Hyperion DeFi, Inc. (HYPD) Q2 2020 Earnings Report, Transcript and Summary

Ladies and gentlemen, thank you for standing by. And welcome to the Eyenovia Second Quarter 2020 Earnings Call. [Operator Instructions] Please be advised that today’s conference is being recorded. [Operator Instructions] I will now hand the conference over to your speaker today, Alex Lobo. Please go ahead.

Good afternoon, and welcome to Eyenovia's second quarter 2020 earnings conference call and audio webcast. With me today are Dr. Sean Ianchulev, Eyenovia's Chief Executive Officer and Chief Medical Officer; John Gandolfo, Eyenovia's Chief Financial Officer; and Michael Rowe, Eyenovia's Vice President of Commercial. Earlier this afternoon, Eyenovia issued a press release announcing financial results for the three months ended June 30, 2020. We encourage everyone to read today's press release, as well as Eyenovia's quarterly report on Form 10-Q for the second quarter of 2020, which will be filed with the SEC. The company's press release and quarterly report will also be available on Eyenovia's website at eyenovia.com. In addition, this conference call is being webcast through the company's website, and will be archived there for future reference. Please note that on today's call, we will be discussing investigational products, which have yet to receive FDA approval. Please also note that certain information discussed on the call today is covered under the Safe Harbor provisions of the Private Securities Litigation Reform Act. We caution listeners that during this call, Eyenovia's management will be making forward-looking statements. Actual results could differ materially from those stated or implied by these forward-looking statements due to risk and uncertainties associated with the company's business. These forward-looking statements are subject to a number of risks, including risks related to impacts of uncertainty related to COVID-19, fluctuations in our financial results, particularly given market conditions and the potential economic impact of COVID-19, our need to raise additional money to fund our operations for at least the next 12 months as a going concern, risks of our clinical trials, including but not limited to, the cost, design, initiation, and enrollment, which could continue to be adversely impacted by COVID-19 and resulting social distancing, timing, progress, and results of such trial trials, the potential impacts of COVID-19 on our supply chain, the timing and our ability to submit applications for, obtain, and maintain regulatory approvals for our product candidates, the potential advantages of our product candidates, our estimates regarding the potential market opportunity for our product candidates, the rate and degree of market acceptance and clinical utility of our product candidates, our ability to timely develop and implement anticipated manufacturing, commercialization, and marketing capabilities and strategies for existing product candidates, our ability to attract and retain key personnel, intellectual property risks, and others detailed in and qualified by the cautionary statements contained in Eyenovia's press release and SEC filings, including its most recent annual report on Form 10-K and subsequent filings. This conference call contains time sensitive information that is accurate only as of the date of this live broadcast, August 12, 2020. Eyenovia undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this conference call, except as may be required by applicable securities law. With that said, I'd like to turn the call over to Dr. Sean Ianchulev.

Thank you, Alex. And welcome, everyone to our Eyenovia's second quarter 2020 earnings conference call. This past quarter, we were very pleased to continue advancing our strategic and clinical initiative despite the ongoing COVID-19 pandemic. At the end of the second quarter, we successfully resumed the recruitment of our Phase III CHAPERONE study for progressive myopia. We look forward to swiftly completing enrollment and also maintaining patient safety during that process. Over the past couple of years, we have been very focused on our U.S operations, building and executing on what is now one of the most advanced late stage clinical pipeline of its kind in the ophthalmic space. We completed the MicroStat Phase III trials, initiated the MicroPine CHAPERONE Phase III trial, and now anticipate initiating the presbyopia Phase III programs in the coming months subject to any impacts of COVID-19. More recently, we also turned our attention to global partnerships and alliances. We're excited by the interest we're seeing in our technology, and just recently took another step towards growing and monetizing some of our market opportunities outside the U.S. with our exclusive license agreement with Arctic Vision, a China based ophthalmologic company for the development and commercialization of MicroPine and MicroLine for the Greater China and South Korean markets. This transaction has immediate financial benefit for Eyenovia, that makes us eligible to receive payments of up to $45.75 million with the potential to receive additional supply and royalty payments over the coming years. With this agreement, we believe we're well positioned when it comes to the Asian markets, and we're very excited to work alongside Arctic Vision as we aim to unlock the major opportunities of myopia and presbyopia in these large markets. In the remaining months of 2020, we plan to submit our new drug application for MicroStat for pharmacologic mydriasis and subject to any impacts of COVID-19 to initiate our Phase III VISION studies for our MicroLine programs for pharmacologic treatment of presbyopia. Before we discuss our clinical progress, I would like to hand the call over to Michael to highlight our agreements with Arctic Vision. Michael?

