Sight Sciences, Inc.

Good day, ladies and gentlemen, and welcome to the Sight Sciences fourth quarter and full year 2021 financial results conference call. At this time, all participants are in a listen-only mode. Later, we will conduct a question and answer session, and instructions will follow at that time. If anyone should require operator's assistance, please press star, then the zero key on your touchtone telephone. As a reminder, this call is being recorded. I would now like to introduce your host for today's conference, Philip Taylor. You may begin.

Thank you for participating in today's call. Presenting today are Site Sciences co-founder and chief executive officer, Paul Bedawi, chief financial officer, Jesse Selnick, and chief commercial officer, Sean O'Neill. Earlier today, Site Sciences released financial results for the three months and 12 months ended December 31st, 2021. A copy of the press release is available on the company's website at investors.sitesciences.com. I would like to remind everyone that comments made by management today in answers to questions will include forward-looking statements within the meaning of the federal securities laws. Those include statements related to SiteScience's anticipated financial performance and operating results, market opportunity, the future impact of COVID-19 on operations, business strategy, and plans for developing and marketing new products. Forward-looking statements are based on estimates and assumptions as of today and are neither promises nor guarantees and are subject to risks and uncertainties that may cause actual results to differ materially from those expressed or implied by these statements. A description of some of the risks and uncertainties that could cause actual results to differ materially from those indicated by the forward-looking statements on this call can be found in the risk factors section of the annual report on Form 10-K filed today and other filings with the Securities and Exchange Commission. The company undertakes no obligation to publicly update or revise any forward-looking statements except as required by law. For more information, please refer to the forward-looking statement notices and risk factors in the recent SEC filings. I will now turn the call over to Paul.

Thanks, Tripp, and thank you all for joining us today. I'm very excited to provide an update on our business and the progress we have made delivering the power of sites. I will touch on the accomplishments that made 2021 a huge success and how we are positioning site sciences for continued success going forward, including an introduction to some of the exciting new products we are developing. Omni and TierCare are well on their way to becoming breakthrough products, yet we have never stopped innovating. We are employing our rigorous product development process to develop a portfolio of new products that will enable us to serve an even broader array of patients, suffering from glaucoma and dry eye disease. These programs, which we anticipate will include controlled product releases and launches this year, will help us drive organic growth for the next decade and beyond. But first, I'd like to start by reviewing our strong performance in the fourth quarter. Our total revenue increased to $14.7 million, representing growth of 63% compared to the fourth quarter of 2020, and 12% growth compared to the third quarter of 2021. Despite headwinds from resurgent COVID disruptions and shifting reimbursement dynamics, we delivered meaningful sequential growth in the fourth quarter, driven by continued new customer wins and higher utilization in our surgical glaucoma segment, which grew 12% sequentially and 60% year-over-year to 13.9 million. As others across our industry have discussed, we experienced a similar slowdown in activity in mid-December due to Omicron and the holidays that dampened what could have been an even more exceptional quarter. Fundamentally, our four principles position us to succeed and underpin the growth of our business. Our efforts are always focused on the needs of patients and protecting and enhancing mankind's most precious sense, sight. We have continued to propel our three strategic initiatives that we believe will unlock the full potential of omni and tear care and drive our growth over the near and medium term. Number one, our first initiative aims to increase the number of surgeons using omni. MIGS-trained surgeons who are already performing combination cataract procedures comprise our most fertile target segment. The bulk of our surgical glaucoma sales team consists of territory-based reps who sell omni to facilities and trained surgeons. We also have a strategic accounts team that focuses on selling to and training surgeons at teaching institutions and government hospitals. These teams have delivered exceptional results converting surgeons to Omni, and we are modestly increasing our investment in these groups in 2022. We believe Omni's strong safety profile, intuitive usability, and demonstrated efficacy in reducing IOP and medication usage have helped us penetrate the combination cataract segment and gain share. despite intense competition from legacy implant-based procedures. Only Omni allows surgeons to treat all three points of resistance within the conventional outflow pathway using a single device to perform two sequential procedures in a single surgical setting. According to MarketScope, there are over 5,600 surgeons performing mixed procedures in the U.S. We've trained approximately 1,500 of these surgeons, so we still have a lot of work to reach our full potential. In the fourth quarter of 2021, over 750 facilities ordered omni surgical systems, with over one-third of these representing new omni facilities. We continue to see increased utilization as our facilities-based tenure increases. Based on the increasing number of ordering facilities and their utilization, we believe we are continuing to take share in combination cataract procedures. Our reps typically train surgeons in combination cataract cases, because they already have cataract patients who also have primary open-angle glaucoma on their operating room schedules. Once a surgeon is proficient with OMNI in the combination cataract setting, they are positioned to perform standalone OMNI cases as well. These surgeons have built their practices around a robust practitioner network for cataract patients. To expand their practices to include interventions in the $5 billion U.S. standalone glaucoma segment, Our customers will require a similar practitioner network for POAG patients. Number two, our second initiative focuses on educating these