OIS @ AAO 2013 Executive Summary by IBF Conferences

AAO

OPHTHALMOLOGY INNOVATION SUMMIT November 14, 2013 | Sheraton New Orleans, LA

OIS/AAO 2013 EXECUTIVE SUMMARY:

E e on Inno ation

AAO

OPHTHALMOLOGY INNOVATION SUMMIT

NOVEMBER 14, 2013 | SHERATON NEW ORLEANS, LA

OIS/AAO 2013 EXECUTIVE SUMMARY Written by Jan Beiting

More than 800 attendees participated in the fifth annual Ophthalmology Innovation Summit, held November 14, 2013, just prior to the annual meeting of the American Academy of Ophthalmology in New Orleans, LA. The full-day focus on innovation in ophthalmology included private pharmaceutical and device company showcases and stimulating discussions with venture capitalists, specialists in public investment and alternative financing, physician entrepreneurs, industry and government sector leaders. In particular, the number of physicians attending OIS this year more than doubled from 2012. “OIS is a good resource for companies and venture capitalists, but it’s a huge benefit for physicians. I think a lot of new entrepreneurs come out of this meeting.” —Daniel S. Durrie, MD

OIS is a good resource for companies and venture capitalists, but it’s a huge benefit for physicians. I think a lot of new entrepreneurs come out of this meeting.” — Daniel S. Durrie, MD, Founder & President, Durrie Vision 22

Even though there are fewer firms investing money, those firms are realizing increasing returns, which should translate into a sustained level of venture funding going forward.” — Emmett T. Cunningham Jr., MD, PhD, MPH, OIS Chairman and Partner at Clarus Ventures

2013: Year in Review OIS Chairman Emmett T. Cunningham Jr., MD, PhD, MPH, a Partner at Clarus Ventures, offered a review of 2013. Despite a reported drought in funding for medical startups, Cunningham was optimistic that venture capital funding has stabilized. “Even though there are fewer firms investing money, those firms are realizing increasing returns, which should translate into a sustained level of venture funding going forward.” 2013 was a good year for acquisitions and initial public offerings (IPOs). Ophthotech, maker of the anti-PDGF agent Fovista, went public in September 2013 and has been valued in the $800M-$1B range since. Aerie Pharmaceuticals also went public in October, with a $250 million market capitalization demonstrating confidence in the strong Phase IIb data for the company’s dual-mechanism glaucoma therapy. Meanwhile Bausch + Lomb acquired Technolas Perfect Vision and was then itself acquired by Valeant Pharmaceuticals. Abbott Medical Optics acquired OptiMedica, and Shire snapped up SARCode Bioscience. Fiscal year (FY) 2013 also saw U.S. approvals of six new ophthalmic drugs and biologics, including two in new product categories: Jetrea ocriplasmin intravitreal injection for symptomatic VMA (Thrombogenics), and Simbrinza (Alcon), the first combination glaucoma drop without a beta blocker available in the U.S. www.opthalmologysummit.com

Wet and dry AMD remain very large markets for ophthalmic biopharma development. Intravitreal anti-VEGF agents now represent the largest pharmaceutical category in ophthalmology, with global revenues for the category expected to nearly double over the next 5 years, from $4.7 billion to $8.4 billion. It was also an active year for device approvals, with four pre-market approvals (PMAs) for toric IOLs and excimer lasers; a humanitarian device exemption for the Argus II retinal prosthesis system (Second Sight); a favorable FDA panel hearing for ReSure Sealant (Ocular Therapeutix), as well as 74 ophthalmic 510k device approvals. Promising growth categories include MIGS, femtosecond laser surgery, corneal inlays, corneal crosslinking and intraoperative aberrometry.

