19 pandemic that determine essential and non-essential functions and staff, which may impact the ability of site staff to conduct assessments, or result in delays to the conduct of the assessments, as part of our clinical trial protocols, or the ability to enter assessment results into clinical trial databases in a timely manner; • delays or inability to recruit patients in sufficient numbers or at the expected rate; • decisions by licensees not to exercise options for products or not to pursue or promote products licensed to them; • adverse side effects; • failure of trials to demonstrate safety and efficacy; • failure to reach agreement with the FDA or other regulatory agency requirements for clinical trial design or scope of the development program; • patients’ delays or failure to complete participation in a clinical trial or inability to follow patients adequately after treatment; • changes in the design or manufacture of a product candidate; • failures by, changes in our (or our licensees’) relationship with, or other issues at, CROs, vendors and investigators responsible for pre-clinical testing and clinical trials; • imposition of a clinical hold following an inspection of our clinical trial operations or trial sites by the FDA or foreign regulatory authorities; • delays or failures in obtaining required IRB approval; • inability to obtain supplies and/or to manufacture sufficient quantities of materials for use in clinical trials; • stability issues with clinical materials; • failure to comply with GLP, GCP, cGMP or similar foreign regulatory requirements that affect the conduct of pre-clinical and clinical studies and the manufacturing of product candidates; • requests by regulatory authorities for additional data or clinical trials; • governmental or regulatory agency assessments of pre-clinical or clinical testing that differ from our (or our licensees’) interpretations or conclusions; • governmental or regulatory delays, or changes in approval policies or regulations; and • developments, clinical trial results and other factors with respect to competitive products and treatments.
Biggest changeThe commencement and completion of clinical trials may be delayed or precluded by a number of factors, including: • decisions not to pursue development of product candidates due to pre-clinical or clinical trial results or market factors; • lack of sufficient funding; • failure to reach agreement with the FDA or other regulatory agency requirements for clinical trial design or scope of the development program; • delays or inability to attract clinical investigators for trials; • clinical sites dropping out of a clinical trial; • time required to add new clinical sites; • delays or inability to recruit patients in sufficient numbers or at the expected rate; • decisions by licensees not to exercise options for products or not to pursue or promote products licensed to them; • adverse side effects; • failure of trials to demonstrate safety and efficacy; • patients’ delays or failure to complete participation in a clinical trial or inability to follow patients adequately after treatment; • changes in the design or manufacture of a product candidate; • failures by, changes in our (or our licensees’) relationship with, or other issues at, CROs, vendors, and investigators responsible for pre-clinical testing and clinical trials; • imposition of a clinical hold following an inspection of our clinical trial operations or trial sites by the FDA or foreign regulatory authorities; • delays or failures in obtaining required IRB approval; • inability to obtain supplies and/or to manufacture sufficient quantities of materials for use in clinical trials, including vorolanib; • our inability to manufacture EYP-1901 to scale, necessary to execute our Phase 3 study in an acceptable time period; • stability issues with clinical materials; • failure to comply with GLP, GCP, cGMP or similar foreign regulatory requirements that affect the conduct of pre-clinical and clinical studies and the manufacturing of product candidates; • requests by regulatory authorities for additional data or clinical trials; • governmental or regulatory agency assessments of pre-clinical or clinical testing that differ from our (or our licensees’) interpretations or conclusions; • governmental or regulatory delays, or changes in approval policies or regulations; and • developments, clinical trial results and other factors with respect to competitive products and treatments, a process which may also create a more competitive environment for patient accrual in clinical trials.
In particular, if governments, private insurers, governmental insurers and other third-party payors do not provide adequate and timely coverage and reimbursement levels for our products or limit the frequency of administration, the market acceptance of our products and product candidates will be limited.
In particular, if governments, private insurers, governmental insurers, and other third-party payors do not provide adequate and timely coverage and reimbursement levels for our products or limit the frequency of administration, the market acceptance of our product candidates will be limited.
We cannot be sure that coverage and reimbursement will be available for any product that we commercialize and, if reimbursement is available, what the level of reimbursement will be. Coverage and reimbursement may impact the demand for, or the price of, any product candidate for which we obtain marketing approval.
We cannot be sure that coverage and reimbursement will be available for any product candidate that we commercialize and, if reimbursement is available, what the level of reimbursement will be. Coverage and reimbursement may impact the demand for, or the price of, any product candidate for which we obtain marketing approval.
Our competitors may succeed in developing alternate technologies and products that, in comparison to the products or product candidates we have and are seeking to develop: • are more effective and easier to use; • are more economical; • have fewer side effects; • offer other benefits; or • may otherwise render our products less competitive or obsolete.
Our competitors may succeed in developing alternate technologies and products that, in comparison to the product candidates we have, and are seeking to, develop: • are more effective and easier to use; • are more economical; • have fewer side effects; • offer other benefits; or • may otherwise render our products less competitive or obsolete.
The price of our common stock and their trading volumes may fluctuate based on a number of factors including, but not limited to: • clinical trials and their results, and other product and technological developments and innovations; • the timing, costs and progress of our commercialization efforts; • FDA and other domestic and international governmental regulatory actions, receipt and timing of approvals of our product candidates, and any denials and withdrawal of approvals; • the duration, scope and outcome of any governmental inquiries or investigations; • competitive factors, including the commercialization of new products in our markets by our competitors; • advancements with respect to treatment of the diseases targeted by our products or product candidates; • developments relating to, and actions by, our collaborative partners, including execution, amendment and termination of agreements, achievement of milestones and receipt of payments; • the success of our collaborative partners in marketing any approved products and the amount and timing of payments to us; • availability and cost of capital and our financial and operating results; • actions with respect to pricing, reimbursement and coverage, and changes in reimbursement policies or other practices relating to our products or the pharmaceutical or biotechnology industries generally; • meeting, exceeding or failing to meet analysts’ or investors’ expectations, and changes in evaluations and recommendations by securities analysts; • the use of social media platforms by customers or investors; • the issuance of additional shares upon the exercise of currently outstanding options or warrants or upon the settlement of stock units; • future sales of substantial amounts of shares of our common stock in the market; • economic, industry and market conditions, changes or trends; and • other factors unrelated to us or the pharmaceutical and biotechnology industries.
The price of our common stock and their trading volumes may fluctuate based on a number of factors including, but not limited to: • clinical trials and their results, and other product and technological developments and innovations; • the timing, costs and progress of our commercialization efforts; • FDA and other domestic and international governmental regulatory actions, receipt and timing of approvals of our product candidates, and any denials and withdrawal of approvals; • the duration, scope, and outcome of any governmental inquiries or investigations; • competitive factors, including the commercialization of new products in our markets by our competitors; • advancements with respect to treatment of the diseases targeted by our product candidates; • developments relating to, and actions by, our collaborative partners, including execution, amendment and termination of agreements, achievement of milestones and receipt of payments; • the success of our collaborative partners in marketing any approved products and the amount and timing of payments to us; • availability and cost of capital and our financial and operating results; • actions with respect to pricing, reimbursement and coverage, and changes in reimbursement policies or other practices relating to our products or the pharmaceutical or biotechnology industries generally; • meeting, exceeding or failing to meet analysts’ or investors’ expectations, and changes in evaluations and recommendations by securities analysts; • the use of social media platforms by customers or investors; • the issuance of additional shares upon the exercise of currently outstanding options or warrants or upon the settlement of stock units; • future sales of substantial amounts of shares of our common stock in the market; • economic, industry and market conditions, changes or trends; and • other factors unrelated to us or the pharmaceutical and biotechnology industries.
Provisions in our charter documents could prevent or delay stockholders’ attempts takeover our company. Our board of directors is authorized to issue “blank check” preferred stock, with designations, rights and preferences as they may determine.
Provisions in our charter documents could prevent or delay stockholders’ attempts to takeover our company. Our board of directors is authorized to issue “blank check” preferred stock, with designations, rights and preferences as they may determine.
Market acceptance by physicians, patients and third party payors of EYP-1901 or other products we may commercialize in the future will depend on a number of factors, some of which are beyond our control, including: • their efficacy, safety and other potential advantages in relation to alternative treatments; • their relative convenience and ease of administration; • the availability of adequate coverage or reimbursement by third parties, such as insurance companies and other healthcare payors, and by government healthcare programs, including Medicare and Medicaid; • the prevalence and severity of adverse events; • their cost of treatment in relation to alternative treatments, including generic products; • the extent and strength of our third party manufacturer and supplier support; • the extent and strength of marketing and distribution support; • the limitations or warnings contained in a product’s approved labeling; and • distribution and use restrictions imposed by the FDA or other regulatory authorities outside the United States.
Market acceptance by physicians, patients and third party payors of EYP-1901 or other products we may commercialize in the future will depend on a number of factors, some of which are beyond our control, including: • their efficacy, safety, and other potential advantages in relation to alternative treatments; • their relative convenience and ease of administration; • the availability of adequate coverage or reimbursement by third parties, such as insurance companies and other healthcare payors, and by government healthcare programs, including Medicare and Medicaid; • the prevalence and severity of adverse events; • their cost of treatment in relation to alternative treatments, including generic products; • the extent and strength of our third party manufacturer and supplier support; 38 • the extent and strength of marketing and distribution support; • the limitations or warnings contained in a product’s approved labeling; and • distribution and use restrictions imposed by the FDA or other regulatory authorities outside the United States.
If our operations are found to be in violation of any of these laws or any other governmental regulations that may apply to us, we may be subject to significant civil, criminal and administrative penalties, damages, fines, imprisonment, exclusion from government funded healthcare programs, such as Medicare and Medicaid, additional oversight 49 and reporting requirements if we become subject to a corporate integrity agreement to resolve allegations of non-compliance with these laws, and the curtailment or restructuring of our operations.
If our operations are found to be in violation of any of these laws or any other governmental regulations that may apply to us, we may be subject to significant civil, criminal and administrative penalties, damages, fines, imprisonment, exclusion from government funded healthcare programs, such as Medicare and Medicaid, additional oversight and reporting requirements if we become subject to a corporate integrity agreement to resolve allegations of non-compliance with these laws, and the curtailment or restructuring of our operations.
On December 21, 2020, CMS issued a final regulation that modified existing Medicaid Drug Rebate Program regulations to permit reporting multiple Best Price figures with regard to value based purchasing arrangements (beginning in 2022) and provided definitions for “line extension,” “new formulation,” and related terms with the practical effect of expanding the scope of drugs considered to be line extensions (beginning in 2022).
On December 21, 2020, CMS issued a final regulation that modified existing Medicaid Drug Rebate Program regulations to permit reporting multiple Best Price figures with regard to value based purchasing arrangements (beginning in 40 2022) and provided definitions for “line extension,” “new formulation,” and related terms with the practical effect of expanding the scope of drugs considered to be line extensions (beginning in 2022).
This will require us to be successful in a range of challenging activities, including completing pre-clinical testing and clinical trials of our product candidates, discovering additional product candidates, obtaining regulatory approval for these product candidates, manufacturing, marketing and selling any products for which we or our licensees may obtain regulatory approval, satisfying any post-marketing requirements and obtaining reimbursement for our products from private insurance or government payors.
This will require us to be successful in a range of challenging activities, including completing pre-clinical testing and clinical trials of our product candidates, discovering additional product candidates, obtaining regulatory approval for these product candidates, manufacturing, marketing, and selling any products for which we or our 32 licensees may obtain regulatory approval, satisfying any post-marketing requirements and obtaining reimbursement for our products from private insurance or government payors.
Any of these drugs, therapies, products, approaches or methods may receive government approval or gain market acceptance more rapidly than our products and product candidates, may offer therapeutic or cost advantages, or may more effectively treat our targeted diseases or their underlying causes, which could result in our product candidates not being approved, reduce demand for our products and product candidates or render them noncompetitive or obsolete.
Any of these drugs, therapies, products, approaches, or methods may receive government approval or gain market acceptance more rapidly than our product candidates, may offer therapeutic or cost advantages, or may more effectively treat our targeted diseases or their underlying causes, which could result in our product candidates not being approved, reduce demand for our product candidates or render them noncompetitive or obsolete.
In these circumstances, we may need to defend or assert our patents by various means, including filing lawsuits alleging patent infringement requiring us to engage in complex, lengthy and costly litigation or other proceedings. In any of these types of proceedings, a court or government agency with jurisdiction may find our patents invalid, unenforceable or not infringed.
In these circumstances, we may need to defend or assert our patents by various means, including filing lawsuits alleging patent infringement requiring us to engage in complex, lengthy and costly litigation, or other proceedings. In any of these types of proceedings, a court or government agency with jurisdiction may find our patents invalid, unenforceable or not 52 infringed.
For instance, HIPAA imposes certain obligations, including mandatory contractual terms, with respect to safeguarding the privacy, security and transmission of individually identifiable health information and imposes notification obligations in the event of a breach of the privacy or security of individually identifiable health information on entities subject to HIPAA and their business associates that perform certain activities that involve the use or disclosure of protected health information on their behalf.
