Ocuphire Pharma(US:OCUP)2025-03-31 21:14PART I ITEM 1. BUSINESS Opus Genetics develops gene therapies for inherited retinal diseases, expanding its pipeline and prioritizing gene therapy programs - Opus Genetics, Inc. is a clinical-stage ophthalmic biotechnology company developing gene therapies for inherited retinal diseases (IRDs) and other ophthalmic disorders31 - The Opus Acquisition in October 2024 significantly expanded the product pipeline to include adeno-associated virus (AAV) based gene therapies for Leber congenital amaurosis (LCA), bestrophinopathy, and retinitis pigmentosa3540 - OPGx-LCA5, the most advanced gene therapy program, targets LCA5 gene mutations. An ongoing Phase 1/2 clinical trial has shown visual improvement in three adult patients with late-stage disease (one-year data) with no dose-limiting toxicity or serious adverse events. The program has received Rare Pediatric Disease Designation and Orphan Drug Designation from the FDA, with the first pediatric patient enrolled in Q1 2025 and data anticipated in Q3 202536445558 - OPGx-BEST1 is another gene therapy candidate for BEST1 gene mutations (Best Disease), with preclinical studies supporting a first-in-man clinical trial. Preliminary Phase 1/2 data is aimed for Q1 202637447889 - RYZUMVI (Phentolamine Ophthalmic Solution 0.75%) was approved by the FDA in September 2023 for pharmacologically induced mydriasis and commercially launched by Viatris in April 2024. Two Phase 3 trials (VEGA-3 for presbyopia, LYNX-2 for dim light vision disturbances) are ongoing, with topline results expected in H1 2025 and mid-2025, respectively. It also received Fast Track designation for chronic night driving impairment3945474899107110115119 - APX3330, a small-molecule inhibitor for non-proliferative diabetic retinopathy (NPDR), has completed Phase 2 and received FDA agreement under SPA for a Phase 3 program. The company is seeking a strategic partner to advance its clinical development, redirecting existing resources toward gene therapy programs384245126130 - The company relies on third-party contract manufacturers for drug substances and products and does not own or operate any manufacturing facilities143 - The company faces substantial competition from major pharmaceutical and biotechnology companies with greater resources. While no direct competitors are currently known for OPGx-LCA5, BEST1, NMNAT1, or MerTK gene therapies, other IRD gene therapies are in development. RYZUMVI faces competition for presbyopia and a generic challenge from Sandoz, Inc. APX3330 competes with anti-VEGF therapies and other R&D stage treatments for diabetic retinopathy185186187188189380381382397 Company Overview & Strategy This section describes the company's core business, strategic focus, and operational approach Pipeline Overview This section details the company's product candidates, their development stages, and therapeutic areas Market Overview This section provides an analysis of the target markets for the company's products Sales and Marketing This section outlines the company's strategies for product sales and market penetration Manufacturing This section describes the company's manufacturing processes and supply chain arrangements License Agreements This section details the company's various licensing and collaboration agreements Intellectual Property This section covers the company's patents, trademarks, and other proprietary rights Competition This section analyzes the competitive landscape and key market rivals Government Regulation and Product Approvals This section explains the regulatory framework and approval processes for the company's products Healthcare Reform This section discusses the impact of healthcare reform on the company's business Healthcare Frauds & Abuse and Compliance Laws and Regulations This section addresses compliance with healthcare fraud and abuse laws Healthcare Reimbursement This section describes the reimbursement landscape for the company's products Human Capital Resources This section provides information on the company's employees and human resource management Available Information This section specifies where public information about the company can be accessed ITEM 1A. RISK FACTORS The company faces significant risks in acquisition, gene therapy, clinical trials, commercialization, finances, regulation, and IP - Risks related to the Opus Acquisition include potential integration failures, the expanded pipeline not improving common stock value, and the possibility of diverting funds for Series A Preferred Stock dividends if conversion is not approved by stockholders315316318319320321 - Gene therapy product candidates are based on novel technology, making development time and cost difficult to predict. There is a risk of unforeseen adverse events, negative public perception, and complexities in manufacturing322325327328 - Clinical trials may face substantial delays, result in failure, or provide inconclusive or adverse results. Difficulties in patient enrollment and changes in regulatory requirements could further impede development and regulatory approvals346350353356358360 - Commercial success is heavily dependent on the product pipeline. Failure to find strategic partners or inadequate commercialization by partners (like Viatris for RYZUMVI/PS) could materially harm the business. Achieving market