5/7/2025

speaker
Operator
Conference Operator

Good afternoon, ladies and gentlemen, and welcome to the Lens Therapeutics First Quarter 2025 Financial Results Conference Call. At this time, all participants are in a listen-only mode. Following prepared remarks from management, we will conduct a question-and-answer session, and instructions will follow at that time. As a reminder, this call is being recorded. At this time, I would like to turn the call over to Dan Chevalard, Chief Financial Officer. Please go ahead.

speaker
Conference Call Moderator
Investor Relations

Thank you. Good afternoon, and thank you for joining us today.

speaker
Dan Chevalard
Chief Financial Officer

My name is Dan Chevalard, Chief Financial Officer of Lens Therapeutics. We are joined today by Abe Schimeltenich, our President and Chief Executive Officer, and Sean Olson, our Chief Commercial Officer, as well as Dr. Mark Odrich, Chief Medical Officer, who will join us for the question and answer session. Before we begin, I would like to remind you that this call will contain forward-looking statements regarding Lens's future expectations plans, prospects, corporate strategy, regulatory and commercial plans and expectations, cash runway projections, and performance. Actual results may differ materially from those indicated by these forward-looking statements as a result of various important factors and risks, including those discussed in our filings with the Security and Exchange Commission, which can also be found on our website. In addition, any forward-looking statements represent only our views as of the date of this webcast and should not be relied upon as representing our views as of any subsequent date. We specifically disclaim any obligations to update such statements. The company encourages you to consult the risk factors contained in our SEC filings for additional detail, including in our first quarter 2025 Form 10-Q, which was filed today. With that, I'll now turn the call over to Abe.

speaker
Abe Schimeltenich
President and Chief Executive Officer

Thank you, Dan, and good afternoon, everyone. The first quarter of 2025 has been a focused and highly productive period for Lens. But up to the target action date for RMZ100, now just three months away, we are entering into what we believe will be a defining chapter in our company's growth. Back in January, I said that 2025 had the potential to be a transformational year. And with each passing milestone, that's proving to be the case. In prior quarters, we emphasized our commitment to disciplined execution as we are advancing LNG100 to launch, and I believe in its potential as a category defining treatment for presbyopia. That focus hasn't wavered, and we've been doing all of this while maintaining a strong financial foundation to support IPRO. The foundation in recent weeks has been further strengthened through a block trade as a result of an inbound from a high-quality investor eager to initiate a meaningful starting position in our stock. Their interest was, amongst others, triggered by our commercial day, which we hosted in April at the NASDAQ market site. Our objective was to provide a clear and comprehensive look at our commercial readiness and share our excitement for the upcoming potential launch of LMZ100. It was an outstanding event with many investors and self-taught analysts joining in person hundreds more joining live online, and many others who have watched the replay since. The feedback has been extremely positive. We believe we accomplished what we set out to do, demonstrate the strength of our commercial strategy and instill confidence in our ability to execute. There are four key takeaways from that event I'd like to briefly touch on here. First, the perspective shared by eye care professionals. We heard from a number of prospective KOLs, who all expressed genuine enthusiasm about the clinical potential of NMZ100, particularly on how it could enhance patient care. As a reminder, while there are approximately 128 million Americans with presbyopia, fewer than half of them are believed to see an eye care doctor. That presents a substantial opportunity, and ECPs are very interested in how our direct-to-consumer marketing will help drive awareness and engagement among this large population. Second, we outlined the progress we had made in preparing for launch. As you know, our commercial strategy is structured around three pillars, enabling doctors to recommend us, empowering patients to request us by name, and ensuring a seamless path to access. On the first pillar, our unbranded I Am Selected campaign continues to generate strong engagement. More than 50 KOs are part of the effort. helping their peers take a fresh look at emerging options in presbyopia treatment. The campaign has reached over 12,000 ECPs and has delivered more than 2 million impressions online. Furthermore, our all-optometrist MSL team has been actively engaging with ECPs with thousands of meaningful interactions to date. They are playing a key role in educating the community about the mechanism of action and the importance of people's activity. And in parallel, a Salesforce build-out is progressing as planned, and Sean will speak to that shortly. The second pillar, building brand awareness among patients post-approval and launch, is driven by a clear and targeted strategy. As shared at the commercial day, our goal is to establish a true category one. We have defined our consumer targets. We know how and where to reach them, and we are building a campaign that will incorporate the right mix of influencer and ambassador engagement to drive visibility and recognition. And third, we've laid the foundation for a strong product access strategy that includes an extensive sampling approach and broad distribution through both traditional retail pharmacies and existing e-pharmacy channels.

speaker
Conference Call Moderator
Investor Relations

ensuring convenience and accessibility from the start.