CORPORATE FINANCE IN OPHTHALMOLOGY Going Public: The IPO and Public Sector Financing “After a 10-year drought in the ability of biotech and life science companies’ to access public financing, we’re now seeing a buoyant market.” —Jeffrey Hoffman, Managing Director, Head of West Coast Healthcare Investment Banking, J.P. Morgan Equity markets are at all-time highs, the health sector is doing very well overall, and biopharma is leading an IPO market resurgence, according to Jeffrey Hoffman. “Investors are flocking to biotech because it is outperforming the S&P.” Certainly, an IPO provides access to capital and opens up tremendous avenues for growth and new ways to incentivize employees, but it also brings public scrutiny and the pressure of quarterly earnings reports. Since 2006, only 10 ophthalmic companies have gone public, but those few are now outperforming the market. How do companies know when the time is right? “Today’s buyers are very discerning,” said Chris Cooley, CFA, Managing Director of Stephens. “They are looking for disruptive technologies that change a paradigm, either from an economic standpoint or a clinical one. And they are looking for double-digit growth, scalability, and a clear pathway to profitability.” That’s a tough order, and perhaps one that entrepreneurs should set aside. 4

“You can’t run a company with the goal being to IPO or sell. If you do it for the right reasons—because you want to cure the disease state—you’ll stay focused on building a successful business for the long term.” “There are companies that need to go public because they are running out of cash and there are the ones that deserve to be public companies because they have compelling, differentiated stories that are easy to tell,” said Nicholas Galakatos, PhD, Managing Director of Clarus Ventures. He noted that value on Wall Street has been driven by generalists in recent years. “They want to be part of a hot market, but you can’t give the generalist a very complicated medical story.”

You can’t run a company with the goal being to IPO or sell. If you do it for the right reasons—because you want to cure the disease state—you’ll stay focused on building a successful business for the long term.”

Dan Myers, President and CEO of — Jeffrey Hoffman, Managing Director, Alimera Sciences, agreed. “You have Head of West Coast Healthcare to keep the story simple so it resonates Investment Banking, J.P. Morgan with analysts, portfolio managers, and the salespeople who will be selling the product.”

Private Funding and Exit Trends There are a number of challenges in health care venture funding, especially in early (Series A) funding, Jonathan Norris, Managing Director of SVB Capital, told OIS attendees. Since 2010, there have been declines in both the dollars raised and the dollars invested. This is especially problematic on the device side, because corporate ventures haven’t filled the gap as well as they have on the pharmaceutical side. A tendency by endowments and pension funds to be more risk-averse in recent years has been partially responsible for driving these large funds away from early stage venture capital to later-stage investments. www.opthalmologysummit.com

“We have huge bottlenecks in the number of venture-funded firms that still need capital,” Norris said. But with successful exits at an 8-year high, investors are finally getting payouts on earlier deals—and that helps everyone by making the sector more attractive, Norris said. Additionally, the performance of structured deal milestones that come due after an exit has been very good, with an earnout rate of better than 45%. Norris said these payouts are evidence that structured deals—in which large companies promise future funding once milestones are met—do work. Finally, a decline in company formation due to the funding crunch in recent years means that exiting companies now have less competition.

Alternative Financing Strategies Charles Warden, Managing Director of Versant Ventures, moderated the discussion about alternative financing strategies that may offer some creative solutions, particularly for later-stage startups. These include structured debt, royalty financing, angel or high-net-worth-individual investing, corporate funding, and other strategies. “When there is a good product, a good market opportunity, and a passionate management team, there will be a way to find funding,” said Gregory Shearer, Managing Director of Healthios Capital Markets. While debt can be a very important bridge to an exit, Brian Demmert, Managing Partner at Armentum Partners, cautioned startups not to assume that it is always better than equity financing. “It can be appealing to not dilute equity, but debt holders can be an even more significant partner than a venture capital investor,” he warned. Debt holders often have liens on the company’s intellectual property and can force it into bankruptcy if they lose confidence.

When there is a good product, a good market opportunity, and a passionate management team, there will be a way to find funding.” — Gregory Shearer, Managing Director of Healthios Capital Markets 66

There is no doubt that more financial value is being generated by U.S. companies, but few of those companies could build value without their European presence because the U.S. and European markets are so interconnected and interdependent.” — William J. Link, PhD, Managing Director, Versant Ventures