acceptance among physicians, patients, and payors is also a significant challenge364365368369373388392 - The company has not generated significant revenue from product sales, expects to incur losses for the foreseeable future, and had an accumulated deficit of approximately $139.0 million as of December 31, 2024. Substantial additional capital will be needed, which could lead to stockholder dilution or require relinquishing rights to technologies412414415416423426719722 - The highly regulated biopharmaceutical industry means legislative reform or changes in the regulatory environment could increase the difficulty and cost of obtaining marketing approval, affect pricing, and impact commercial viability. Post-marketing obligations, restrictions, or withdrawal from the market are also risks433434436437 - Inadequate patent protection could allow competitors to commercialize similar products. The company is currently involved in a patent infringement lawsuit against Sandoz, Inc. regarding RYZUMVI®, which could be expensive, time-consuming, and unsuccessful, potentially reducing market share and future revenue397398487490491498503504510 - The company relies completely on third parties (CROs, manufacturers) for nonclinical and clinical trials, as well as drug supply and manufacturing. Failures by these third parties to meet contractual duties, deadlines, or regulatory requirements could delay or prevent regulatory approval and harm the business460462465471473476 - The business and operations are vulnerable to system failures or unplanned events, including cyber incidents, network security breaches, service interruptions, or data corruption, which could materially disrupt operations and adversely affect the business532546 ITEM 1B. UNRESOLVED STAFF COMMENTS The company has no unresolved staff comments from the SEC - No unresolved staff comments are applicable to the company542 ITEM 1C. CYBERSECURITY The company manages cybersecurity risks via NIST frameworks, with no material incidents reported to date - The company has adopted a cybersecurity risk management program based on National Institute of Standards and Technology (NIST) frameworks543 - The program includes processes to identify, assess, manage, and monitor risks from cybersecurity threats, conducting assessments at least annually and evaluating third-party vendor cybersecurity risks543 - As of the report date, no risks from a cybersecurity threat or incident have been identified that are reasonably likely to have a material effect on the business strategy, results of operations, or financial condition546 - The cybersecurity risk management program is led by the Company's Finance organization, with the Senior Vice President of Finance reporting on cybersecurity matters to the Audit Committee at least annually and to senior management as appropriate547 ITEM 2. PROPERTIES The company's headquarters is in Durham, NC, occupying 84 square feet under a lease expiring in September 2025 - The company's headquarters is located in Durham, North Carolina548 - The headquarters consists of approximately 84 square feet of office space under a short-term, non-cancellable facility lease that expires on September 30, 2025548 ITEM 3. LEGAL PROCEEDINGS The company is involved in a patent infringement lawsuit against Sandoz regarding RYZUMVI generic approval - The company is subject to litigation and claims arising in the ordinary course of business549 - In March 2025, the company, in collaboration with its commercialization partner for RYZUMVI®, filed a patent infringement complaint against Sandoz, Inc. in response to Sandoz's ANDA filing for a generic version of RYZUMVI549504 - The complaint seeks equitable relief enjoining Sandoz from infringing the specified RYZUMVI patents549 ITEM 4. MINE SAFETY DISCLOSURES This item is not applicable to the company - Mine Safety Disclosures are not applicable to the registrant550 PART II ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Common stock trades on Nasdaq, with new shares issued post-acquisition and Series A Preferred Stock convertible pending approval - The company's common stock trades on the Nasdaq Capital Market under the symbol "IRD"5551 - As of March 27, 2025, there were 45,483,823 shares of common stock outstanding and approximately 67 holders of record7552 - In connection with the Opus Acquisition on October 22, 2024, the company issued 5,237,063 shares of common stock and 14,145.374 shares of Series A Non-Voting Convertible Preferred Stock to the securityholders of Private Opus553565770 - The Series A Preferred Stock is convertible into common stock, subject to stockholder approval at the 2025 Annual Meeting. If conversion is not approved, holders will be entitled to cumulative quarterly cash dividends starting October 15, 2025321554556807 - The company has not paid any cash dividends on its common stock since inception and plans to retain future earnings for business development538560 ITEM 6. [RESERVED] This item is reserved and not applicable - This item is reserved and not applicable562 ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The company discusses its financial condition, operating results, and capital needs, reporting a net loss of $57.5 million for 2024 - Opus Genetics, Inc. is a clinical-stage ophthalmic biotechnology company developing gene therapies for