Clearside Biomedical, Inc.

Good day, and thank you for standing by. Welcome to the ClearSide Biomedical fourth quarter 2022 financial results and corporate update conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you'll need to press star 1-1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 1-1 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Jenny Coleman, Investor Relations. Please go ahead.

Good afternoon, everyone, and thank you for joining us on the call today. Before we begin, I would like to remind you that during today's call, we will be making certain forward-looking statements, various remarks that we make during this call, and about the company's future expectations, plans, and prospects today. constitute forward-looking statements for purposes of the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by these forward-looking statements as a result of various important factors, including those discussed in the risk factors section of our annual report on Form 10-K for the year ended December 31st, 2021, our quarterly report on Form 10-Q for the quarter ended September 30, 2022, and our other SEC filings available on our website. We expect that our 10-K for the year ended December 31, 2022 will be filed tomorrow. In addition, any forward-looking statements represent our views as of today and should not be relied upon as representing our views as of any subsequent date. While we may elect to update these forward-looking statements in the future, we specifically disclaim any obligation to do so, even if our views change. On today's call, we have George Blazeski, our Chief Executive Officer, and Charlie Degnan, our Chief Financial Officer. After formal remarks, we will open the call for your questions. I would now like to turn the call over to George.

Thank you, Jenny. Over the past year, we have reinforced ClearSight's leadership position in the delivery of therapeutics into the supracoroidal space. We've successfully executed on our strategic plans with the launch and commercialization of the first FDA-approved supracoroidal product, Zypyr, by our partner, Bausch & Lomb. And we completed and announced positive data from our Phase I-IIa OASIS trial of CLSA-X in wet AMD. We have also seen promising data presented by partners utilizing our proprietary STS microinjector to administer gene therapy and oncology agents to treat a variety of retinal diseases. On today's call, I will cover key highlights from the past year and provide a snapshot of our plans for 2023. I will begin with our development programs, both internal and with our partners. Last month, we reported exciting data from our lead internal program, CLSAX, that combines our proprietary small molecule suspension of Excedinib with delivery by our SCS microinjector. Excedinib is a highly potent tyrosine kinase inhibitor, or TKI, that achieves pan-VEGF blockade, directly inhibiting VEGF receptors 1, 2, and 3 with high potency and specificity. We believe this broad VEGF blockade may have advantages over existing retinal therapies by acting at a different level of the angiogenesis cascade. We reported positive data from OASIS, our open-label Phase I-IIa trial in wet AMD. The trial consisted of four cohorts with escalating doses that monitored participants for three months. This was followed by a three-month extension study in the higher-dose cohorts. for a total of six-month follow-up. Participants enrolled in OASIS were heavily anti-VEGF treatment experienced patients with active disease at screening, which was confirmed by an independent reading center. In OASIS, we assessed three components. Primary endpoint evaluated safety and tolerability of CLS-AX, and we also looked at durability and biological effect. First, safety. We were very pleased with the safety results we saw with CLSA-X. In all participants in the trial, CLSA-X was well tolerated and demonstrated an excellent safety profile. There were no adverse effects, no dose-limiting toxicities, and because we are injecting behind the retina, we did not have any instances of vitreous floaters or dispersion of drug into the vitreous. We anticipated this favorable safety profile as Excedinib is a well-characterized small molecule with less propensity for inflammation compared to a biological agent or gene therapy. In addition, the safety of the suprachoroidal injection procedure with our SCS microinjector has already been assessed through the approval of Zypyr. Second, durability. OASIS demonstrated that two-thirds of patients may be able to go at least six months without additional treatment, which is a really important element for patients and caregivers managing this disease. For those participants in the extension study that received higher doses in cohorts three and four, 67% went at least six months without additional treatment, and 50% of participants went beyond six months. This translates to a 77% to 85% reduction in treatment burden. That's calculated by comparing the number of monthly injections participants had six months before CLSAX to the monthly injections they received after CLSAX. We believe that reduction in treatment burden is the current unmet medical need in the wet AMD space. Finally, biological effect. In OASIS, our six-month data was encouraging as we observed anatomic signs of biological effect on the OCT scans. We also saw stable mean best corrected visual acuity and stable mean central subretinal thickness in the extension study participants. These strong results in all three areas are supportive of excedinib's potency and panVEGF blockade. Furthermore, delivery via our SCS microinjector into the suprachoroidal space specifically targets the affected choreoretinal tissues for potential efficacy benefits and compartmentalizes drugs away from the front of the eye for potential safety benefits. OASIS reinforces our belief that CLSAX has the potential to reduce treatment burden in patients with wet AMD while maintaining stable visual acuity. gives us confidence as we advance into