speaker
Abe Schimeltenich
President and Chief Executive Officer

We also provided an update on our interactions with the FDA. Given the current regulatory environment, we felt it was important to reiterate that we are continuing to see a high level of engagement from the agency, an excellent continuity among the review team, which has seen no changes in personnel. In fact, our late cycle review meeting has been moved forward to later this month. We remain on track for August 8th, the Dufa date. Finally, I want to briefly speak to the topic of tariffs, which for obvious reasons continues to come up in conversations. As we shared at the commercial day, we're in a strong and well-defined position. On November 7th of last year, U.S. Customs and Border Protection issued a definitive ruling establishing the United States as the country of origin for LNG 100. Then, on April 2nd, we received a second definitive ruling confirming that LNG-100 will be duty-free. Combined with the fact that our intellectual property is domiciled in the U.S., we are proud to say that LNG-100 is designated made in the USA. Across the organization, from medical and regulatory to manufacturing operations, quality, finance, HR, and commercial, every team is operating with urgency and alignment. as we approach our target action date in August. It is a truly cross-functional effort, and I'm incredibly proud of what we have accomplished so far. With that, I will turn the call over to Sean, our Chief Commercial Officer, who will share more on the progress we are making in our pre-commercial planning. Sean? Thank you, Ace.

speaker
Sean Olson
Chief Commercial Officer

Good afternoon, everyone. As we discussed on previous calls, the commercial potential for an effective presbyopia treatment represents one of the largest eye care market opportunities in the United States. Presbyopia impacts an estimated 128 million people in the U.S., population nearly four times larger than those impacted by dry eye, and nearly six times larger than those impacted by demodex blepharitis. For further context, presbyopia impacts more than the combined U.S. population suffering from dry eye, demodex blepharitis, childhood myopia, macular degeneration, diabetic retinopathy, and glaucoma. The first eye drop treatment for presbyopia was approved in 2021 and confirmed that there's a strong consumer desire for an eye drop treatment, as evidenced by initial paid new scripts of up to 6,000 per week. Long-term usage beyond the trial period of this product did not materialize as pilocarpine, even at the high concentration of one and a quarter percent cannot deliver the consumer-required performance. Extensive, independent consumer market research suggests this category is wide open for an eyedrop solution that can deliver what consumers desire, a once-a-day eyedrop that provides seamless near vision for the full workday for the majority of presbyopes. Unlocking this market requires an ideal presbyopia eyedrop, and we're excited for the prospect of a cycladine-based LNZ100. We believe the commercial potential of LNZ100 was validated in our phase three clarity study with 90% of participants noticing an improvement in near vision and 75% of participants indicating they would continue to use LNZ100 after the study, of which 81% plan to use the product four to seven days per week. Together with our broad inclusion criteria, we believe this positions LNZ100 well for the estimated 3 billion plus market creating a potential category one. We continue to advance our commercial readiness as we progress towards August 8th, the DUFA date, and I'd like to take just a moment to provide an update on the three pillars of our commercial strategy. The first pillar of our commercial strategy is doctors to recommend us. As Abe mentioned, our all optometrists MSL team is already engaging with ECPs on medical education and fielding questions on the phase three data. In addition, our unbranded campaign continues to drive awareness of an ideal price for your solution with over two million digital impressions. Following prudential NDA approval, our sales force will immediately begin branded calls on approximately 15,000 ECPs, and I'm pleased to report that we have made substantial progress on the sales force over the past quarter. As a reminder, we have already successfully hire a full sales leadership team, including both of our regional directors in 2024. In Q1, we expand the team further with additional 10 district managers. Collectively, this core leadership group brings nearly 150 years of ICARE experience and more than 300 years of total sales experience. In March, we launched job postings for all 88 sales territories nationwide. The interest to join Lens Salesforce has been tremendous, with over 7,500 applications for the 88 positions. The quality applicants have been very high, and we're excited to share that we've begun extending offers to our field-based sales representatives. As of today, we've extended and received accepted offers for over 40% of our field sales team. In addition, 97% of these new team members have prior eye care or pharma experience, and on average have over 10 years of sales experience. This marks a major milestone in commercialization readiness and great progress towards our target to have the full field team in place by July 1st. We're excited to progress our first pillar, Doctors to Recommend Us. And as a reminder, our primary market research surveyed 426 eye care professionals, and it yielded an impressive 82% and 83% of ECGs already being likely to provide prescribe and sample LNZ100 if FDA approved, respectively, based on that phase three data. Our second pillar of our commercial strategy is consumers to request us by name. We've taken a consumer-first approach, leaning heavily into lifestyle creative that reflects the aspirations and daily experiences of our future consumers. The brand we've built is empowering, desirable, and has tested exceptionally well in market research. On April 15th, we hosted our commercial day event in New York City, where we unveiled the visual identity of the brand, which is modern, clean, and sophisticated. We heard from phase three users of L&Z 100, which highlighted the personal experience with the drop and the word of mouth potential. We shared our plan for advertising, including influencers and celebrities to drive awareness. We even facilitated a live discussion with Tiffany Thiessen, who many of you may know from Saved by the Bell, 90210, and White Collar. As a presbyope herself, she shared her frustrations with presbyopia and desire for a better solution. All of this to help frame how we plan to ensure consumers will request us by name. Our brand creative is now fully locked, and the majority of our launch promotional materials are ready, pending final product insert language. Once approved, we'll begin activating our eye care professional-facing materials to ensure providers are confident and well-equipped. Following that, and once the ECP education is firmly in place, we'll launch into our direct consumer campaign with high-impact advertising, influencers, and celebrities that we believe will powerfully introduce our brand to the market. For more information from the commercial today, a replay of the event is available on our investor relations page under the IR calendar on our website. The third and final pillar, seamless journey to use, will ensure ease of sample and product access for patients. This requires enabling the patient to experience the product and move from trial to usage as quickly as possible. To support this, our team has built out consumer sampling capabilities and commercial access across multiple channels, including the traditional retail pharmacy as well as e-pharmacy home delivery. In our clinical trials, 95% of patients noticed at least two lines of improvement on hour one, day one. This immediate response and wow effect is incredibly important to product sampling. Our sample vendor has been contracted, and after approval, samples will be rough delivered to eye care professionals, allowing consumers to try the products. Our team has developed a five-day sample pack, similar to sample sizes for contact lenses, which following the initial trial can act like a bridge until product is picked up at the pharmacy or delivered to the consumer's home. We will continue to drive these three pillars as we continue to progress towards our . Doctors recommend us, consumers request us by name, and a seamless journey to use. I'd now like to hand the call over to Dan Chevalard, our CFO, to highlight our financial results.

