Sight Sciences, Inc.

Hello, and welcome to SightScience's fourth quarter 2022 earnings results. At this time, all participants are in listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask the question during the session, you will need to press star 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 again. I would now like to hand the conference over to Tripp Taylor of Investor Relations. You may begin.

Thank you for participating in today's call. Presenting today are SightSciences co-founder and chief executive officer, Paul Badawi, interim chief financial officer, Jim Rodberg, and head of corporate strategy, Tom Huang. Earlier today, SightSciences released financial results for the three months and full year ended December 31st, 2022. 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 and answers to questions will include forward-looking statements within the meaning of the federal securities laws. Those include statements related to Sitesciences' anticipated financial performance and operating results, market opportunity, the future impact of supply chain disruptions, business strategy, and plans for developing and marketing new products. Forward-looking statements are based on estimates and assumptions as of today, 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 that was 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. I will now turn the call over to Paul.

Thanks, Tripp. In our first full year as a public company, we made great strides fulfilling our mission to improve the lives of patients with glaucoma and dry eye. We are grateful for the trust and partnership our customers, physicians, and patients have placed in us. In 2022, we grew total revenue by 46% to $71.3 million and executed our commercial and operational initiatives to further solidify our position as the innovation and efficacy leader in MIGS and DryEye. We exercised rigorous financial discipline to rationalize operating expenses and reduce burn as planned in the third quarter, which bolsters our belief that our $185 million cash balance at the end of 2022 is sufficient to support our growth plans and achieve cash flow breakeven in 2025 with a substantial cash cushion. On the commercial front, we continue to propel market penetration and expansion with both the Omni surgical system and tear care system. expand our current addressable markets with the successful launch of Scion, our innovative bladeless goniotomy technology, and advance our efforts to establish fair market access and reimbursement for our dry eye treatment technology. We also announced several publications providing clinical support for broadening the use case for our core products and made great progress with our ongoing clinical trial programs. Our fourth quarter results exhibited strong sustained revenue growth and meaningful impact from our cost rationalization program. Our fourth quarter total revenue increased to 20.5 million, up 40% compared to the fourth quarter of 2021. Notably, we grew revenue 10% sequentially while decreasing both quarterly cash burn by 27% or 5.5 million and quarterly OpEx by 10% or 3.7 million versus the third quarter. Surgical glaucoma revenue was 18.8 million in Q4 2022, growing 35% year-over-year and 10% compared to Q3. And dry eye revenue was 1.8 million, growing 135% year-over-year and 12% compared to Q3. I will now discuss the progress and strategic focus for our business units, starting with surgical glaucoma. Our growth metrics demonstrate further adoption and utilization of our Omni and Scion technologies as surgeons continue to embrace the new minimally invasive glaucoma surgery techniques enabled by these important innovations. As a reminder, our core mission in surgical glaucoma is to provide surgeons with the best solutions for their patients, regardless of severity of disease or lens status. We continue to advance our growth initiatives, which include, one, expanding the large and growing moderate to advanced combination cataract segment and the considerably larger standalone MIG segment with Omni's differentiated efficacy profile. Two, driving adoption and utilization of Scion among specific subsets of surgeons who choose a more basic procedure. And three, increasing our total share of MIGs with our Omni and Scion technologies. Our growth has significantly outpaced the overall MIGS market. We are taking share in combination cataract procedures and expanding MIGS beyond its narrow legacy confines. We believe Omni is the only technology that offers the efficacy, functionality, and clinical results to support long-term market expansion and penetration of the entire six-plus billion MIGS market opportunity, as evidenced by our growing penetration and sticky customer base. We continue to see a natural progression of surgeons who first learned to use Omni technology in combination with cataract for patients with less severe POAG, then expand their use cases to patients with more severe POAG and to standalone use in patients that do not require cataract surgery. In the fourth quarter, we maintained a greater than 