our next clinical trial. Given this favorable OASIS data, we intend to conduct a randomized, controlled, double-masked Phase IIb clinical trial called Odyssey with CLS-AX and wet AMD participants. On February 24th, the FDA issued draft guidance for the industry on developing drugs for the treatment of wet AMD. In this guidance, they recommend that all trials for this disease should use either Aflibirzeb or Ranivizumab in the comparator arm. We spoke with the agency regarding its development of the draft guidance and to clarify our understanding of the recommendations. We were fully prepared and ready to open enrollment this quarter in Odyssey based on our planned trial design. However, Based on our discussion with the agency and in response to this new guidance, we have adjusted the Odyssey trial design to use on-label Aflibirseb dosing in the comparator arm. As part of our planning process, we had considered and evaluated various clinical trial scenarios, including using Aflibirseb as a comparator. As a result, we are able to smoothly and seamlessly transition to an adjusted Odyssey trial design utilizing Aflibirseb. We anticipate this changeover will take a relatively short period of time to complete as we make the necessary paperwork and operational adjustments with our clinical research organization partners. We now plan to open the trial for enrollment next quarter and currently expect data in the second half of next year. Our clinical team is led by our Chief Clinical Officer, Dr. Susan Koltis, who joined us last year as a member of the leadership team with overall operational responsibility for conduct and execution of our clinical trials. She has substantial prior experience in advancing ophthalmic therapies from the early clinical development stages through final approval for commercialization, which is an important and valuable asset for us at this stage. We've had a smooth handoff related to our clinical operations as Dr. Tom Chula has transitioned to the role of Chief Medical Advisor, Retina, and chair of our Scientific Advisory Board. We are pleased that Tom continues to provide his expert advice and counsel on ClearSight's supercorroital development programs, including the ODYSSEY Phase IIb trial. I would also like to highlight the progress being made with Zypyr, ClearSight's first FDA-approved product and the first commercial product used using the supercorroital delivery. Zypyr was launched in the United States almost a year ago by our commercialization partner, Bausch & Lomb. They've done excellent work getting the drug into the hands of physicians, and they continue to expand outreach and training to healthcare providers. We estimate that over 1,000 retinal physicians have been trained to date in the use of the SES microinjector. In addition, Bausch & Lomb recently filed for Zypyr regulatory approval in Canada. so we're looking forward to market expansion in that additional territory. Our Asia-Pacific commercial partner for Zypyr is Arctic Vision, a leading China-based ophthalmic company. Arctic Vision is currently enrolling a confirmatory Phase III trial in macular edema associated with uveitis, and Arctic Vision just completed a Phase I clinical trial for the treatment of diabetic macular edema. Data from this trial is expected to be made public in the near future. and we look forward to their progress in these programs and future data readouts. As part of our corporate strategy, we value partnerships to expand the benefits of supracoital delivery utilizing our STS microinjector outside our core areas of expertise. Our current STS microinjector partners are focused on ocular oncology and gene therapy. Our oncology partner, Oral Biosciences, is utilizing our SES microinjector to deliver their viral-like drug conjugate, Belsar, for the treatment of choroidal melanoma, a serious disease that is the most common intraocular tumor in adults with no approved therapies. At the Macular Society annual meeting last month, ORA presented positive interim efficacy data from their ongoing Phase II study. The data presented showed very favorable safety profile along with an excellent response to the therapy with 89 to 100% tumor control. Based on their promising data, Aura announced final plans for its global phase three trial utilizing the suprachoroidal route of administration. They expect to begin enrollment in that trial this year. Our gene therapy partner, Regenexx Bio, continues to advance two Phase II clinical trials with their asset, RGX314, delivered superchoroidally with our SCS microinjector. These programs are being developed in collaboration with AbbVie. Recently, Regenexx Bio announced cohort expansions in both the AV8 and altitude superchoroidal clinical trials. The ABA clinical trial in wet AMD continues to enroll patients in cohort six at the third dose level. Regenexx has announced new interim data demonstrating that RGX314 was well tolerated with a meaningful reduction in treatment burden at six months observed across all dose levels. The altitude trial in diabetic retinopathy continues to enroll patients in two new cohorts at a higher third dose level. Progenix Bio has announced new data demonstrating that RGX314 was well tolerated and BCVA remained stable through six months. Patients treated with RGX314 demonstrate clinically meaningful improvements in disease severity and less disease worsening versus observational control at six months. Last week, Regenexx Bio reported that both the wet AMD and diabetic retinopathy supercoital clinical trials are on track to be completed in the first half of 2023, with additional interim trial data expected in the second half of 2023. With our Xypher approval, our successful OASIS trial, and the ongoing clinical development programs by our partners in the U.S. and China, Super-choroidal drug delivery via our SCS microinjector is now more widely accepted than ever by retinal communities. I will now turn over the call to our CFO, Charlie Degnan, for a financial update. Charlie?