inherited retinal diseases (IRDs) and other ophthalmic disorders564 - The company acquired Private Opus on October 22, 2024, expanding its pipeline to include AAV-based gene therapies for LCA, bestrophinopathy, and retinitis pigmentosa565566 - Key pipeline assets include OPGx-LCA5 (Phase 1/2 ongoing, pediatric data Q3 2025), OPGx-BEST1 (preliminary Phase 1/2 data Q1 2026), RYZUMVI (FDA approved Sept 2023, commercialized April 2024 by Viatris), and APX3330 (Phase 3 program ready, seeking partner)569570571572 Summary of Operating Results (in thousands) | Metric | 2024 | 2023 | Change | | :----------------------------------- | :---------- | :---------- | :---------- | | License and collaborations revenue | $10,992 | $19,049 | $(8,057) | | General and administrative expenses | $18,215 | $11,959 | $6,256 | | Research and development expenses | $26,851 | $17,653 | $9,198 | | Acquired in-process R&D expenses | $28,000 | $0 | $28,000 | | Total operating expenses | $73,066 | $29,612 | $43,454 | | Loss from operations | $(62,074) | $(10,563) | $(51,511) | | Net loss | $(57,532) | $(9,986) | $(47,546) | | Accumulated deficit (as of Dec 31) | $(138,998) | $(81,466) | $(57,532) | - As of December 31, 2024, the company had $30.3 million in cash and cash equivalents and believes this is sufficient to fund operations for at least twelve months602640737 - The company's primary funding sources have been equity offerings ($89.7 million), convertible notes ($8.5 million), and license/milestone payments from the Viatris License Agreement ($35 million non-refundable, $10 million milestone)603 - Subsequent to December 31, 2024, the company raised approximately $21.5 million in combined gross proceeds from an underwritten public offering and a private placement in March 2025607891 - The company anticipates substantial additional capital requirements in the future to fund R&D, regulatory approvals, manufacturing, and commercialization efforts, which may involve equity, debt, or strategic collaborations423644647 Company Overview This section provides a high-level summary of the company's business and strategic direction Strategic Outlook This section outlines the company's future plans and strategic priorities Financial Operations Overview This section summarizes the company's financial structure and operational performance Results of Operations This section analyzes the company's financial performance over the reporting periods Liquidity and Capital Resources This section details the company's cash position, funding sources, and capital needs Contractual Obligations and Commitments This section outlines the company's significant contractual liabilities and future commitments Critical Accounting Policies and Estimates This section describes the key accounting policies and significant estimates used in financial reporting Recent Accounting Pronouncements This section discusses the impact of recently issued accounting standards ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK This item is not applicable to the company - Quantitative and Qualitative Disclosures About Market Risk are not applicable to the registrant666 ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA This section presents audited financial statements, including balance sheets, income statements, and cash flows, with notes - The section includes the Report of Independent Registered Public Accounting Firm, Consolidated Balance Sheets, Consolidated Statements of Comprehensive Loss, Consolidated Statements of Changes in Series A Preferred Stock and Stockholders' Equity, Consolidated Statements of Cash Flows, and Notes to Consolidated Financial Statements671704 - The consolidated financial statements are prepared in conformity with U.S. Generally Accepted Accounting Principles (GAAP)15708734 - A critical audit matter identified was the accounting for the Opus Acquisition, specifically the significant estimation used to determine the fair value of acquired in-process research and development (IPR&D) of $28 million, due to the complexity of the valuation model and sensitivity of underlying assumptions713714 Report of Independent Registered Public Accounting Firm This section presents the auditor's opinion on the company's financial statements Consolidated Balance Sheets This section provides a snapshot of the company's assets, liabilities, and equity at specific dates Consolidated Statements of Comprehensive Loss This section details the company's revenues, expenses, and net loss over periods Consolidated Statements of Changes in Series A Preferred Stock and Stockholders' Equity This section tracks changes in the company's equity accounts Consolidated Statements of Cash Flows This section reports the company's cash inflows and outflows from operating, investing, and financing activities Notes to Consolidated Financial Statements This section provides detailed explanations and disclosures supporting the financial statements Note 1. Company Description and Summary of Significant Accounting Policies This note details Company Description and Summary of Significant Accounting Policies Note 2. Mergers This note details Mergers Note 3. Commitments and Contingencies This note details Commitments and Contingencies Note 4. Supplemental Balance Sheet Information This note details Supplemental Balance Sheet Information Note 5. Related Party