For instance, HIPAA imposes certain obligations, including mandatory contractual terms, with respect to safeguarding the privacy, security and transmission of individually identifiable health information and imposes notification obligations in the event of a breach of the privacy or security of individually identifiable health information on entities subject to HIPAA and their business 59 associates that perform certain activities that involve the use or disclosure of protected health information on their behalf.
In addition, to the extent that we have to file patent litigation in a federal court against a U.S. patent holder, we would be required to initiate the proceeding in the state of incorporation or residency of such entity. With respect to the validity question, for example, we cannot be certain that no invalidating prior art exists.
In addition, to the extent that we have to file patent litigation in a federal court against a U.S. patent holder, we would be required to initiate the proceeding in the state of incorporation or residency of such entity. With respect to the validity question, for example, we cannot be certain that no invalidating 50 prior art exists.
The FCP is based on the Non-FAMP, which we calculate and report to the VA on a quarterly and annual basis. We do not currently participate in the Tricare Retail Pharmacy program, under which we would need to pay quarterly rebates on utilization of innovator products that are dispensed through the Tricare Retail Pharmacy network to TRICARE beneficiaries.
The FCP is based on the Non-FAMP, which we calculate and report to the VA on a quarterly and annual basis. We do not currently participate in the Tricare 41 Retail Pharmacy program, under which we would need to pay quarterly rebates on utilization of innovator products that are dispensed through the Tricare Retail Pharmacy network to TRICARE beneficiaries.
Pursuant to our license agreement with Equinox, we acquired exclusive rights to patents, patent applications and know-how owned or controlled by Equinox relating to the compound vorolanib, a tyrosine kinase inhibitor. Our lead product candidate, EYP-1901, utilizes vorolanib in combination with our proprietary Durasert sustained release technology.
Pursuant to our license agreement with Equinox, we acquired exclusive rights to patents, patent applications and know-how owned or controlled by Equinox relating to the compound vorolanib, a tyrosine kinase inhibitor. Our lead product candidate, EYP-1901, utilizes vorolanib in combination with our proprietary Durasert E™ sustained release technology.
As a result, we might obtain marketing approval for a product in a particular country, but then be subject to price regulations that delay our commercial launch of the product, possibly for lengthy time periods, which could negatively impact the revenues we are able to generate from the sale of the product in that particular country.
As a result, we might obtain marketing approval for a product candidate in a particular country, but then be subject to price regulations that delay our commercial launch of the product candidate, possibly for lengthy time periods, which could negatively impact the revenues we are able to generate from the sale of the product candidate in that particular country.
The IRA sunsets the coverage gap discount program starting in 2025 and replaces it 45 with a new manufacturer discount program and makes other reforms to the Part D benefit, which could increase our liability under Part D. These or any other public policy change could impact the market conditions for our products.
The IRA sunsets the coverage gap discount program starting in 2025 and replaces it with a new manufacturer discount program and makes other reforms to the Part D benefit, which could increase our liability under Part D. These or any other public policy change could impact the market conditions for our products.
In addition, any delays in completing our clinical trials will increase our costs, slow down our product candidate development and approval process, and jeopardize our ability to commence product sales and generate revenues. Any of these occurrences may harm our business, financial condition, results of operations, cash 40 flows and prospects significantly.
In addition, any delays in completing our clinical trials will increase our costs, slow down our product candidate development and approval process, and jeopardize our ability to commence product sales and generate revenues. Any of these occurrences may harm our business, financial condition, results of operations, cash flows and prospects significantly.
Accordingly, our efforts to enforce intellectual property rights around the world may be inadequate to obtain a significant commercial 55 advantage from our intellectual property. We may not prevail in any lawsuits that we initiate in these foreign countries and the damages or other remedies awarded, if any, may not be commercially meaningful.
Accordingly, our efforts to enforce intellectual property rights around the world may be inadequate to obtain a significant commercial advantage from our intellectual property. We may not prevail in any lawsuits that we initiate in these foreign countries and the damages or other remedies awarded, if any, may not be commercially meaningful.
Misconduct by these employees could include intentional, reckless and/or negligent conduct or unauthorized activity that violates: • FDA regulations, including those laws requiring the reporting of true, complete and accurate information to the FDA; • manufacturing standards; • federal and state healthcare fraud and abuse laws and regulations; or • laws that require the true, complete and accurate reporting of financial information or data.
Misconduct by these employees could include intentional, reckless and/or negligent conduct or unauthorized activity that violates: • FDA regulations, including those laws requiring the reporting of true, complete and accurate information to the FDA; • manufacturing standards; • federal and state healthcare fraud and abuse laws and regulations; or 56 • laws that require the true, complete, and accurate reporting of financial information or data.
Funds paid in satisfaction of judgments, fines and expenses may be funds we need for the operation of our business and the development of our product candidates, thereby affecting our ability to attain profitability. GENERAL RISK FACTORS We will need to grow the size of our organization, and we may experience difficulties in managing this growth.
Funds paid in satisfaction of judgments, fines, and expenses may be funds we need for the operation of our business and the development of our product candidates, thereby affecting our ability to attain profitability. 58 GENERAL RISK FACTORS We will need to grow the size of our organization, and we may experience difficulties in managing this growth.
The IRA limits the negotiation eligibility for the 2026, 2027 and 2028 program years and afford limited additional relief for “small biotech drugs” of certain small manufacturers which, among other things, represent a limited portion (as specified in the text) of Medicare program spending.
The IRA limits the negotiation eligibility for the 2026, 2027 and 2028 program years and afford 42 limited additional relief for “small biotech drugs” of certain small manufacturers which, among other things, represent a limited portion (as specified in the text) of Medicare program spending.
If the market opportunities for our products and product candidates, including EYP-1901, are smaller than we believe they are, our results of operations may be adversely affected and our business may suffer. We focus our research and product development primarily on treatments for eye diseases.
If the market opportunities for our product candidates, including EYP-1901, are smaller than we believe they are, our results of operations may be adversely affected and our business may suffer. We focus our research and product development primarily on treatments for eye diseases.
If we experience delays in the completion of, or the termination of, any clinical trial of any of our product candidates, including EYP-1901, the commercial prospects of such product candidate will be harmed, and our ability to generate product revenues from such product candidate will be delayed.
If we experience delays in the completion of, or the termination of, any clinical trial of any of our product candidates, including EYP-1901, the commercial prospects of such product candidate will be 35 harmed, and our ability to generate product revenues from such product candidate will be delayed.
If EYP-1901 or any other product that we commercialize in the future does not gain an adequate level of acceptance among physicians, patients and third parties, we may not generate significant product 42 revenues or become profitable.
If EYP-1901 or any other product that we commercialize in the future does not gain an adequate level of acceptance among physicians, patients and third parties, we may not generate significant product revenues or become profitable.
Under the AIA, patents may also be challenged under the inter partes review procedure. Inter partes review provides a mechanism by which any third party may challenge the validity of any issued U.S. 53 Patent in the USPTO on the basis of prior art.
Under the AIA, patents may also be challenged under the inter partes review procedure. Inter partes review provides a mechanism by which any third party may challenge the validity of any issued U.S. Patent in the USPTO on the basis of prior art.
Our failure to become and remain profitable would depress the value of our company and could impair our ability to raise capital, expand our business, maintain our research and development efforts, diversify 34 our product offerings or even continue our operations.
Our failure to become and remain profitable would depress the value of our company and could impair our ability to raise capital, expand our business, maintain our research and development efforts, diversify our product offerings, or even continue our operations.
The steps we have taken to protect our proprietary rights may not be adequate to preclude misappropriation of our proprietary information or infringement of our intellectual property rights, both inside and outside the U.S.
The steps we have taken to protect our proprietary rights may not be adequate to 49 preclude misappropriation of our proprietary information or infringement of our intellectual property rights, both inside and outside the U.S.
In November 2020, California voters approved the California Privacy Rights Act (CPRA) ballot initiative which introduced significant amendments 65 to the CCPA and established and funded a dedicated California privacy regulator, the California Privacy Protection Agency (CPPA).
In November 2020, California voters approved the California Privacy Rights Act (CPRA) ballot initiative which introduced significant amendments to the CCPA and established and funded a dedicated California privacy regulator, the California Privacy Protection Agency (CPPA).
Many of our competitors and potential competitors for our leading product candidate, EYP-1901, and our commercialized products have substantially greater financial, technological, research and development, marketing and personnel resources than we do.
Many of our competitors and potential competitors for our leading product candidate, EYP-1901, and our commercialized products have substantially greater financial, technological, research and development, marketing, and personnel resources than we 47 do.
If our agreement with Equinox is terminated by Equinox for our uncured material breach, we would lose our license and all rights to the use of vorolanib for EYP-1901.
If our agreement with Equinox is terminated by Equinox for our uncured material breach, we would lose our license and all rights to the use of vorolanib, from Equinox, for EYP-1901.
If we are unable to raise additional capital in sufficient amounts or on terms acceptable to us, we will need to curtail and reduce our operations and costs, and modify our business strategy, which may require us to, among other things: • significantly delay, scale back or discontinue the commercialization or development of one or more of our products or product candidates or one or more of our other research and development initiatives; 33 • seek partners or collaborators for one or more of our products or product candidates at an earlier stage than otherwise would be desirable or on terms that are less favorable than might otherwise be available; • sell or license on unfavorable terms our rights to one or more of our technologies, products or product candidates that we otherwise would seek to develop or commercialize ourselves; and/or • seek to sell our company at an earlier stage than would otherwise be desirable or on terms that are less favorable than might otherwise be available.
If we are unable to raise additional capital in sufficient amounts or on terms acceptable to us, we will need to curtail and reduce our operations and costs, and modify our business strategy, which may require us to, among other things: • significantly delay, scale back or discontinue the development of one or more of our product candidates or one or more of our other research and development initiatives; • seek partners or collaborators for one or more of our product candidates at an earlier stage than otherwise would be desirable or on terms that are less favorable than might otherwise be available; • sell or license on unfavorable terms our rights to one or more of our technologies or product candidates that we otherwise would seek to develop or commercialize ourselves; and/or • seek to sell our company at an earlier stage than would otherwise be desirable or on terms that are less favorable than might otherwise be available.
Implementation of our development and commercialization of product strategies will require additional managerial, operational, sales, marketing, financial and other resources. Our current management, personnel and systems may not be adequate to effectively manage the expansion of our operations, which may result in weaknesses in our infrastructure, give rise to operational mistakes, loss of business opportunities, employee turnover and reduced productivity.
Development and commercialization of our product candidate strategies will require additional managerial, operational, sales, marketing, financial, and other resources. Our current management, personnel, and systems may not be adequate to effectively manage the expansion of our operations, which may result in weaknesses in our infrastructure, give rise to operational mistakes, loss of business opportunities, employee turnover, and reduced productivity.
If we fail to comply with applicable regulatory requirements for YUTIQ or DEXYCU, a regulatory authority may: • issue a warning letter asserting that we are in violation of the law; • seek an injunction or impose civil or criminal penalties or monetary fines; • suspend, modify or withdraw regulatory approval; • suspend any ongoing clinical trials; • refuse to approve a pending NDA or a pending application for marketing authorization or supplements to an NDA or to an application for marketing authorization submitted by us; • seize our product; and/or • refuse to allow us to enter into supply contracts, including government contracts.
If we, and with respect to YUTIQ ® , Alimera, fail to comply with applicable regulatory requirements for YUTIQ ® or DEXYCU ® , a regulatory authority may: • issue a warning letter asserting that we are in violation of the law; • seek an injunction or impose civil or criminal penalties or monetary fines; • suspend, modify or withdraw regulatory approval; 43 • suspend any ongoing clinical trials; • refuse to approve a pending NDA or a pending application for marketing authorization or supplements to an NDA or to an application for marketing authorization submitted by us; • seize our product; and/or • refuse to allow us to enter into supply contracts, including government contracts.
Among the provisions of the Affordable Care Act that have been implemented since enactment and are of importance to the commercialization of our approved products in the U.S. are the following: • an annual, nondeductible fee on any entity that manufactures or imports specified branded prescription drugs or biologic agents; • an increase in the statutory minimum rebates a manufacturer must pay under the Medicaid Drug Rebate Program; • expansion of healthcare fraud and abuse laws, including the U.S. civil False Claims Act and the Anti-Kickback Statute, new government investigative powers, and enhanced penalties for noncompliance; 50 • a Medicare Part D coverage gap discount program, in which manufacturers must agree to offer 50% point-of-sale discounts off negotiated prices of applicable brand drugs to eligible beneficiaries during their coverage gap period, as a condition for a manufacturer’s outpatient drugs to be covered under Medicare Part D (such manufacturer discounts were increased from 50% to 70% effective as of January 1, 2019 as required by the Bipartisan Budget Act of 2018) (the IRA sunsets the coverage gap discount program effective 2025); • extension of manufacturers’ Medicaid rebate liability to covered drugs dispensed to individuals who are enrolled in Medicaid managed care organizations; • price reporting requirements for drugs that are inhaled, infused, instilled, implanted, or injected; • expansion of eligibility criteria for Medicaid programs; • addition of entity types eligible for participation in the Public Health Service Act’s 340B drug pricing program; • a requirement to annually report certain information regarding drug samples that manufacturers and distributors provide to physicians; and • a Patient-Centered Outcomes Research Institute to oversee, identify priorities in, and conduct comparative clinical effectiveness research, along with funding for such research.