Thank you, George, and good afternoon, everyone. Our financial results for the fourth quarter and full year were published this afternoon in our press release and are available on our website. In addition, we expect to file our annual report on Form 10-K tomorrow. As George mentioned, the growing acceptance of our supercoroidal delivery platform has provided several opportunities for ClearSight. Last year, we were able to secure royalty financing that provided meaningful non-dilutive capital by leveraging a portion of our future royalties from Zypyr and certain SES microinjector license agreements. This transaction was achievable because of the successful U.S. FDA approval for Zypyr and the subsequent commercial launch of the product by As of December 31, 2022, our cash and cash equivalents total approximately $48.3 million. Based on our current outlook, we expect to have sufficient resources to fund our planned operations into the second quarter of 2024. As we finalize our Phase II clinical trial plans for CLSA-X, we will provide an update if there is any impact on our current cash runway guidance. Over the next few months, we will be participating at several investor conferences, including the Needham Virtual Healthcare Conference and the J&P Life Science Conference. We look forward to these interactions and keeping updated on our progress. I will now turn the call back over to George for his closing remarks.

Thank you, Charlie. 2022 was a successful and productive year for ClearSide, and we are carrying this momentum forward into 2023. continues to stay engaged with the medical community with attendance at 15 medical congresses last year, featuring more than 40 posters and podium presentations delivered on our superchoroidal injection platform and our clinical development programs. Our SES microinjector has been used in well over 2000 superchoroidal injections in multiple clinical trials in a variety of retinal disorders. continuing to demonstrate a clinical safety and tolerability profile comparable to intravitreal injections. Importantly, it is commercially accepted by retinal physicians following the launch of Zypyr. With our positive OASIS data and the upcoming ODYSSEY trial, we have a solid plan to advance CLSAX as a potential treatment option for patients with wet AMD. We look forward to initiating ODYSSEY and to the data readouts from all our development and commercialization partners throughout the year. We will continue building on the promising opportunities ahead for ClearSight, delivering therapies to the back of the eye and leveraging our SES platform technology for patients with sight-threatening diseases. I would now ask the operator to open the call up for questions.

Thank you. As a reminder, to ask a question, you'll need to press star 11 on your telephone. To withdraw your question, please press star 11 again. Please wait for your name to be announced. Please stand by while we compile the Q&A roster.

Our first question comes from Annabelle Samimi with Stifel.

Your line is open.

Hi. Thanks for taking my question. So I noted the change that you had in the audience trial comparing it against the Flibercept, You know, you've been studying your product against this current standard of care, but furosemab seems to be possibly taking over as in that position. And so I'm just wondering if you have any sense as to how CLS-AX may do against furosemab based on what you're hearing. And as for a second question, Yes, you noted about 1,000 retinal specialists have been trained on SCS delivery. I guess, how are you sensing the increased appetite in terms of licensing your technology now that you're seeing some success in administration across this program up here as well as additional programs and real-world experience? Is there any additional activity on the licensing? Thanks.

Well, thanks for the question, Annabelle. I want to make sure I understand the first part of that question correctly. You know, we were excited about the idea of going against parizumab, but given the recent guidance coming out from the FDA and in discussions with the FDA, We thought it was the better course of action to better prepare us for phase three trial to change to the comparator being Aflibizumab instead of Verisimab. We felt very confident against Verisimab. We thought it was an innovative and forward-looking approach. But with the FDA's position, at least expressed in the draft guideline, that the comparator should either be Renabizumab or Aflibizumab, We thought since the trial had not yet started, it was best to make this small adjustment and move forward with an Aflirizumab comparator. Because Verizumab and Aflirizumab basically, Verizumab was approved as being non-inferior to Aflirizumab, we feel pretty good about the switch to comparators. feel as good as we did before. So we're glad to make that switch to be more in line with their guidelines. You asked about licensing interest. It's an interesting question. As you know, really out-licensing has not been a key part of our strategy. It was very strategic early on several years ago. But we have noted that we've had a little bit more interest recently in people wanting to work with us using our supercoital microinjector and approaching drugs by delivering them into the supercoital space. So we continue to have those conversations with multiple other parties right now. And if a deal makes sense, we'll do it. If not... it's good to know that other people are starting to accept supercarotid injection as a more commonplace mode of administration.

Okay, fair enough. Thank you.

Okay, thanks, Annabelle.

Thank you. One moment for our next question. And our next question comes from Sergey Bellinger with Needham & Company. Your line is now open.

Hi, good afternoon. A couple questions. First,

Hi, George. Hi. First one on the changes to the Odyssey trial. How does that change the loading dose portion at the start of this trial and maintenance? And then does it also change the sizing and statistical powering of the study?

Okay. The comparator arm will be just like it was before. We were using carisumab on label. We're going to be using Aflibirseb on label. So that's what I can tell you, that there will be the loading doses on label, and then it will be dosed every two months as per its label. And that's consistent with the draft guidelines from the FDA. So, we'll be loading in both arms, both the investigative arm and in the comparative arm on label with a Flibber sub. Okay. There should be no difference in the way we look at this. We've powered this more for estimation purposes. We're looking for, you know, mean corrected visual acuity, best corrected visual acuity, that we're trying to see that they're not this similar, but that we've reduced the treatment burden by having fewer maintenance doses compared to now would it be every other month of a FLEVR-Seb. So in terms of the overall statistical approach, it'll be the same as the previous Odyssey trial design. OK.