Ventures and Commercialization: US vs. EU Versant Ventures has invested $800 million in 18 ophthalmic startups, five of which have been sold. That experience gives Managing Director William J. Link, PhD, the best perspective on what makes a startup venture successful. Link told OIS attendees that he looks for companies with a strong leadership team and committed corporate partners; a disruptive technology product that fills an unmet need in a large, accessible market; a solid reimbursement strategy; and a predictable regulatory pathway—the shorter, the better. In comparing the U.S. and European markets, he finds advantages in each. Both are large markets with strong reimbursement and progressive surgeons. The U.S. has an advantage in both the number of entrepreneurs and the sources of capital available to young ventures. And because the U.S. has a single regulatory process and common language, it offers better access. Europe, on the other hand, offers a faster and more predictable regulatory path. Of 32 venture-backed ophthalmic mergers and acquisitions that took place during the decade from 2003 to 2013, 70% were U.S. or Canadian companies, and those deals generated 97% of the total value. Excluding 4 large mergers, 65% of the early-stage acquisitions were North American, generating 80% of the total value. “There is no doubt that more financial value is being generated by U.S. companies, but few of those companies could build value without their European presence because the U.S. and European markets are so interconnected and interdependent,” Link concluded. www.opthalmologysummit.com

Most U.S.-based companies do plan to commercialize in Europe, often before seeking U.S. product approvals. Products get to market in Europe an average of 3 years earlier than in the U.S., although device prices in Europe tend to be lower. A recent move by the European parliament to require more clinical data prior to CE mark may slow down approvals in the E.U. in the future. Audience polling at OIS indicated that incremental cash flow (25%), revenue growth to impress investors (20%), and commercial validation of the technology (42%) were all considered important benefits of commercializing in Europe. A panel of experts agreed with commercial validation and suggested that clinical iteration of the technology is also a key benefit of early European experience. “Shareholders like to have some assurance that the product works outside the parameters of a clinical trial and they like to have confidence in the commercial market acceptance,” noted Versant Ventures partner Andy Corley. David Muller, President & CEO of Avedro agrees but cautions that the product must truly be ready for market. Muller also cautioned against going into the European market too early, however. “If you get shot down by all the key opinion leaders there for poor efficacy you may not get another chance to demonstrate better data later on,” he said. Majorities in the audience felt that Germany most closely correlates with the U.S. market (56%) and is the best European country to enter first (66%). The expert panel, however, was less inclined to bet on any single country, saying decisions really must be made on a case-by-case basis. “You have to look closely at the pricing for a pharmaceutical product in a particular country because prices can rapidly spiral down depending on the ‘reference country’ that others base their pricing on,” said Laurent Attias, Head of Global Commercial Strategy for Alcon.

If you get shot down by all the key opinion leaders there for poor efficacy you may not get another chance to demonstrate better data later on.” 88

— David Muller, President & CEO, Avedro

Government Partners: Working with the NEI and FDA The National Eye Institute (NEI) has an annual budget of $662 million, representing about 2.5% of the total NIH public expenditure. Funding is disbursed to researchers in a number of ways, including R01 and R24 grants and Small B usiness Innovation Research (SBIR) grants. NEI director Paul Sieving, MD, said that everyone who cares about innovation should be concerned about budget pressures on government agencies like NEI, NIH, and the National Science Foundation. “Our funding primes the pipeline of research that fosters innovation,” he said.

Our funding primes the pipeline of research that fosters innovation.” — Paul Sieving, MD, Director, NEI

Sieving cited a number of NEI-funded success stories: • Second Sight’s recently-approved Argus II retinal implant was the beneficiary of more than $100 million in public funding from 5 different agencies over 10 years. • Bioptigen received an SBIR grant to aid in the development of its Envisu handheld SD-OCT system for pediatric and veterinary use. • Emory University’s Henry Edelhauser, PhD, received a $6.9 million R24 grant to explore trans-scleral drug delivery systems, which are now being developed for commercial use. • The nutritional supplement used in the AREDS trial, with massive public health implications, was patented by NEI in 1992, licensed to B+L, and is now commercially available as PreserVision. “NEI continues to fund basic science research in a number of exciting areas in ophthalmology. We are fully committed to working with the private sector to facilitate the translation of the basic sciences into medicine,” Sieving said. OIS attendees also heard from the heads of the ophthalmic device and drug divisions of the Food and Drug Administration. The past year has seen significant change, particularly in the device area, due to the Medical Device www.opthalmologysummit.com

M eeting with the FDA is a lot easier than people think it is.” — Malvina B. Eydelman, MD, Director of the Division of Ophthalmic and Ear, Nose and Throat Devices, Center of Devices and Radiological Health

