Cortigent, through its predecessor Second Sight Medical Products, Inc., is a pioneer in developing precision (targeted) neurostimulation systems to help patients recover critical body functions. Our technology combines advanced neuroscience with proprietary microelectronics, software, and data processing capabilities to provide artificial vision and potentially restore muscle movement. Our first commercial system, Argus II®, a retinal implant, was approved by the U.S. Food and Drug Administration (“FDA”) under a Humanitarian Device Exemption (“HDE”) and has provided artificial vision to hundreds of profoundly blind people who were implanted with this device. Building on this neurostimulation platform we have completed an early feasibility clinical trial to evaluate a more advanced system for artificial vision that we call “Orion.” We are further exploring the application of our Orion® neurostimulation technology for accelerating the recovery of arm and hand function in patients who are partially paralyzed due to stroke. In February 2023, we held a meeting with FDA staff to commence discussions of an early feasibility clinical study in stroke victims. We believe that additional future applications of our platform technology may have the potential to generate substantial business growth over time. Both the Argus II and Orion devices create artificial vision by using electrical stimulation. Artificial vision does not restore normal stereoscopic vision or vision with color but rather perceptions of light and shapes requiring implantees to interpret their environment through specialized training. This artificial vision can aid in supporting basic tasks such as finding a doorway, detecting another person’s presence, following a sidewalk or locating an object. For the Argus II device, the stimulation is delivered to the surviving cells of the retina which convey the activity to the brain via the optic nerve. For the Orion device, electrical stimulation is delivered directly to the visual cortex, the region of the brain responsible for vision. The pattern of electrical stimulation corresponds to the images captured by a small video camera mounted in the center of the glasses that the patient wears and is connected to the video processing unit (“VPU”). The VPU is a battery-powered device worn by the user, typically on a belt or a strap, that sends power and stimulation commands to the implant and receives diagnostic information from the implant via the external antenna of the glasses. Argus II users undergo surgery to implant an electrode array inside the eye on the surface of the retina and affix a small electronics case (like a metal button) and an antenna to the outer surface of the eye. A small cable traverses the eye wall, connecting the electronics case to the array. Orion users undergo cranial surgery to implant an electrode array placed on the surface of the brain on the visual cortex and have a small electronics case and an antenna implanted on the outside of the skull, but completely covered by the scalp. A small cable passes through the skull to connect the array to the electronics case. No part of the device penetrates or cuts into the brain tissue itself. The quality of the artificial vision created by both the Argus II and Orion systems varies from patient to patient. The perception typically appears as a collection of up to 60 small points of light that correspond to the brightness of the different regions of the visual image detected by a camera. With scanning and repetition, patients can use their perception of the lights to construct a better understanding of their environment. The Argus II design process began in 2004. The Argus II was a novel device that required the components to be developed internally. The Argus II feasibility study commenced in 2006. In March 2011, the Argus II® Retinal Prosthesis System was approved for commercial use in the European Union to provide visual perception in patients with profound blindness due to retinitis pigmentosa (“RP”), a rare condition. The device was initially available in the United Kingdom, France, Germany and several other countries at a price of approximately USD $115,000. In February 2013, the U.S. Food and Drug Administration (FDA) approved Argus II under a Humanitarian Device Exemption, and in August 2013 the reimbursement price for Medicare patients was approved at approximately $150,000. More than 350 profoundly blind people around the world have received Argus II retinal implants. Many of these patients have been using their Argus implants for more than ten years, confirming our high manufacturing standards and product reliability. The market opportunity for the Argus II was limited to the small number of patients who have profound blindness due to RP, and we discontinued production and marketing of the Argus system in 2019 due to resulting commercial considerations. To make artificial vision available to a much larger group of individuals who are blind due to a wider range of causes, including glaucoma, diabetic retinopathy, optic nerve injury or disease and eye injury, we designed and built our next generation system, the Orion® Visual Cortical Prosthesis System (“Orion”). The Orion system leverages our 20 years of experience in precision neurostimulation for artificial vision. To be eligible for the Orion system, patients must be bilaterally blind with bare or no light perception. This is defined as non-measurable binocular visual acuity, or 5° or less visual field in each eye. We refer to these eligibility criteria as “profound blindness.” Cranial surgery is required to place the electrode array onto the brain’s surface; the Orion system has been designed not to penetrate the brain tissue. The