Ocugen Q2 2024 Earnings Report

Ocugen EPS Results

• Actual EPS: -$0.04
• Consensus EPS: -$0.06
• Beat/Miss: Beat by +$0.02
• One Year Ago EPS: -$0.10

Ocugen Revenue Results

• Actual Revenue: $1.14 million
• Expected Revenue: N/A
• Beat/Miss: N/A
• YoY Revenue Growth: N/A

Ocugen Announcement Details

• Quarter: Q2 2024
• Date: 8/8/2024
• Time: Before Market Opens
• Conference Call Date: Thursday, August 8, 2024
• Conference Call Time: 8:30AM ET

Ocugen (NASDAQ:OCGN) Inc is a clinical-stage biopharmaceutical company focused on discovering, developing and commercializing gene therapies to treat rare inherited retinal diseases, as well as vaccines designed to address unmet needs in infectious diseases. Headquartered in Malvern, Pennsylvania, the company applies its proprietary gene therapy platform to create novel treatments aimed at preserving and restoring vision, while leveraging strategic partnerships to broaden its vaccine pipeline.

In its gene therapy portfolio, Ocugen is advancing multiple programs targeting retinal disorders. Lead candidates include OCU400 for retinitis pigmentosa and OCU410 for wet age-related macular degeneration, each engineered to deliver functional genetic material to retinal cells. The company’s approach is rooted in adeno-associated viral (AAV) vector technology, which has the potential to enable single-administration treatments and durable therapeutic benefits for patients facing progressive vision loss.

On the vaccine front, Ocugen entered into a collaboration with India-based Bharat Biotech in mid-2020 to co-develop and commercialize the COVID-19 vaccine Covaxin in the United States and Canada. This partnership illustrates Ocugen’s ability to partner with established developers to bring critical vaccine candidates into North American regulatory pathways. The company is also exploring additional vaccine opportunities that may leverage its manufacturing and distribution networks.

Founded in 2014, Ocugen is led by President and Chief Executive Officer Dr. Shankar Musunuri, who co-founded the company with the goal of addressing conditions with limited or no treatment options. Under his leadership and that of an experienced management team, Ocugen continues to advance its pipeline through clinical trials and regulatory interactions, with a mission to deliver innovative therapies for patients worldwide.

Ocugen Q2 2024 Earnings Call Transcript

Key Takeaways

• Ocugen closed a $32.6 million financing in Q2, extending its cash runway into Q3 2025, with cash, cash equivalents and restricted cash of $16 million as of June 30, 2024.
• The Ocu400 Phase 3 LIMELITE trial for retinitis pigmentosa is actively recruiting, backed by FDA orphan and RMAT designations, and includes an FDA-approved expanded access program for adults ≥18 regardless of mutation.
• Over 60% of intent-to-treat patients in the Phase 1/2 Ocu400 study met the responder criteria (≥2 lux improvement), and the Phase 3 is powered >95% to detect a 50% responder rate using the proprietary LDNA mobility test.
• Ocu410 for geographic atrophy has completed dosing in its third cohort, launched a Phase 2 dose-expansion trial, and anticipates safety and preliminary efficacy updates later this year for its one-time subretinal RORA gene therapy.
• Ocu410 ST for Stargardt disease holds FDA orphan drug designation and is enrolling in the high-dose cohort of its Phase 1/2 GUARDIAN trial, targeting a disease with no approved therapies and ~100,000 patients in the U.S. and EU.

Presentation

[Operator]

Good morning, and welcome to Ocugen's second quarter 2024 financial results and business update. Please note that this call is being recorded at this time. All participant lines are in a listen-only mode. Following the speaker commentary, there will be a question and answer session. I will now turn the call over to Tiffany Hamilton, Ocugen's Head of Corporate Communications. You may begin.

[Tiffany Hamilton, Head of Corporate Communications at Ocugen]

Thank you, operator, and good morning, everyone. Joining me on today's call and webcast is Dr. Shankar Musunuri, Ocugen's Chairman, CEO, and Co-founder, who will provide a business update and an overview of our clinical and operational progress. Michael Brininger, our Corporate Controller, is also on the call to provide a financial update for the quarter ended June 30th, 2024. Dr. Huma Qamar, Chief Medical Officer, will be available to answer questions following the presentation. This morning, we issued a press release detailing associated business and operational highlights for the second quarter of 2024. We encourage listeners to review the press release, which is available on our website at ocugen.com. This call is being recorded, and a replay with the accompanying slide presentation will be available on the investor section of the Ocugen website for approximately 45 days.