User Fee Amendments (MDUFA) of 2012. Malvina B. Eydelman, MD, Director of the Division of Ophthalmic and Ear, Nose and Throat Devices in the Center of Devices and Radiological Health, said that in addition to the oft-despised user fees, there is a positive side to MDUFA. The law also provided a significant increase in funding that has allowed Eydelman’s division to hire more personnel, speed up response times, and improve the transparency of their processes. “We have changed our approach to provide companies with leapfrog guidance that delineates the regulatory way forward for technologies that are new to the market,” she said. The additional staff is having an impact, too: While the number of ophthalmic PMA and 510k submissions increased dramatically, from 450 in 2012 to 950 in 2013, the agency was able to significantly shorten total approval time during the same period. Both Eydelman and Wiley A. Chambers, MD, the Deputy Director of the Division of Transplant and Ophthalmology Products in the Center for Drug Evaluation and Research, stressed that they try to respond to phone or email messages within 24-48 hours. “Meeting with the FDA is a lot easier than people think it is,” said Eydelman. “We encourage sponsors to ask us questions very early in the pre-submission process. In my personal experience, an early consultation can shave off 5 to 7 years of device development. Similarly, Chambers encouraged drug manufacturers to request a “special protocol assessment” for every Phase III clinical trial. “It commits the agency to the responses, even if there is a reorganization a few years later and the new people in charge have a different opinion.” 10

Sustaining Innovation in Ophthalmology A View from the Top In the OIS@AAO keynote address, David E.I. Pyott, Chairman of the Board and CEO of Allergan, addressed the challenges that large companies face in sustaining a spirit of innovation. “The imperatives of greater efficiency practically mandate economies of scale, and that has led to consolidation in the industry.” Today, there are only a few major players left with ophthalmology at their core: Allergan, Alcon/Novartis, and Abbott Medical Optics. In large companies like these, he acknowledged, remaining entrepreneurial means fighting against bureaucracy and inertia. Allergan’s approach to staying innovative has been to jump-start R&D. During Pyott’s tenure, annual R&D spending has increased from $100 million in 1998 to more than $1 billion (or 16.5% of sales) today—and he expects that to continue growing to $1.5 billion annually over the next 5 years. Nevertheless, Pyott says the big players can’t do everything within their own walls. “We are constantly looking for new technologies and products, many of which will come from the small companies bringing innovation to our field,” he said. When Pyott considers the environment for innovation in the U.S., he sees both good and bad news. On the negative side are healthcare reform and reimbursement hurdles, new taxes and fees, the rising cost of regulation compliance, and tight government budgets. “Despite all these challenges, I’m optimistic about the future. We remain in a very healthy and attractive environment,” he said.

We are constantly looking for new technologies and products, many of which will come from the small companies bringing innovation to our field.” — David E.I. Pyott, Chairman of the Board and CEO of Allergan www.opthalmologysummit.com

Among the significant opportunities for ophthalmology, Pyott believes, are the aging and increasing affluence of the world’s population. An older proportion means a rising incidence of age-related conditions like cataract and macular degeneration. And with greater affluence comes greater prioritization of longevity and quality of life.

OIS Innovator Award The OIS Innovator Award is given in recognition of individuals whose companies have brought high-impact innovation to ophthalmology to help patients and, in the process, generate value for shareholders and investors. The 2013 Innovator Award was presented to Richard Hill, MD, Co-Founder of Glaukos and inventor of the iStent, and to Thomas Burns, President & CEO of Glaukos. Since its founding in 2001, Glaukos has led the emerging field of micro-invasive glaucoma surgery, or MIGS. The iStent received CE mark in Europe in 2004 and FDA approval in 2012. William Link, PhD, a board director and early investor in the company, noted that a few extra minutes during cataract surgery to implant the iStent can potentially deliver therapy for the rest of that patient’s life. “I believe that more than 3 million patients are going to benefit from MIGS surgery and technology over the next decade,” he said. “My projection is that MIGS product revenue will exceed the revenue of standard IOLs in 3 to 4 years and match that of premium IOLs in about 5 years.” Impressively, the company progressed from the initial idea to its first human implant in just 9 months and with less than $1 million dollars. In between, dozens of micromachined prototypes were developed in the process of refining Glaukos’ first-generation implant. The current, third-generation device is a suprachoroidal stent designed to synergistically activate trabecular and suprachoroidal outflow to reduce pressure without filtering blebs. Early on, the stent required trephination with a separate instrument. Richard Hill credits Richard L. Lindstrom, MD, with the insight that a sharp point to allow 1-step 12