POAG practitioner networks to better understand when glaucoma patients may benefit from standalone procedures performed by OMNI trained surgeons. We are in the early stages of educating the broader POAG community, including primary eye care professionals and patients, regarding the possibility and potential benefits of early intervention with OMNI. We believe Omni, due to its indication for use, safety, high degree of efficacy, and high consistency of efficacy, has the ideal product market fit for standalone interventions. Our clinical trials have demonstrated that Omni can safely and reliably reduce IOP and medication burden. Primary eye care professionals are the first to diagnose and treat POAG patients. Currently, if a POAG patient does not require cataract surgery, the treatment algorithm relies on increasing use of topical eyedrop medication to slow the progression of the disease, with the goal of staving off conventional surgical procedures for as long as possible. These highly invasive surgeries are effective at reducing IOP, but carry a high risk of complications and side effects, and are typically only attempted by glaucoma specialists. Our mission is to let the glaucoma community know that an earlier intervention performed by a local, omni-trained surgeon could be a better alternative than prescribing a second or third eye drop. To this end, we're fielding a dedicated team of glaucoma clinical consultants that will deliver our message to the tens of thousands of office-based primary care optometrists and ophthalmologists who treat POAG patients with medications. We have strategically placed our GCCs in territories that have multiple qualified omni-trained surgeons with strong comprehensive practices or established practitioner networks. Our market research indicates that 85% of glaucoma patients would likely choose an intervention using Omni if it was recommended by their doctor. We expanded our GCC field team from a beta launch of four last year to 20 in the first quarter of 2022. Eventually, we believe each of our traditional territories could benefit from one or more GCCs, building relationships in the broader glaucoma and provider community. We are supplementing these field efforts with our Don't Wait for Too Late educational campaign that emphasizes the value of early MIGS intervention and with patient education and outreach materials available in doctors' offices and online. We believe the commercial impact from our standalone market development efforts will be evident in the back half of this year. Number three, our third key strategic initiative, involves developing the market for effective dry eye treatment procedures. We achieved a major milestone in December when TierCare received FDA clearance for an expanded label for the application of localized heat therapy in adult patients with evaporative dry eye disease due to meibomian gland dysfunction, when used in conjunction with manual expression of the meibomian glands. MGD is the leading cause of dry eye disease. This clearance was supported by data from our Olympia RCT, which demonstrated clinically significant improvements in all signs and symptoms of dry eye disease. This expanded label allows our commercial team to communicate the benefits of TierCare more completely. Our reps have already reported increased customer receptivity in the field. Improving reimbursed patient access to TierCare is our ultimate goal. Our Sahara clinical trial was developed with input from eight payer medical directors from eight different major insurance companies. to provide the specific data they would require to reimburse tier care procedures. We expect to complete enrollment in Sahara later this year. As a reminder, Sahara aims to demonstrate the superiority of tier care treatments compared to the market-leading prescription eye drop, Restasis, at six months. We hope to be able to report back on this key superiority endpoint by the middle of next year. We are very pleased with the progress we have made advancing these initiatives, which we believe will create tremendous value. We are also making investments in other areas that will contribute to our growth in the coming years. Outside the U.S., we have established a direct selling effort in the U.K. and have seen substantial traction in Germany. Both of these markets are progressing nicely. We plan to expand our presence in Europe and other geographies. We spent a lot of time discussing changes to reimbursement over the past nine months, so I'll be very brief in my remarks now. In summary, surgeon and ASC reimbursement for OMNI are both in better positions relative to implantable procedures in 2022 than 2021. With our professional and facility reimbursement levels recently revalued and fully stabilized under broad and dependable Category 1 CPT coding, We look forward to devoting more time discussing fundamental patient-focused drivers of our business going forward. We know the investor and glaucoma communities also have questions regarding some of the newer entrants to canal surgery. Our recently published March 2022 investor presentation includes a comparison of the clinical history of canaloplasty, trabeculotomy or goniotomy, and the newer, less understood procedures enabled by some of these tools. We continue to make significant investments in our expansive clinical trial program, which includes 10 ongoing and planned trials. We just announced the first patient treatment in our Trident European study, and we'll soon begin enrolling patients in our U.S. Precision IDE trial. These twin 459-patient, 24-month head-to-head RCTs will compare three arms. One, canaloplasty alone using OMNI. Two, canaloplasty followed by trabeculotomy using OMNI. And three, the leading trabecular bypass implant. Because of the label limitations of trabecular bypass stents in the U.S., Precision will study combination cataract procedures, while Trident in Europe will examine standalone procedures. As a reminder, OMNI's current label calls for canaloplasty followed by trabeculotomy, the second arm of these studies. We hope to use the results of these studies, if successful, to expand the indication for OMNI to include usage for canaloplasty alone, which may provide surgeons with another valuable on-label surgical option to titrate treatment for their patients with POAG. Unlike recent entrance into angle-based procedures, we sought and received FDA clearance for an IDE to study canaloplasty alone. We believe that FDA clearance for an expanded canaloplasty alone label could further differentiate Omni from the competition. As the market leader in canal surgery, we're executing our canaloplasty alone IDE