[Tiffany Hamilton, Head of Corporate Communications at Ocugen]

This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which are subject to risks and uncertainties. We may, in some cases, use terms such as predicts, believes, potential, proposed, continue, estimates, anticipates, expects, plans, intends, may, could, might, will, should, or other words that convey uncertainty of future events or outcomes to identify these forward-looking statements. Such statements include, but are not limited to, statements regarding our clinical development activities and related anticipated timelines. Such statements are subject to numerous important risk factors and uncertainties that may cause actual events or results to differ materially from our current expectations.

[Tiffany Hamilton, Head of Corporate Communications at Ocugen]

These and other risks and uncertainties are more fully described in our periodic filings with the Securities and Exchange Commission, SEC, including the risk factors described in the section entitled "Risk Factors" in the quarterly and annual reports that we file with the SEC. Any forward-looking statements that we make in this presentation speak only as of the date of this presentation, except as required by law. We assume no obligation to update forward-looking statements contained in this presentation, whether as a result of new information, future events, or otherwise, after the date of this presentation. Finally, Ocugen's quarterly report on Form 10-Q, covering the second quarter of 2024, has been filed. I will now turn the call over to Dr. Musunuri.

[Shankar Musunuri, Chairman, CEO and Co-founder at Ocugen]

Thank you, Tiffany, and thank you all for joining us today. We're excited to discuss the substantial progress of our modifier gene therapy platform across all three clinical programs. To continue driving these programs, we recently completed a successful fundraising effort with net proceeds of $32.6 million, extending our runway into the third quarter of 2025. Our scientific advances and the strategic growth of company were further acknowledged by our inclusion in the Russell Index in June. This ranking demonstrates the value of our pipeline and supports Ocugen's dedication to creating long-term shareholder value. Additionally, the recent offering was led by a premier mutual fund, along with participation from leading life sciences investors, which further strengthens our shareholder base. We're actively recruiting patients in our OCU400 phase III LIMELIGHT clinical trial for the treatment of retinitis pigmentosa, RP.

[Shankar Musunuri, Chairman, CEO and Co-founder at Ocugen]

Just this week, we announced FDA approval for an expanded access program, EAP, for the treatment of adult patients aged 18 and older with RP with OCU400. This is the first-ever gene therapy candidate to treat patients with RP, regardless of mutation, approved for EAP. We also progressed into the OCU410 phase II ARMADA clinical trial for the treatment of geographic atrophy, an advanced stage of dry age-related macular degeneration. Following completion of dosing in patients in phase I, I will discuss these pivotal milestones in greater depth later in the presentation. Additionally, we're about to conclude phase I of the OCU410ST phase I/II GUARDIAN clinical trial for the treatment of Stargardt disease. OCU400 is making remarkable strides in clinical development, and we are actively dosing patients in the phase III LIMELIGHT clinical trial.As announced earlier, OCU400 has received key regulatory approvals, including expanded orphan drug designations for RP from the FDA and the European Medicines Agency, as well as Regenerative Medicine Advanced Therapy, RMAT, designation from the FDA. With phase III dosing, OCU400 remains on track to meet the 2026 approval targets for a Biologics License Application, BLA, from the FDA and for a Marketing Authorization Application, MAA, from the European Medicines Agency. We are very encouraged that more than 60% of the intent to treat patients from the phase I/II clinical trial, including patients with RHO mutation

[Shankar Musunuri, Chairman, CEO and Co-founder at Ocugen]

The OCU400 phase III study includes pediatric patients, eight years of age or older, and adults with early intermediate to advanced stages of RP. The study has a sample size of 150 participants. One arm has 75 participants with the RHO gene mutations, and the other arm has 75 participants with the mutations in any of several other genes, randomized two to one. A mobility test, the luminance dependent navigation assessment, LDNA, is the primary endpoint of the study. In this assessment, a participant navigates an obstacle course that constitutes a more sensitive and specific measurement of visual function than the mobility measurement used in previous phase III clinical trials. The phase III Limelight study will focus on the proportion of responders in treated and untreated groups who achieve an improvement of at least two lux levels from baseline.