99% developed customer retention rate for Omni, while growing active accounts by 24% since the end of 2021. Among accounts who placed Omni orders in both the fourth quarter of 2022 and the fourth quarter of 2021, Omni utilization increased 28%. We believe we are both increasing our market share in legacy combination cataract and expanding the market beyond legacy combination cataract procedures and towards standalone procedures. These market expansion opportunities are substantial and very sticky for our Omni technology due to its proven degree and consistency of efficacy. These important long-term efficacy-minded customers are among the most attractive in MIGS. To accelerate adoption and facilitate broader patient access, we have created a comprehensive program that includes targeted field resources, patient and physician education, and programs focused on improving patient access to these new combination cataract and standalone procedures made possible by our Omni technology. As part of this program, our team is actively educating the glaucoma community on our new real-world data recently published in International Ophthalmology from TRAE, our multicenter study that evaluated the safety and efficacy of OMNI in patients with uncontrolled IOP despite a history of trabecular bypass stent implantation at the time of cataract surgery. TRAE highlighted that significant intraocular pressure reductions were achieved with a standalone OMNI technology intervention and patients who already had stent implanted at the time of cataract surgery. This study suggests OMNI could be a natural fit for standalone interventions for the over 1 million patients who have undergone combination cataract stent implantations. Here is an example of what we are regularly seeing in the real world. One recent case at a prestigious West Coast medical school involved a patient with low 20s IOP on three medications after combo cataract stent implantation. Standalone intervention with our Omni technology decreases patients' IOP to 14 millimeters mercury on just one medication after six months. Needless to say, the patient and surgeon were very happy to avoid an invasive conventional surgery. This is just one example of the type of results that we believe Omni can consistently deliver. To further demonstrate our market-leading efficacy, we have partnered with the data and technology provider, Verana Health. Our partnership leverages the American Academy of Ophthalmology's IRIS registry of real-world data to analyze post-surgical outcomes for the leading mixed technologies in the U.S., including Omni, iStent, and Hydrus. The first phase of the study analyzes IOP and medication reduction in 77,391 patients out to two years. This is the largest collection of MIGS data ever studied and offers compelling real-world evidence that we believe will demonstrate the clinical superiority of our Omni technology. We plan to present and publish these groundbreaking study results, including comparative IOP and medication reduction outcomes at the one- and two-year marks, at multiple medical meetings, and in peer-reviewed literature throughout 2023. We believe our four other ongoing and planned studies will further corroborate the results of Trey and IRIS in both combination cataract and standalone settings to further propel our share-taking and market expansion progress. Surgeon feedback from our clinical trials and real-world usage informs our innovation. We seek to continually improve clinical outcomes by improving functionality and usability, innovating creatively, and raising the technological bar within MIGS. Earlier this month, we announced the launch of our newest Omni technology called the Ergo Series at the recent American Glaucoma Society meeting. As with our other technologies, the Ergo Series incorporates direct input from many of our customers and was designed entirely in-house. We're very pleased with the enthusiastic reception it has received thus far, and the feedback confirms that our continuous enhancements to usability are key reasons surgeons love Omni and choose it as their preferred mix technology. The ergo series technology sets a new standard in circumferential glaucoma surgery, and it's just the latest in our long line of best-in-class technologies. This brings us to our newest product, the Scion surgical instrument, the world's first bladeless goniotomy technology. We designed Scion to allow surgeons to smoothly, efficiently, and reliably excise and remove several clock hours of diseased trabecular meshwork tissue via an ab interno approach. Scion is an ideal solution for a subset of patients prioritizing a simpler goniotomy procedure, complementing our Omni technology's broad indication for use and leading efficacy. The fourth quarter with our commercial team's first full quarter offering Scion following its limited launch in August of 2022. Surgeon feedback on the instrument continues to be extremely positive, particularly around procedural smoothness, a less traumatic goniotomy, and improved ease of use. The ideal customers for Scion fall