And then second question is kind of a broader strategy one. Just curious if you have any plans to explore CLSAx beyond wet AMD. I think Tom had previously spoken about diabetic retinopathy. Is it possible to run additional small cohorts to do those evaluations in parallel with this Odyssey trial?

Right now, we want to focus simply on the Odyssey trial. I think, you know, as Tom has said in the past, and I agree with him, CLSAX could have interesting potential in diabetic retinopathy. But with our resources, we've made a decision to focus in a singular fashion on Odyssey in wet AMD patients at this point in time.

Thanks for the updates. Thank you.

Our next question comes from the line of, I'm sorry, one moment.

I apologize.

John Wolinbin with JMP Securities. Your line is now open.

Hey, thanks for taking the question. Just a couple other follow-ups. Hi, John.

Hi, George. A couple other follow-ups on Odyssey. I know with the prior design, you were using the first of every treatment criteria. I'm wondering if that changes at all with the new comparator. And then also, what's kind of your estimated cost for Odyssey as well? Thanks.

Well, Let me tell you, we're still putting, you know, as you might imagine, the guidelines came out. They were actually published on the 27th of February. So we've been able to adjust, make the beginning adjustments to the protocol. When we have a more detailed and a more complete set of information, we'll let you, we'll update you on that. But right now we're still going, still have some stuff that's, preliminary that we're working through in terms of the actual details, the kind of details that you're talking about right now. But that's the best I can tell you right now, John, is we're making the switch over and using Flibberseb on label as our comparator. But we will be updating once we come out and finalize the new protocols. We'll give you more detail as it becomes available. Do you have a follow-up to that?

Just wondering about the estimated cost for Odyssey.

Yes. So, John, it's Charlie. You know, we don't give out the total cost. Again, the protocol is still being finalized. But these wet AMD studies, you know, usually run, you know, let's say 150,000 to 200,000 a patient. So you can use that as a guidepost.

That's helpful. Thanks, George. Thanks, Charlie.

Thank you.

One moment for our next question. Our next question comes from the line of Andreas Argaritis with Wedbush.

Your line is open.

Hi. Good afternoon. This is Caroline on . Thanks for taking our questions, and just one from us. So, even though you don't plan to use Verisimab in the Phase IIb, do you think it would eventually be necessary to show CLS-AX compared to Verisimab, or perhaps in combination with Verisimab from a commercial standpoint?

Well, thanks for the question. Some of that's a little out of our control, kind of what the FDA will allow. But I do think that over time, and we've always thought this, that was our original trial design, had furosemab in there, that with the acceptance of furosemab by the retinal community, this is going to be an important part of the treatment regimen here in the near term. And I think It's very possible over time that we will end up having to compare ourselves to some degree to farisumab. But that's right now under the draft guidelines. It's pretty clear what the FDA is expecting, especially going into the registration trials. And that does not include farisumab. It's our understanding that it just hasn't been out long enough for them to feel comfortable using. indicating that that could be a comparator arm. But I think that's certainly possible in the future. And if it is possible, I'd be more than happy to put CLS-AX in a trial versus for SNF.

Okay, great. Thank you so much.

Sure.

Thank you. As a reminder, ladies and gentlemen, that's star 11 to ask your question. One moment for our next question. Our next question comes from the line of Yi Chen with HC Wainwright. Your line is now open.

Thank you for taking my question. Just for the revenue recorded in fourth quarter, is this solely based on sales of the SCS microinjector?

Our revenues can be, we have supply agreements, surface agreements, training, So those are revenues related to all of our partners. So it is included in there, but there's also, you know, other service agreements we're doing, helping with training and design and engineering with our partners. So it's not just product sales or injector sales.

Yeah, so it's not proportional to the sales of Zypia recorded by Barcelona, correct?

That's correct.

Okay.

And then, you know, there could be – there wasn't this quarter, but there could be milestone payments. We'll hit that line also.

Okay. Okay. Got it. I see. And can you also comment on the level of operating expenses we should expect to see in 2023?

You know, guidance says we said our cash should get us into 2024, second quarter of 2024. I wouldn't expect to see, you know, major increases in our operating lines. other than, you know, the costs for a Phase II program. So, you know, the organization's, you know, pretty lean, and we can continue to stay that way.

Okay. Thank you.

Thank you. And I'm currently showing no further questions at this time. I'd like to hand the conference back over to Mr. George Lukaski for closing remarks.

Thank you, Operator, and thank you all for joining us on the call this evening. call this afternoon. We appreciate your continued interest in Clairsight and we look forward to updating you on our progress throughout the year. Operator, you may now disconnect the call.