Who knows better than we do what the unmet needs are? We see them every day.” — Daniel S. Durrie, MD, Founder & President, Durrie Vision

insertion would be more efficient. A collector of antique Japanese swords, Hill put Lindstrom’s idea into action immediately by adapting an armor-piercing sword tip to become the leading edge of the iStent. “Being open-minded and listening to those early reactions is a big part of how teams innovate,” said Link. But early reactions to innovation ideas can also be skeptical and downright dismissive. Burns recalled that the company had to fight the perception of modest efficacy among glaucoma specialists, who initially compared the iStent to trabeculectomy and shunts used in late-stage glaucoma rather than viewing it as a safer intervention for those with moderate glaucoma. “We really had to change thought patterns,” agreed Hill.

Physician Entrepreneurship in Ophthalmology While new pharmaceutical therapies are generally developed in a laboratory, great ideas for ophthalmic devices often originate with clinicians trying to solve a problem. “Who knows better than we do what the unmet needs are? We see them every day,” said Daniel S. Durrie, MD, a leading cataract and refractive surgeon. What physicians often don’t anticipate is how much time, effort and money it can take to bring an idea to market. “I thought it might take 5 years to bring the Catalys laser to market, but it took 10,” said Mark S. Blumenkranz, MD, Chairman of the Department of Ophthalmology at Stanford and a former Board Director for OptiMedica. “Along the way you face significant challenges and it can feel like somebody moved the goalpost without telling you,” he said. In the end, of course, the laser was approved for use in the U.S. and the company was successfully sold to AMO in 2013. When asked how he counsels aspiring physician entrepreneurs, Steve Charles, MD, vitreoretinal surgeon and CEO of CamPlex, said he tells doctors they need www.opthalmologysummit.com

We aren’t even beginning to see the downstream effects of the opening of the equity capital markets, we have a better regulatory environment than I’ve ever seen, and technologically the future is bright.” — Mark S. Blumenkranz, MD, Chairman of the Department of Ophthalmology at Stanford

to set their egos aside and focus on what they don’t know. In his first business venture, he said, he was too focused on the engineering at the expense of understanding the business ecosystem. “I’ve learned that I need to add people with core competencies that are different from my own,” he said. Richard L. Lindstrom, MD, recommends that aspiring entrepreneurs do some preparatory work before approaching others for advice. “Consider creating a preliminary business plan, register your product or apply for a patent, review the literature surrounding the device and understand the market for it,” he advises. But Durrie recommended not overdoing the preparation, either. “The mistakes I’ve made are usually in not engaging other professionals early enough,” he said. “Without the right partners, a great idea won’t get anywhere.” He also cautioned colleagues to think carefully about how their idea or device will fit into current practice. “If your idea requires people to change the way they practice medicine, that will be a tough hurdle to overcome.” As an example, he cites Refractec’s FDA-approved conductive keratoplasty procedure. “It was safe and effective, but ophthalmology wasn’t used to a temporary correction business model. Had we introduced that device to plastic surgeons, the outcome might have been entirely different.” Although there are certainly challenges for physician entrepreneurship, Blumenkranz is bullish on the future. “We aren’t even beginning to see the downstream effects of the opening of the equity capital markets, we have a better regulatory environment than I’ve ever seen, and technologically the future is bright,” he said, citing developments in genome sequencing, new-generation anti-VEGF treatments, and lasers as among the bright spots. 14

Private Company Device Showcase Murthy V. Simhambhatla, PhD, Senior Vice President of Abbott Medical Group, and James Garvey, Chairman and Managing Partner of SV Life Sciences, co-moderated a session showcasing 12 privately-held ophthalmic device companies and the technologies they are developing and bringing to market.