the right way from the start by demonstrating, if successful, clinical efficacy and safety, securing our desired label from the FDA, and putting our patients' needs first. We believe this is the only way to build the canaloplasty category for meaningful long-term value and unshakable leadership. Due to their large study populations and two-year endpoints, final data for Trident and Precision will be available in three years. In the meantime, we are preparing numerous other articles for publication, including one based on the results of our multicenter TRACE study that examines the safety and efficacy of standalone omni procedures in POA GIs with uncontrolled IOP and a previous history of combination cataract surgery with trabecular bypass implants. Trey will examine the potential benefits of OMNI interventions in the over 1 million now pseudophagic trabecular micro-bypassed dentites that may require further treatment, as well as the general standalone population. Our publication plan in peer-reviewed journals includes numerous articles based on data from our clinical trials. Earlier this week, Clinical Ophthalmology published an article that reported 12-month outcomes for OMNI canaloplasty followed by trabeculotomy, in conjunction with cataract surgery in a population of adult Hispanic patients with mild to moderate open-angle glaucoma. The article reported a reduction in unmedicated mean IOP of 35% and a 93% reduction in average medications. Adverse events were mild, self-limiting, and typical of MIGs combined with cataract surgery. We're very pleased with these outstanding results. In parallel with our clinical efforts, We have also made a push to expand our presence at key industry conferences, such as the American Glaucoma Society meeting earlier this month and the upcoming ASCRS meeting at the end of April. We plan to expand our presence at ophthalmologists and optometrists meetings to help educate the eye care community about the benefits of our products and our company's mission. Our desire to improve the lives of all patients with glaucoma and dry eye disease drives our innovations. We are developing a broad portfolio in both categories, and our goal is to offer market-leading treatment options along every step of a patient's journey living with these incurable, lifelong diseases. To do so, we will be expanding beyond devices into pharma, drug-device combinations, and sustained-release pharmaceuticals. We recognize that medications can be an effective first-line glaucoma treatment if administered properly. We believe that sustained delivery of hypotensive medications is a very promising area to innovate and have filed IP on a product that we believe could have a superior product market fit in terms of ease of application, efficacy, and safety compared to existing and announced competing products. Our early results in animal testing have been promising, and we are very excited to continue developing this product, and we'll share more in due course. As the patient advances beyond medications and requires microinvasive glaucoma surgery, where we have Omni today, we are pleased to announce our plans to introduce two new MIGS products in the coming year, and that we have two more in earlier stages of development. Ultimately, we would have four surgical devices that would represent five distinct procedures, representing the broadest and most compelling product portfolio in the MIGS category. First, We have continued to innovate our flagship Omni product and plan to launch the third generation of the Omni device that will feature numerous design improvements. We expect a controlled release in the second half of this year and a full launch in 2023. We will continue to improve and update Omni on a regular basis to ensure its continued leadership position in microinvasive canal surgery. If our IDE is successful, we believe the clinical data would serve as a strong basis for us to seek FDA clearance of an expanded indication covering canaloplasty alone. Second, while we believe OMNI's ability to circumferentially treat all three points of resistance in the conventional outflow pathway cannot be surpassed, and the market is increasingly recognizing canaloplasty as the foundational procedure of MIGS, we do recognize that there is interest in the market for various types of procedures. To that end, we will be introducing a dedicated and differentiated, ab internotrabeculotomy or goniotomy device in the second half of the year. Third, moving beyond our third-generation Omni device and the goniotomy device that we intend to release this year, we also resume development of our implantable canalicular scaffold. The ultimate goal of this development program is to improve the long-term efficacy of canalicular implants and scaffolds by adding new innovations for which we have already filed IP. Fourth, And last but not least, we are also developing an implantable solution for advanced or refractory glaucoma. We believe this product would be appropriate for patients whose conventional outflow pathway options have been exhausted. In summary, we believe that circumferential canal surgery is quickly becoming the foundational procedure in MIGS, both on a standalone basis and in combination with other MIGS procedures. We are the first mover in microinvasive canal surgery and intend to keep the lead with our third-generation Omni release later this year. We are also in the process of developing an incredible portfolio of products around Omni that would offer our surgeons a complete armamentarium and a full expansion of the customer-company relationship with Site Sciences. We're also innovating in dry eye. As with Omni, we'll continue to update and improve our flagship tear care system, We have a next-generation tear care system in development that will include several new features, such as an improved tablet-based user interface and further enhancements to our smart lids. We plan to introduce this product in 2023. Longer term, we are also working on several products that will help patients suffering from MGD to maintain healthy meibomian glands between office-based tear care treatments. These include OTC eye drops, a prescription ointment applied to the eyelids for MGD, and an at-home consumer version of TierCare. We believe this dry eye portfolio will offer physicians and the 14 million patients diagnosed with MGD a comprehensive range of solutions to combat dry eye. We plan to schedule an investor day or analyst day or both to discuss these pipeline products in greater detail later this year. I will now turn the call over to Jesse to discuss our fourth quarter financial results and our outlook for 2022.