Oyster Issue Pharma, Inc. (NASDAQ:OYST) has an accepted merchandise, Tyrvaya (OC-01, varenicline solution) Nasal Spray for dealing with dry eye condition, and it is also in the pipeline for Neurotrophic Keratopathy Stage 1. NK is a uncommon disorder characterised by decreased corneal sensitivity and lousy corneal healing. For the pipeline program, the firm suggests in its earnings call:
We keep on to enroll clients in our OLYMPIA Stage 2 study of OC-01 nasal spray aimed at managing Stage 1 NK. We continue being on track to assume outcomes of this trial in the second 50 percent of this 12 months.
Now, coming to the acceptance, Tyrvaya was accredited in October 2021 and started out in the market by early November. So this was proficiently the initially full quarter of claimed earnings for Tyrvaya.
Dry eye sickness occurs in in excess of 38 million Individuals. Latest remedy choices are Allergan’s Restasis and Shire’s Xiidra both of those are given as eye drops. Restasis is a mild immunosuppressant while Xiidra is an anti-inflammatory drug. Even so, given the formulation that calls for supplying the medicines instantly to the eye – normally a cumbersome and agonizing system – compliance is minimal. What’s more, these therapies consider months to function from the onset of treatment. The firm says there are 7 million patients that have attempted and deserted the normal therapies.
Tyrvaya employs a wholly new shipping approach, as perfectly as a unique mechanism of action. It is utilised as a nasal fall, and it is effective by triggering the trigeminal nerve which in its switch triggers tear creation. In 3 medical trials in about 1000 patients in delicate, average and critical dry eye ailment – ONSET-1, ONSET-2 and MYSTIC – the drug has demonstrated security and efficacy. Patients showed statistically sizeable advancements in tear film output as assessed using the Schirmer’s rating at Week 4, with far more than 50% sufferers demonstrating best tear manufacturing in contrast to about half that variety in the placebo team:
TYRVAYA-addressed clients confirmed statistically sizeable enhancements in tear film production as assessed utilizing the anesthetized Schirmer’s rating (-35 mm) at Week 4. Of the people addressed with TYRVAYA, 52% obtained ≥10 mm improve in Schirmer’s score from baseline in the ONSET-1 study, and 47% achieved ≥10 mm increase in Schirmer’s score from baseline in the ONSET-2 research, in contrast to 14% and 28% of automobile-addressed clients in the ONSET-1 research and the ONSET-2 analyze, respectively at Week 4 (p<0.01 in both studies). Of the patients treated with TYRVAYA, the mean change in Schirmer's score was 11.7 mm and 11.3 mm as compared to 3.2 mm and 6.3 mm in the vehicle treated patients in the ONSET-1 study and ONSET-2 study, respectively at Week 4.
So the first full quarter revenue is $2.7mn. Around 19,000 prescriptions were filled, and these were written by 4500 unique prescribers. 65% of all patients went for refills. A number of patients have continued using the medicine for 6 months starting from November.
The company has also taken great strides on the mediclaim front. In February, TYRVAYA was placed on Express Scripts National Preferred basic and high performance formularies, which collectively make up around 26 million lives. The company has gone on to add more payers, and now it has commercial coverage for up to approximately 95 million lives, which represents 52% of all U.S. commercial lives.
OYST has a market cap of $134mn and a cash balance of $144mn. This is a terrible state of affairs. There’s a short interest of 22%, which says that the market still thinks the company is overvalued. For a commercial stage company with a clinically successful drug to be in this sorry state is unnerving for investors.
Sales and marketing expenses for the three months ended March 31, 2022, were $27.0 million, General and administrative expenses were $12.9 million, and Research and development expenses were $4.7 million. Net product revenues for the three months ended March 31, 2022, were $2.7 million. At this rate, and ignoring any major improvement in sales, the company hardly has cash for 2 more quarters.
In order to curtail some of these high expenses – high for a small company, that is – the company has gone through a restructuring process. This, it says, will lead to $6M-$8M in savings this year but also include laying off up to 50 workers. The company expects savings of $40-$48mn in 2023. These measures will allow it to commercialize Tyrvaya better, and also put focus on the NK pipeline program. This plan will also include retiring John Snisarenko, Chief Commercial Officer, effective July 1.
The company signed a deal with a Chinese firm last year to commercialize Tyrvaya in China against $17.5mn in upfront payment and a stake in that Chinese company.
I really have nothing to say. Restasis is a billion dollar drug, while Xiidra is a half-a-billion dollar drug. Tyrvaya has an admittedly better mechanism of action and mode of delivery. Yet it is floundering in the market, and I cannot find any reason for that except perhaps lack of execution, which is also difficult to allege given what the company has been doing. All in all, this is a perplexing situation, and when I am perplexed, I tend to avoid buying.
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