Telemedicine Two companies presented exciting developments in the field of telemedicine. ForeseeHome from Notal Vision is an FDA-cleared home telemonitoring device. Patients take a 3-minute daily test at home; physicians are alerted to statistically significant changes measured by the device so that patients can be brought in for follow-up. The goal, said Notal President Scott Jones, is to monitor progression to wet AMD and be able to begin treatment while patients still have good functional vision. “Just as a number of agents have changed the paradigm of treatment for AMD, we believe this technology will change the paradigm of detection,” he said. Sensimed AG has developed a soft contact lens-based solution, the Sensimed Triggerfish, that provides continuous 24-hour IOP readings. Triggerfish is “a powerful solution to manage glaucoma because it will enable doctors to predict risk of progression, assess treatment efficacy and reduce disease progression,” said CEO Jean-Marc Wismer.

Refractive cataract surgery A number of companies presented devices designed to enhance accuracy and improve outcomes in refractive cataract surgery. Two aberrometers for intraoperative guidance of refractive cataract surgery were presented. The established market leader, WaveTec Vision, already has a base of 252 installed systems. Its newest iteration, ORA with VerifEye, provides surgeons with streaming refractive data and faster measurements. Thomas Frinzi, President and CEO of WaveTec, noted that the company’s customers have experienced a 20% increase in premium IOL conversion rates and a 47% decrease in enhancement rates since adopting the ORA technology. Clarity Medical Systems is new to the market with an AAO launch of its continuous real-time aberrometer, Holos Intraop. “Surgeons are actively seeking www.opthalmologysummit.com

solutions to bring cataract surgery outcomes into line,” said CEO Keith Mullowney. The company also makes the RetCam Digital Imaging System used in pediatric care and is launching a campaign to screen all newborns for eye disease and ocular abnormalities at birth. The Cassini corneal topographer from i-Optics Corp. is CE- and FDA-cleared. Conceived of as an addition to refractive cataract surgery, Cassini uses point-source color LED topography to improve astigmatism management. The company’s other products include a confocal SLO device and an integrated service for screening diabetes patients and others at high risk for retinal diseases. ClarVista, a spinout from medical device incubator Prospex Medical, has developed a modular, “tailorable” IOL that is in Phase I of clinical development. This hydrophobic acryclic Harmoni lens has a base device to which the surgeon adds a toric, multifocal, or monofocal optic tailored to the patient’s needs.

Presbyopia Correction By 2020 there will be 2 billion presbyopes worldwide, and companies are lining up to fill the gap in refractive procedures for this large and growing 40- to 65-year-old demographic. Refocus Group is currently collecting 2-year data in anticipation of a 2014 FDA filing. Its bilateral presbyopia treatment involves insertion of four PMMA implants outside the visual axis. The company is also beginning an IOP reduction study. The AcuFocus KAMRA inlay, a small-aperture corneal inlay, is commercially available in 50 countries and has been implanted in 20,000 eyes; a U.S. pre-market approval application has been submitted. Chief Clinical and Regulatory Officer Nicholas Tarantino highlighted the AcuTarget HD, a new multifunctional tool the company has introduced to support patient selection, education and management. Two unique IOLs for presbyopes were also profiled. PowerVision’s fluid-controlled accommodating IOL harnesses natural muscle movements to move fluids from the pontoon-like haptics into the center of the optic, achieving at least 3.0 D of accommodation in all 20 sighted eyes recently implanted with the lens. A multi-site trial is expected to begin in 2014. The Akkolens Lumina is a dual-element accommodating lens designed to be implanted within the ciliary muscle, which pushes the device laterally to create accommodation. CEO Michiel 16

...a new lens for new eyes for a new life…but new money is needed to expand clinical trials.” — Michiel Rombach, CEO, Akkolens

Rombach called it “a new lens for new eyes for a new life…but new money is needed to expand clinical trials.”

Other Categories Sinopsys Surgical profiled its system for minimally invasive lacrimal sinus diversion. Although intended to treat chronic sinusitis, the procedure offers a novel mechanism for delivering common anti-allergy and other ophthalmic drops to the sinuses. Corneal crosslinking strengthens corneal tissue through photochemical interactions between riboflavin, ultraviolet light, and oxygen. Avedro’s KXL system is used extensively for keratoconus and ectasia treatment, as well as for the LASIK Xtra procedure for high myopes, which is CE Mark approved and commercialized in 35 countries. Now, the company is planning a European roll-out of photorefractive intrastromal cross-linking (PIXL), a new, non-invasive method for performing refractive correction. “This procedure is attractive to low myopes who don’t want to commit to surgery—it’s the equivalent of getting their teeth cleaned,” said President and CEO David Muller, PhD.