speaker
Dan Chevalard
Chief Financial Officer

Thank you, Sean. As has been mentioned, the first quarter of 2025 has been a very productive and focused time for the company with our PDUFA target action date for LNZ100 just over 90 days from now. We ended Q1 2025 in a position of financial strength and funded for success with approximately $194.1 million in cash, cash equivalents, and marketable securities. As you may have seen, now having passed the anniversary date of our merger in March 2024, and the corresponding Rule 145 shell limitations imposed upon us by the SEC, we became SHELF eligible and filed our first S3 SHELF registration statement in early April. Subsequent to quarter end, we received a meaningful inbound inquiry from a high-quality investor on our ATM, which ultimately resulted in a single block trade of 600,000 shares and net proceeds of $16.3 million, further strengthening our financial position. As such, we have upwardly revised our projected cash at PDUFA from over $170 million, which we disclosed at our commercial day, to now over $185 million, and again reiterated our cash on hand is anticipated to fund the company's cash runaway to post-launch positive operating cash flow. Let's now turn to our first quarter results. As I noted on our most recent year-end call, we expected measured increases in our operating expenses as we exited 2024 between year-end and the time of our producer date, which was exactly what we saw in the first quarter. Our total Q1 2025 operating expenses increased to $16.9 million, an 11% increase over Q4, but well within our operating plan. From a cash perspective, We had a total net cash burn of $15 million Q1 2025, which included approximately $3 million in one-time annual cash costs and is really reflective of closer to $12 million in operating cash burn compared to our Q4 2024 net operating cash burn for approximately $8.1 million. Total SG&A expenses increased to $11.3 million for Q1 2025 compared to $5.6 million in the same period in 2024, driven primarily by an increase in commercial headcount and other prelaunch commercial planning activities. Sequentially, SG&A increased quarter over quarter by approximately 19% from $9.4 million in the fourth quarter, driven primarily by increases in personnel-related expenses due to a growth in commercial headcount pre-commercial marketing, advertising and sales infrastructure, and all continuing the pattern of a ramped commercial spend as we approach our potential August 2025 approval for L&Z 100. As I have highlighted on previous calls and in what will be a consistent objective, we will continue to be measured in our spend on the G&A side of the organization as we aim to remain a lean and efficient G&A team. Total research and development expenses decreased to $5.8 million in Q1 2025 compared to $10.5 million for the same period in 2024. Sequentially, however, R&D expenses were flat quarter over quarter with a 1% net decrease from the fourth quarter. The majority of our research and development expenses in Q1 were dedicated to our manufacturing operations efforts as we build pre-approval commercial product and sample inventory to support our launch. which will continue through the approval of LMZ 100, and which time much of our manufacturing costs will be prospectively reflected in cost of sales. Finally, our net loss per share, both basic and diluted, was 53 cents per share in the first quarter of 2025 on a net loss of $14.6 million, compared to a net loss per share of $3.53 per share in first quarter of 2024 on a net loss of $16.6 million. Q1 2025 net loss per share was calculated on approximately 27.5 million weighted average common shares outstanding compared to Q1 of last year, which was the quarter in which we completed our reverse merger, and net loss was calculated on approximately 4.7 million weighted average common shares outstanding. In total, we ended Q1 2025 with approximately 27.5 million shares of common stock outstanding. In summary, we feel very good about where we stand financially as we approach the exciting period ahead and are pleased with the strength of our balance sheet and discipline operating plan as we approach our August 8th period. With that, I'll turn the call back over to Abe for final remarks.