Thank you. This concludes today's conference call. Thank you for your participation. You may now disconnect. Everyone have a wonderful day. The conference will begin shortly. To raise and lower your hand during Q&A, you can dial star 1 1. you Thank you. Bye. Bye. Thank you. Good day, and thank you for standing by. Welcome to the Clearside Biomedical fourth quarter 2022 financial results and corporate update conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there'll be a question and answer session. To ask a question during the session, you'll need to press star 1-1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 1-1 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Jenny Coleman, Investor Relations. Please go ahead.

Good afternoon, everyone, and thank you for joining us on the call today. Before we begin, I would like to remind you that during today's call, we will be making certain forward-looking statements, various remarks that we make during this call, and about the company's future expectations, plans, and prospects today. constitute forward-looking statements for purposes of the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by these forward-looking statements as a result of various important factors, including those discussed in the risk factors section of our annual report on Form 10-K for the year ended December 31st, 2021, our quarterly report on Form 10-Q for the quarter ended September 30, 2022, and our other SEC filings available on our website. We expect that our 10-K for the year ended December 31, 2022 will be filed tomorrow. In addition, any forward-looking statements represent our views as of today and should not be relied upon as representing our views as of any subsequent date. While we may elect to update these forward-looking statements in the future, we specifically disclaim any obligation to do so, even if our views change. On today's call, we have George Blazeski, our Chief Executive Officer, and Charlie Degnan, our Chief Financial Officer. After formal remarks, we will open the call for your questions. I would now like to turn the call over to George.