outside of Omni's optimal product market fit, and we have observed minimal overlap in our analysis of early ordering patterns for Scion customers. In addition to adding completely new accounts and reviving dormant accounts, we saw significant uplift in accounts that use both Omni and Scion technologies. Among accounts that ordered Omni in the fourth quarter of 2021 and both Omni and Scion in the fourth quarter of 2022, average revenue per facility increased by 32%. Encouragingly, we saw utilization of our Omni technology increase 12% in these accounts, even as they added Scion to their armamentarium. Our portfolio approach has already increased revenue per account. We also continue to make progress bringing Omni technology to international markets. We launched direct operations in Germany, our second direct OUS market, in January of this year. Germany, along with the UK, our first direct OUS market, are two of the largest MIG markets in the world. We've begun laying the groundwork in several other OUS markets and plan to proceed as prudently and aggressively as market access, regulatory, and commercial conditions permit. We couldn't be more excited to deliver the power of sight to improve patients' lives around the world. Transitioning now to our dry eye business, where we continue to focus on establishing fair market access and reimbursement for dry eye treatment procedures. Our success introducing TierCare to over 1,000 accounts, including over 400 new accounts in 2022, spotlights the pent-up demand for effective dry eye treatments, especially interventional eyelid procedures. Note that we accomplished the 1,000-account milestone while still in a controlled launch, deploying only 20 sales representatives. Given the 14 million diagnosed evaporative dry eye sufferers in the U.S. and the growing prevalence of the disease, we believe the lack of fair market access to reimbursed effective dry eye treatments is one of the greatest problems and opportunities in eye care today. We have built a foundation from which tear care can scale rapidly. Adding just one single additional treatment per week for our existing customer base would quadruple the size of our dry eye revenues. So it is very easy to appreciate just how big this market can become with appropriate reimbursement. Pioneering fair market access will require strong payer-centric clinical data to demonstrate TierCare's health benefits to patients and economic benefits to insurers. We custom-tailored our Sahara RCT with extensive input from medical directors at eight different payers to understand and form the clinical foundation required to successfully support reimbursement coverage for tear care. After completing enrollment of Sahara in the third quarter of 2022, we remain on track to provide the initial six-month data readout by the second half of 2023. As a reminder, This six-month endpoint is powered to evaluate the superiority of care care treatments versus the leading multibillion-dollar dry eye prescription eye drop, Restasis. With over 300 subjects, we believe Sahara is the largest dry eye device study ever and the first to attempt to demonstrate the superiority of a device versus the most successful daily prescription eye drop. The six-month study period designed to allow Restasis to achieve maximum efficacy also covers a much longer study period than the one to three month endpoints typical in other dry eye studies. Sahara is in all respects a very ambitious study, but one that is also very worthwhile given the unmet need that we are seeking to address. In summary, we drove significant growth with all three of our category leading products and made substantial progress expanding our opportunities in MIGS and dry eye. We remain dedicated to increasing physician adoption and utilization across our portfolio and increasing the number of customers and patients we serve. Looking ahead, we are focused on leveraging our procedure productive field team and increasing body of clinical evidence to train new customers and broaden use cases with each of our products, with the ultimate goal of generating sustainable growth while continually improving operating efficiency and maintaining strict financial discipline. With these factors in mind, we are providing revenue guidance for 2023 of $89 million to $94 million. We expect 2023 to exhibit similar seasonal impacts and quarterly revenue distribution that we saw in 2022, with the first quarter stepping down sequentially versus the last quarter of 2022, then increasing as the year progresses. we expect first quarter revenue to comprise 20% to 21% of the midpoint of our 2023 guidance, consistent with the first quarter of 2022. As it relates to operating expense, we continue to believe our reduced quarterly cash op-ex of approximately $30.5 million is an appropriate level of spend to meet our growth plan for the year. Before I turn the call over to Jim Rodberg, our interim CFO, to detail the fourth quarter financial results, I'd like to thank Jim and his team for stepping up and doing an absolutely phenomenal job. Jim?