speaker
Conference Call Moderator
Investor Relations

Thanks, Dan. As you can see, we're off to a great start in 2025.

speaker
Abe Schimeltenich
President and Chief Executive Officer

I believe we have tremendous momentum as we are now about three months from our Purdue target action date. We've never been more confident in our abilities to deliver once daily, well-tolerated, and rapidly acting treatments to the 128 million individuals living with presbyopia in the United States. I'm looking forward to the exciting months ahead. With that, I'd like to open up the call for questions.

speaker
Operator
Conference Operator

At this time, if you would like to ask a question, simply press star, followed by the number one on your telephone keypad. If you would like to withdraw your question, press star one again. To repeat, to ask a question, please press star one. Your first question comes from the line of Stacey Ku from TV Cohen. Please go ahead.

speaker
Stacey Ku
Analyst, TWC Cohen & Co.

Hi, thanks so much for taking our questions and congrats on the progress. So we have a few. First, as we think about the LNZ 100 initial launch, we do think it makes a lot of sense to maximize the prescriber and patient relationship with high volume sampling. So just curious, do you have the infrastructure in place to get samples to all interested offices as quickly as possible post-launch? Can you discuss in more detail plans kind of right immediately after approval? That's the first question. And then the second is somewhat related. Maybe talk about the type of preparation the team is doing to drive continued use and refills of LNZ100 after that initial sample. How are you thinking about the level of stickiness of LNZ100 as it relates to setting expectations for the patient experience? And then last, if we could, as you approach the approval timing, what kind of metrics will you disclose to kind of show patient demand to the street? Thank you so much.

speaker
Conference Call Moderator
Investor Relations

Great. Thanks, Stacy. This is Sean.

speaker
Sean Olson
Chief Commercial Officer

So, for your first question, you're asking about, you know, where are we in our readiness and ability to sample right out the gate for LNZ100. I think I got that right. So, you know, we see sampling as a critical component to our commercial strategy. So, we've been out in front of this for a long time. So, we actually contracted our sampling distributor back in 2024. You know, and what we're doing in terms of progress, you know, obviously internally we're writing all of our policies for how the reps deliver the samples. And then also, you know, we're already coordinating between our sample distributor as well as our CRM system and actually smoke testing those systems to make sure it will be seamless upon those samples being available. So once samples are available, you know, we'll immediately begin shipping those samples to the reps. They'll receive those samples and be out distributing them to their 15,000 ECP targets. And really, our plan is to have the majority of our samples rep-delivered. And we see that as very important. We see that that opens the door to go and talk to the eye care professionals. And that allows us to have that conversation about LNG-100 with the eye care professional every time we show up. On your second question, in terms of preparations for the field, so we have a lot of work going on already to ensure that we're ready to go. So as you can imagine, with over 40 percent of the sales force already accepting offers, you know, in the background ahead of that, we've been building up all the training modules for the sales team. You know, once the sales team comes on, they have about a three-week training cycle where we take them through all those modules. All of them, except for the one on the product, are all ready to go and through the medical, legal, and regulatory review process. So we need to get training them day one. And in terms of preparations to make sure that, you know, appropriate information is passed along to the out-of-care professional. And we prepared our Q&A documents as well as, you know, key messages to have that conversation with the doctors.

speaker
Stacey Ku
Analyst, TWC Cohen & Co.