[Shankar Musunuri, Chairman, CEO and Co-founder at Ocugen]

Let me take a moment to discuss the unmet need and underserved market for RP patients. There are approximately 300,000 patients in the U.S. and E.U. that are affected by the disease, which is caused by mutations in any of approximately 100 different genes. The only other treatment currently on the market addresses mutations in one gene associated with RP. OCU400 has the potential to treat multiple gene mutations because of its gene agnostic mechanism of action, and in this way, it will fulfill a significant unmet medical need. We continue our extensive campaign to educate the ophthalmology community about the concept of modifier gene therapy, and we recently presented supporting data at a variety of conferences, such as Annual Meeting of the American Society of Retina Specialists, which convened in Stockholm, Sweden, last month. At the conference, Dr.

[Shankar Musunuri, Chairman, CEO and Co-founder at Ocugen]

Benjamin P. Pockros, who serves as the Director of Clinical Research at Associated Retina Consultants and as Clinical Assistant Professor at the University of Arizona College of Medicine – Phoenix, presented phase I/II data on OCU400. With the initiation of our EAP for OCU400, RP patients with early intermediate to advanced RP, with at least minimal retinal preservation and who may benefit from the mechanism of action of OCU400, may be eligible to receive treatment prior to approval of the BLA. The decision by the FDA to endorse the use of OCU400 in any patients with RP reflects the agency's position on the safety, tolerability, and benefit profile of OCU400 for any mutations relative to any risk of treatment. The approval of an expanded access program for OCU400 further supports the gene-agnostic mechanism of action for this novel modifier gene therapy.

[Shankar Musunuri, Chairman, CEO and Co-founder at Ocugen]

We look forward to working with clinicians, patients, and the RP community to provide access to OCU400 for eligible patients through our EAP. Now, let's move on to our developments in OCU410 and OCU410ST, which aim to treat Geographic Atrophy secondary to dAMD and Stargardt Disease respectively. These modifier gene therapies leverage a nuclear receptor gene called RORA, which stands for RAR-related orphan receptor A, as a potential one-time therapy for life with a single subretinal injection. OCU410, physically designed to address multiple pathways implicated in the pathogenesis of dAMD, offers a distinct advantage for current treatment options that target only one pathway, the complement system, and require frequent intravitreal injection, about 6 to 12 doses per year, accompanied by various safety concerns, such as roughly 12% of patients developed with AMD.

[Shankar Musunuri, Chairman, CEO and Co-founder at Ocugen]

OCU410 has the potential to regulate all four pathways related to disease progression, lipid metabolism, inflammation, oxidative stress, and the complement system, thereby addressing the underlying causes of the disease with a single subretinal injection. An ARMADA clinical trial update, providing further insights into the safety and efficacy of OCU410 is anticipated later this year. Our approach with OCU410 is to provide a comprehensive and durable solution with a potential one-time treatment. There are 2 million to 3 million geographic atrophy patients among the 19 million people affected by AMD in the U.S. and Europe, demonstrating a considerable market opportunity. In July, we announced the completion of dosing in the third cohort of the OCU410 phase I/II ARMADA clinical trial for the treatment of geographic atrophy. Today, nine patients with geographic atrophy have been treated with a low, medium, and high doses.The phase II dose expansion, Assessor blinded

[Shankar Musunuri, Chairman, CEO and Co-founder at Ocugen]

Stargardt affects approximately 100,000 people in the U.S. and Europe, and there is no approved therapies available. These efforts represent our commitment to advancing treatments for blindness, focusing on innovative gene therapy solutions that aim to provide lasting benefits to patients. We look forward to sharing further updates as we continue to advance these promising therapies through clinical development. With that, I will now turn the call over to our corporate controller, Michael Brininger, to provide an update on our financial results for the second quarter ended June 30th, 2024. Michael?