Thank you, Jenny. Over the past year, we have reinforced ClearSight's leadership position in the delivery of therapeutics into the supracoroidal space. We've successfully executed on our strategic plans with the launch and commercialization of the first FDA-approved supracoroidal product, Zypyr, by our partner, Bausch & Lomb. And we completed and announced positive data from our Phase I-IIa OASIS trial of CLSA-X in wet AMD. We have also seen promising data presented by partners utilizing our proprietary STS microinjector to administer gene therapy and oncology agents to treat a variety of retinal diseases. On today's call, I will cover key highlights from the past year and provide a snapshot of our plans for 2023. I will begin with our development programs, both internal and with our partners. Last month, we reported exciting data from our lead internal program, CLSAX, that combines our proprietary small molecule suspension of Excedinib with delivery by our SCS microinjector. Excedinib is a highly potent tyrosine kinase inhibitor, or TKI, that achieves pan-VEGF blockade, directly inhibiting VEGF receptors 1, 2, and 3 with high potency and specificity. We believe this broad VEGF blockade may have advantages over existing retinal therapies by acting at a different level of the angiogenesis cascade. We reported positive data from OASIS, our open-label Phase I-IIa trial in wet AMD. The trial consisted of four cohorts with escalating doses that monitored participants for three months. This was followed by a three-month extension study in the higher-dose cohorts. for a total of six-month follow-up. Participants enrolled in OASIS were heavily anti-VEGF treatment experienced patients with active disease at screening, which was confirmed by an independent reading center. In OASIS, we assessed three components. Primary endpoint evaluated safety and tolerability of CLS-AX, and we also looked at durability and biological effect. First, safety. We were very pleased with the safety results we saw with CLSA-X. In all participants in the trial, CLSA-X was well tolerated and demonstrated an excellent safety profile. There were no adverse effects, no dose-limiting toxicities, and because we are injecting behind the retina, we did not have any instances of vitreous floaters or dispersion of drug into the vitreous. We anticipated this favorable safety profile as Excedinib is a well-characterized small molecule with less propensity for inflammation compared to a biological agent or gene therapy. In addition, the safety of the suprachoroidal injection procedure with our SCS microinjector has already been assessed through the approval of Zypyr. Second, durability. OASIS demonstrated that two-thirds of patients may be able to go at least six months without additional treatment, which is a really important element for patients and caregivers managing this disease. For those participants in the extension study that received higher doses in cohorts three and four, 67% went at least six months without additional treatment, and 50% of participants went beyond six months. This translates to a 77% to 85% reduction in treatment burden. That's calculated by comparing the number of monthly injections participants had six months before CLSAX to the monthly injections they received after CLSAX. We believe that reduction in treatment burden is the current unmet medical need in the wet AMD space. Finally, biological effect. In OASIS, our six-month data was encouraging as we observed anatomic signs of biological effect on the OCT scans. We also saw stable mean best corrected visual acuity and stable mean central subretinal thickness in the extension study participants. These strong results in all three areas are supportive of excedinib's potency and panVEGF blockade. Furthermore, delivery via our SCS microinjector into the suprachoroidal space specifically targets the affected choreoretinal tissues for potential efficacy benefits and compartmentalizes drugs away from the front of the eye for potential safety benefits. OASIS reinforces our belief that CLSAX has the potential to reduce treatment burden in patients with wet AMD while maintaining stable visual acuity. gives us confidence as we advance into our next clinical trial. Given this favorable OASIS data, we intend to conduct a randomized controlled double-masked Phase IIb clinical trial called Odyssey with CLS-AX and wet AMD participants. On February 24th, the FDA issued draft guidance for the industry on developing drugs for the treatment of wet AMD. In this guidance, they recommend that all trials for this disease should use either Aflibirzeb or Ranivizumab in the comparator arm. We spoke with the agency regarding its development of the draft guidance and to clarify our understanding of the recommendations. We were fully prepared and ready to open enrollment this quarter in Odyssey based on our planned trial design. Based on our discussion with the agency and in response to this new guidance, we have adjusted the Odyssey trial design to use on-label Aflibirseb dosing in the comparator arm. As part of our planning process, we had considered and evaluated various clinical trial scenarios, including using Aflibirseb as a comparator. As a result, we are able to smoothly and seamlessly transition to an adjusted Odyssey trial design utilizing Aflibirseb. We anticipate this changeover will take a relatively short period of time to complete as we make the necessary paperwork and operational adjustments with our clinical research organization partners. We now plan to open the trial for enrollment next quarter and currently expect data in the second half of next year. Our clinical team is led by our Chief Clinical Officer, Dr. Susan Koltis, who joined us last year as a member of the leadership team with overall operational responsibility for conduct and execution of our clinical trials. She has substantial prior experience in advancing ophthalmic therapies from the early clinical development stages through final approval for commercialization, which is an important and valuable asset for us at this stage. We've had a smooth handoff related to our clinical operations as Dr. Tom Chula has transitioned to the role of Chief Medical Advisor, Retina, and chair of our Scientific Advisory Board. We are pleased that Tom continues to provide his expert advice and counsel on ClearSight's supercorroital development programs, including the ODYSSEY Phase IIb trial. I would also like to highlight the progress being made with Zypyr, ClearSight's first FDA-approved product and the first commercial product used using the supercorroital delivery. Zypyr was launched in the United States almost a year ago by our commercialization partner, Bausch & Lomb. They've done excellent work getting the drug into the hands of physicians, and they continue to expand outreach and training to healthcare providers. We estimate that over 1,000 retinal physicians have been trained to date in the use of the SES microinjector. In addition, Bausch & Lomb recently filed for Zypyr regulatory approval in Canada. so we're looking forward to market expansion in that additional territory. Our Asia-Pacific commercial partner for Zypyr is Arctic Vision, a leading China-based ophthalmic company. Arctic Vision is currently enrolling a confirmatory Phase III trial in macular edema associated with uveitis, and Arctic Vision just completed a Phase I clinical trial for the treatment of diabetic macular edema. Data from this trial is expected to be made public in the near future. and we look forward to their progress in these programs and future data readouts. As part of our corporate strategy, we value partnerships to expand the benefits of supracoital delivery utilizing our STS microinjector outside our core areas of expertise. Our current STS microinjector partners are focused on ocular oncology and gene therapy. Our oncology partner, Ora Biosciences, is utilizing our SES microinjector to deliver their viral-like drug conjugate, Belsar, for the treatment of choroidal melanoma, a serious disease that is the most common intraocular tumor in adults with no approved therapies. At the Macular Society annual meeting last month, ORA presented positive interim efficacy data from their ongoing Phase II study. The data presented showed very favorable safety profile, along with an excellent response to the therapy with 89% to 100% tumor control. Based on their promising data, Aura announced final plans for its global Phase III trial utilizing the suprachoroidal route of administration. They expect to begin enrollment in that trial this year. Our gene therapy partner, Regenexx Bio, continues to advance two Phase II clinical trials with their asset, RGX314, delivered superchoroidally with our SCS microinjector. These programs are being developed in collaboration with AbbVie. Recently, Regenexx Bio announced cohort expansions in both the AV8 and altitude superchoroidal clinical trials. The ABA clinical trial in wet AMD continues to enroll patients in cohort six at the third dose level. Regenexx has announced new interim data demonstrating that RGX314 was well tolerated with a meaningful reduction in treatment burden at six months observed across all dose levels. The altitude trial in diabetic retinopathy continues to enroll patients in two new cohorts at a higher third dose level. Progenix Bio has announced new data demonstrating that RGX314 was well tolerated and BCVA remained stable through six months. Patients treated with RGX314 demonstrate clinically meaningful improvements in disease severity and less disease worsening versus observational control at six months. Last week, Regenexx Bio reported that both the wet AMD and diabetic retinopathy supercoital clinical trials are on track to be completed in the first half of 2023, with additional interim trial data expected in the second half of 2023. With our Xypher approval, our successful OASIS trial, and the ongoing clinical development programs by our partners in the US and China, Super-choroidal drug delivery via our SCS microinjector is now more widely accepted than ever by retinal communities. I will now turn over the call to our CFO, Charlie Degnan, for a financial update. Charlie?