Got it. And then the last comment on that. on what type of metrics you might disclose?

speaker
Sean Olson
Chief Commercial Officer

Yeah, so in terms of the metrics, so what we see there is, you know, this product will be distributed both through the retail pharmacy as well as the e-pharmacy. So I think where most people will be looking for us in terms of metrics early on, I'd really be going to the IQVIA data, looking at new script rates as well as that refill rate. I think early on the focus of Q4 is going to be samples. Once we move into Q1, I think that focus is really going to be what are those new scripts per week. And then moving into Q2, it's going to be a lot about how are those refills coming through. You know, given the e-pharmacy, obviously that's often not picked up in IQVIA. You know, we'll make sure that we can provide some guidance on how that's going so the appropriate analysis can be made.

speaker
Abe Schimeltenich
President and Chief Executive Officer

Thanks. Just adding to it, I think you had a question in there on how we would expect to go from samples to ultimately use. That's really that. that that sample will be accompanied with a script. At that moment, the patient can either choose to fill that script, as Sean mentioned, through e-pharmacy. This is the, you know, what we're all getting very accustomed to now. Leave the doctor's office, and the text will pop up on your phone, and that product will then be delivered to your doorstep, or if you want to go the more traditional route, you can pick the actual product up at the retail pharmacy. And then the second part of that question was what we think about stickiness. Hard to say at the moment. I think this is different from our product. I'm sure I'm highlighted that sample use. And we know that 95% of patients hit at least two lines of near vision improvements. Do you expect that people see that improvement from the sample? If they are converting to a script, they should be motivated to continue to use that. Do you expect relatively high stickiness once people have converted it into a script?

speaker
Stacey Ku
Analyst, TWC Cohen & Co.

Wonderful. Incredibly thoughtful. Thank you.

speaker
Operator
Conference Operator

Your next question comes from the line of Bhavan Patel with Bank of America. Please go ahead.

speaker
Bhavan Patel
Analyst, Bank of America

Hey, guys. This is Bhavan on for Jason Gerberry. First question is related to the five-day sample pack. I know that's a key part of the strategy. How will sample distribution be managed and tracked to ensure that they reach high potential prescribers and patients? And what's the expected conversion rate from sample to paid prescription? And then on the manufacturing supply chain, with the start of manufacturing in February of 2025, can you help us understand what's the current inventory level and what's the target inventory for launch? And then one follow-up, if I may.

speaker
Sean Olson
Chief Commercial Officer

Absolutely. Sean, you want to take the sample back? Yeah, great. Right here for you, Pavan. So the five-day sample pack, when we think about, you know, how that will be managed and tracked. So what will happen is, obviously, you know, our sample vendor will hold all of the actual bulk samples in their location. And then how that will be managed every month, that product will be shipped to each rep, right? So every month will be a shipment that goes to the rep. They'll hold their products in their storage locker. And then that shipment will be dependent on the number of targets and then the expected amount of samples they'd be dropping off. So that will be replenished every single month. Now, once that rep goes to the actual doctor's office, to the eye care professional, every time samples are dropped off, you know, we will make sure that they're signed for and fully accounted for to make sure that it's a clear transfer of ownership to the eye care professional. And every subsequent visit, they'll be checking in on how many samples were written, or sorry, how many samples were left and how many scripts were written to make sure it maintains the right ratio. In terms of the expected conversion from samples to full-time users, I think it's a little bit too early to tell on that. But, you know, when we have more insight, we'll share more on that.

speaker
Abe Schimeltenich
President and Chief Executive Officer

Thanks, Sean. Just to add to that before I go to the inventory question, you have a map on the 15,000 doctors and 88 reps. You get to about a three-week call cycle. So every three weeks, the rep is in that office. On top of that, there's a mechanism for doctors, if there are other samples in that period, to request more. So on the inventory, you are right that we started production of our to-be commercial product. I don't think we're going to be sharing at this moment what our inventory levels are other than, you know, we're confident that we can supply what we believe will constitute a successful launch.

speaker
Bhavan Patel
Analyst, Bank of America

Great. And then just for a follow-up, maybe if you can elaborate on the mechanics of the e-pharmacy partnership and how that will strengthen the patient journey from prescription to refill. including data capture on script conversion and adherence. Thank you.

speaker
Sean Olson
Chief Commercial Officer

Yeah, absolutely. You know, what we've really seen over the past few years are the growth of people that prefer their medicines to be delivered to their house, just like their Amazon packages. So there's really been this growth in the use of e-pharmacies. What's great about that is, you know, it really creates like a closed system, which is helpful. So, you know, our partner that we're going to be using for our e-pharmacy is already active in the eye care professional space. What that means and why that's important means when we go to, you know, when a doctor goes to enter the scripts into their EMR system, you know, that e-pharmacy should already be loaded up within that computer. So it should be seamless to send it on the e-pharmacy. Once the e-pharmacy actually receives the scripts, you know, they then take over the ownership and relationship of the patient to get them the product. So the e-pharmacy shoots the text to the patient's phone, right? At that point, it's just a link to click in. And from that link, they put in their credit card information and shipping information, and that product starts shipping to their door. Throughout that process also, what's great about it is the opportunity for auto refill, which means in terms of stickiness, right, that product's showing up, you know, every single month to the door. Now, if they didn't select the auto refill, of course, the ePharmacy will also follow up once they're at the end of their first box or second box to follow up and say, hey, now it's time to order again. So it definitely creates a nice closed environment where you have a strong relationship with the consumer. And then one other question which you asked earlier that I think I missed a spot on, you want to make sure the samples go to those high volume prescribers. Because our samples are rep delivered, you know, they're targeting those eye care professionals that we've identified as high decile users of the beauty products. So, you know, our reps are going to those practices which have already shown a high volume of beauty use early on, and therefore, that way the samples are going to the right accounts.