Thank you, Sean. Yesterday, we announced our license agreement with Arctic Vision, a China based company focused on developing and commercializing innovative ophthalmic therapies in Asia. This exclusive partnership for the development and commercialization of MicroLine and MicroPine in greater China and South Korea significantly expands the market potential of our products into a region where it's estimated that there are hundreds of millions of myopic children. Many of these children have parents and doctors already well aware of the published clinical evidence, supporting the use of atropine to prevent their myopia from worsening. Additionally, there are nearly as many adults between the ages of 40 and 60 in Greater China and South Korea, who may also benefit from a pharmaceutical alternative for the episodic treatment of age related presbyopia. Under the terms of the agreement we're eligible to receive payments of up to $45.75 million with additional supplier royalty payments that we estimate could reach into the tens of millions of dollars. These payments are comprised of an upfront payment, as well as additional payments. Payments are based on various development and regulatory milestones, including the initiation of clinical research and approvals in Greater China and South Korea, as well as development costs. In addition, Arctic Vision has agreed to purchase MicroPine and MicroLine from Eyenovia or for products not supplied by us, Arctic Vision will pay us a mid single-digit percentage royalty on net sales of such products subject to certain adjustments. As part of this agreement, Eyenovia will pay Senju Pharmaceuticals, a mid double-digit percentage of license and royalty payments received from Arctic Vision and the net proceeds of our supply of products to Arctic Vision. These payments are part of our previously announced agreement with Senju Pharmaceuticals by which we reacquired the rights to these products in Greater China and South Korea. Overall, we believe that the Arctic Vision transaction is a good example of our international distribution strategy and will help to further grow our commercial reach to address some of the largest progressive myopia and presbyopia markets in the world. Importantly, this transaction also provides us with non-dilutive capital, which could help to further support the execution of our objectives in the United States. Now, I would like to hand the call back to Sean to provide an update on our ongoing clinical activities. Sean?