Among the provisions of the Affordable Care Act that have been implemented since enactment and are of importance to the commercialization of our product candidates in the U.S. are the following: • an annual, nondeductible fee on any entity that manufactures or imports specified branded prescription drugs or biologic agents; • an increase in the statutory minimum rebates a manufacturer must pay under the Medicaid Drug Rebate Program; 45 • expansion of healthcare fraud and abuse laws, including the U.S. civil False Claims Act and the Anti-Kickback Statute, new government investigative powers, and enhanced penalties for noncompliance; • a Medicare Part D coverage gap discount program, in which manufacturers must agree to offer 50% point-of-sale discounts off negotiated prices of applicable brand drugs to eligible beneficiaries during their coverage gap period, as a condition for a manufacturer’s outpatient drugs to be covered under Medicare Part D (such manufacturer discounts were increased from 50% to 70% as required by the Bipartisan Budget Act of 2018) (the IRA sunsets the coverage gap discount program effective 2025); • extension of manufacturers’ Medicaid rebate liability to covered drugs dispensed to individuals who are enrolled in Medicaid managed care organizations; • price reporting requirements for drugs that are inhaled, infused, instilled, implanted, or injected; • expansion of eligibility criteria for Medicaid programs; • addition of entity types eligible for participation in the Public Health Service Act’s 340B drug pricing program; • a requirement to annually report certain information regarding drug samples that manufacturers and distributors provide to physicians; and • a Patient-Centered Outcomes Research Institute to oversee, identify priorities in, and conduct comparative clinical effectiveness research, along with funding for such research.
Attorney’s Office for the District of Massachusetts seeking production of documents related to sales, marketing and promotional practices, including as pertain to DEXYCU (DOJ Investigation), higher interest rates, inflation, supply shortages, competing technological and market developments and the costs of any strategic acquisitions and/or development of complementary business opportunities.
Attorney’s Office for the District of Massachusetts (DOJ) seeking production of documents related to sales, marketing and promotional practices, including as pertain to DEXYCU ® (DOJ Subpoena), higher interest rates, inflation, supply shortages, competing technological and market developments, and the costs of any strategic acquisitions and/or development of complementary business opportunities.
These laws impact, among other things, our proposed sales, marketing, support and education programs and constrain our business and financial arrangements and relationships with third-party payors, healthcare professionals and others who may prescribe, recommend, purchase or provide our products, and other parties through which we market, sell and distribute our products.
These laws impact, among other things, our proposed sales, marketing, support and education programs and constrain our business and financial arrangements and relationships with third-party payors, healthcare professionals and others who may prescribe, recommend, purchase or provide our products, and other parties through which we may market, sell and distribute our product candidates.
Such challenges may result in loss of exclusivity or freedom to operate or in patent claims being narrowed, invalidated or held unenforceable, in whole or in part, which could limit our ability to stop others from using or commercializing similar or identical technology and products, or limit the duration of the patent protection of our technology and products.
Such challenges may result in loss of exclusivity or freedom to operate or in patent claims being narrowed, invalidated or held unenforceable, in whole or in part, which could limit our ability to stop others from using or commercializing similar or identical technology and products, or limit the duration of the patent protection of our technology and product candidates.
We will need to raise additional capital in the future, which may not be available on favorable terms and may be dilutive to stockholders or impose operational restrictions. We will need to raise additional capital in the future to help fund the development and commercialization of EYP-1901 and our other product candidates, if approved, and the continued commercialization of YUTIQ.
We will need to raise additional capital in the future, which may not be available on favorable terms and may be dilutive to stockholders or impose operational restrictions. We will need to raise additional capital in the future to help fund the development and commercialization of EYP-1901 and our other product candidates, if approved.
Patient enrollment is affected by a variety of factors including, among others: • severity of the disease under investigation; • design of the trial protocol and size of the patient population required for analysis of the trial’s primary endpoints; • size of the patient population; • eligibility criteria for the trial in question; • perceived risks and benefits of the product candidate being tested; • willingness or availability of patients to participate in our clinical trials (including due to the COVID-19 pandemic); • proximity and availability of clinical trial sites for prospective patients; • our ability to recruit clinical trial investigators with the appropriate competencies and experience, and adequate research staffing to support multiple, concurrent clinical trials; • availability of competing vaccines and/or therapies and related clinical trials; • efforts to facilitate timely enrollment in clinical trials; • our ability to obtain and maintain patient consents; • the risk that patients enrolled in clinical trials will drop out of the trials before completion; • patient referral practices of physicians; and • ability to monitor patients adequately during and after treatment.
Patient enrollment is affected by a variety of factors including, among others: • severity of the disease under investigation; • design of the trial protocol and size of the patient population required for analysis of the trial’s primary endpoints; • size of the patient population; • eligibility criteria for the trial in question; • perceived risks and benefits of the product candidate being tested; • willingness or availability of patients to participate in our clinical trials; • proximity and availability of clinical trial sites for prospective patients; • our ability to recruit clinical trial investigators with the appropriate competencies and experience, and adequate research staffing to support multiple, concurrent clinical trials; • availability of competing therapies and related clinical trials; • efforts to facilitate timely enrollment in clinical trials; • our ability to obtain and maintain patient consents; • the risk that patients enrolled in clinical trials will drop out of the trials before completion; • patient referral practices of physicians; and • ability to monitor patients adequately during and after treatment.
If we are unable to obtain and maintain patent protection for our technology and products, or if the scope of the patent protection obtained is not sufficient, our competitors could develop and commercialize technology and products similar or superior to ours, and our ability to successfully commercialize our technology and products may be impaired.
If we are unable to obtain and maintain patent protection for our technology and products, or if the scope of the patent protection obtained is not sufficient, our competitors could develop and commercialize technology and products similar or superior to ours, and our ability to successfully commercialize our technology and product candidates may be impaired.
Attorney’s Office for the District of Massachusetts seeking production of documents related to sales, marketing and promotional practices, including as pertain to DEXYCU ® . We are cooperating fully with the government in connection with this matter.
Attorney’s Office for the District of Massachusetts (DOJ) seeking production of documents related to sales, marketing, and promotional practices, including as pertain to DEXYCU ® (DOJ Subpoena).We are cooperating fully with the government in connection with this matter.
We cannot predict the outcome of the DOJ Investigation, and there can be no assurance that the DOJ will not commence an action against us, or as to what the ultimate outcome of any such DOJ Investigation might be.
We cannot predict the outcome of the DOJ Subpoena, and there can be no assurance that the DOJ will not commence an action against us, or as to what the ultimate outcome of any such DOJ Subpoena might be.
RISKS RELATED TO OUR RELIANCE ON THIRD PARTIES The development and commercialization of our lead product candidate, EYP-1901, is dependent on intellectual property we license from Equinox Science and API supply of vorolanib. If we breach our agreement with Equinox Science, or the agreement is terminated, we could lose license rights that are material to our business.
RISKS RELATED TO OUR RELIANCE ON THIRD PARTIES The development and commercialization of our lead product candidate, EYP-1901, is dependent on intellectual property we license from Equinox Science and active pharmaceutical ingredient (API) supply of vorolanib. If we breach our agreement with Equinox Science, or the agreement is terminated, we could lose license rights that are material to our business.
We may never achieve profitability from future operations. Our ability to generate revenue and achieve profitability depends on our ability, alone or with strategic collaboration partners, to successfully commercialize our current products and complete the development of, and obtain the regulatory approvals necessary for, the manufacture and commercialization of our product candidates, including EYP-1901.
We may never achieve profitability from future operations. Our ability to generate revenue and achieve profitability depends on our ability, alone or with strategic collaboration partners, to successfully complete the development of, and obtain the regulatory approvals necessary for, the manufacture and commercialization of our product candidates, including EYP-1901.
We do not know the extent to which YUTIQ or DEXYCU, or any of our product candidates, including EYP-1901, if approved, will generate significant revenue for us, if at all. We may never succeed in these activities and, even if we do, we may never generate revenues significant enough to achieve profitability.
We do not know the extent to which any of our product candidates, including EYP-1901, if approved, will generate significant revenue for us, if at all. We may never succeed in these activities and, even if we do, we may never generate revenues significant enough to achieve profitability.
RISKS RELATED TO THE COMMERCIALIZATION OF OUR PRODUCTS AND PRODUCT CANDIDATES Our current business strategy relies in part on our ability to successfully commercialize our approved products; however, the products may not achieve market acceptance or be commercially successful. Our ability to continue to successfully commercialize our approved products is important to the execution of our business strategy.
RISKS RELATED TO THE COMMERCIALIZATION OF OUR PRODUCTS AND PRODUCT CANDIDATES Our business strategy relies in part on our ability to successfully commercialize our product candidates, if approved; however, the products may not achieve market acceptance or be commercially successful. Our ability to successfully commercialize our product candidates, if approved, is important to the execution of our business strategy.
The occurrence of any event or penalty described above may inhibit our ability to commercialize YUTIQ in the U.S. and generate revenues, which would have a material adverse effect on our business, financial condition and results of operations.
The occurrence of any event or penalty described above may inhibit our ability to commercialize our product candidates in the U.S. and generate revenues, which would have a material adverse effect on our business, financial condition, and results of operations.
We, the FDA, other regulatory authorities outside the United States, or an IRB may suspend a clinical trial at any time for various reasons, including if it appears that the clinical trial is exposing participants to unacceptable health risks or if the FDA or one or more other regulatory authorities outside the United States find deficiencies in our IND or similar application outside the United States or the conduct of the trial.
We, the FDA, other regulatory authorities outside the United States, or an IRB may suspend a clinical trial at any time for various reasons, including if it appears that the clinical trial is exposing participants to unacceptable health risks or if the FDA or one or more other regulatory authorities outside the United States find deficiencies in our investigational new drug application or similar application outside the United States or the conduct of the trial.
If adequate financing is not available if and when needed, we may delay, reduce the scope of, or eliminate research or development programs, postpone or cancel the pursuit of product candidates such as EYP-1901, including pre-clinical and clinical trials and new business opportunities, independent U.S. commercialization of YUTIQ, or other new products, if any, reduce staff and operating costs, or otherwise significantly curtail our operations to reduce our cash requirements and extend our capital.
If adequate financing is not available if and when needed, we may delay, reduce the scope of, or eliminate research or development programs, postpone or cancel the pursuit of product candidates such as EYP-1901, including pre-clinical and clinical trials and new business opportunities, or other new products, if any, reduce staff and operating costs, or otherwise significantly curtail our operations to reduce our cash requirements and extend our capital.
The amount of additional capital we will require will be influenced by many factors, including, but not limited to: • our clinical development plans for EYP-1901 for the treatment of wet AMD, NPDR, and DME and our other product candidates; • the outcome, timing and cost of the regulatory approval process for EYP-1901 and our other product candidates, including the potential for the FDA to require that we perform more studies and clinical trials than those we currently expect; • product revenues received and cash flow generated from sales of YUTIQ; • whether and to what extent we internally fund, whether and when we initiate, and how we conduct other product development programs; • whether and when we are able to enter into strategic arrangements for our products or product candidates and the nature of those arrangements; • the costs involved in preparing, filing, and prosecuting patent applications, and maintaining, and enforcing our intellectual property rights; • changes in our operating plan, resulting in increases or decreases in our need for capital; • our views on the availability, timing and desirability of raising capital; and • the costs of operating as a public company.
The amount of additional capital we will require will be influenced by many factors, including, but not limited to: • our clinical development plans for EYP-1901 for the treatment of wet AMD, NPDR, and DME and our other product candidates, including EYP-2301; • the outcome, timing and cost of the regulatory approval process for EYP-1901 and our other product candidates, including the potential for the FDA to require that we perform more studies and clinical trials than those we currently expect; • whether and to what extent we internally fund, whether and when we initiate, and how we conduct other product development programs; 33 • whether and when we are able to enter into strategic arrangements for our products or product candidates and the nature of those arrangements; • the costs involved in preparing, filing, and prosecuting patent applications, and maintaining, and enforcing our intellectual property rights; • changes in our operating plan, resulting in increases or decreases in our need for capital; • our views on the availability, timing and desirability of raising capital; and • the costs of operating as a public company.
Additionally, any agreements we may enter into in the future with collaborators in connection with the development or commercialization of YUTIQ, DEXYCU, EYP-1901 or any of our other product candidates may entitle us to indemnification against product liability losses, but such indemnification may not be available or adequate should any claim arise.
Additionally, any agreements we have entered into, or we may enter into. in the future with collaborators in connection with the development or commercialization of EYP-1901 or any of our other product candidates, may entitle us to indemnification against product liability losses, but such indemnification may not be available or adequate should any claim arise.