speaker
Conference Call Moderator
Investor Relations

Thanks, guys.

speaker
Operator
Conference Operator

Your next question comes from the line of Igalna Chalmabits with Citi. Please go ahead.

speaker
Igalna Chalmabits
Analyst, Citi

Yeah, hi. Thank you very much. Regarding the marketing plans, can you talk about when you're going to turn on the influencers and not who you're going to get, but kind of when that might happen and on what platforms? And then as far as the commercial model in terms of how you're thinking about the launch, obviously, Vuity got to 6,000 scripts per week, I believe, and then it peaked out. I'm just wondering if you get to that point, would that be breakeven for you? Or would you need to be higher or lower? And how quickly do you think you could get to that 6,000 script high watermark that Beauty got to and then presumably exceed that? Thank you.

speaker
Sean Olson
Chief Commercial Officer

Hi, you all. This is Sean again. Thanks for that. I'll take the first question on the marketing plans and when to turn on the influencers. So when we think of, you know, when we go to market, you know, Immediately upon the August 8th PDUFA date, if approved, the field will go out and start training ECPs. Our main goal ahead of the influencer campaign is to make sure the ECPs are aware of the product and comfortable with it. So that's what we want to make sure is in place before we turn on the influencer campaign. That's important because what we heard about beauty is if you turn on the influencers too quick, the doctors are caught off guard. So I think it's safe to assume Q4 is really a focus on the eye care professionals. What's also great about our product is it's a cash pay product. So we're not beholden to when we have coverage by the PBMs to turn on DTC. So we can turn on faster than other products that are covered by insurance. So, you know, when we start turning on influencer campaigns and really promoting DTC, that's going to happen in early 2026, I would expect. I think by that time, we'll have enough time to meet with the doctors a few times each, make sure they're comfortable with the products before turning on DTC. In terms of channels, you know, we worked a lot on identifying the early adopters and where they spend their time. What we are finding, you know, these people over 45, So they're spending the majority of time on Facebook, Instagram, YouTube, and Pinterest. So those are really going to be the avenue that we focus to drive that awareness. We're not finding that they're spending their time on, like, linear TV, so your standard TV channels.

speaker
Conference Call Moderator
Investor Relations

So timing, early 2026, and channels, Facebook, YouTube, Pinterest, and Instagram. Got it. Got it. Thanks, Sean.

speaker
Abe Schimeltenich
President and Chief Executive Officer

I'll take a question on the modeling. Thanks for dialing in. You'll appreciate that at this stage in the company and pre-launch, we're not guiding on revenue or volume. You know, what we have shared is that ultimately we can see this being a $3 billion plus market. And as we've shared previously in that space, upon 8 million ultimate users in the U.S. alone, using the product five day, five refills a year, at, you know, what would be EOD pricing. So, with that in mind, and, you know, the fact that we're going to be cash flow positive, I think many of the models, including yours, are, you know, actively or probably is giving a sense of when that could happen.

speaker
Conference Call Moderator
Investor Relations

But, again, we're not cutting to what we have in our plans. Okay, got it. Thank you.

speaker
Operator
Conference Operator

Your next question comes from the line of Lachlan Hanbury-Brown with William Blair. Please go ahead.

speaker
Lachlan Hanbury-Brown
Analyst, William Blair

Hey, guys. Thanks for taking the questions. So, Sean, just on the DTC marketing, I mean, you've obviously had, you know, a pretty comprehensive unbranded campaign prior to approval. So I was curious how you think about the transition from that to branded campaigns and DTC. Does that, if DTC starts in early 2026, does the unbranded campaign continue until then, or does it sort of flip over to something else upon approval or availability? And then second, you sort of touched on this a little earlier, but with the sales force expected to all be hired by July 1, and presumably at least some of them will have been through that three-week training, What can they do in terms of the interactions with target ECPs before an approval, if anything? Because I know there are obviously a lot of restrictions around what they can and can't say and do.

speaker
Conference Call Moderator
Investor Relations

So could you just elaborate on what they can do in that, say, five weeks before the BDUFA? Thanks, Lachlan. Great questions.