[Michael Breininger, VP at Ocugen]

Thank you, Shankar. The company's cash, cash equivalents, and restricted cash totaled $16 million as of June 30th, 2024, compared to $39.5 million as of December 31st, 2023. The company had 257.4 million shares of common stock outstanding as of June 30th, 2024. Total operating expenses for the three months ended June 30th, 2024, were $16.6 million and included research and development expenses of $8.9 million and general and administrative expenses of $7.7 million. This compares to total operating expenses for the three months ended June 30th, 2023, of $24 million. That included research and development expenses of $14.5 million and general and administrative expenses of $9.5 million.

[Michael Breininger, VP at Ocugen]

As stated earlier, we recently completed a successful fundraising effort with net proceeds of $32.6 million, extending our runway into the third quarter of 2025. As always, we are constantly exploring strategic and shareholder-friendly opportunities to increase our working capital and continue to pursue strategic partnerships that will drive long-term strategy. That concludes my update for the quarter. Tiffany, back to you.

[Tiffany Hamilton, Head of Corporate Communications at Ocugen]

Thank you, Mike. We will now open the call for questions. Operator?

[Operator]

At this time, I would like to remind everyone, in order to ask a question, press Star, then one on your telephone keypad. We will pause for just a moment to compile the question and answer roster. Our first questions comes from the line of Sean Lee. Please go ahead.

[Sean Lee, VP of Equity Research at HC Wainwright]

Hi, good morning. This is Sean from HC Wainwright, standing in for RK. How are you?

[Shankar Musunuri, Chairman, CEO and Co-founder at Ocugen]

Good morning, Sean.

[Sean Lee, VP of Equity Research at HC Wainwright]

Great. Thanks for taking my questions. My first one is on the OCU400 expanded access program. I was wondering, what is the EAP primarily targeted towards, since I'm sure you are still actively recruiting a lot of patients into the phase III study?

[Shankar Musunuri, Chairman, CEO and Co-founder at Ocugen]

Uma?

[Huma Qamar, CMO at Ocugen]

Yes, thank you for the question. So the expanded access program is targeting the population that do not meet the inclusion, exclusion criteria for Phase III, or they would have to have an option, needing a little bit more flexibility based on what we have not offered in our Phase III, because that is mandated by FDA regulatory process. So in this trial, our inclusion criteria would be 18 years of age, anyone that has a clear, certified genetic diagnosis of RP, and those who have photoreceptors left, and also discretionary by the treating physician. This is the decision that individually will be taken by the treating physician and the patient.

[Sean Lee, VP of Equity Research at HC Wainwright]

I see. Thanks for that. On to the OCU400 phase III. I was wondering, have you disclosed what's the expected difference between the treatment and untreated arms, and how is the study powered to detect it?

[Shankar Musunuri, Chairman, CEO and Co-founder at Ocugen]

Yeah. So the treated and untreated. Untreated is not truly untreated because it's an SSR blinded study. It's a subretinal surgery, so that's the way you actually blind the study. So the study is powered at 2:1 ratio. That means out of 150 patients, 50 patients are going to be in the untreated group. And the study is powered at greater than 95%, assuming there is a 50% response rate. So responders are defined as- who can reach either two levels or higher on the mobility test, which is our mobility test is proprietary LDNA.

[Sean Lee, VP of Equity Research at HC Wainwright]

Okay, understood. So 95% to detect a 50% difference. Got it.

[Shankar Musunuri, Chairman, CEO and Co-founder at Ocugen]

Yes.

[Sean Lee, VP of Equity Research at HC Wainwright]

Finally, for the OCU410 study update expected later this year, could you elaborate a little more on what can we expect at the update? What will you provide? What kind of data will you provide?

[Huma Qamar, CMO at Ocugen]

So yes, for the OCU410 geographic atrophy secondary to dry age-related macular degeneration study, we are hoping to provide preliminary safety and efficacy updates later this year.

[Sean Lee, VP of Equity Research at HC Wainwright]

So we can expect both safety and some efficacy results then.

[Huma Qamar, CMO at Ocugen]

Yes.

[Sean Lee, VP of Equity Research at HC Wainwright]

Great. Thanks. That's all the questions I have. Thanks again for taking my questions.

[Shankar Musunuri, Chairman, CEO and Co-founder at Ocugen]

Thank you.