Thanks, Michael. We're thrilled to partner with Arctic Vision and we look forward to advancing our OUS activities. Now I would like to highlight our clinical programs in the U.S as well as touch upon some recent data that our R&D team has generated to further support our Opteject dispenser. Since we introduced the Opteject, we have highlighted the many benefits of microdosing therapeutics to the eye, including the ability to reduce the amount of preservatives being delivered. Our R&D team recently completed some research evaluating whether our Opteject dispenser can deliver preservative free medication. We're happy to report that the Opteject can be qualified for preservative free multi dosing, something which could lead to great benefits and eliminate significant waste associated with the single drop containers currently in use where every drug delivered has to be packaged individually in separate plastic packages. To put this into perspective, this equates to approximately 352 packages per year for patients for daily use medication and more than approximately 700 plastic blow field packages per patient year with twice daily use medication. You can imagine the incredible waste and environmental footprint of this preservative free single unit packaging. We're very happy that the Opteject has the potential to lead the way in eliminating waste and improving compliance as well as accuracy of on target topical delivery. In addition, in the context of COVID-19 pandemic where the virus can be spread asymptomatically, it is tantamount to reduce the risk of contamination in the physician offices. It is critical to reduce that risk when patients are seen today. In a recent study published in the peer-reviewed journal of the American Medical Association, JAMA ophthalmology, investigators examine the potential of COVID-19 to contaminate environmental surfaces of an ophthalmology or optometry examination room. The study found that COVID-19 was present within one meter diameter around where the patient sat. This study is just one example of the contamination risks that we need to be aware of and indeed this increased unmet need for sterility and contamination prevention across patients has been top of mind for our clinical partners and key opinion leaders. As a result, this has generated significant interest with regard to the Opteject as clinicians struggle with the contamination and exposure risk related to the cross patient use of dilating drops. While in medicine, we do not reuse things like injection needles or thermometer tips across patients. This is unfortunately not the case with eyedropper bottle where the standard is that these bottles are routinely reused, not just between two or three patients, but commonly across 40 to 50 patients. It is well established by third-party clinical studies that the dropper bottle often touches the ocular surface and lids of the patient after only a couple of uses, potentially introducing bacterial contamination to the medication itself or to the dropper. One study publishing the peer-reviewed journal medicine found that at home patient administered eyedropper bottle were contaminated nearly 25% of the time. And even eye drops used by medical personnel were contaminated approximately 20% of the time. The second study published in the journal of Investigative Ophthalmology and Visual Science, similarly found that approximately 23% of the open eyedroppers tested positive for bacterial culture, indicating that the bacteria were coming from the handling of the dropper by user or from touching the eyelids or the eyelashes of patients. Now, while eyedropper's protruding tip and low velocity drip tip is prone to touch the lids in the conjunctiva risking potential contamination. The Opteject has a non-contact protrusion free delivery tip, as well as non gravity driven horizontal spray dispensation, which is designed for remote spray delivery. So it is not surprising that the Opteject could be a perfect solution for this post-COVID reality to reduce the risk of contamination, while also reducing waste from single use packaging. I'm also pleased to say that much of the interest in the Opteject has come about because of MicroStat. And we are working very hard to submit our NDA by the end of this year, to make this vital product available to clinics, physicians and patients, as soon as possible. Let me address our recent clinical progress in the U.S. Despite the externalities of COVID-19 in the second quarter, we've continued to advance our best-in-class late stage therapeutic pipeline. We were pleased to announce in June that we had resumed recruitment in our Phase III CHAPERONE study for progressive myopia. Among nearly all of our clinical sites who we have worked closely with to ensure patient and clinical safety, which remains our top priority. Our Phase III CHAPERONE study is randomized double-masked clinical trial set to enroll more than 400 children between 3 and 12 years of age, which is examining the safety and efficacy of our proprietary atropine topical micro formulation delivered in the Opteject dispenser for the reduction of progressive myopia. Subjects are randomized to receive treatment with either of two MicroPine concentration or a placebo. And the primary efficacy endpoint is the change in refractive error from baseline through 36 months. Throughout the clinical pause, we continued to follow-up with and monitor all previously enrolled CHAPERONE patients via telemedicine and remote monitoring processes, and are very pleased to report that all patients who were previously randomized, all of them to treatment, has continued to progress uneventfully in the study. We're now working with our clinical sites to advance total enrollment and believe that we're on track to swiftly complete enrollment. Of course, this continues to depend on the improvement of the COVID pandemic. And we're constantly working to ensure that we create the safest possible environment for everybody who participates in our clinical trials. As I mentioned in conjunction with our recent R&D test around the Opteject, we are continuing to develop our NDA for MicroStat for pharmacologic mydriasis. As you remember, MicroStat, which we plan on marketing under the brand name Mid Combi [ph], is our novel combination formulation of phenylephrine-tropicamide. These two drugs are often used together in the approximately 18 million diagnostic eye exams and 4 million cataract surgeries performed each year in the U.S alone. Based on our two positive MIST-1 and MIST-2 Phase III trials, we're working towards submitting our NDA application to the US FDA by end of 2020. If approved, MicroStat would be our first commercial product, introducing physicians and patients to our high precision Opteject dispenser and priming the market for our future therapeutics. Finally, we remain excited about our Phase III ready MicroLine program for the pharmacologic treatment of presbyopia. Presbyopia, which is the non-preventable age related hardening of the ocular lens, which causes the gradual loss of the eye's ability to focus on nearby objects, affects an estimated 113 million people in the U.S., as well as a very significant portion of those over 40 in China. We anticipate initiating the VISION 1 and the VISION 2 studies this year, and hopefully enroll both the trials rapidly since the size and availability of this patient population is relatively easy to target. Though, of course, this will depend on the COVID-19 situation. With that said, I would like to now turn the call over to John to discuss the financial results.

Thank you, Sean. Now I would like to review our financial results for the three months ended June 30, 2020. For the second quarter of 2020, we reported a net loss of approximately $5 million or $0.25 per share, and this compares to a net loss of approximately $5.3 million, or $0.44 per share for the second quarter of 2019. Research and development expenses totaled approximately $2.9 million for the second quarter of 2020. And this compares to approximately $3.6 million for the same period in 2019, a decrease of 18.3%. For the second quarter of 2020, general and administrative expenses were approximately $2.1 million compared with approximately $1.8 million for the second quarter of 2019, an increase of 16.3%. Total operating expenses for the second quarter of 2020 were approximately $5 million compared to total operating expenses of approximately $5.4 million for the same period in 2019. This represents a decrease of 6.7%. Operating expenses included approximately $633,000 of non-cash stock compensation expense. As of June 30, 2020, the company's cash balance was approximately $10.2 million. We anticipate that our current cash resources, the upfront payment received from our agreement with Arctic Vision, as well as proceeds received from recent warrant exercises, provides the company with sufficient capital through at least the end of the first quarter of 2021. That concludes our financial statements. I would like to hand the call back over to Sean for some closing remarks.