speaker
Sean Olson
Chief Commercial Officer

Yeah, happy to cover those topics. First thing, when did the unbranded stop? So right now, the unbranded campaign, obviously, it's, you know, a disease state awareness and looking for, you know, what's the ideal solution look like in presbyopia. So our plan is to continue to run that up until potential approval. And then we would sunset that campaign. So it's really, you know, what we can have out there so we can get the excitement going for future solutions in presbyopia. Once we can transition to speaking about the brand, we want to immediately transition to that and make that the focus of all messaging. And so, so what that transition will look like to DTC marketing. So right now in the unbranded campaign, you know, a lot of that's focused on where do doctors spend their time as well as the conventions that they're going to in their publications. When we move over to DTC for the direct to consumer, we'll actually first start with direct to practitioner. So we'll actually bring on branded messaging to the doctors. So we'll just transfer everything we're doing on the unbranded side, flip it over to branded materials directly at the doctors to really drive their awareness and make sure they're comfortable with the product. And then as we transition to then DTC after that in early 2026, the whole game resets in terms of how we target them. Because now that we're targeting a consumer, You know, we're moving off of the platforms where doctors are focused for information back to that, you know, Pinterest, YouTube, Facebook, Instagram. And to do that, you know, we've brought on the right type of media by agencies that have those relationships to make sure that we have hard-hitting, impactful messaging on those platforms. So that's how we're really going to transition to DTC. Now, the sales force, you know, as we shared, over 40% of them have already accepted offers. You know, some of them will be on before July 1st, right? You spoke about the three weeks of training. So what can happen after their training but before approval? So that's, again, where the unbranded campaign comes in. You know, the unbranded campaign is, you know, fair game for Salesforce to talk about. So they can actually start their call cycles. So they can start to meet the eye care professionals, confirm routings, confirm emails, get to know the doctor, just the discussion will be limited to the IAM selective campaign. And then upon approval, they can then immediately switch to the branded calls.

speaker
Conference Call Moderator
Investor Relations

So that's how to think of that transition from hiring until product approved.

speaker
Lachlan Hanbury-Brown
Analyst, William Blair

Okay, thanks. That's useful.

speaker
Operator
Conference Operator

Your next question comes from the line of Gary Nachman with Raymond James. Please go ahead.

speaker
Dennis Resnick
Analyst, Raymond James

Hey guys, this is Dennis Resnick on for Gary Noffman. Thanks for taking our questions and congrats on all the progress. First, could you provide an update on the work you're doing surrounding the additional patent protection for L&D 100? I believe you previously mentioned you had 10 currently under review. Just any additional color on what types of patents they are and your confidence in the overall IT estate? And then can you talk a little bit more about the process that went into selecting the e-pharmacy you're working with? What specifically sets this e-pharmacy apart from others? And just elaborate a little bit more there. And then I've got one follow-up.

speaker
Abe Schimeltenich
President and Chief Executive Officer

Absolutely. Great questions. If you think about the current patent estate, we have seven granted patents that go out to 2039 already. Those fall roughly in two buckets. One around the use of the cycadine to treat presbyopia, so very strong patterns around that. Another suite of up-to-date formulation patterns, and very strong patterns that go out to 2039. And the patterns that are currently on the review, and I'm talking U.S. only here for the moment, that will extend that to at least 2044, in those two categories, as well as use patents in different use cases that we have seen in our product. That's going to be, again, a very broad, very strong patent test date. Just to complete that on the protection side for the product, ahead of that sits, because this is a new chemical entity for the U.S., at least five years of data accessibility upon approval is what we expect to get. And on the back end, because it's a self-paid product, you'll never see your traditional generic switch for a product like this because there's no insurance involved. So there's no insurance pushing the pharmacist to switch a brand over to a generic. That we feel on the back end, and now we're talking 2044 and beyond, will provide a very strong and long-lasting lifecycle for the product.

speaker
Sean Olson
Chief Commercial Officer

And this is Sean for the second question on the process to select an e-pharmacy. So we spent a lot of time making sure we chose the right partner for e-pharmacy. One of the most important criteria is we wanted to make sure we selected an e-pharmacy that already existed within the eye care professional EMR ecosystem. You know, we didn't want to select a pharmacy that's not already established in the eye care offices because obviously that takes work to set up all their EMR systems. So that was a key criteria. Another another key criteria was actually the interface for the consumer with this being consumer products. We want something that was sleek, easy to use and a partner that had good follow up to ensure compliance. So other factors that were behind those two, speed of delivery, ability to handle high volume of actual scripts and other partners, making sure that they work with other reputable partners as well. Not necessarily an eye care, but other high-end pharma companies. What was not in the selection process that's different than many other companies is their ability for prior authorization or insurance claim adjudication. That was not something that we put into the factors as we were involved in evaluating e-pharmacy, given the fact that this is a cash-paid product.