Transactions This note details Related Party Transactions Note 6. Series A Preferred Stock This note details Series A Preferred Stock Note 7. Stockholders' Equity This note details Stockholders' Equity Note 8. Stock-based Compensation This note details Stock-based Compensation Note 9. Apexian Sublicense Agreement This note details Apexian Sublicense Agreement Note 10. License and Collaboration Agreements This note details License and Collaboration Agreements Note 11. Net loss per share This note details Net loss per share Note 12. Income Taxes This note details Income Taxes Note 13. Deferred Compensation Plan This note details Deferred Compensation Plan Note 14. Subsequent Events This note details Subsequent Events ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE There have been no changes in or disagreements with accountants on accounting and financial disclosure - There were no changes in or disagreements with accountants on accounting and financial disclosure668 ITEM 9A. CONTROLS AND PROCEDURES Disclosure controls and internal control over financial reporting were effective as of December 31, 2024 - The company's disclosure controls and procedures were evaluated as effective as of December 31, 2024669 - Management concluded that the company's internal control over financial reporting was effective as of December 31, 2024, based on criteria established in the Internal Control—Integrated Framework (2013) issued by COSO673 - No changes in internal control over financial reporting occurred during the quarter ended December 31, 2024, that materially affected, or are reasonably likely to materially affect, internal control over financial reporting674 ITEM 9B. OTHER INFORMATION No directors or officers adopted or terminated Rule 10b5-1 trading arrangements in Q4 2024 - No director or officer adopted or terminated a "Rule 10b5-1 trading arrangement" or "non-Rule 10b5-1 trading arrangement" during the fiscal quarter ended December 31, 2024675 ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS This item is not applicable to the company - Disclosure regarding foreign jurisdictions that prevent inspections is not applicable to the registrant676 PART III ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE Information on directors, executive officers, and corporate governance is incorporated by reference from the proxy statement - Information required by Item 10 is incorporated by reference to the sections of the 2025 Proxy Statement under "Corporate Governance" and "Proposal No. 1 – Election of Directors," "Executive Officers"679 - The company has adopted an Insider Trading Compliance Policy governing the purchase, sale, and/or other dispositions of its securities by directors, officers, and employees681 ITEM 11. EXECUTIVE COMPENSATION Information regarding executive compensation is incorporated by reference from the proxy statement - Information required by Item 11 is incorporated by reference to the sections of the 2025 Proxy Statement under "Executive Compensation" and "Proposal No. 1 – Election of Directors – Non-Employee Director Compensation"682 ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS Information on security ownership is incorporated by reference from the proxy statement - Information required by Item 12 is incorporated by reference to the sections of the 2025 Proxy Statement under "Security Ownership of Certain Beneficial Owners and Management" and "Executive Compensation – Securities Authorized for Issuance under Equity Compensation Plans"682 ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE Information on related transactions and director independence is incorporated by reference from the proxy statement - Information required by Item 13 is incorporated by reference to the sections of the 2025 Proxy Statement under "Certain Relationships and Related-Party Transactions" and "Corporate Governance"683 ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES Information on principal accountant fees and services is incorporated by reference from the proxy statement - Information required by Item 14 is incorporated by reference to the sections of the 2025 Proxy Statement under the caption "Proposal No. 2 – Ratification of Independent Registered Public Accounting Firm"683 PART IV ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES This section lists all exhibits and financial statement schedules filed as part of the Annual Report on Form 10-K - The section lists financial statements, corporate documents (Restated Certificate of Incorporation, Certificate of Amendment, Certificate of Designation, Amended and Restated Bylaws), and various forms of warrants685687 - Key agreements listed include the Merger Agreement, Sublicense Agreement, Lease Agreements, Equity Incentive Plans, Contingent Value Rights Agreement, Sales Agreements, Purchase Agreement, Registration Rights Agreement, and multiple License and Collaboration Agreements (Viatris, Processa, University of Pennsylvania, Iveric, Massachusetts Eye and Ear Infirmary)687689691694695697699 - Also included are various employment and consulting agreements for key personnel, an Insider Trading Compliance Policy, and certifications from executive officers681689691694695697699 ITEM 16. FORM 10-K SUMMARY No Form 10-K summary is provided in this report - No Form 10-K summary is provided in this report702