design process began in 2014 and required substantial changes to the Argus II implant electronics to generate higher currents with a redesigned array for implantation on the brain cortex rather than within the eye. In November 2017 we commenced an Early Feasibility Study (EFS) of Orion in six patients who enrolled at two medical sites, the Ronald Reagan UCLA Medical Center in Los Angeles (“UCLA”) and the Baylor College of Medicine in Houston (“Baylor”). Regularly scheduled visits at both sites were paused in mid-March 2020 due to the COVID-19 outbreak; visits at UCLA resumed in September 2020 and at Baylor in December 2020. Three of the six patients were explanted after the third year of the study and the remaining three patients continue to use their devices outside of the clinic. We have three-year safety data for all six subjects, and five-year safety data for three subjects: . Orion safety data: Five subjects experienced a total of seventeen adverse events (AEs) and one subject did not report any adverse events related to the device or to surgery through July 2024. One was considered a serious adverse event (SAE) and all other adverse events were not serious. The single SAE, a seizure, occurred about three months post-implant, was resolved safely and quickly, and did not require a hospital stay. The investigators determined that this SAE was device-related and not unexpected as it had been disclosed as a potential safety risk in the patient informed consent form. The SAE occurred as we attempted to explore the optimal treatment frequency, which is a key stimulation parameter. The SAE occurred at a specific frequency. All adverse events are evaluated by an independent medical safety monitoring (IMSM) committee. With the IMSM committee’s input, we thereafter kept stimulation frequencies for all patients below the level that induced the SAE, and we have not observed any other seizures in this or any other participant. The FDA requires medical device manufacturers to follow 21 CFR 820 and maintain a Quality Management System (QMS). As a part of our QMS, we conform to ISO 14971, an FDA-recognized standard, to identify the hazards associated with the medical device, to estimate and evaluate the associated risks, to control these risks, and to monitor the effectiveness of the controls. There have been no serious adverse events due to the device or surgery since June 2018. One patient chose to have the device explanted before the 36th month due to an unrelated medical condition. Two other patients subsequently requested explantation for reasons unrelated to the device’s efficacy or safety. Cortigent’s independent medical safety monitor (IMSM) has determined that the reasons for these explants were not related to the device or the surgery. We have three-year efficacy data for five of the six original subjects (one did not participate in this assessment), and five-year efficacy data for three subjects: . Orion efficacy data: We assess efficacy by looking at three measures of visual function: 1) Square localization – Orion subjects sit in front of a touch screen and are asked to touch within the boundaries of a square when it appears; 2) Direction of motion – Subjects are asked to identify the direction of the motion of a line that traverses a screen; and 3) Grating visual acuity – a measure of visual acuity that is adapted for very low vision. Five of the six original subjects completed the planned efficacy assessments at 36 months post-implant and three completed these assessments at 60 months. – For square localization, at 36 months five of the six original subjects remained in the study and all performed significantly better with the system turned on versus turned off. At 60 months, three of the six original subjects remained in the study and all performed significantly better. – For direction of motion, at 36 months the five subjects remaining in the study all performed significantly better with the system turned on than with it turned off. At 60 months, the three subjects remaining in the study all performed significantly better. – For grating visual acuity, at 36 months two of the five subjects remaining in the study had measurable visual acuity with the system turned on compared to none with the device turned off. At 60 months, two of three remaining subjects had measurable visual acuity. Another efficacy measurement of day-to-day functionality and benefit is the Functional Low-Vision Observer Rated Assessment (FLORA). The FLORA assessments were performed by an independent, third-party specialist who spent time with the subjects in their homes. The specialist asked each subject a series of questions and observed them performing 15 or more daily living tasks with the Orion system turned on and with it turned off, such as finding light sources, following a sidewalk, or sorting laundry. The specialist then determined if the system was providing a benefit, was neutral, or impaired the subject’s ability to perform these tasks. Four of four subjects who completed the FLORA evaluation at 36 months had positive or mildly positive results indicating that the Orion system was providing benefit. This evaluation was not performed at the 60-month timepoint. Cortigent is planning to work with the FDA to gain agreement on the additional clinical studies that will be required to secure marketing approval for Orion. The FDA categorizes electronic medical devices that are implanted as Class III. Both the Argus II and Orion are in this Class III category and require FDA approval. Class III devices face higher burdens to attain regulatory approval; Cortigent (formerly Second Sight Medical) successfully navigated this approval process with the Argus II system. The Argus II clinical