In addition, some states have laws requiring pharmaceutical sales representatives to be registered or licensed, and still others impose limits on co-pay assistance that pharmaceutical companies can offer to patients. • The Physician Payments Sunshine Act, implemented as the Open Payments program, and its implementing regulations, require certain manufacturers of drugs, devices, biologics and medical supplies that are reimbursable under Medicare, Medicaid, or the Children’s Health Insurance Program to report annually to the CMS information related to certain payments made in the preceding calendar year and other transfers of value to physicians and teaching hospitals, as well as ownership and investment interests held by physicians and their immediate family members.
In addition, some states have laws requiring pharmaceutical sales representatives to be registered or licensed, and still others impose limits on co-pay assistance that pharmaceutical companies can offer to patients. • The Physician Payments Sunshine Act, implemented as the Open Payments program, and its implementing regulations, require certain manufacturers of drugs, devices, biologics, and medical supplies that are reimbursable under Medicare, 44 Medicaid, or the Children’s Health Insurance Program to report annually to the CMS information related to certain payments made in the preceding calendar year and other transfers of value to physicians, physician assistants, nurse practitioners, clinical nurse specialists, certified nurse anesthetists, certified nurse-midwives, and teaching hospitals, as well as ownership and investment interests held by physicians and their immediate family members.
Any delay, interruption or other issues that arise in the manufacture, fill-finish, packaging or storage of our products as a result of a failure of our facilities or the facilities or operations of third parties to pass any regulatory agency inspection could significantly impair our ability to develop and commercialize our products.
Any delay, interruption or other issues that arise in the manufacture, fill-finish, packaging, or storage of our products as a result of a failure of our facilities or the facilities or operations of third parties to pass any regulatory agency inspection could significantly impair our commercial partners' ability to commercialize our products.
The degree of future protection afforded by our intellectual property rights is uncertain because intellectual property rights have limitations, and intellectual property rights may not adequately protect our business or permit us to maintain our competitive advantage. 57 The following examples are illustrative: • others may be able to make drug and device components that are the same as or similar to our product candidates but that are not covered by the claims of the patents that we own or have exclusively licensed; • we or any of our licensors or collaborators might not have been the first to make the inventions covered by the issued patent or pending patent application that we own or have exclusively licensed; • we or any of our licensors or collaborators might not have been the first to file patent applications covering certain of our inventions; • others may independently develop similar or alternative technologies or duplicate any of our technologies without infringing our intellectual property rights; • the prosecution of our pending patent applications may not result in granted patents; • granted patents that we own or have licensed may not cover our products or may be held not infringed, invalid or unenforceable, as a result of legal challenges by our competitors; • with respect to granted patents that we own or have licensed, especially patents that we either acquire or in-license, if certain information was withheld from or misrepresented to the patent examiner, such patents might be held to be unenforceable; • patent protection on our product candidates may expire before we are able to develop and commercialize the product, or before we are able to recover our investment in the product; • our competitors might conduct research and development activities in the U.S. and other countries that provide a safe harbor from patent infringement claims for such activities, as well as in countries in which we do not have patent rights, and may then use the information learned from such activities to develop competitive products for sale in markets where we intend to market our product candidates; • we may not develop additional proprietary technologies that are patentable; • the patents of others may have an adverse effect on our business; and • we may choose not to file a patent application for certain technologies, trade secrets or know-how, and a third party may subsequently file a patent covering such intellectual property.
The following examples are illustrative: • others may be able to make drug and device components that are the same as or similar to our product candidates but that are not covered by the claims of the patents that we own or have exclusively licensed; • we or any of our licensors or collaborators might not have been the first to make the inventions covered by the issued patent or pending patent application that we own or have exclusively licensed; • we or any of our licensors or collaborators might not have been the first to file patent applications covering certain of our inventions; • others may independently develop similar or alternative technologies or duplicate any of our technologies without infringing our intellectual property rights; • the prosecution of our pending patent applications may not result in granted patents; • granted patents that we own or have licensed may not cover our products or may be held not infringed, invalid or unenforceable, as a result of legal challenges by our competitors; • with respect to granted patents that we own or have licensed, especially patents that we either acquire or in-license, if certain information was withheld from or misrepresented to the patent examiner, such patents might be held to be unenforceable; 53 • patent protection on our product candidates may expire before we are able to develop and commercialize the product, or before we are able to recover our investment in the product; • our competitors might conduct research and development activities in the U.S. and other countries that provide a safe harbor from patent infringement claims for such activities, as well as in countries in which we do not have patent rights, and may then use the information learned from such activities to develop competitive products for sale in markets where we intend to market our product candidates; • we may not develop additional proprietary technologies that are patentable; • the patents of others may have an adverse effect on our business; and • we may choose not to file a patent application for certain technologies, trade secrets or know-how, and a third party may subsequently file a patent covering such intellectual property.
Adverse pricing limitations may hinder our ability to recoup our investment in one or more of our products. Our success also depends in part on the extent to which coverage and reimbursement for these products and related treatments will be available from government health administration authorities, private health insurers and other organizations.
Adverse pricing limitations may hinder our ability to recoup our investment in one or more of our products. Our success also depends in part on the extent to which coverage and reimbursement for our product candidates, once commercialized, and related treatments will be available from government health administration authorities, private health insurers and other organizations.
Regardless of merit or eventual outcome, liability claims may result in: • decreased demand for our products; • injury to our reputation and significant negative media attention; 52 • termination of clinical trial sites or entire trial programs that we conduct in the future relating to YUTIQ, DEXYCU, EYP-1901 or our other product candidates; • withdrawal of clinical trial participants from any future clinical trial relating to YUTIQ, DEXYCU, EYP-1901 or our other product candidates; • significant costs to defend the related litigation; • substantial money awards to patients; • loss of revenue; • diversion of management and scientific resources from our business operations; and • an increase in product liability insurance premiums or an inability to maintain product liability insurance coverage.
Regardless of merit or eventual outcome, liability claims may result in: • injury to our reputation and significant negative media attention; • termination of clinical trial sites or entire trial programs that we conduct in the future relating to EYP-1901 or our other product candidates; • withdrawal of clinical trial participants from any future clinical trial relating to EYP-1901, and EYP-2301or our other product candidates; • significant costs to defend the related litigation; • substantial money awards to patients; • loss of revenue; • diversion of management and scientific resources from our business operations; and • an increase in product liability insurance premiums or an inability to maintain product liability insurance coverage.
Manufacturers that fail to pay refunds could be subject to civil monetary penalties of 125 percent of the refund amount. Statutory or regulatory changes or CMS guidance could affect the pricing of our approved products, and could negatively affect our results of operations.
Manufacturers that fail to pay refunds could be subject to civil monetary penalties of 125 percent of the refund amount. Statutory or regulatory changes or CMS guidance could affect the pricing of our product candidates, and could negatively affect our results of operations.
These research programs may initially show promise in identifying potential product candidates, yet fail to yield product candidates for clinical development. Initial results from a clinical trial do not ensure that the trial will be successful and success in early stage clinical trials does not ensure success in later-stage clinical trials.
These research programs may initially show promise in identifying potential product candidates, yet fail to yield product candidates for clinical development. Phase 1 or 2 results from a clinical trial do not ensure that the trial will be successful and success in early stage clinical trials does not ensure success in later-stage clinical trials.
For example, Congress eliminated, starting January 1, 2019, the tax penalty for not complying with the Affordable Care Act’s individual mandate to carry health insurance Further, the Bipartisan Budget Act of 2018, among other things, amended the Medicare statute to reduce the coverage gap in most Medicare drugs plans, commonly known as the “donut hole,” by raising the required manufacturer point-of-sale discount from 50% to 70% off the negotiated price effective as of January 1, 2019.
For example, Congress eliminated the tax penalty for not complying with the Affordable Care Act’s individual mandate to carry health insurance Further, the Bipartisan Budget Act of 2018, among other things, amended the Medicare statute to reduce the coverage gap in most Medicare drugs plans, commonly known as the “donut hole,” by raising the required manufacturer point-of-sale discount from 50% to 70% off the negotiated price (the IRA sunsets the coverage gap discount program effective 2025).
The upward adjustment in the rebate amount per unit is equal to the excess amount of the current AMP over the inflation-adjusted AMP from the 44 first full quarter of sales. The rebate amount is computed each quarter based on our report to CMS of current quarterly AMP and Best Price for our drug.
The upward adjustment in the rebate amount per unit is equal to the excess amount of the current AMP over the inflation-adjusted AMP from the first full quarter of sales. The rebate amount is computed each quarter based on our report to the Centers for Medicare and Medicaid Services (CMS) of current quarterly AMP and Best Price for our drug.
Our failure to comply with these laws could expose us to criminal, civil and administrative sanctions, reputational harm, and could harm our results of operations and financial conditions. Our current and future operations with respect to the commercialization of YUTIQ and DEXYCU are subject to various U.S. federal and state healthcare laws and regulations.
Our failure to comply with these laws could expose us to criminal, civil and administrative sanctions, reputational harm, and could harm our results of operations, and financial conditions. Our current and future operations with respect to the commercialization of new product candidates are subject to various U.S. federal and state healthcare laws and regulations.
We were advised by the FDA to show diligence and enroll at least one patient in the protocolled trial before submitting a new Deferral Extension Request. We submitted a pediatric study protocol to the FDA as required. We have identified clinical sites and are continuing study start-up activities that have resulted in dosing of a first patient in January 2022.
We were advised by the FDA to show diligence and enroll at least one patient in the protocolled trial before submitting a new Deferral Extension Request. We submitted a pediatric study protocol to the FDA as required. We have identified clinical sites and continued study start-up activities with dosing of a first patient in January 2022.
Any 43 inability on our part to successfully commercialize YUTIQ in the U.S and DEXYCU internationally, and our other product candidates in the U.S. or any foreign territories where they may be approved, or any significant delay in such approvals, could have a material adverse impact on our ability to execute upon our business strategy and our future business prospects.
Any inability on 39 our part to successfully commercialize our product candidates in the U.S. or any foreign territories where they may be approved, or any significant delay in such approvals, could have a material adverse impact on our ability to execute upon our business strategy and our future business prospects.
Future growth would impose significant added responsibilities on members of management, including: • overseeing our clinical trials for EYP-1901 effectively; 64 • managing the commercialization of YUTIQ; • identifying, recruiting, maintaining, motivating and integrating additional employees, including any research and development personnel engaged in our clinical trials for EYP-1901, as well as sales and marketing personnel engaged in connection with the commercialization of YUTIQ; • managing our internal development efforts effectively while complying with our contractual obligations to licensors, licensees, contractors and other third parties; and improving our managerial, development, operational and financial systems and procedures.
Future growth would impose significant added responsibilities on members of management, including: • overseeing our clinical trials for EYP-1901 effectively; • identifying, recruiting, maintaining, motivating and integrating additional employees, including any research and development personnel engaged in our clinical trials for EYP-1901; • managing our internal development efforts effectively while complying with our contractual obligations to licensors, licensees, contractors and other third parties; and improving our managerial, development, operational and financial systems, and procedures.
At present, Betta, an affiliate of Equinox also provides us with the API supply of vorolanib to support our clinical trials. Our license agreement with Equinox imposes various development, regulatory, commercial, financial and other obligations on us.
At present, Betta, an affiliate of Equinox is a provider of the API supply of vorolanib to support our clinical trials. Our license agreement with Equinox imposes various development, regulatory, commercial, financial, and other obligations on us.
Therefore, we have no sufficient historical evidence to assert that it is probable that we will receive sufficient revenues from our product sales to fund operations. As of December 31, 2022, our cash, cash equivalents, and investments in marketable securities totaled $144.6 million.
Therefore, we have no sufficient historical evidence to assert that it is probable that we will receive sufficient revenues from our product sales to fund operations. As of December 31, 2023, our cash, cash equivalents, and investments in marketable securities totaled $331.0 million.
The loss of the license from Equinox would prevent us from developing and commercializing EYP-1901 and could subject us to claims of breach of contract and patent infringement from Equinox if any continued research, development, manufacture or commercialization of EYP-1901 is covered by the affected patents. Accordingly, the loss of our license from Equinox would materially harm our business.
The loss of the license from Equinox could prevent us from developing and commercializing EYP-1901 and could subject us to claims of breach of contract and patent infringement from Equinox if any continued research, development, manufacture or commercialization of EYP-1901 is covered by the affected patents.
We anticipate that our expenses will continue to be significant if, and as, we: • continue the research and pre-clinical and clinical development of our product candidates, including EYP-1901 and YUTIQ; • initiate additional pre-clinical studies, clinical trials or other studies or trials for EYP-1901 and our other product candidates; • continue to sustain and enhance an effective commercial infrastructure and enter into, and maintain new agreements for the commercialization of YUTIQ; • continue efforts to commercialize DEXYCU internationally; • add additional operational, financial and management information systems and personnel, including personnel to support our development and commercialization efforts; • continue to perform tasks associated with the ongoing DOJ Investigation; • hire additional commercial, clinical, manufacturing and scientific personnel and engage third party commercial, clinical and manufacturing organizations; • further develop the manufacturing process for our product candidates; • change or add additional manufacturers or suppliers; • seek regulatory approvals for our product candidates that successfully complete clinical trials; • seek to identify and validate additional product candidates; • acquire or in-license other products, product candidates and technologies; • maintain, protect and expand our intellectual property portfolio; • create additional infrastructure to support our product development and planned future commercial sale efforts; and • experience any delays or encounter issues with any of the above.