Thank you, George, and good afternoon, everyone. Our financial results for the fourth quarter and full year were published this afternoon in our press release and are available on our website. In addition, we expect to file our annual report on Form 10-K tomorrow. As George mentioned, the growing acceptance of our supercoroidal delivery platform has provided several opportunities for ClearSight. Last year, we were able to secure royalty financing that provided meaningful non-dilutive capital by leveraging a portion of our future royalties from Zypyr and certain SES microinjector license agreements. This transaction was achievable because of the successful U.S. FEA approval for Zypyr and the subsequent commercial launch of the product by As of December 31, 2022, our cash and cash equivalents total approximately $48.3 million. Based on our current outlook, we expect to have sufficient resources to fund our planned operations into the second quarter of 2024. As we finalize our Phase II clinical trial plans for CLSA-X, we will provide an update if there is any impact on our current cash runway guidance. Over the next few months, we will be participating in several investor conferences, including the Needham Virtual Healthcare Conference and the J&P Life Science Conference. We look forward to these interactions and keeping updated on our progress. I will now turn the call back over to George for his closing remarks.

Thank you, Charlie. 2022 was a successful and productive year for ClearSide, and we are carrying this momentum forward into 2023. continues to stay engaged with the medical community with attendance at 15 medical congresses last year, featuring more than 40 posters and podium presentations delivered on our superchoroidal injection platform and our clinical development programs. Our SCS microinjector has been used in well over 2000 superchoroidal injections in multiple clinical trials in a variety of retinal disorders. continuing to demonstrate a clinical safety and tolerability profile comparable to intravitreal injections. Importantly, it is commercially accepted by retinal physicians following the launch of Zypyr. With our positive OASIS data and the upcoming Odyssey trial, we have a solid plan to advance CLSAX as a potential treatment option for patients with wet AMD. We look forward to initiating Odyssey and to the data readouts from all our development and commercialization partners throughout the year. We will continue building on the promising opportunities ahead for ClearSight, delivering therapies to the back of the eye and leveraging our SES platform technology for patients with sight-threatening diseases. I would now ask the operator to open the call up for questions.

Thank you. As a reminder, to ask a question, you'll need to press star 11 on your telephone. To withdraw your question, please press star 11 again. Please wait for your name to be announced. Please stand by while we compile the Q&A roster.

The first question comes from Annabelle Samimi with Stifel.

Your line is open.

Hi. Thanks for taking my question. So I noted the change that you had in the audience trial comparing it against the Flibercept, but I've You know, you've been studying your product against this current standard of care, but furosemab seems to be possibly taking over as in that position. And so I'm just wondering if you have any sense as to how CLS-AX may do against furosemab based on what you're hearing. And as for a second question, Yes, you noted about 1,000 retinal specialists have been trained on SCS delivery. I guess, how are you sensing the increased appetite in terms of licensing your technology now that you're seeing some success in administration across this program up here as well as additional programs and real-world experience? Is there any additional activity on the licensing? Thanks.

Well, thanks for the question, Annabelle. I want to make sure I understand the first part of that question correctly. You know, we were excited about the idea of going against parizumab, but given the recent guidance coming out from the FDA and in discussions with the FDA, We thought it was the better course of action to better prepare us for a Phase III trial to change to the comparator being Aflibizumab instead of Verisimab. We felt very confident against Verisimab. We thought it was an innovative and forward-looking approach. But with the FDA's position, at least expressed in the draft guideline, that the comparator should either be Renabizumab or Aflibizumab, We thought since the trial had not yet started, it was best to make this small adjustment and move forward with an Aflibirizumab comparator. Because Berizumab and Aflibirizumab basically, Berizumab was approved as being non-inferior to Aflibirizumab, we feel pretty good about the switch to comparators. feel as good as we did before. So we're glad to make that switch to be more in line with their guidelines. You asked about licensing interest. It's an interesting question. As you know, really out-licensing has not been a key part of our strategy. It was very strategic early on several years ago. But we have noted that we've had a little bit more interest recently in people wanting to work with us using our supercoital microinjector and approaching drugs by delivering them into the supercoital space. So we continue to have those conversations with multiple other parties right now. And if a deal makes sense, we'll do it. If not... it's good to know that other people are starting to accept supercarotid injection as a more commonplace mode of administration.

Okay. Fair enough. Thank you.

Okay. Thanks, Annabelle.

Thank you. One moment for our next question. And our next question comes from Sergey Bellinger with Needham & Company. Your line is now open.

Hi. Good afternoon.

A couple questions.

First,

Hi, George. Hi. First one on the changes to the Odyssey trial. How does that change the loading dose portion at the start of this trial and maintenance? And then does it also change the sizing and statistical powering of the study?

Okay. The comparator arm will be just like it was before. We were using carisumab on label. We're going to be using Aflibirseb on label. So that's what I can tell you, that there will be the loading doses on label, and then it will be dosed every two months as per its label. And that's consistent with the draft guidelines from the FDA. So we'll be loading in both arms, both the investigative arm and in the comparative arm on label with a Flibber sub. Okay. There should be no difference in the way we look at this. We've powered this more for estimation purposes. We're looking for, you know, mean corrected visual acuity, best corrected visual acuity, that we're trying to see that they're not this similar, but that we've reduced the treatment burden by having fewer maintenance doses compared to now would it be every other month of a FLEVR-Seb. So in terms of the overall statistical approach, it'll be the same as the previous Odyssey trial design. OK.