Private BioPharma Company Showcase Theresa G. H. Heah, MD, Director of Brand Management and Global Marketing for Ophthalmology at Bayer HealthCare Pharmaceuticals and Neil Levine, Senior Director of Marketing for Ophthalmology at Regeneron Pharmaceuticals, co-moderated a lively series of 13 pharmaceutical companies in the process of bringing new drugs, biologics, and novel drug delivery mechanisms to market.

Glaucoma Therapy Aerie Pharmaceuticals just completed its initial public offering, raising $77 million—enough to move its glaucoma treatments through clinical

www.opthalmologysummit.com

development towards a new drug application (NDA) filing. Aerie, considered a leader in rho kinase R&D, has a once-daily, dual-action drug and a triple-action fixed combination with latanoprost. Another company attempting to optimize rho kinase inhibition for glaucoma therapy is Amakem Therapeutics. Rho kinase inhibitors have the potential to be effective in normal-tension glaucoma, according to both companies.

Reducing the Burden of AMD Injection Therapy Another recent IPO, Ophthotech, has demonstrated statistically significant superiority of its anti-PDGF agent Fovista in combination with Lucentis over Lucentis alone for wet AMD in IIb trials and is now actively recruiting for phase III, with data expected in 2016. “There is still an urgent unmet medical need for patients with wet AMD,” said CEO David Guyer.

There is still an urgent unmet medical need for patients with wet AMD.” — David Guyer, CEO, Ophthotech

PanOptica hopes to avert intravitreal injections altogether, especially for younger patients whose lifetime burden of injections is very high. The company has identified an anti-VEGF molecule used in cancer therapy that could be administered in topical eye-drops, relying on the aqueous circulation rather than corneal penetration to get to the target site. “Our team has taken a complicated and ambitious science experiment and turned it into a clinical candidate that has the potential to benefit patients within the next few years,” said President & CEO Paul Chaney. Neurotech is working on encapsulated cell therapy (ECT) that can deliver biologics over multiple years with a single minimally invasive procedure. The company’s lead program involves a PDGF-VEGF combination therapy that will soon begin randomized trials in wet AMD patients, with on-label Eyelea used to treat the comparison group. 18

We have moved from molecule discovery to Phase II studies in less than 4 years.” — Vicken Karageozian, MD, CTO and Co-Founder, Allegro Ophthalmics

Diabetic Macular Edema / Other Retinal Therapy Allegro Ophthalmics is developing integrin peptide therapy for the treatment of retinal diseases. Its lead molecule targets several integrin receptors sites associated with retinal angiogenesis and posterior vitreous detachment and is now being studied in diabetic macular edema (DME), wet AMD and vitreomacular traction. “We have moved from molecule discovery to Phase II studies in less than 4 years,” noted CTO and Co-Founder Vicken Karageozian, MD. iCo Therapeutics, a small publicly traded company with established partnerships with Isis Pharmaceuticals, AstraZenceca MedImmune and the Juvenile Diabetes Research Foundation, detailed its novel 2nd-generation antisense candidate for the treatment of DME, as well as a human monoclonal antibody in the pipeline. Another small publicly-traded company, RXi Pharmaceuticals, is developing a self-delivering Sd-rxRNA therapy intended to combine the positive attributes of antisense and RNAi. Three areas of focus, all in the discovery or pre-clinical stage, are retinal scarring, retinoblastoma, and neovascularization/fibrotic disorders.