speaker
Dennis Resnick
Analyst, Raymond James

That's super helpful. And then just given there's been some previous rumblings of recession, perhaps consumer sentiment being worse than people had anticipated, If that does end up occurring where there is a recession, how does that kind of change your initial call point, if at all? And then would that cause you to focus on certain geographies over others? Thanks so much, guys, and congrats on all the progress.

speaker
Dan Chevalard
Chief Financial Officer

Yeah, so Dennis, this is Dan Shetlar. I'll start the first part of that question, and I'll pass it to Sean to conclude it. So, you know, the topic of recession is one that we've certainly looked at. And, you know, as you think about relative risks for a product with our profile, we evaluate it medical aesthetics field, beauty category, medical procedures like LASIK, dermatology, and others. And I think reference time points where you could look back to to say, well, gosh, how did those profiles or how did those categories behave? You don't have to go too far back to see how do these categories behave in the COVID era and then prior to that in the global financial crisis era 2007 through 2011. Key takeaways. I think we would be naive to say that we're not immune, but historical precedent really suggests that the medical aesthetics category, and we'll use the neurotoxins and fillers as maybe the closest proxy to what we do, are a bit more insulated from a recession risk than higher price elective procedures, such as cosmetic surgery. So that's one way to look at it. I think that it's fair to say discretionary spend will always potentially be impacted. But I think for a product like ours that impacts quality of life, that has such a large addressable market, and you can even kind of put it into a category like these medical aesthetics from the standpoint of consumerism, you could almost put this into a beauty-like view of this being becoming something that is viewed as an essential, really, which I think could insulate us from significant downside risk. Just to quantify that, you could look at the categories that we're highlighting as the closest proxies, and you get at the high end single-digit negative impacts from a growth perspective at the peak of recession years, but on balance coming through in an extremely strong way.

speaker
Sean Olson
Chief Commercial Officer

And adding on to that in terms of the targets and given what was just shared by Dan, so in terms of if a recession was to happen, you know, our 88-rep field force we believe is right-sized. you know, and it's really focused on 85% of all those beauty scripts. So I wouldn't see that changing. Again, given that minimal potential impact that Dan just highlighted, you know, we're already also focused. When you look at those 88 reps in those territories, we're really focused in calling in those major metropolitan markets, you know, where you're focused on that higher end consumer as well that has, you know, a little bit more resolve in those situations. So I don't see that call point changing.

speaker
Dennis Resnick
Analyst, Raymond James

Super helpful. Thanks, guys.

speaker
Operator
Conference Operator

Your next question comes from the line of Matthew Caulfield from HC Wainwright. Please go ahead.

speaker
Matthew Caulfield
Analyst, HC Wainwright

Hi, guys. Thanks for taking our question. So we were curious with the recent developments in the space regarding others' NDA submission and a product launch. Do you foresee specific scenarios where a prescriber could ultimately suggest an alternative approved iDrop first prior to utilizing LNZ100 pending approval?

speaker
Conference Call Moderator
Investor Relations

Thanks a lot. Great question, Matt. I think Sean and I might tag team a little bit on that.

speaker
Abe Schimeltenich
President and Chief Executive Officer

I think ultimately with these products, it's all around, does it work? Yes or no? Do you achieve as a consumer what you're expecting, which is can you go without your reading glasses? Or at least a very significant part of the thing. We've seen that with beauty, that was not the case. It was a high-dose biotopping. That clearly did not deliver that expectation or on that expectation. Therefore, after our initial good launch, people didn't refill because it didn't work. These are not products that you can get people to say and use it for three months and maybe you notice an effect. It's on the very first day. You either like it or you don't like it. And the liking it sort of comes down to does it work. So it's hard to believe how others currently on the market can achieve that. We'll see. We're very much focused on what we can deliver, and that's where we know, again, if you just look at clinical data, but especially also at the patient feedback, and we share some of that at the commercial day, how they're talking about the product and how they've experienced that, you know, very first drop that went into their lives. And because of that, what you see us do is very heavy sampling, which is different than what I was doing. I'll leave it with that. It's hard to see that you'll step in with one product and then if you don't graduate to something else, sampling is going to be key and people pick the ones that they will like.

speaker
Sean Olson
Chief Commercial Officer

Yeah, just to add on to that minorly. So again, I've been out there at the conferences. I've spoken to the eye care professionals. I've seen the data of the products you're talking about.

speaker
Conference Call Moderator
Investor Relations

And I continue to see this as a category of one. Excellent. Very helpful. And definitely looking forward to the PDUFA. Thanks, guys. Congrats. Thanks, Matt.

speaker
Operator
Conference Operator

That concludes our question and answer session, as I am showing no further questions. Thank you for your participation, and we will now conclude today's conference call. You may now disconnect.

Disclaimer

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