trial enrolled patients with late-stage retinitis pigmentosa, a rare disease, affecting less than four thousand Americans. This small potential market size of fewer than 8,000 individuals enabled the Argus II to qualify for a Humanitarian Device Exemption (HDE) which the FDA granted in February 2013. In November 2017, the FDA granted an Expedited Access Pathway (EAP) designation to the Orion system to treat individuals who are bilaterally blind due to non-cortical etiology and who are not candidates for any other commercially approved vision restoration therapy. The Breakthrough Device Program (BDP) subsumed the EAP program and its devices in December 2018. Breakthrough Device designations, such as granted to Orion, are intended to accelerate medical device development, assessment, and review, while preserving the statutory standards for premarket approval. The potential patient population for Orion is expected to include blindness due to most common causes, including glaucoma, diabetic retinopathy, eye trauma, optic nerve damage, and retinitis pigmentosa. According to a company-sponsored 2018 study by Fletcher Spaght Inc., there are about 82,000 Americans who could potentially benefit from the Orion system. We are developing a platform technology with multiple potential applications: Our current-generation miniature neurostimulation device with 60 independently controlled cortical stimulation channels, supported by reliability data from the Argus II and Orion programs, is expected to serve as a platform for targeting other conditions with high unmet medical need. Technical evaluations of potential new indications for the technology began in 2021. We believe that our most promising next target will be to apply cortical neurostimulation to improve recovery of arm and hand function in partially paralyzed stroke patients who are undergoing rehabilitation after stroke. This medical treatment concept is supported by evidence from clinical studies conducted by Northstar Neuroscience, Inc. in the early 2000s using a single-channel electrical stimulation device that was placed on the motor cortex, the area of the brain surface that controls hand and arm motion (the same surface area of the brain where our device will be placed). Northstar reported achieving positive patient results in its Phase 1 and Phase 2 clinical studies (Cramer 2007) but a pivotal Phase 3 study failed to achieve statistical significance at the 4-week primary endpoint. Northstar was unable to obtain FDA approval and was eventually dissolved. It has been reported that a clinical benefit was demonstrated at six months (Levy 2016). We believe that our 60-channel cortical stimulation device has the potential to target neuron bundles more precisely and generate favorable clinical results. Like Orion, the stroke recovery system will require cranial surgery; in this case to place the electrode array on the motor cortex. We began to design the stroke system in 2022, and during February 2023 we studied what we believe to be the optimal array placement on the motor cortex of a cadaver. We have filed an NIH grant application to seek non-dilutive funding to support this program but it was not initially awarded. We plan to reapply for grant funding in early 2025. In addition, in February 2023 we held a pre-submission (“Pre-Sub”) meeting with FDA staff to discuss commencing an Early Feasibility Study of the stroke recovery system. We applied for a Breakthrough Device designation for the stroke recovery system in April 2023 and the FDA responded that human clinical data will be needed to make this determination. If we fail to secure this designation, we may experience slower interactions with the FDA that could delay our projected development timelines. We are targeting substantial revenue opportunities: The Orion system, designed to provide visual perception to profoundly blind people, has a target market of approximately 82,000 individuals in the U.S., assuming the planned indication is achieved (profound blindness due to glaucoma, diabetic retinopathy, optic nerve injury or disease and eye injury), based on a study by an independent market research firm engaged by Cortigent. We believe that about one-third of these patients could be reached by a marketing program. Depending on study results to assess clinical utility, Cortigent may seek reimbursement similar to or higher than the $150,000 per device that was approved by the Centers for Medicare and Medicaid Services (“CMS”) for the Argus II system. These assumptions translate into an estimated total addressable U.S. market size that could potentially exceed $4 billion at the time of launch. We believe that there are substantially more blind people who could potentially benefit from Orion in Europe, Asia and other world areas. There are approximately 7.6 million living Americans who have reported a stroke in their lifetime. (Tsao 2022). Consequently, we believe that the sales potential for a medical device system that can help improve motoric function in partially paralyzed stroke victims is very large. Each year approximately 610,000 Americans have a first stroke (Kissela 2012). Among the over 80% of people who survive a first stroke, the most common neurological deficit is motor weakness on one side of the body (hemiparesis), and approximately 40% of these stroke victims suffer moderate to severe motor impairment that requires special care (Gresham 1995). If our device achieves treatment success, as to which we can make no assurance, we estimate that it could potentially benefit up to 195,000 U.S. stroke victims each year, creating a total addressable market estimated at approximately $6 billion by the time of system launch. Several critical development and