[Operator]

Our next question comes from the line of Robert LeBoyer with Noble Capital Markets. Please go ahead.

[Robert LeBoyer, Managing Director at Noble Capital Markets]

Good morning. My question has to do with OCU400, and you'd mentioned that you're on track for the 2026 BLA. So, I was wondering if you could give any details on upcoming milestones or data presentations for the trial.

[Shankar Musunuri, Chairman, CEO and Co-founder at Ocugen]

Robert. Good morning, Robert. Since it's an SSR blinded study, updates will be providing our, on the recruitment rates, how we are meeting the BLA timeline. Since we do have RMAT designation, as well as, orphan designations in U.S. and EU, that will allow us to do a rolling submission of our BLA, and MAA. So that's the process potentially we're going to take, starting from late next year. And then when the clinical recruitment is done, early next year, that will take one year for us to complete the last patient, which is the duration of the trial. And when the data comes out, we'll close the clinical sections, and then that will trigger the accelerated path of six months in 2026. So that will allow us to potentially get approvals in both U.S. and EU, late 2026.

[Robert LeBoyer, Managing Director at Noble Capital Markets]

Okay, great. Thank you very much.

[Shankar Musunuri, Chairman, CEO and Co-founder at Ocugen]

Thank you, Robert.

[Operator]

Our next question comes from the line of Daniel Gatulin with Chardan Capital Markets. Please go ahead.

[Daniil Gataulin, Director of Equity Research at Chardan Capital Markets]

Hi, this is Janani on behalf of Daniel. So my first question is on OCU200. Can you tell us where you are in the process for getting the clinical hold lifted for OCU200? And once the hold is lifted, will you be launching the trial right away, or are you focusing on the gene therapy programs at this point? Thank you.

[Shankar Musunuri, Chairman, CEO and Co-founder at Ocugen]

We are still working with FDA to submit the information they requested, and we designed a very simple phase one study. After FDA's decision lifting the clinical hold, we will define the path forward for the program.

[Daniil Gataulin, Director of Equity Research at Chardan Capital Markets]

Okay. And for-

[Shankar Musunuri, Chairman, CEO and Co-founder at Ocugen]

I mean, again, as I just want to reiterate, our focus has been primarily gene therapies, but the 200 is a good program. As soon as the FDA lifts the clinical hold, we'll provide a direction on that program.

[Daniil Gataulin, Director of Equity Research at Chardan Capital Markets]

Okay, thank you. So I have another question on OCU400. So are there meaningful differences in achieving responder criteria with the LDNA compared to the mobility assessments used in previous phase III trials?

[Shankar Musunuri, Chairman, CEO and Co-founder at Ocugen]

Yes. As we stated and showed today, intent to treat population data we analyzed from the phase I/II. That means patients who will qualify for phase III based on our criteria, and we clearly showed 62% response rate based on people who can reach two levels or more. And in the approved product, they are 52% response rate. And I think one of the questions earlier we addressed, we powered the study at 50% response rate. That means we actually powered it lower than what we achieved in phase II.

[Daniil Gataulin, Director of Equity Research at Chardan Capital Markets]

Great. Thank you.

[Operator]

This concludes the question and answer portion. I will now turn the call back over to Chairman, CEO, and Co-founder, Dr. Shankar Musunuri. Please go ahead.

[Shankar Musunuri, Chairman, CEO and Co-founder at Ocugen]

Thank you, operator. Thank you, everyone, for joining us today. We appreciate your continued support as we move forward with our groundbreaking scientific and clinical initiatives. We look forward to the second half of 2024 as we continue to solidify Ocugen's position as a biotechnology leader. Thank you.

[Operator]

Ladies and gentlemen, that concludes today's call. Thank you all for joining. You may now disconnect.

Participants

Executives

• Huma Qamar, CMO
• Michael Breininger, VP
• Shankar Musunuri, Chairman, CEO and Co-founder
• Tiffany Hamilton, Head of Corporate Communications

Analysts

• Daniil Gataulin, Director of Equity Research at Chardan Capital Markets
• Robert LeBoyer, Managing Director at Noble Capital Markets
• Sean Lee, VP of Equity Research at HC Wainwright