Glaukos Corporation

Hello and welcome to Glaucus Corporation's second quarter 2026 financial results conference call. Copies of the company's press release and quarterly summary document, both issued after the market closed today, are available at www.glaucus.com. After today's prepared remarks, we will host a question and answer session. If you would like to ask a question, please press star 1 to raise your hand. To withdraw your question, press star 1 again. This call is being recorded and an archived replay will be available online in the investor relations section at www.glaucus.com. I will now turn the call over to Chris Lewis, Vice President of Investor Relations and Corporate Affairs.

Thank you and good afternoon. Joining me today are Glaucus Chairman and CEO Tom Burns, President and COO Joe Gilliam, and CFO Alex Thurman. Similar to prior quarters, the company has posted a document on its investor relations website under the financials and filings quarterly results section, title quarterly summary. This document is designed to be read by investors before the regularly scheduled quarterly conference call. To ensure ample time and opportunity to address everyone's questions, We request that you limit yourself to only one question. Please note this is a change versus our previous calls. If you still have additional questions, you may get back into the queue. Please note that all statements other than statements of historical facts made on this call that address activities, events, or developments we expect, believe, or anticipate will or may occur in the future forward-looking statements. These include statements about our plans, objectives, strategies, and prospects regarding, among other things, our sales, products, pipeline technologies and clinical trials, U.S. and international commercialization, market development efforts, product approvals, the efficacy of our current and future products, competitive market position, regulatory strategies and reimbursement for our products, financial condition, and results of operations, as well as the expected impact of general macroeconomic conditions and others. These statements are based on current expectations about future events affecting us and are subject to risks, uncertainties, and factors relating to our operations and business environment, all of which are difficult to predict and many of which are beyond our control. Therefore, they may cause our actual results to differ materially from those expressed or implied by forward-looking statements. Please review today's press release and our recent SEC filings for more information about these risk factors. You'll find these documents in the investor section of our website at www.glaucos.com. Finally, please note that during today's call, we will also discuss certain non-GAAP financial measures, including results on an adjusted basis. We believe these financial measures can facilitate a more complete analysis and greater transparency into Glaucos' ongoing results of operations, particularly when comparing underlying results from period to period. Please refer to the tables on earnings press release available in the investor relations section of our website for a reconciliation of these measures for their most directly comparable GAAP financial measure. With that, I will turn the call over to Glockos Chairman and CEO, Tom Burns.