And then second question is kind of a broader strategy one. Just curious if you have any plans to explore CLSAx beyond wet AMD. I think Tom had previously spoken about diabetic retinopathy. Is it possible to run additional small cohorts to do those evaluations in parallel with this Odyssey trial?

Right now, we want to focus simply on the Odyssey trial. I think, you know, as Tom has said in the past, and I agree with him, CLSAX could have interesting potential in diabetic retinopathy. But with our resources, we've made a decision to focus in a singular fashion on Odyssey in wet AMD patients at this point in time.

Thanks for the updates. Thank you.

Our next question comes from the line of, I'm sorry, one moment.

I apologize.

John Wolinbin with JMP Securities. Your line is now open.

Hey, thanks for taking the question. Hi, John.

Hi, George. A couple other follow-ups on Odyssey. I know with the prior design, you were using the first of every treatment criteria. I'm wondering if that changes at all with the new comparator. And then also, what's kind of your estimated cost for Odyssey as well? Thanks.

Well... Let me tell you, we're still putting, you know, as you might imagine, the guidelines came out. They were actually published on the 27th of February. So we've been able to make the beginning adjustments to the protocol. When we have a more detailed and a more complete set of information, we'll update you on that. But right now, we still have some stuff that's preliminary that we're working through in terms of the actual details, the kind of details that you're talking about right now. But that's the best I can tell you right now, John, is we're making the switch over and using Flibberseb on label as our comparator. But we will be updating once we come out and finalize the new protocol. We'll give you more detail as it becomes available. Do you have a follow-up to that?

Just wondering about the estimated cost for Odyssey.

Yes. So, John, it's Charlie. You know, we don't give out the total cost. Again, the protocol is still being finalized. But these wet AMD studies, you know, usually run, you know, let's say 150,000 to 200,000 a patient. So you can use that as a guidepost.

That's helpful. Thanks, George. Thanks, Charlie.

Thank you.

One moment for our next question. Our next question comes from the line of Andreas Argaritis with Wedbush.

Your line is open.

Hi. Good afternoon. This is Caroline on . Thanks for taking our questions, and just one from us. So, even though you don't plan to use Verisimab in the Phase IIb, do you think it would eventually be necessary to show CLS-AX compared to Verisimab, or perhaps in combination with Verisimab from a commercial standpoint?

Well, thanks for the question. Some of that's a little out of our control, kind of what the FDA will allow. But I do think that over time, and we've always thought this, that was our original trial design, had parisimab in there, that with the acceptance of parisimab by the retinal community, this is going to be an important part of the treatment regimen here in the near term. And I think it's very possible over time that we will end up having to compare ourselves to some degree to farisumab. But that's right now under the draft guidelines. It's pretty clear what the FDA is expecting going into, especially going into the registration trials. And that does not include farisumab. It's our understanding that it just hasn't been out long enough for them to feel comfortable using indicating that that could be a comparator arm. But I think that's certainly possible in the future. And if it is possible, I'd be more than happy to put CLSAX in a trial versus for SNF.

Okay, great. Thank you so much.

Sure.

Thank you. As a reminder, ladies and gentlemen, that's star 11 to ask your question. One moment for our next question. Our next question comes from the line of Yi Chen with HC Wainwright. Your line is now open.

Thank you for taking my question. Just for the revenue recorded in fourth quarter, is this solely based on sales of the SCS microinjector?

Our revenues can be, we have supply agreements, surface agreements, training, So those are revenues related to all of our partners. So it is included in there, but there's also, you know, other service agreements we're doing, helping with training and design and engineering with our partners. So it's not just product sales or injector sales.

Yeah, so it's not proportional to the sales of Zypia recorded by portion alone, correct?

That's correct.

Okay. Okay.

And then, you know, there could be – there wasn't this quarter, but there could be milestone payments. We'll hit that line also.

Okay. Okay. Got it. I see. And can you also comment on the level of operating expenses we should expect to see in 2023?

You know, guidance says we said our cash should get us into 2024, second quarter of 2024. I wouldn't expect to see, you know, major increases in our operating lines. other than, you know, the costs for a Phase II program. So, you know, the organization's, you know, pretty lean, and we can continue to stay that way.

Okay. Thank you.

Thank you. And I'm currently showing no further questions at this time. I'd like to hand the conference back over to Mr. George Lukaski for closing remarks.

Thank you, Operator, and thank you all for joining us on the call this evening. call this afternoon. We appreciate your continued interest in Clairsight and we look forward to updating you on our progress throughout the year. Operator, you may now disconnect the call.

Thank you. This concludes today's conference call. Thank you for your participation. You may now disconnect. Everyone have a wonderful day.