Thank you, John. We believe that our recent successes continue to not only demonstrate our commitment to our mission, but also to further validate our therapeutic approach. Our license agreement with Arctic Vision for the development and commercialization of MicroPine and MicroLine in Greater China and South Korea expands our commercial potential well beyond the United States and demonstrates the tremendous interest for our technology. As we look ahead, we plan to submit our first NDA for MicroStat by the end of 2020. And subject to any impact of COVID-19, initiate our Phase III VISION trials for MicroLine. We appreciate all the support from our team, clinical partners and shareholders, and are very excited to continue executing on our mission. That concludes our prepared remarks. We would now like to open the call to questions. Operator?

Hi. Good afternoon, guys and thanks for taking questions. Just wanted to get a little bit of an update on the MicroStat NDA process. I think you've mentioned before that kind of the rate limiting step there has been stability studies for the product. Have those been at all impacted by the COVID-19 pandemic, and could that have a impact on the timing of your NDA filing?

Matt, good question and thank you. The answer -- the quick answer is not materially. We are still tracking and we're very thankful that that's the case because it could have been, but our partners and also our internal team had the foresight to prepare and execute during this pandemic. And I think at this point we're tracking well with the plans to submit to the NDA by the end of this year. And we hope that doesn't change.

Okay. Very good. And then with respect to that, where are you and what are your thoughts in terms of commercializing MicroStat and preparation for commercialization if you could potentially get approval by kind of middle of next year, let's call it, second half?

Yes. And I will turn that to Michael. I think he would be able to give you the most informed answer. I want to say, just as we mentioned in our earlier discussion, we have seen enormous interest in our technology from the community, from the clinicians, who in this post-COVID reality understand the need for a much more sterile-friendly delivery and the dispenser seems to provide, as we discussed, some of the characteristics of the Opteject as such an inherent in a design for remote delivery and non touch delivery. So we've seen a lot of interest inbound by clinical sites, particularly the ones that are in our studies that would like to have that today in order to provide better care. And so we are really on it as a team. We want to make sure everything possible to get this into the hands of patients, the clinicians and patients, as soon as possible because of COVID we realize the unmet need has even increased. And the reality is such that we're sitting on a product that can really help in this respect. So we definitely want to get it out and me as a clinician personally. I want to see it in my own practice, giving this to my patients, but Michael please comment on the rest of the commercialization.

Yes, my pleasure, Matt, and good to speak with you. One thing that Sean was alluding to is we just finished our second round of market research on Mid Combi and the interesting thing was prior to COVID doctors were reusing these eyedropper bottles across 20 or 30 patients each. And now in a post-COVID world, they're either limiting that to whatever number they see during that day, or they're going to go to single use, which is going to be much more expensive. And why that's important to consider is that one of the things we were doing from a strategic point of view is we wanted to eliminate a cost difference between our new technology and what the doctors were currently using. And it may turn out that because of COVID, what they're currently using is actually going to become more expensive. And while we certainly wouldn't take advantage of that, it does give us the possibility of having more ways that we can move around with price than we thought of before. So that's one of the positives that come out of this. In terms of actually selling the product, we're expecting or looking forward to a launch third quarter -- end of the third quarter next year, we're going to start small probably with about a dozen key account people who will be located where the biggest accounts are, and that would just be your group practices that see lots of patients. And we'll start there and we'll move out from there. The nice thing about a product like this is it doesn't require sample drops or other things that are -- that you see with the traditional ophthalmic pharmaceutical product. So it's the kind of thing where you can go in, do an introduction, make sure that people know how to use the product, set them up on ordering, and then you can move on to the next office and not have to service that all that often. So anything else I can answer for you?

Yes, that's great. That's very helpful.

Good, Matt.

And just another couple of questions, If I might. Congratulations on the Arctic deal. It looks very good. I guess the question maybe for John with the $45.75 million in upfront and other milestones, how should we think about that in terms of extending your cash runway, or is that kind of incorporated into your guidance that you provided in terms of first quarter '21?