We anticipate that our expenses will continue to be significant if, and as, we: • continue the research and pre-clinical and clinical development of our product candidates, including EYP-1901 and EYP-2301; • initiate additional pre-clinical studies, clinical trials, or other studies or trials for EYP-1901, EYP-2301, and our other product candidates; • add additional operational, financial and management information systems, and personnel, including personnel to support our development and commercialization planning efforts; • continue to perform tasks associated with the ongoing DOJ Subpoena; • hire additional commercial, clinical, manufacturing and scientific personnel, and engage third party commercial, clinical and manufacturing organizations; • further develop the manufacturing process for our product candidates; • change or add additional manufacturers or suppliers; • seek regulatory approvals for our product candidates that successfully complete clinical trials; • seek to identify and validate additional product candidates; • acquire or in-license other products, product candidates, and technologies; • maintain, protect, and expand our intellectual property portfolio; • create additional infrastructure to support our product development and planned future commercial sale efforts; and • experience any delays or encounter issues with any of the above.
In February 2022, we requested a PREA Deferral Extension because of the unavoidable delays in this program due, among other things, to the Pandemic. The extension was granted by the FDA, extending the study deadline to June 30, 2025.
In February 2022, we requested a PREA Deferral Extension because of the unavoidable delays in this program due, among other things, to the Pandemic. The extension was granted by the FDA, extending the study deadline to June 30, 2025. As of December 31, 2023, the study remains ongoing.
If patients are unwilling to participate in our trials because of the COVID-19 pandemic and restrictions on travel or healthcare institution policies, negative publicity from adverse events in the biotechnology industries, public perception of vaccine safety issues or for other reasons, including competitive clinical trials for similar patient populations, the timeline for recruiting patients, conducting studies and obtaining regulatory approval of potential products may be delayed.
If patients are unwilling to participate in our trials because of negative publicity from adverse events in the biotechnology industries, public perception of vaccine safety issues or for other reasons, including competitive clinical trials for similar patient populations, the timeline for recruiting patients, conducting studies, and obtaining regulatory approval of potential products may be delayed.
In addition, if we or our CROs fail to comply 61 with applicable current Good Clinical Practices (GCP), the clinical data generated in our clinical trials may be deemed unreliable and the FDA may require us to perform additional clinical trials before approving any marketing applications.
In addition, if we or our CROs fail to comply with applicable current Good Clinical Practices (GCP), the clinical data generated in our clinical trials may be deemed unreliable and the FDA may require us to perform additional clinical trials before approving any marketing applications. Upon inspection, the FDA may determine that our clinical trials did not comply with GCP.
The IRA contains a negotiation provision that requires the Secretary of Health and Human Services to negotiate, with respect to Medicare units and subject to a specified cap, the price of a set number of high Medicare spend drugs and biologicals per year starting in 2026.
One significant example of recent legislative action is the IRA. The IRA contains a negotiation provision that requires the Secretary of Health and Human Services to negotiate, with respect to Medicare units and subject to a specified cap, the price of a set number of high Medicare spend drugs and biologicals per year starting in 2026.
It is possible that the Affordable Care Act, as currently enacted or as it may be amended in the future, and other healthcare reform measures, including those that may be adopted in the future, could have a material adverse effect on our industry generally and on our ability to maintain or increase sales of our approved products in the U.S. or to continue to successfully commercialize in the U.S.
It is possible that the Affordable Care Act, as currently enacted or as it may be amended in the future, and other healthcare reform measures, including those that may be adopted in the future, could have a material adverse effect on our industry generally and on our ability to successfully commercialize our product candidates in the U.S.
If any such actions are instituted against us, and we are not successful in defending ourselves or asserting our rights, those actions could have a significant impact on our business, including the imposition of civil, criminal and administrative penalties, damages, monetary fines, possible exclusion from participation in Medicare, Medicaid and other federal healthcare programs, contractual damages, reputational harm, diminished profits and future earnings, additional reporting requirements and oversight if we become subject to a corporate integrity agreement or similar agreement to resolve allegations of non-compliance with these laws, and curtailment of our operations. 62 RISKS RELATED TO OWNERSHIP OF OUR COMMON STOCK The trading price of the shares of our common stock has been highly volatile, and purchasers of our common stock could incur substantial losses.
If any such actions are instituted against us, and we are not successful in defending ourselves or asserting our rights, those actions could have a significant impact on our business, including the imposition of civil, criminal and administrative penalties, damages, monetary fines, possible exclusion from participation in Medicare, Medicaid and other federal healthcare programs, contractual damages, reputational harm, diminished profits and future earnings, additional reporting requirements and oversight if we become subject to a corporate integrity agreement or similar agreement to resolve allegations of non-compliance with these laws, and curtailment of our operations.
We participate in, and have certain price reporting obligations to, the Medicaid Drug Rebate Program. This program requires us to pay a rebate for each unit of drug reimbursed by Medicaid.
Once we commercialize any new products, we may participate in, and have certain price reporting obligations to, the Medicaid Drug Rebate Program. This program requires us to pay a rebate for each unit of drug reimbursed by Medicaid.
CMS uses these submissions to determine payment rates for drugs under Medicare Part B.
CMS may use these submissions to determine payment rates for drugs under Medicare Part B.
Product liability lawsuits against us could cause us to incur substantial liabilities and to limit commercialization of YUTIQ and DEXYCU, and any other product candidates that we may develop and commercialize, including EYP-1901. We face the risk of product liability exposure as we commercialize YUTIQ and DEXYCU, and other product candidates that we may develop and commercialize.
Product liability lawsuits against us could cause us to incur substantial liabilities and to limit manufacturing or commercialization of YUTIQ ® and DEXYCU ® , and any other product candidates that we may develop and commercialize, including EYP-1901.
The U.S. and state governments have enacted and proposed legislative and regulatory changes affecting the healthcare system that could affect our ability to profitably sell our approved products, prevent or delay marketing of our other product candidates, and restrict or regulate post-approval activities.
The U.S. and state governments have enacted and proposed legislative and regulatory changes affecting the healthcare system that could prevent or delay marketing of our product candidates and restrict or regulate post-approval activities.

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Item 2. Properties

Properties — owned and leased real estate

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Biggest changeRent for the extension period would be at the fair market rent for comparable space in comparable properties in the Watertown area. 67 On January 23, 2023, we entered into a lease agreement with V.E. Properties IX, LLC for a new standalone manufacturing facility, including office and lab space located at 600 Commerce Drive, Northbridge, Massachusetts.
Biggest changeProperties IX, LLC for a new standalone manufacturing facility, including office and lab space located at 600 Commerce Drive, Northbridge, Massachusetts. The new leased premises will consist of approximately 40,000 square feet.
The new leased premises will consist of approximately 40,000 square feet. The lease includes a lease term of fifteen years and four months, with two options to extend the lease term for either five years or ten years at 95% of the then-prevailing fair market rent.
The lease includes a lease term of fifteen years and four months, with two options to extend the lease term for either five years or ten years at 95% of the then-prevailing fair market rent.
The amendment also reinstated our right to extend the lease for the space we occupy after May 31, 2025 for one additional period of five years.
The amendment also reinstated our right to extend the lease for the space we occupy after May 31, 2025, for one additional period of five years. Rent for the extension period would be at the fair market rent for comparable space in comparable properties in the Watertown area. On January 23, 2023, we entered into a lease agreement with V.E.
Please refer to Note 9 to the Consolidated Financial Statements, included under Item 15, "Exhibits and Financial Statement Schedules," for further details.
We have the option to extend the lease for one additional 5-year term. We believe our leased facilities are adequate for our present and anticipated needs. Please refer to Note 8 to the Consolidated Financial Statements, included under Item 15, "Exhibits and Financial Statement Schedules," for further details. 62
The lease term will commence upon the substantial completion of construction to prepare the premises for our intended use, which is currently expected to occur during the second half of 2024. We have the option to extend the lease for one additional 5-year term. We believe our leased facilities are adequate for our present and anticipated needs.
The lease term will commence upon the substantial completion of construction to prepare the premises for our intended use, which is currently expected to occur in the second half of 2024 (the “Lease Commencement Date”). Our obligation to pay base rent will begin four months following the Lease Commencement Date.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeAt this time, we are unable to predict the duration, scope or outcome of this matter or whether it could have a material impact on our financial condition, results of operation or cash flow. ITEM 4. MINE SAFE TY DISCLOSURES Not applicable. 68 PART II
Biggest changeAt this time, we are unable to predict the duration, scope, or outcome of this matter or whether it could have a material impact on our financial condition, results of operation or cash flow. ITEM 4. MINE SAFE TY DISCLOSURES Not applicable. 63 PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOC KHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Our common stock is traded on the Nasdaq Global Market under the trading symbol “EYPT.” As of March 2, 2023, we had approximately 46 holders of record of our common stock.
Biggest changeITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOC KHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Our common stock is traded on the Nasdaq Global Market under the trading symbol “EYPT.” As of February 29, 2024, we had approximately 38 holders of record of our common stock.
Recent Sales of Unregistered Securities Other than as previously disclosed in our Current Reports on Form 8-K or Quarterly Reports on Form 10-Q filed with the SEC, we did not issue any unregistered equity securities during the 12 months ended December 31, 2022. Purchases of Equity Securities by the Issuer and Affiliated Purchasers None. ITEM 6. [RESE RVED] 69
Recent Sales of Unregistered Securities Other than as previously disclosed in our Current Reports on Form 8-K or Quarterly Reports on Form 10-Q filed with the SEC, we did not issue any unregistered equity securities during the 12 months ended December 31, 2023. Purchases of Equity Securities by the Issuer and Affiliated Purchasers None. ITEM 6. [RESE RVED] 64

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeResults of Operations Years Ended December 31, 2022 and 2021 (in thousands except percentages) Year Ended December 31, Change 2022 2021 Amounts % Revenues: Product sales, net $ 39,905 $ 35,312 $ 4,593 13 % License and collaboration agreements 362 756 (394 ) -52 % Royalty income 1,137 871 266 31 % Total revenues 41,404 36,939 4,465 12 % Operating expenses: Cost of sales, excluding amortization of acquired intangible assets 8,326 8,177 149 2 % Research and development 49,642 28,500 21,142 74 % Sales and marketing 25,507 27,503 (1,996 ) -7 % General and administrative 34,817 25,575 9,242 36 % Impairment of acquired intangible assets 20,699 — 20,699 100 % Amortization of acquired intangible assets 2,050 2,460 (410 ) -17 % Total operating expenses 141,041 92,215 48,826 53 % Loss from operations (99,637 ) (55,276 ) (44,361 ) 80 % Other income (expense): Interest and other income, net 2,131 292 1,839 630 % Interest expense (3,189 ) (5,498 ) 2,309 -42 % Gain (loss) on extinguishment of debt (1,559 ) 2,065 (3,624 ) -175 % Total other income (expense), net (2,617 ) (3,141 ) 524 -17 % Net loss $ (102,254 ) $ (58,417 ) $ (43,837 ) 75 % Product Sales, net Product sales, net represents the gross sales of YUTIQ and DEXYCU less provisions for product sales allowances.
Biggest changeWe can terminate the agreements at any time without penalty, and if terminated, we would be liable only for services through the termination date plus non-cancellable CRO obligations to third parties. 68 Results of Operations Years Ended December 31, 2023 and 2022 (in thousands except percentages) Year Ended December 31, Change 2023 2022 Amounts % Revenues: Product sales, net $ 14,232 $ 39,905 $ (25,673 ) -64 % License and collaboration agreements 30,797 362 30,435 8407 % Royalty income 989 1,137 (148 ) -13 % Total revenues 46,018 41,404 4,614 11 % Operating expenses: Cost of sales, excluding amortization of acquired intangible assets 4,632 8,326 (3,694 ) -44 % Research and development 64,662 49,642 15,020 30 % Sales and marketing 11,689 25,507 (13,818 ) -54 % General and administrative 40,102 34,817 5,285 15 % Amortization of acquired intangible assets — 2,050 (2,050 ) -100 % Impairment of acquired intangible assets — 20,699 (20,699 ) -100 % Total operating expenses 121,085 141,041 (19,956 ) -14 % Loss from operations (75,067 ) (99,637 ) 24,570 -25 % Other income (expense): Interest and other income, net 6,949 2,131 4,818 226 % Interest expense (1,247 ) (3,189 ) 1,942 -61 % Gain (loss) on extinguishment of debt (1,347 ) (1,559 ) 212 -14 % Total other income (expense), net 4,355 (2,617 ) 6,972 -266 % Net loss before income taxes $ (70,712 ) $ (102,254 ) $ 31,542 -31 % Provision for income taxes $ (83 ) $ — $ (83 ) Net loss $ (70,795 ) $ (102,254 ) $ 31,459 -31 % Net loss per share - basic and diluted $ (1.82 ) $ (2.74 ) $ 0.92 -34 % Weighted average shares outstanding - basic and diluted 38,904 37,317 1,587 4 % Net loss $ (70,795 ) $ (102,254 ) $ 31,459 -31 % Product Sales, net Product sales, net represents the gross sales of YUTIQ ® and DEXYCU ® less provisions for product sales allowances.
