KALA BIO, Inc. Q1 FY2021 earnings call

• EYSUVIS launched in early January, with over 11,600 prescriptions filled by over 2000 unique prescribers as of April 23rd. Secured coverage for approximately 43% of commercial lives (69 million lives) for EYSUVIS.
• Eye care professionals show high awareness of EYSUVIS, with nearly 80% familiar and 70% having prescribed it. Plan to expand sales force to ~105 by Q3 and ~125 by end of 2021.
• INVELTYS faced pandemic impact on ocular surgery volume, with ~37,000 prescriptions in Q1 2021 vs. 41,000 in Q4 2020.
• Entered a new $125 million credit facility, pushing debt repayment obligations out by at least two years, enhancing cash runway to fund operations for at least two years.
• Advancing pipeline programs, including SEGRM and TKI, aiming to enter clinical development later in 2021.

In the first quarter of 2021, Kala Pharmaceuticals reported net product revenues of $3.3 million. This was composed of $1.63 million from INVELTYS sales and $1.64 million from EYSUVIS sales. The cash position as of March 31, 2021 was $156 million, an increase from $153.5 million at the end of 2020. Cost of product revenues for the quarter was $800,000, SG&A expenses were $27.7 million, and R&D expenses were $3.1 million.

Management anticipates cash resources as of March 31, 2021, combined with revenue from EYSUVIS and INVELTYS, will fund operations for at least the next two years. Expect continued growth for EYSUVIS with expanding market access and sales force, and see potential for INVELTYS growth as elective ocular surgeries recover towards pre-COVID levels with vaccine rollout.

• COVID-19 impact on ocular surgery volumes, affecting INVELTYS revenue projections.
• Uncertainty in market access and payer coverage for EYSUVIS impacting prescription growth.
• Actual results may differ materially from forward-looking statements due to various risk factors described in SEC filings.

Q: What trends are you seeing in cataract surgeries that give confidence they'll pick up later in the year?

A: Surgical volume is at ~80% of pre-COVID levels; ophthalmologists expect to return to near full pre-COVID levels by end of year due to vaccine rollout.

Q: Can you speak to confidence in adding additional EYSUVIS contracts near term?

A: Expect additional wins in Q2, with commercial coverage continuing to expand throughout 2021 as key driver of prescription growth.

Q: What's the breakdown of prescriptions between ophthalmologists and optometrists?

A: ~55% of prescriptions from optometrists, ~45% from ophthalmologists; optometrists treat younger patients with mild-to-moderate dry eye, ideal for EYSUVIS.