Yes. So very good question. So as we previously stated, we will require additional capital to execute our strategy over the short-term, as well as long-term. So the recently announced Arctic Vision transaction, as well as some other strategic transactions that we're pursuing, similar instruction to the AV transaction provides us with the current and hopefully a potential future source of non-dilutive capital. So we're continuing to pursue these strategic transactions and we're optimistic. To the extent that we need to raise equity capital, we'll be opportunistic and we'll look to do it in the most efficient way possible in order to minimize any dilution. But in terms of the impact of the Arctic Vision deal, as we mentioned in our 8-K, the upfront payment was $4 million. So the balance of the milestones are expected to come over the next 4 to 5 years. So that will definitely help us significantly over the long-term capital needs, but we'll continue to have a shorter term need for capital as we look to execute our strategy.

Okay. That's very helpful. And last question for Sean. The MicroLine program, you mentioned that you are continued to be on track to launch the Phase III VISION trials this year. Do you intend to run both VISION trials in parallel, or will they be more in tandem?

Yes, that's a good question. I don't think I can give you a clear answer on that. We are evaluating almost daily, the status of all the clinical sites. Because as we move forward, we're going to move with that trial very fast and efficient. We're going to have a very few sites and this trials we hope to enroll within less than a month. And we hope to have results literally within the following one or two months. So we're talking three to six months to complete both enrollment and get the Phase III results of both trials. Ginger Clasby, who is the VP of Operations, she has a lot of experience in the ophthalmology space and she executed beautifully on the MIST 1 and MIST 2 trials, as you remember those were done in a few months. So we're going to really do what's best for the patients for their safety in this environment. At the same time, what makes more sense to execute very quickly. But regardless of which way we go, whether it's a slightly sequential or fully sequential or completely in parallel, those will be very fast paced studies.

Great. Great. Well, thanks again, and congrats on the progress.

Thank you, Matt.

Thank you. Our next question is from Yi Chen with H.C. Wainwright. Please go ahead.

Hi. This is Blair Cohen on for Yi. Just a couple of questions from us. Could you comment on the speed of enrollment for the CHAPERONE trial that you've seen in July and August so far? Are all sites enrolling now and have you added any new sites?

Yes, pretty much all of the sites are up and running or in final stages of activation. As you know, we decided and we can give them that guidance before they were not going to update periodically on how many patients are in the study. I think what's probably more relevant and meaningful is that we expect over the next nine months or so to hopefully complete enrollment. And again, I'm saying that with all the caveats today that if we see a second wave or a third wave or really exacerbation, particularly in certain geographies where we have clinical sites, we obviously have to do authorize the patients and for our clinical partners. So I think we are doing very well and internally we're tracking with or even better than what we thought we would be doing at this time after we realize where we are with COVID. But at the same time we're holding our breath because we really don't want to be in another situation in a few months where we have to discontinue again. The machine that Ginger has put in -- the enrollment machine and really the clinical operations is running so smoothly and it's so fast paced. We're still hooking to enroll very fast and also initiate in the same time, with -- in the same breath while doing the NDA submission execute on the two Phase IIIs for presbyopia. And again, let's not forget, Eyenovia is a company with only 30 people. So, yes, I think we're doing very well and we're very happy where we are with CHAPERONE.

Okay, great. And then in regards to Arctic Vision deal, do you expect to receive any milestones before the end of 2021?

Yes we do. Before the end of 2020 or 2021, what was the question?

Both.

Well, we expect to receive it before the end of 2020, so it would answer both questions. Maybe we do expect to receive a milestone before that.

Okay, great. That's it for me. Thank you.

Thank you.

Sure.

Thank you. Our next question is from Michael Brcic with National Securities. Please go ahead.

Hi. Thank you. That wasn’t my question, but I just want to follow-up on this last one. Is there any way you can sort of talk about what these milestones are that once the closest ones? And how much money we're talking about, or is that -- so we're prohibited contractually to get into details like that and disclose it publicly?

I could tell you that the nature of the milestones are typical, but what you would see with other drug licensing type deals regarding approvals, regulatory oriented approvals and things along those lines. In addition, this transaction does allow us to get reimbursed for some of the development expenses as well. But unfortunately, I just can't give you the details per milestone.

No, totally understandable. On this AV deal, I noticed that doesn't involve MicroStat, which is your most advanced one. Were they not interested in that, or do you -- or let me put it different way. Do you have other international thoughts about MicroStat?

Michael, do you want to take that?

Yes. Yes. Let me take that. If you look at the market opportunity in these countries, the opportunity for myopia control with MicroPine and even presbyopia with MicroLine is so far and the way larger, especially even larger than United States, just because of the population and the number of children that are impacted, that those were the two places they wanted to go to first. For MicroStat, which is really based upon a number of exams, it's not that the product is not attractive. It's just not for them in the same league as the epidemic of myopia.