By their nature, these estimates, judgments and assumptions are subject to an inherent degree of uncertainty, and management evaluates them on an ongoing basis for changes in facts and circumstances. Changes in estimates are recorded in the period in which they become known. Actual results may differ from our estimates under different assumptions or conditions.
By their nature, these estimates, judgments and assumptions are subject 66 to an inherent degree of uncertainty, and management evaluates them on an ongoing basis for changes in facts and circumstances. Changes in estimates are recorded in the period in which they become known. Actual results may differ from our estimates under different assumptions or conditions.
GAAP). The preparation of these financial statements requires that we make certain estimates, judgments and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods.
The preparation of these financial statements requires that we make certain estimates, judgments and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting periods.
Amounts not expected to be recognized within one year following the balance sheet date are classified as non-current deferred revenue. Please refer to Note 3 for further details on the license and collaboration agreements into which we have entered and corresponding amounts of revenue recognized for the years ended December 31, 2022 and 2021.
Amounts not expected to be recognized within one year following the balance sheet date are classified as non-current deferred revenue. Please refer to Note 3 for further details on the license and collaboration agreements into which we have entered and corresponding amounts of revenue recognized for the years ended December 31, 2023 and 2022.
Applying the practical expedient in paragraph 606-10-32-18, we do not assess whether a significant financing component exists if the period between when we perform our obligations under the contract and when the customer pays is one year or less. None of our contracts contained a significant financing component as of December 31, 2022.
Applying the practical expedient in paragraph 606-10-32-18, we do not assess whether a significant financing component exists if the period between when we perform our obligations under the contract and when the customer pays is one year or less. None of our contracts contained a significant financing component as of December 31, 2023.
As such, we assess each milestone to determine the 73 probability and substance behind achieving each milestone. Given the inherent uncertainty associated with these future events, we will not recognize revenue from such milestones until there is a high probability of occurrence, which typically occurs near or upon achievement of the event.
As such, we assess each milestone to determine the 67 probability and substance behind achieving each milestone. Given the inherent uncertainty associated with these future events, we will not recognize revenue from such milestones until there is a high probability of occurrence, which typically occurs near or upon achievement of the event.
Due to the difficulty and uncertainty associated with the design and implementation of clinical trials, we will continue to assess our cash and cash equivalents, results from investments in marketable securities and future funding requirements. However, there is no assurance that additional funding will be achieved and that we will succeed in our future operations.
Due to the difficulty and uncertainty associated with the design and implementation of clinical trials, we will continue to assess our cash and cash equivalents, investments in marketable securities, and future funding requirements. However, there is no assurance that additional funding will be achieved and that we will succeed in our future operations.
FINANCIAL STATEMEN TS AND SUPPLEMENTARY DATA The information required by this item may be found on pages F-1 through F-33 of this Annual Report on Form 10-K. ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOU NTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE None.
FINANCIAL STATEMEN TS AND SUPPLEMENTARY DATA The information required by this item may be found on pages F-1 through F-29 of this Annual Report on Form 10-K. ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOU NTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE None.
Recognition of Expense in Outsourced Clinical Trial Agreements We recognize research and development expense with respect to outsourced agreements for clinical trials with contract research organizations (CROs) as the services are provided, based on our assessment of the services performed.
Recognition of Expense in Outsourced Clinical Trial Agreements We recognize research and development expense with respect to outsourced agreements for clinical trials with contract research organizations (CROs) as the services are provided, based on information provided by CROs and our assessment of the services performed.
The following Management’s Discussion and Analysis (MD&A) provides a narrative of our results of operations for the year ended December 31, 2022 and the comparable period ended December 31, 2021, respectively, and our financial position as of December 31, 2022 and 2021, respectively.
The following Management’s Discussion and Analysis (MD&A) provides a narrative of our results of operations for the year ended December 31, 2023, and the comparable period ended December 31, 2022, respectively, and our financial position as of December 31, 2023 and 2022, respectively.
Product sales, net — We sell YUTIQ and DEXYCU to a limited number of specialty distributors and specialty pharmacies (collectively the Distributors) in the U.S., with whom we have entered into formal agreements, for delivery to physician practices for YUTIQ and to hospital outpatient departments and ambulatory surgical centers (ASCs) for DEXYCU.
Product sales, net — We sold YUTIQ ® and DEXYCU ® to a limited number of specialty distributors and specialty pharmacies (collectively the Distributors) in the U.S., with whom we had entered into formal agreements, for delivery to physician practices for YUTIQ ® and to hospital outpatient departments and ambulatory surgical centers (ASCs) for DEXYCU ® .
If adequate financing is not available if and when needed, we may delay, reduce the scope of, or eliminate research or development programs, independent commercialization of YUTIQ and DEXYCU, or other new products, if any, postpone or cancel the pursuit of product candidates, or otherwise significantly curtail our operations to reduce our cash requirements and extend our capital.
If adequate financing is not available if and when needed, we may delay, reduce the scope of, or eliminate research or development programs, or other new products, if any, postpone or cancel the pursuit of product candidates, or otherwise significantly curtail our operations to reduce our capital requirements and extend our cash runway.
Components of variable consideration include trade discounts and allowances, provider chargebacks and discounts, payor rebates, product returns, and other allowances that are offered within contracts between us and our Distributors, payors, and other contracted purchasers relating to our product sales.
Components of variable consideration included trade discounts and allowances, provider chargebacks and discounts, payor rebates, product returns, and other allowances that were offered within contracts between us and our Distributors, payors, and other contracted purchasers relating to our product sales.
The MD&A should be read together with our consolidated financial statements and related notes included on pages F-1 through F-33 of this Annual Report on Form 10-K. Overview We are a company committed to developing and commercializing innovative therapeutics to help improve the lives of patients with serious eye disorders.
The MD&A should be read together with our consolidated financial statements and related notes included on pages F-1 through F-29 of this Annual Report on Form 10-K. Overview We are a company committed to developing and commercializing innovative therapeutics to help improve the lives of patients with serious retinal diseases.
Overall, these reserves reflect our best estimates of the amount of consideration to which it is entitled based on the terms of the respective underlying contracts. Actual amounts of consideration ultimately received may differ from our estimates.
Overall, these reserves reflected our best estimates of the amount of consideration to which it was entitled based on the terms of the respective underlying contracts. The actual amounts of consideration ultimately received may differ from our estimates.
These reserves, as detailed below, are based on the amounts earned, or to be claimed on the related sales, and are classified either as reductions of product revenue and accounts receivable or a current liability, depending on how the amount is to be settled.
These reserves were based on the amounts earned, or to be claimed on the related sales, and were classified either as reductions of product revenue and accounts receivable or a current liability, depending on how the amount was to be settled.
Actual cash requirements could differ from management’s projections due to many factors, including cash generation from sales of YUTIQ and DEXYCU, additional investments in research and development programs, clinical trial expenses for EYP-1901, competing technological and market developments and the costs of any strategic acquisitions and/or development of complementary business opportunities.
Actual cash requirements could differ from management’s projections due to many factors including additional investments in research and development programs, clinical trial expenses for EYP-1901and potentially EYP-2301, competing technological and market developments and the costs of any strategic acquisitions and/or development of complementary business opportunities.
Based on historical product sales, royalty receipts and other relevant information, we recognize royalty income each quarter and subsequently determine a true-up when we receive royalty reports and payment from our commercial partners. Historically, these true-up adjustments have been immaterial. Sale of Future Royalties — We have sold our rights to receive certain royalties on product sales.
Based on historical product sales, royalty receipts and other relevant information, we recognize royalty income each quarter and subsequently determine a true-up when we receive royalty reports and payment from our commercial partners. Historically, these true-up adjustments have been immaterial.
We recognize revenue on sales of our products when Distributors obtain control of the products, which occurs at a point in time, typically upon delivery.
We recognized revenue on sales of our products when Distributors obtained control of the products, which occurred at a point in time, typically upon delivery.
On March 9, 2022 (the SVB Closing Date), we entered into a loan and security agreement (the SVB Loan Agreement) with Silicon Valley Bank (SVB) providing for (i) a senior secured term loan facility of $30.0 million (the Term Facility) and (ii) a senior secured revolving credit facility of up to $15.0 million (the Revolving Facility and together with the Term Facility, the Credit Facilities).
Financing Activities On March 9, 2022, we entered into a loan and security agreement (the SVB Loan) among us, as borrower, and Silicon Valley Bank, as lender (SVB), providing for (i) a senior secured term loan facility of $30 million (the Term Facility) and (ii) a senior secured revolving credit facility of up to $15.0 million (the Revolving Facility).
This amount was attributable to the impairment of the DEXYCU product intangible asset that resulted from impairment test related to the termination of pass-through payment by CMS on November 1, 2022 (see Note 6). Interest (Expense) Income Interest expense totaled $3.2 million for 2022.
Amortization and Impairment of Acquired Intangible Assets Impairment of acquired intangible assets was $20.7 million for 2022. This amount was attributable to the impairment of the DEXYCU ® product intangible asset that resulted from impairment test related to the termination of pass-through payment by CMS on November 1, 2022 (see Note 6).
If we seek to sell our equity securities, we do not know whether and to what extent we will be able to do so, or on what terms.
Collaboration, licensing, or other agreements may not be available on favorable terms, or at all. If we seek to sell our equity securities, we do not know whether and to what extent we will be able to do so, or on what terms.
Sales and Marketing Sales and marketing expenses decreased by $2.0 million, or 7%, to $25.5 million for 2022 from $27.5 million in the prior year.
Sales and Marketing Sales and marketing expenses decreased by $13.8 million, or 54%, to $11.7 million for 2023 from $25.5 million in the prior year.
The actual amounts owed under the agreements and the timing of those obligations will depend on various factors, including changes to the protocols and/or services requested, the number of patients to be enrolled and the rate of patient enrollment, achievement of pre-defined direct cost milestone events and other factors relating to the clinical trials. 74 We can terminate the agreements at any time without penalty, and if terminated, we would be liable only for services through the termination date plus non-cancellable CRO obligations to third parties.
The actual amounts owed under the agreements and the timing of those obligations will depend on various factors, including changes to the protocols and/or services requested, the number of patients to be enrolled and the rate of patient enrollment, achievement of pre-defined direct cost milestone events, and other factors relating to the clinical trials.
In addition to agreements with Distributors, we also enter into arrangements with healthcare providers, ASCs, and payors that provide for 72 government mandated and/or privately negotiated rebates, chargebacks, and discounts with respect to their purchase of our products from Distributors.
In addition to agreements with Distributors, we also entered into arrangements with healthcare providers, ASCs, and payors that provided for government mandated and/or privately negotiated rebates, chargebacks, and discounts with respect to their purchase of our products from Distributors. Reserves for variable consideration — Product sales were recorded at the wholesale acquisition costs, net of applicable reserves for variable consideration.
Recently Adopted and Recently Issued Accounting Pronouncements For a full discussion of recently adopted and recently issued accounting pronouncements, see Note 2, "Significant Accounting Policies" to the Consolidated Financial Statements included under Item 15, "Exhibits and Financial Statement Schedules." Liquidity and Capital Resources We have had a history of operating losses and an absence of significant recurring cash inflows from revenue, and at December 31, 2022 we had a total accumulated deficit of $671.3 million.
Loss on extinguishment of debt in 2022 was for the early repayment of the loan made to the Company by CRG Servicing LLC on February 13, 2019 (CRG Loan) resulting in a $1.6 million non-cash write-off of the remaining balance of unamortized debt discount. 70 Recently Adopted and Recently Issued Accounting Pronouncements For a full discussion of recently adopted and recently issued accounting pronouncements, see Note 2, "Significant Accounting Policies" to the Consolidated Financial Statements included under Item 15, "Exhibits and Financial Statement Schedules." Liquidity and Capital Resources We have had a history of operating losses and an absence of significant recurring cash inflows from revenue, and at December 31, 2023, we had a total accumulated deficit of $742.1 million.
Net cash used in investing activities for the year ended December 31, 2021 consisted of the purchase of $33.0 million of marketable securities, and purchases of property and equipment of $155,000.
Net cash used in investing activities for the year ended December 31, 2023, consisted of $3.5 million for the purchase of property and equipment, partially offset by $0.2 million of net cash provided by the sale of marketable securities.
