Kala Pharmaceuticals(KALA) - 2019 Q4 - Earnings Call Transcript

Financial Data and Key Metrics Changes - As of December 31, 2019, the company's cash position was $85.4 million, down from $170.9 million as of December 31, 2018 [32] - For Q4 2019, INVELTYS net revenue was reported at $1.2 million, while the full-year 2019 net revenue was $6.1 million [33] - The net loss for Q4 2019 was $22 million, or $0.63 per share, compared to a net loss of $25.2 million, or $0.76 per share for the same period in 2018 [37] Business Line Data and Key Metrics Changes - INVELTYS prescriptions grew to over 144,000 since its launch, with approximately 47,000 prescriptions reported in Q4 2019, representing a 17% increase over Q3 2019 [11][23] - The company achieved an 11.2% NRx share in the branded steroid market and an 18.8% NRx branded market share among eye care professionals [24] - EYSUVIS is expected to target a market of approximately 33 million patients with dry eye disease in the U.S., with an estimated total addressable market potential exceeding $8 billion annually [19][20] Market Data and Key Metrics Changes - The branded steroid market and prescriptions were down by 16.5% between Thanksgiving and Christmas holidays, yet INVELTYS showed positive growth [23] - The company has achieved unrestricted access for approximately 80% of all commercial lives and about 23% of Medicare Part D lives [26] Company Strategy and Development Direction - The company aims to position EYSUVIS as the preferred first-line prescription therapy for dry eye flares, with launch preparations already underway [28] - The sales force is expected to grow from 57 to between 75 and 100 representatives to effectively cover 75% to 85% of all dry eye prescriptions if EYSUVIS is approved [27][61] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the upcoming top-line results from the STRIDE 3 trial and the potential for EYSUVIS to meet a significant unmet need in the dry eye market [54] - The company anticipates a stable operating expense situation in 2020, with a reduction in R&D expenses expected following the completion of the STRIDE 3 trial [56][73] Other Important Information - The company plans to resubmit its NDA for EYSUVIS in Q2 2020, expecting a Class II designation which would entail a six-month review period [10][48] - The company reported that the weighted average number of shares outstanding at the end of 2019 was 35.5 million [74] Q&A Session Summary Question: Differences in patient characteristics in STRIDE trials - Management explained that changes in STRIDE 3 aimed to exclude patients with unstable symptom profiles during the run-in phase, which could improve statistical outcomes [42][43] Question: Update on INVELTYS prescriber growth - The company reported that over 3,300 physicians have prescribed INVELTYS, achieving about 50% penetration of the target universe of 6,000 to 7,000 physicians [47] Question: Confidence in EYSUVIS filing timeline - Management reiterated confidence in the six-month filing timeline for EYSUVIS based on previous experiences with similar resubmissions [48] Question: 2020 priorities in light of EYSUVIS results - Management expressed excitement about the STRIDE 3 trial results and the potential market need for EYSUVIS, indicating readiness to launch if results are positive [52][54] Question: R&D expense expectations post-STRIDE 3 - Management confirmed expectations for reduced R&D expenses in 2020, particularly related to clinical trial work [73] Question: Shares outstanding and 10-K filing - The company confirmed 35.5 million shares outstanding at the end of 2019 and indicated that the 10-K would be filed within the week [74]