Okay. Going back to the milestones for MicroPine and MicroLine, and I know there's not much you can talk about. But are the milestones based on your progress here in the U.S., or are they based on the progress in Asia?

They’re primarily based upon Asia about progress those drugs in Asia.

I think, John, we would probably say, though some of the development ones are based upon our actions here.

Yes. Yes. I was only talking about the license fee milestones, but correct.

Right. Yes. So both.

Okay. Have you -- I know I should speak market, but have you had talks with anyone in Europe about this as well?

Yes. So let me answer this. Again, as we've spoken before, and we've been very clear, Eyenovia was really busy and we were very focused on the U.S. We wanted to first things first get our pipeline here, because this is where our biggest opportunity is for now. And only recently almost six to nine months ago, we really started investing and spending time on partnering and licensing. And, and in fact, I probably think it's fair to say that after we reported the positive Phase III results of MicroStat, which is now going to be Mid Combi, we saw our tremendous pike of inbound interest. So it was so big that it actually was very distracting for a small company to really see through that. So I think one of the first products of that is our deal with Arctic Vision. I think John mentioned earlier that we are working right now and we're spending a lot more effort, especially with Michael heading the BD effort. And we probably would see more and more in that respect as we should as our programs mature and as we come, we have the Phase III trials that are underway here. We're going to start turning our attention to other markets like Asia. Obviously, for Europe, it's even easier for us because Eyenovia owns all of the markets in Europe, they are really within our scope. So I think you're going to see a lot more hopefully, we can never predict when and how and who, but we're very diligent in terms of selecting partners, particularly in Asia, where we have seen a lot of interest from different entities. But let me say that we are, as we said, extremely happy that we're collaborating with Arctic Vision because they came out on top in terms of expertise and partnership. You want to select the right partners in that market. And so we’re -- we think we have the right partners that came through all of our diligence process. And we are going to start doing a lot more of that and feeding through that inbound interest in collaborating and licensing with us.

Great. You guys have been very good for my clients and it's been great. So thank you. Appreciate it.

Thank you.

Thank you. [Operator Instructions] Our next question is from Len Yaffe with Stoc*Doc Partners. Please go ahead.

Thank you very much. Had a couple of quick questions for you guys. First is on the Phase III VISION study for MicroLine. How long should that take to complete?

So again, just to be clear, I'm sorry if we may have confused you. It's actually a Phase III study, not a Phase II study, but it's the VISION 1 and VISION 2 studies. Yes. So, the VISION 1 and VISION 2 they're two trials, identical and they’re part of the same Phase III program. And it's a program that we’re -- if you look at it for -- because I don't want to get, we already talked a little bit about sequential parallel, let's not talk about that again. But if you think about it as the whole program, because you need to complete the whole Phase III program, we hope to initiate that program this year, by the end of the year and we hope to complete that program with Phase III results from the entire program probably sometime in mid next year. So it's an extremely fast paced program. These are trials that we expect to enroll quickly and we expect to complete quickly. And again, I'm still saying that with all the caveats that we are planning in a reality where we are not having any resurgence, and we are not having a pandemic resurgence and closure of sites and everything else. But again, we have readiness and I think the team has executed before multiple times, and we know exactly which time, how quickly, and we've already got some feedback. We have the protocol ready, and we hope to initiate that promptly because it's really phenomenal opportunities for the first time treating presbyopia with a pharmacologic means to eliminate the hardware, the spectacles that people use. It's a groundbreaking approach. And we've seen that by far off the charts response in our market research that Michael has conducted. So this is coming soon and it's coming fast and furious. Hopefully we'll not have gone a trip over with some externalities with COVID situation, and we'll keep you updated.

Great. In terms of the cash you mentioned that should last through, I believe the first quarter of 2021, both what you exited the quarter within the Arctic Vision upfront $4 million. Does that projection of Q1 '21 not include any cash you may receive from any additional licensing agreements with companies between now and the end of the year. And I was wondering if you could comment given the advantages of Opteject and the fact that there are several ophthalmic companies out there that would probably benefit from being able to incorporate Opteject as a delivery system for their own pharmacological agents. Could it be possible in addition to seeing some of your drug licensing that there may be interest in companies as opposed to countries licensing your Opteject technology to incorporate as a drug delivery capability?