The initial focus will be on geographic atrophy, an advanced form of age-related macular degeneration that leads to irreversible vision loss. Summary of Critical Accounting Policies and Estimates The discussion and analysis of our financial condition and results of operations is based upon our consolidated financial statements, which have been prepared in accordance with U.S. generally accepted accounting principles, (U.S.
Summary of Critical Accounting Policies and Estimates The discussion and analysis of our financial condition and results of operations is based upon our consolidated financial statements, which have been prepared in accordance with U.S. generally accepted accounting principles, (U.S. GAAP).
Net cash provided by financing activities for fiscal 2021 totaled $216.9 million and consisted of the following: (i) $108.2 million of net proceeds from the issuance of 5,122,273 shares of our common stock and 3,272,727 pre-funded warrants; (ii) $107.9 million of net proceeds from the issuance of 10,465,000 shares of our common stock; (iii) $499,000 of net proceeds from the issuance of 48,538 shares of our common stock sold utilizing our ATM; and (iv) $273,000 of proceeds from stock issued under our employee stock purchase plan. 79 Off-Balance Sheet Arrangements We do not have any off-balance sheet arrangements that have, or are reasonably likely to have, a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that would be material to investors.
Net cash provided by financing activities for fiscal 2023 totaled $187.1 million and consisted of the following: (i) $215.9 million of net proceeds from the issuance of 15,294,116 shares of our common stock; (ii) $40.5 million used to pay off the SVB loan; (iii) $1.4 million used to pay debt extinguishment costs related to the SVB loan; (iv) $9.6 million of net proceeds from the issuance of 902,769 shares of our common stock sold utilizing our ATM (v) $3.4 million of proceeds from exercise of employee stock options and stock issued under our employee stock purchase plan Net cash used in financing activities for fiscal 2022 totaled $0.7 million and consisted of the following: (i) $38.2 million used to pay off the CRG loan; (ii) $2.3 million used to pay debt extinguishment costs related to the CRG loan; (iii) $30.0 million of proceeds from the issuance for long-term debt related to the SVB loan; and (iv) $10.5 million of net proceeds from the revolving facility. 72 Off-Balance Sheet Arrangements We do not have any off-balance sheet arrangements that have, or are reasonably likely to have, a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures, or capital resources that would be material to investors.
The twelve-month, randomized, controlled PAVIA trial is expected to enroll approximately 105 patients randomly assigned to one of two doses of EYP-1901 (approximately 2 mg or 3 mg), or to the control group receiving a sham injection.
The trial enrolled 77 patients randomly assigned to one of two doses of EYP-1901 (approximately 2 mg or 3 mg), or to the control group receiving a sham injection. EYP-1901 is delivered with a single intravitreal injection at the physician's office.
Operating cash outflows for the year ended December 31, 2021 totaled $50.1 million, primarily due to our net loss of $58.4 million, reduced by $10.1 million of non-cash expenses, which included $7.5 million of stock-based compensation and $2.5 million of amortization of the DEXYCU finite-lived intangible asset, $628,000 of amortization of debt discount and a $2.1 million gain on extinguishment of debt from the forgiveness of our PPP Loan.
Operating cash outflows for the year ended December 31, 2022 totaled $65.0 million, primarily due to our net loss of $102.3 million, reduced by $40.3 million of non-cash expenses, which included $20.7 million of impairment of the DEXYCU ® finite-lived intangible asset, $14.2 million of stock-based compensation, $2.1 million of amortization of intangible assets, $1.9 million of provision for excess and obsolete inventory, and $1.6 million of loss on extinguishment of debt.
This increase was attributable primarily to (i) $7.0 million in personnel expense, including $2.4 million of stock-based compensation, for organizational expansion across Executive, Finance, Corporate Development, HR, and IT functions, (ii) $2.0 million in consulting, legal, and other professional services, and (iii) $443,000 in facilities and IT expenses. These increases were partially offset by a $232,000 decrease in other expenses.
This increase was attributable primarily to a (i) $3.4 million increase in personnel and related expenses, including a $0.7 million increase of stock-based compensation, and a (ii) $2.2 million increase in professional fees. These increases were partially offset by a $0.3 million decrease in other administrative costs.
Our consolidated statements of historical cash flows are summarized as follows (in thousands): Year Ended December 31, 2022 2021 Change Cash flows from operating activities: Net loss $ (102,254 ) $ (58,417 ) $ (43,837 ) Changes in operating assets and liabilities (3,023 ) $ (1,739 ) $ (1,284 ) Other adjustments to reconcile net loss to cash flows from operating activities: $ 40,272 10,059 30,213 Net cash used in operating activities $ (65,005 ) $ (50,097 ) $ (14,908 ) Net cash used in investing activities (17,265 ) (33,121 ) 15,856 Net cash (used in) provided by financing activities (690 ) 216,902 (217,592 ) Operating cash outflows for the year ended December 31, 2022 totaled $65.0 million, primarily due to our net loss of $102.3 million, reduced by $40.3 million of non-cash expenses, which included $20.7 million of impairment of the DEXYCU finite-lived intangible asset, $14.2 million of stock-based compensation, $2.1 million of amortization of intangible assets, $1.9 million of provision for excess and obsolete inventory, $1.6 million of loss on extinguishment of debt, partially offset by $162,000 of other non-cash gains.
Our consolidated statements of historical cash flows are summarized as follows (in thousands): Year Ended December 31, 2023 2022 Change Cash flows from operating activities: Net loss $ (70,795 ) $ (102,254 ) $ 31,459 Changes in operating assets and liabilities 58,882 (3,023 ) 61,905 Other adjustments to reconcile net loss to cash flows from operating activities: 13,788 40,272 (26,484 ) Net cash (used in) provided by operating activities $ 1,875 $ (65,005 ) $ 66,880 Net cash (used in) provided by investing activities $ (3,315 ) $ (17,265 ) $ 13,950 Net cash (used in) provided by financing activities $ 187,070 $ (690 ) $ 187,760 Operating cash inflows for the year ended December 31, 2023, totaled $1.9 million, primarily due to our net loss of $70.8 million reduced by $13.8 million of non-cash expenses, which included $12.1 million of stock-based compensation, $1.3 million of loss on extinguishment of debt, and $0.7 million for the provision of excess and obsolete inventory.
Research and Development Research and development expenses increased by $21.1 million, or 74%, to $49.6 million for 2022 from $28.5 million for the same period in the prior year.
Research and Development Research and development expenses increased by $15.0 million, or 30%, to $64.7 million for 2023 from $49.6 million in the prior year.
License and collaboration agreement revenue — We analyze each element of our license and collaboration arrangements to determine the appropriate revenue recognition. The terms of the license agreement may include payment to us of non-refundable upfront license fees, milestone payments if specified objectives are achieved, and/or royalties on product sales.
The terms of the license agreement may include payment to us of non-refundable upfront license fees, milestone payments if specified objectives are achieved, and/or royalties on product sales. We recognize revenue from upfront payments at a point in time, typically upon fulfilling the delivery of the associated intellectual property to the customer.
Cost of Sales, Excluding Amortization of Acquired Intangible Assets Cost of sales, excluding amortization of acquired intangible assets, increased by $149,000 to $8.3 million for fiscal 2022 from $8.2 million in the prior year.
The decrease was primarily attributable to Ocumension Royalties. 69 Cost of Sales, Excluding Amortization of Acquired Intangible Assets Cost of sales, excluding amortization of acquired intangible assets, decreased by $3.7 million to $4.6 million for fiscal 2023 from $8.3 million in the prior year.
Our pipeline leverages our proprietary Durasert ® technology for sustained intraocular drug delivery including EYP-1901, an investigational sustained delivery intravitreal anti-VEGF treatment currently in Phase 2 clinical trials for wet AMD, the leading cause of vision loss among people 50 years of age and older in the United States, and NPDR.
EYP-1901 is presently in Phase 2 clinical trials as a sustained delivery treatment for wet age-related macular degeneration (wet AMD), the leading cause of vision loss among people 50 years of age and older in the United States, non-proliferative diabetic retinopathy (NPDR), and diabetic macular edema (DME).
This increase was attributable primarily to (i) $10.0 million of personnel related costs for investment in new employees across the research and clinical organizations, including $3.8 million of stock-based compensation, and (ii) $8.5 million in increased clinical costs, primarily related to the completion of our EYP-1901 Phase 1 DAVIO clinical trial and initiation of Phase 2 DAVIO2 and PAVIA clinical trials, (iii) $1.8 million of increased facilities cost associated with laboratory and personnel expansion, and (iv) $782,000 of other research and development activities.
This increase was attributable primarily to (i) $11.8 million in increased clinical trial costs, related to the ongoing Phase 2 DAVIO2 and PAVIA clinical trials, and (ii) $3.5 million of increased personnel related costs for investment in new employees across the research and clinical organizations. These increases were partially offset by a $0.2 million decrease in other administrative costs.
Our operations have been financed primarily from sales of our equity securities, issuance of debt and a combination of license fees, milestone payments, royalty income and other fees received from collaboration partners. In the first quarter of 2019, we commenced the U.S. launch of our first two commercial products, YUTIQ and DEXYCU.
Our operations have been financed primarily from public and private offerings of our common stock, issuance of debt and a combination of license fees, milestone payments, royalty income and other fees received from collaboration partners.
We make our assessments of the services performed based on various factors, including evaluation by the third-party CROs and our own internal review of the work performed during the period, measurements of progress by us or by the third-party CROs, data analysis with respect to work completed and our management’s judgment.
We make our assessments of the services performed based on various factors, including reporting from third-party CROs and internal tracking of work performed during the period, which are subject to management’s judgment. Our financial obligations under the agreements are determined by the services that we request from time to time under the agreements.
If actual results in the future vary from the estimates, we adjust these estimates, which would affect product revenue and earnings in the period such variances become known. Distribution fees — We compensate our Distributors for services explicitly stated in our contracts and they are recorded as a reduction of revenue in the period the related product sale is recognized.
If actual results in the future vary from the estimates, we adjust these estimates, which would affect product revenue and earnings in the period such variances become known. License and collaboration agreement revenue — We analyze each element of our license and collaboration arrangements to determine the appropriate revenue recognition.
The amount of additional capital we will require will be influenced by many factors, including, but not limited to: 1. the potential for EYP-1901, as a sustained delivery intravitreal anti-VEGF treatment for wet AMD, NPDR, and DME 2. our expectations regarding the timing and clinical development of our product candidates, including EYP-1901; 3. the duration, scope and outcome of the DOJ Investigation and its impact on our financial condition, results of operations or cash flows; 4. our ability to sustain and enhance an effective commercial infrastructure and enter into and maintain commercial agreements for the commercialization of YUTIQ; 5. the cost of commercialization activities for YUTIQ and DEXYCU, including product manufacturing, marketing, sales and distribution; 6. the December 31, 2022 expiration of pass-through related separate payment under which DEXYCU is reimbursed for Medicare Part B patients treated in hospital outpatient department and ASC settings of care; 7. whether and to what extent we internally fund, whether and when we initiate, and how we conduct additional pipeline product development programs; 8. payments we receive under any new collaboration agreements; 9. the effectiveness of current and future license and collaboration agreements, including our agreements with Ocumension Therapeutics (Ocumension), Equinox Science, LLC (Equinox), and Betta Pharmaceuticals Co., LTD.
The amount of additional capital we will require will be influenced by many factors, including, but not limited to: 1. the scope, progress, results, and costs of clinical trials of EYP-1901, as a sustained delivery intravitreal VEGF treatment for wet AMD, NPDR, and DME 2. our expectations regarding the timing and clinical development of our product candidates, including EYP-1901 and EYP-2301; 3. the duration, scope and outcome of the DOJ Subpoena and its impact on our financial condition, results of operations, or cash flows; 4. whether and to what extent we internally fund, whether and when we initiate, and how we conduct additional pipeline product development programs; 5. payments we receive under any new collaboration agreements or payments expected from existing agreements; 6. whether and when we are able to enter into strategic arrangements for our products or product candidates and the nature of those arrangements; 7. the costs involved in preparing, filing, prosecuting, maintaining, defending and enforcing any patent claims; 8. changes in our operating plan, resulting in increases or decreases in our need for capital; and 9. our views on the availability, timing, and desirability of raising capital. 71 We do not know if additional capital will be available when needed or on terms favorable to us or our stockholders.
We recognize revenue from upfront payments at a point in time, typically upon fulfilling the delivery of the associated intellectual property to the customer. If the contract contains a single performance obligation, the entire transaction price is allocated to the single performance obligation.
For licenses that are combined with other promises, we determine whether the combined performance obligation is satisfied over time or at a point in time, when (or as) the associated performance obligation in the contract is satisfied. If the contract contains a single performance obligation, the entire transaction price is allocated to the single performance obligation.
The loss of pass-through status will have a material negative impact to DEXYCU revenue and the value of the net intangible asset related to DEXYCU. • In January 2023, we announced that Jay S. Duker, M.D., who has served as the company’s Chief Operating Officer (COO) since November 2021, has been promoted to the additional role of President.