Okay, thank you, Chris. Good afternoon, and thank you all for joining us today. Today, Glockos reported record second quarter consolidated net sales of $185.6 million. up 50% on a reported basis and 49% on a constant currency basis versus the year ago quarter. As a result of our second quarter outperformance, we are raising our full year 2026 net sales guidance to 680 to 700 million, an increase of 60 to 65 million over our prior guidance of 620 to 635 million. Our second quarter results reflect strong performance across our global commercial and development priorities, underscoring the successful execution of our teams, the strength of our differentiated technology platforms, and our continued evolution as an increasingly diversified leader in ophthalmology. Looking ahead, we believe we are well positioned to sustain this momentum, driven by two transformational growth drivers. including the further advancement of the interventional glaucoma treatment paradigm with iDoseTR and the launch of Epioxa, establishing a new standard in interventional keratoconus and rare diseases. Together, these compelling and durable market opportunities reinforce our confidence in our ability to deliver a best-in-class growth and margin profile long into the next decade. At the same time, we continue to invest strategically across our industry-leading pipeline and commercial infrastructure while maintaining a focus on disciplined capital allocation to support sustained operating leverage and cash flow. While our priority remains to maximize near and long-term growth, we were pleased with our progress across our P&L in the second quarter. Now let's discuss our second quarter results in more detail. Within our U.S. glaucoma franchise, we delivered record second quarter net sales of 118.5 million on strong year-over-year growth of 64% driven by growing contributions from IDOS-TR, which generated sales of approximately 74 million in the second quarter. IDOS-TR continues to deliver strong clinical outcomes that meaningfully improve patients' lives, resulting in strong physician interest and adoption while helping to accelerate a broader treatment paradigm shift towards earlier interventional glaucoma care. From an execution standpoint, we remain focused on our key initiatives, including expanding our base of trained surgeons and active accounts, increasing utilization, broadening market access, scaling targeted commercial investments, and expanding the robust and growing body of clinical evidence, which now includes 24 peer review publications, complimented by a broad portfolio of active phase four studies across diverse real-world clinical settings, further enforcing and reinforcing its consistent performance in real-world practice. Earlier this month, CMS issued its proposed rules for 2027, which as drafted, largely maintained the 2026 APC assignments associated facility payments, and relative physician fee rates associated with our procedures across both the hospital outpatient and ASC settings. Additionally, as many of you know, during the quarter, five of the seven Medicare administrative contractors issued proposed local coverage determinations for IDOS-TR. We were encouraged by the overwhelming support from physicians, Medical Societies, and other stakeholders throughout the open meetings and public comment period, validating the meaningful clinical value that IDOS-TR is delivering to patients. We continue to believe that the strength of IDOS-TR's clinical evidence, real-world outcomes, and broad stakeholder advocacy support appropriate Medicare coverage that preserves physician decision-making and patient access. Moving on. Our international glaucoma franchise delivered record net sales of 36.6 million on year-over-year growth of 17% on a reported basis and 16% on a constant currency basis. The strong growth was once again broad-based as we continue to scale our international infrastructure and execute our plans to drive NAICS forward as a standard of care in each region and major market in the world. As previously discussed, we continue to expect new competitive product trialing headwinds in some of our major international markets as we progress through 2026, partially offset by growing contributions from iStent Infinite following its EU NDR certification and associated European commercial launches late last year. We also expect the currency tailwinds to abate going forward based on the current rate environment. And finally, our corneal health franchise delivered net sales of 30.4 million on year-over-year growth of 48%, including Epioxa net sales of approximately 11 million. Turning to Epioxa, we remain very encouraged by the early progress of our commercial launch. As the first and only FDA-approved epithelium on corneal cross-planting therapy for keratoconus, Epioxa has been met with strong interest from surgeons and the broader ophthalmic community. reinforcing our confidence in its potential to redefine the treatment paradigm for this rare, sight-threatening disease that is currently far too often undiagnosed and untreated. Our launch priorities remain centered on expanding patient access, building awareness, optimizing referral networks, and driving earlier diagnosis. We continue to make meaningful progress across each of these areas, including the ongoing expansion of our site of care network establishing broad market access and the implementation of our specialty pharma infrastructure and robust patient support programs. First, I'm proud to report that we've successfully established and continue to selectively expand a broad reaching site of care network. Our acquired O2N systems are already actively deployed across locations serving roughly 85% of the US population. With the pipeline progressing through various approval processes that we expect will expand our treatment center reach to approximately 95%. Next, we continue to make considerable progress with payers to secure access pathways for policy coverage for Epioxa. With access pathways now established for more than 125 million covered commercial lives in the United States. including with the five largest payers reflecting encouraging initial receptivity of Epiox's clinical value. While we expect the pace of policy adoption to build over time, we remain focused on driving broader coverage across both commercial payers and Medicaid programs to support more streamlined access pathways over time. As anticipated, Epioxa's new product-specific J-code, J2789, became effective on July 1, 2026. While we expect it will take some time for this to be solidified operationally by providers and our specialty pharma partner, we believe this now effective code will help streamline the reporting and reimbursement processes for Epioxa among U.S. payers over time. The on-market access, we're proud to lead the way once again in forging a new path for interventional care at CONUS by advancing targeted marketing and DTC initiatives to drive awareness, education, and earlier detection supported by greater optometric engagement and strengthened advocacy partnerships. Finally, we've launched a co-pay assistance program for eligible patients. While we remain in the early stages of the launch, we're encouraged by the solid progress we're making against our core launch priorities and remain very excited by the significant potential Epioxa offers to patients living with keratoconus. Beyond Epioxa, we continue to advance abroad and differentiate clinical pipeline across our five novel therapeutic platforms, encompassing 13 publicly-disposed programs and additional undisclosed assets supported by a robust portfolio of active clinical and phase four studies. Within our IDOS platform, we are advancing a phase 2B3 clinical program for IDOS T-Rex, our next generation IDOS therapy and patient follow up in a phase 3B study for IDOS Trio with a targeted FDA approval by the end of 2027. We also continue to advance various additional phase four studies. Within our iLink platform, we remain on track for our planned commercial introduction of our KC screening device later this year and are preparing to commence a phase three clinical program for our third generation customized topographically guided iLink therapy in 2027. Within our iStent surgical glaucoma platform, We are advancing a PMA pivotal trial for ISEN infinite and mild to moderate glaucoma patients and recently completed patient enrollment in our 510k pivotal study for the presser flow microshot. Within our ILLUTION platform, we recently completed patient enrollment in a phase two study for demodex blepharitis and expect to have top line results in hand by the end of this year. Finally, within our retinal platform. We're advancing a first in human clinical development program for GLK401, our intravitreal multi-kinase inhibitor retinal program in wet AMD patients. We believe that each of these novel differentiated platforms have the potential to generate transformative therapies that significantly improve the existing treatment paradigms for patients suffering from chronic eye diseases. So in conclusion, at Globcos, we're in the business of pioneering new marketplaces within ophthalmology. Our record second quarter performance highlights the strength of our strategy and execution as we continue evolving into an increasingly diversified ophthalmic leader with multiple transformational growth drivers in Eidos TR and Epioxa as we advance our mission to transform vision therapies for the benefits of patients worldwide. So with that, I'll open the call open for questions. Operator.