Yes. So let me start with your last question and then John can answer the first one, but I like how you're threading the needle on your logic, which is perfect and obviously it can. I mean we can make every -- pretty much every topical drug that currently is overdosed and COVID side effects and inaccurately delivered and all the benefits we've talked about, we can make that better. I think we don't have -- unfortunately, in ophthalmology, we do not have the same vibrant space of strategic and established companies as we have in oncology and other spaces. But we do have some and actually I've been very successful at selling technologies to them before. And what we've seen as I mentioned in the recent months, especially after the Phase III data, especially actually after we reprioritize our pipeline and we made it laser focused on MicroPine for a huge market, multibillion dollar opportunity in the U.S for progressive myopia, which will be the first ever topical treatment of a back of the eye disease. I mean, I was involved in the development of LUCENTIS. We're still injecting drugs in the eyes of patients and here we can impact a back of the eye progressive myopia with collateral retinal elongation and pathology, which is almost, as we call it the epidemic behind the pandemic. And again, I think people are waking up and we've seen tremendous interest in that. Of course, we are very cautious. These very core assets for us. We not going to obviously part with them easily. It has to be the right opportunity, the right deal and everything is going through real discussions and reviews internally with the Board and so forth. So yes, if the opportunity and the right opportunity comes, we definitely -- we will consider it. But right now the transaction on hand is the Arctic Vision and we're very happy about that because it was not ever a milestone that was expected or we ever talked about. We still have all of our milestones or candy bar in the cookie jar with all the NDA, the Phase III trial and everything else. This was an additional good news and it happened pretty fast because the teams were very motivated. And we'll see what happens. But for us, obviously, we want to make sure that if we consider some partnerships, either on our programs or in other programs, they're not distracting us from our core mission of executing on our clinical trials. So everything will have to be thought out operationally, strategically and financially. And as I said, we've just started focusing on that. Now that we've loaded the pipeline and we were executing very smoothly from a internal perspective, and we hope you guys will see more of that and we hope we'll see more of that too as this Opteject technology becomes hopefully one day standard of care. Because like I said, I would not imagine why would anybody use a rotary phone today when we have mobile phones? I'm sure there is somewhere a rotary phone that somebody would use. And I think hopefully in the future, I would not want to see why would anybody use an eyedropper when you have an Opteject dispenser.

Yes. My rotary phone is avocado colored and still hangs on the wall. What I was wondering lastly is, could you discuss -- because you guys have a great sense of what's going on in the market with other companies, the competitive position for the couple other companies that are working on atropine in progressive myopia?

Yes. I mean, basically I think there are a couple that are private companies. They're all using the same eyedropper paradigm and just a modification of the formulation of atropine. They like us have realized probably ahead of everybody else, the big opportunity of progressive myopia. This is a huge market. This is a huge unmet need because it's our kids that are losing their sight. It's our kids that are getting myopic. In Asia, this is 80% of the kids and in some countries like Taiwan right now, 80% of all children are on atropine today. So we’ve an amazing opportunity to inflect the therapeutic index for the treatment of this disease. In some of the studies, we've seen almost 70% reduction of progression in progressive myopia. So I think it's no wonder that multiple players are going there. Now I can tell you with the eyedropper we've seen and studies have shown that half of the time patients miss their eye and they cannot put it in, and these are adult patients. If the adult patients miss their eye and they cannot put in an eye drop, think about what that number is for pediatric patients. And more importantly, what we've seen in our clinical study of MicroPine with the CHAPERONE that now almost 90% or more of the patients of the actual kids are self administering that. Just like they're using their iPhone and they love it. Their parents are not putting the eye drops. So again, that just highlights that when it comes down to options in the future, if you have a number of companies out there, I cannot see why would anybody use an eyedropper when you have an Opteject dispenser, particularly in that population and where you're giving a microdose of atropine, which is an anticholinergic drug with systemic absorption, why would you want to have any systemic absorption of a topical treatment when you can minimize that with microdose. So we are looking to a very good, I think, outlook and horizon for atropine. And we think when there are multiple players there, it will all come down to delivery.

Yes, I'll just close with a comment that one of the consequences of this tragic pandemic may be an increase in incidence of the disease, just because of the much greater amount of time that children are spending indoors, looking at either iPhones or computers and not being outdoors in the sunshine. So it unfortunately may increase the incidence of the disease as well?