Duker, M.D., who served as the Company’s Chief Operating Officer (COO) since November 2021, had been promoted to the additional role of President. In addition to continuing to oversee his duties as COO, in his expanded role, Dr.
Interest income from investments in marketable securities and institutional money market funds increased to $2.1 million for fiscal 2022 compared to $292,000 in the prior year, due primarily to higher cash balances invested in marketable securities in the current year. 76 Gain on Extinguishment of Debt Loss on extinguishment of debt in 2022 was for the early repayment of the CRG Loan resulting in a $1.6 million non-cash write-off of the remaining balance of unamortized debt discount.
There was no amortization or impairment of acquired intangible assets for 2023 due to the write-off of the DEXYCU ® intangible asset in the fourth quarter of 2022. Interest (Expense) Income Interest income from investments in marketable securities and institutional money market funds increased $4.8 million, to $6.9 million for 2023 compared to $2.1 million for the prior year.
In January 2023, we entered into a lease agreement to design and construct a manufacturing facility in Northbridge, Massachusetts to support global manufacturing programs, including EYP-1901 and YUTIQ. The agreement requires only a modest financial upfront requirement, as rent obligations do not begin until we occupy the facility in the second half of 2024.
Duker has also been overseeing regulatory affairs. • In January 2023, we entered into a lease agreement to design and construct a 40,000-square-foot manufacturing facility in Northbridge, Massachusetts to support the global manufacturing of programs, including EYP-1901 and YUTIQ ® . • In May 2023, we entered into a definitive agreement pursuant to which we granted an exclusive license and rights to YUTIQ ® to Alimera Sciences, Inc.
Customer demand has a direct impact on product orders from our specialty distributors that we record as net product sales. Net product revenue represents product purchased by our distributors whereas customer demand represents purchases of product by physician practices and ASCs from our distributors.
Net product revenue represented product purchased by our distributors whereas customer demand represented purchases of product by physician practices and ASCs from our specialty distributors. License and collaboration agreement License and collaboration agreement revenues increased by $30.4 million, to $30.8 million in 2023 compared to $0.4 million in 2022.
The twelve-month, randomized, controlled DAVIO2 trial is expected to enroll approximately 144 patients previously treated with a standard-of-care anti-VEGF therapy, and top-line data is expected in the fourth quarter of 2023. • In September 2022, we announced that the first patient was dosed in the Phase 2 PAVIA clinical trial of EYP-1901 for the potential treatment of NPDR.
All patients were previously treated with a standard-of-care anti-VEGF therapy and were randomly assigned to one of two doses of EYP-1901 or to an aflibercept on-label control. • In June 2023, we completed enrollment in the Phase 2 clinical trial evaluating EYP-1901 as a potential nine-month treatment for moderately severe to severe NPDR.
Future Funding Requirements At December 31, 2022, we had cash, cash equivalents, and investments in marketable securities of $144.6 million.
Future Funding Requirements At December 31, 2023, we had cash, cash equivalents, and investments in marketable securities of $331.0 million. We expect that our cash and investments in marketable securities will fund our operating plan through topline data for the planned Phase 3 wet AMD pivotal trials into 2026.
These decreases were partially offset by (i) a $551,000 increase in commission due to our commercial partner for higher DEXYCU sales, and (ii) a $29,000 increase in other expenses. General and Administrative General and administrative expenses increased by $9.2 million, or 36%, to $34.8 million for 2022 from $25.6 million for the prior year.
These reductions were offset by a restructuring charge in the second quarter 2023 of $0.9 million for restructuring resulting from the license of the YUTIQ ® franchise. General and Administrative General and administrative expenses increased by $5.3 million, or 16%, to $40.1 million for 2023 from $34.8 million in the prior year.
Removed
We also have two commercial products: YUTIQ ® , a once every three-year treatment for posterior segment uveitis, and DEXYCU ® , a single dose treatment for postoperative inflammation following ocular surgery.
Added
Our pipeline leverages our proprietary Durasert E ™ technology for sustained intraocular drug delivery. The Company’s lead product candidate, EYP-1901, is an investigational sustained delivery treatment for anti-vascular endothelial growth factor (anti-VEGF) -mediated retinal diseases combining vorolanib, a selective and patent-protected tyrosine kinase inhibitor with Durasert E ™ .
Removed
Fiscal 2022 Overview The fiscal year ended December 31, 2022 was highlighted by the following events: • The ongoing Pandemic has had a material and adverse impact on the Company’s business pursuant to a reduction in physician office visits impacting YUTIQ, specifically in early 2022.
Added
We expect to initiate pivotal Phase 3 clinical trials in wet AMD in the second half of 2024. Fiscal 2023 Overview The fiscal year ended December 31, 2023, was highlighted by the following events: • In January 2023, we announced that Jay S.
Removed
The emergence of new variants of the coronavirus may continue to cause intermittent or prolonged periods of reduced patient services at our customers’ facilities, which may negatively affect customer demand. The future progression of the Pandemic and its effects on our business and operations are uncertain at this time.
Added
(Alimera). Under the terms of the agreement, Alimera received global rights to YUTIQ ® outside of China, Hong Kong, Taiwan, Macau and Southeast Asia, where YUTIQ ® is exclusively licensed to Ocumension Therapeutics (Ocumension) and we will continue to receive royalties from Ocumension for its YUTIQ ® sales.
Removed
Although the U.S. government has announced its intention to terminate the public health crisis associated with the Pandemic as of May 2023, there remains uncertainty about the potential future impact of the Pandemic on the Company’s business.
Added
In exchange for the rights granted to Alimera under the agreement, we received a $75 million upfront cash payment at closing and will receive an additional $7.5 million in equal $1.875 million quarterly installments in 2024.
Removed
Depending on future developments that are uncertain and difficult to predict, including new information that may emerge concerning the Pandemic, our customer demand may be adversely affected in the future as well. During the Pandemic, our sales organization has continued to call on physician offices, though at a reduced frequency.
Added
In addition, commencing in 2025, we will receive a low to mid double-digit royalty on Alimera’s related U.S. net sales above defined thresholds for the calendar years 2025-2028. • In May 2023, we received confirmation from the FDA that the September 2021 inspection of our Watertown, MA facility had been classified as Voluntary Action Indicated (VAI) and was no longer considered Official Action Indicated.
Removed
There have been no disruptions to the supply chains for YUTIQ and DEXYCU during the Pandemic and we continue to produce finished product for commercial sale. • In March 2022, we entered into a loan agreement for senior secured credit facilities in the aggregate amount of $45 million with Silicon Valley Bank to replace our existing credit facility with CRG. • In May 2022, we entered into an Exclusive License Agreement (the Betta License Agreement) with Betta Pharmaceuticals Co., Ltd.
Added
A VAI classification means that the agency is not prepared to take or recommend further regulatory action. • In July 2023, we announced the appointment of Jay S. Duker, M.D. as President and Chief Executive Officer (CEO). Dr. Duker transitioned from his most recent role as President and Chief Operating Officer (COO). Dr.
Removed
Under the Betta License Agreement, we granted to Betta an exclusive, sublicensable, royalty-bearing license to develop, use (but not make or have made), sell, offer for sale and import EYP-1901 in the field of ophthalmology (the Betta Field) in the Greater Area of China, including China, the Hong Kong Special Administrative Region, the Macau Special Administrative Region, and Taiwan (the Betta Territory).
Added
Duker was also appointed to the Board of Directors of the Company (Board), effective July 10, 2023. Nancy S. Lurker transitioned to the role of Executive Vice Chair from the position of CEO. • In October 2023, we announced the promotion of George O.
Removed
Under the terms of the Betta License Agreement, we retained all ophthalmic rights to EYP-1901 outside of the Betta Territory and to, among other things, conduct clinical trials on EYP-1901 in the Betta Field in the Betta Territory. • Concurrently with the execution of the Betta License Agreement, we entered into Amendment #1 (the First Amendment) to that certain Exclusive License Agreement, dated February 3, 2020, with Equinox Sciences, LLC (Equinox), regarding our exclusive, sublicensable, royalty-bearing right and license to certain patents and other Equinox intellectual property to research, develop, make, have made, use, sell, offer for sale and import the compound vorolanib and any pharmaceutical products comprising the compound for local delivery to the eye for the prevention or treatment of wet AMD, DR and RVO using our proprietary localized delivery technologies (the Original Field), in each case, throughout the world except China, Hong Kong, Taiwan and Macau.
Added
Elston, our Chief Financial Officer, to Executive Vice President and Chief Financial Officer. • In October 2023, we announced the appointment of Stuart Duty to the Company’s Board of Directors. Mr. Duty is an experienced financial executive with over 30 years of experience in finance and investment banking. Mr.
Removed
Pursuant to the First Amendment, the Original Field was expanded to cover the prevention or treatment of all ophthalmology indications, using our proprietary localized delivery technologies. • In June 2022, China's Center for Drug Evaluation (CDE) of the National Medical Products Administration (NMPA) approved YUTIQ 0.18mg for the treatment of posterior segment uveitis of the eye. 70 • In June 2022, we announced the appointment of Anthony (Tony) Adamis, M.D. to our Board of Directors.
Added
Duty has focused primarily on biotechnology and specialty pharmaceuticals clients for much of his career, advising senior executives and boards on a range of financing activities and strategic transactions. 65 • On December 8, 2023, we announced the closing of an underwritten public offering of 13,529,411 shares of our common stock, which included the exercise in full by the underwriters of their option to purchase an additional 1,764,705 shares of common stock, at the public offering price of $17.00 per share.
Removed
Dr. Adamis is a highly accomplished ophthalmology executive with more than 30 years or research and development experience in the biopharmaceutical industry. • In July 2022, we announced the appointment of Karen Zaderej to our Board of Directors. Ms.
Added
Gross proceeds to the Company in the offering, before underwriting discounts and estimated expenses of the offering, were approximately $230.0 million. R&D Highlights • In February 2023, we entered into a research collaboration with Rallybio Corporation to evaluate sustained delivery of their inhibitor of complement component 5 (C5) using our proprietary Durasert E ™ technology for sustained intraocular drug delivery.
Removed
Zaderej is currently the President, Chief Executive Officer, and Chair of the Board at AxoGen Corporation, and brings more than 35 years of biopharmaceutical and medical device experience to the role. • In August 2022, we received a subpoena from the U.S.
Added
The initial focus will be on geographic atrophy, an advanced form of age-related macular degeneration that leads to irreversible vision loss. • In March 2023, we completed enrollment in the Phase 2 "Durasert E ™ and Vorolanib in Ophthalmology 2" (DAVIO 2) clinical trial evaluating EYP-1901 as a potential six-month maintenance treatment for wet AMD.
Removed
Attorney’s Office for the District of Massachusetts seeking production of documents related to sales, marketing and promotional practices, including as pertain to DEXYCU ® . If the DOJ commences an action against us, the action could have a material adverse effect on our business, financial condition, results of operations and cash flows.
Added
The trial enrolled a total of 160 patients.
Removed
In addition, we have expended and expect to continue to expend significant financial and managerial resources responding to the DOJ subpoena, which could also have a material adverse effect on our business, financial condition, results of operations and cash flows. • In October 2022, we entered into a Mutual Termination Agreement (the Termination Agreement) with ImprimisRx, pursuant to which we and ImprimisRx agreed (a) that ImprimisRx would continue to support the sales and marketing of DEXYCU through the fourth quarter of 2022, consistent with ImprimisRx’s level of effort during the January through June 2022 period, (b) decrease the required minimum quarterly sales levels based on DEXYCU unit demand for the fourth quarter of 2022, and (c) terminate the previously entered into Commercial Alliance Agreement, made effective as of August 1, 2020, as modified by the Letter Agreement dated November 12, 2020 and the Letter Agreement dated December 6, 2021, effective January 1, 2023 due to the loss of pass-through related separate payment of DEXYCU. • In November 2022, CMS announced in the Final Rule it would not provide further extension of pass-through related separate payment for certain drugs, including DEXYCU.
Added
The primary efficacy endpoint of the trial is improvement of at least two diabetic retinopathy severity scale (DRSS) levels as of week 36 after the EYP-1901 injection.
Removed
DEXYCU lost eligibility for pass-through related separate payment on December 31, 2022, and effective January 1, 2023, payment is instead packaged into reimbursement for the underlying procedure.
Added
Secondary endpoints include reduction in vision-threatening complications, occurrence of diabetic macular edema and/or proliferative disease, retinal ischemia/nonperfusion and safety. • In July 2023 we presented the interim safety and patient demographics of the DAVIO 2 clinical trial in wet AMD at the OIS Retina Innovation Summit.
Removed
In addition to continuing to oversee his duties as COO, in his expanded role, Dr. Duker will also oversee regulatory affairs. R&D Highlights • In January 2022, we announced that we completed a positive Type C meeting with the U.S.
Added
As of July 1, 2023, there were no reported drug related ocular serious adverse events (SAEs) or drug related systemic SAEs.

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Other EYPT 10-K year-over-year comparisons