Dry Eye Novaliq has developed a new protein delivery system to address the poor solubility of many ophthalmic compounds. Its technology is much smaller than a water droplet, needs no preservatives, spreads well, and dissolves compounds such as cyclosporine. “It’s a compelling drug delivery opportunity to enhance the performance of topical eye drops,” says CEO Bernhard Günther. www.opthalmologysummit.com

There is a way to treat signs and symptoms of dry eye and meet the unmet need by focusing on the biology of the disease.” — Abbie Celniker, CEO, Eleven Biotherapeutics “There is a way to treat signs and symptoms of dry eye and meet the unmet need by focusing on the biology of the disease,” said Eleven Biotherapeutics CEO Abbie Celniker. Her company is initiating pivotal clinical development of a novel interleukin-1 receptor agonist for topical treatment of inflammatory ocular s urface diseases. Eleven also has pipeline drugs for DME and uveitis in earlier-stage development. Kala Pharmaceuticals works with mucus-penetrating particle (MPP) technology to overcome mucosal barriers to ocular therapy for dry eye, post-cataract inflammation, blepharitis, and retinal disease. By harnessing the power of nanotechnology, the company says it is able to achieve superior drug concentrations of loteprednol in target tissues and potentially avoid typical steroid side effects.

Other Drug Delivery Ocular Therapeutix, maker of the ReSure Sealant that just received a favorable FDA panel recommendation, is also a leading developer of sustained release technology. Its drug-eluding punctal plugs offer sustained delivery of therapies for inflammation and glaucoma for up to six months, eliminating daily dosing. “We’re trying to shift the paradigm from pulsed to sustained therapies in ophthalmology,” said President and CEO Amarpreet Sawhney. “We already have the right drugs for

We’re trying to shift the paradigm from pulsed to sustained therapies in ophthalmology.” — Amarpreet Sawhney, President and CEO, Ocular Therapeutix 20

many disease states,” said Icon Bioscience President & CEO William S. (Sandy) White. “The key is getting the right drug to the right place in a clinically optimal manner.” Icon has a deep product portfolio for multiple indications using its injected Verisome drug delivery technology.

Mobile Ophthalmic Technology Showcase The use of mobile applications for smart phones and tablets has grown 400% in the last five years. “Compared to many other fields, ophthalmology and medicine in general are incredibly far behind with mobile technology,” said Gilbert Kliman, MD, Managing Director of InterWest Partners. But he thinks the five companies featured in the OIS session showcasing mobile ophthalmic technologies may change that.

Compared to many other fields, ophthalmology and medicine in general are incredibly far behind with mobile technology.”

— Gilbert Kliman, MD, Gobiquity Mobile Health aims to use Managing Director, mobile diagnostics and monitoring to InterWest Partners improve quality of life. The company’s initial product, GoCheck Kids, is a smart phone-based photo app designed to help pediatricians and others quickly screen for amblyopia so they can refer at-risk kids to an ophthalmologist. DigiSight provides a digital platform for monitoring patients with macular disease, including 2.6 million patients with AMD, DME, or retinal vein occlusion (RVO). “Patients with macular disease are highly motivated to stave off progression and vision loss,” said CEO Doug Foster. By self-testing on mobile devices, their progress between treatments can be monitored. Another app that lets patients take a more active role in their health care is CheckedUp. Developed by Richard Awdeh, MD, this app extends the doctor-patient relationship by providing patients with customized reminders and visual instructions they can see, hear, and repeat as needed. www.opthalmologysummit.com

If we can balance the cost of broad screening of healthy individuals by reducing the cost of treating late-stage disease, it could be very profitable for the health care industry overall.” — Marie Alexander, CEO, KeepYourSight.org

With 2.4 billion people worldwide uncorrected for refractive error, EyeNetra aims to overcome barriers by making diagnostic eye tests available using a smart phone and inexpensive, off-the-shelf components. KeepYourSight.org is a nonprofit organization dedicated to providing free telemedicine vision screenings for glaucoma, DME and AMD. “These major sight-threatening diseases often remain undetected. We have a public health problem but little public awareness,” said Marie Alexander. KeepYourSight.org offers tools that charitable organizations and others can use to test for perimetric visual function and macular function. “If we can balance the cost of broad screening of healthy individuals by reducing the cost of treating late-stage disease, it could be very profitable for the health care industry overall,” Alexander said.

About OIS OIS was created as a platform to push ophthalmic innovation and commercialization by facilitating meaningful interactions and business partnerships between physicians, academic scientists, entrepreneurs, investors and industry executives. Plan to attend the next OIS meeting in Boston on the eve of the 2014 ASCRS meeting. For more information, visit www.oisascrs.com. For videos and presentations from OIS/AAO 2013 visit www.oisTV.net.

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