Right. And Len, just to -- we talked about it during our last call, what you're saying has actually been quantified in epidemiologic studies, which have shown through the last few years, how much an extra additional hour of thing in front of a computer screen actually increases your progressive myopia rate and it's in the 20% plus. Now imagine how many additional hours kids, including my own spend in front of the computers today, doing remote learning. So we're going to see that -- again, that pandemic is going to make the epidemic of progressive myopia hugely escalated. So we're already seeing doubling and tripling of that rate over the last few decades. We're going to see something even more if the remote home based learning persists, which is a great solution to the problems we have in the schools today. At the same time, it's going to have the unfortunate byproduct of complicating progressive myopia. And that's why we think we need to get this product to patients and particularly to kids and their patient and their parents early because once you progress with progressive myopia, you cannot unprogress. Once your eyeball stretches and your sclera and retina stretches and you cannot go back and now shrink it back to where it should be. So it's a -- it's an important thing to keep in mind, and I think it's an important disease and we are really happy to execute very fast here to get this as quickly as possible and it's one of our top most priorities. And again, those for us only you asked, I think somebody asks about Arctic Vision. Why aren't they doing dilating drops? Well, because you need to do, I think the much more important and the much bigger markets as the biggest unmet need now of a major global epidemic, particularly in China and Asia for progressive myopia. And that's where you're going to spend your capital and attention at least at the beginning.

Great. Thanks so much.

You're welcome.

Thank you. And we have a follow-up from Michael Brcic with National Securities. Please go ahead.

Yes. Hi. Obviously, for prescription drugs, even that are approved, they still have to do trials with your Opteject because it's a different delivery system. What about -- and this is a licensing question. What about over the counter drugs? Do they have to go through some sort of trial? So the thing, if they want to adopt your technology as opposed to droppers? Or how would that work?

Yes. So everything is different. Again, every indication is different, but it's a very fast paced validation and clinical process because you don't have to go through Phase I, Phase II, literally for an established product, whether it's a prescription product, it's a very simple development time. And this really is a great advantage of this technology for microdosing. For over the counter, like artificial tears and we've talked about artificial tears before and some other it's actually even simpler, easier. And I think where, for us -- what that means for us, we really need to schedule our prioritize -- priorities and prioritize our schedule at the same time. We need to tackle the biggest opportunities and the biggest unmet needs first. I think for all of the anti-itch and anti-redness medications and dry eye over-the-counter, it's a perfect use case for the Opteject. But right now we're focusing on the bigger unmet needs. Of course, if this technology is in the hands of a big strategic, and they can literally invest in parallel in 20 programs to take the market and really differentiate, because over-the-counter is completely undifferentiated and it's begging for a differentiated product. Of course, in that case, it can go much faster and in parallel, but for us we have now three programs with very high value. We're very laser blaze focused on them. And after we come to the end of that runway and we were satisfied of where we are and we can redirect to some others, we'll do that. But for a small company, even 3 late-stage programs, I don't think there are many others in ophthalmology that a publicly traded company is doing that.

Right. Finally, sorry about this, but this is one of those out of the ballpark questions. Are there other drugs that are not ophthalmologic that could be delivered through the eye? Have you thought about that?

Yes, I think we have and there are. And again, we have some efforts initially internal that are also in early stages and potentially we're looking at opportunities there too, given that some of those would also be in the scope of and in the area of proprietary information or intellectual property. I would not want to comment on that. But again, you could deliver and the Opteject technology could also be used, not necessarily for the eye. You can deliver potentially in the mouth, in the tympanic membrane or in the ear. So there's a lot of applications of what we're doing, which is the micro array print technology. We're inkjet printing, micro droplets in a very precise stream on a surface, and one can really come up with a lot of applications. And we're thinking about that as we grow the intellectual property and all the patents, and we have so many patents now in ophthalmology and we’re starting even beyond. So very good question. It's something we're thinking about more on the R&D side, but I appreciate it regardless.

Great. Thank you very much again.

Sure.

Thank you. And this concludes our Q&A session for today. I would like to turn the call back to Sean Ianchulev for his final remarks.

Yes. Again, I think enough said today, I think it was a very productive call and very interesting questions. I want to thank everybody for staying late. It's 5:30 here on the East Coast. And thank you for bearing with us on getting all these detailed updates. A lot is happening at Eyenovia with multiple Phase III programs, now collaborations, multiple markets. And we hope next time when we reconvene for the next earnings call, we'll have more details and further progress to report. So for everybody, please stay safe and thank you for tracking with us.

And with that, ladies and gentlemen, we thank you for participating in today's program. You may now disconnect.