regulatory milestones must be accomplished in order to complete and market the Orion and stroke recovery systems. We face the material risks of failing to achieve successful clinical trials, to attain regulatory approvals, and to secure favorable product reimbursement for patients covered by Medicare and other types of insurance. Even with a successful trial, it could be determined that certain patient subpopulations cannot be effectively treated by our devices which would reduce our product sales potential. The development process may take longer and be more costly than anticipated and we may not achieve reimbursement levels similar to the one we received for our Argus II device or obtain other suitable reimbursement levels that we may require. Since we currently have no commercial revenues, any of these outcomes could require substantial additional funding. No assurance can be made that clinical trials will demonstrate safety and efficacy or will lead to commercial products. Clinical trial planning: The five-year Orion Early Feasibility Study was completed in July 2023, and at our election is being extended by approximately another year to allow for additional exploratory research to improve vision quality, for example by enhanced contrast filtering or by other software modifications. The next step will be to manufacture and validate new Orion devices for a planned pivotal clinical trial that we expect will involve approximately 60 profoundly blind subjects at approximately 10 U.S. trial centers. These are internal estimates and the size of the Orion pivotal clinical trial will depend upon further review and collaborations with the FDA. Our intended target is to commence the pivotal trial by or about mid 2026, complete it by approximately mid 2028, and if successful to obtain FDA clearance and launch Orion on the US market in early 2029. For the stroke recovery system, we anticipate manufacturing modified clinical trial devices for the planned Early Feasibility Study (EFS) in parallel with manufacturing of the Orion devices. Our intended target is to commence this EFS for the stroke recovery system in mid 2026. We anticipate a shorter time for stroke recovery patients to reach the primary study endpoint than for Orion (nine months versus 12 months, respectively). Patient population size and other terms of the stroke recovery system pivotal trial will depend upon the outcomes of the stroke recovery systems EFS and on further review and collaboration with the FDA. Our intended target is to commence a pivotal clinical trial for the stroke recovery system in late-2027, complete it by mid 2029, and if successful to be able to launch the stroke recovery system in late 2029. The target clinical development timelines for Orion and the stroke recovery system, shown in the diagram below, are subject to further discussions and collaborations with the FDA and assume that adequate financing will be available to fund the execution of our clinical development programs. Clinical trials require FDA approvals and clearances. No assurance can be given that we will be able to obtain these approvals and clearances, that we will obtain approval of a marketable device or that we will be able to launch commercially successful products. --- The timeline presented represents management’s estimate of the time required to complete each stage. No assurance can be given that these timelines will prove correct. Intellectual property: Cortigent has amassed an extensive intellectual property estate consisting of rights (as of September 30, 2024) to 207 issued U.S. patents, 20 issued European patents (nationalized in France and Germany, or a unitary patent plus Great Britain), two pending U.S. patent applications, including a recent filing covering the stroke recovery device under development, two pending European patent applications, four issued U.S. design patents and four issued European design registrations (with six corresponding issued British design registrations). Our patent estate covers the technologies invented during the development of the Argus and Orion devices. Our patent estate primarily covers the core technologies of implant neurostimulation techniques and achieving implant longevity, which are integral to our current and future product lines, including the planned stroke rehabilitation system. Pre-Revenue company: We are a pre-revenue company with a history extending from 1998, including the history of our predecessor Second Sight Medical Products, Inc., of recurring operating losses that are likely to continue for the foreseeable future. We will require substantial additional capital, including the proceeds of this offering, to continue development of our products and fund clinical trials. Relationship with Vivani Prior to this offering Cortigent has been a wholly owned subsidiary of Vivani Medical, Inc. (Nasdaq: VANI), formerly known as Second Sight Medical Products, Inc. (“Second Sight”). Second Sight had historically operated as a standalone public company but completed a merger with Nano Precision Medical, Inc. as of August 2022. Vivani Medical, Inc. is the resulting entity of this August 2022 merger of Nano Precision Medical Inc. into a subsidiary of Second Sight Medical Products, Inc. Cortigent includes personnel, technologies, intellectual property and other assets that formerly comprised the vision operations of Second Sight Medical Products, Inc. Cortigent was organized as a Delaware corporation in November 2022 as a successor to the business and operations formerly conducted by Second Sight Medical Products, Inc. Our principal executive offices are located in 27200 Tourney Road, Suite 315 Valencia, California.
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