Oyster Therapeutics Stock: State Of Business Is Confounding (NASDAQ:OYST)2 min read
Oyster Place Pharma, Inc. (NASDAQ:OYST) has an accredited merchandise, Tyrvaya (OC-01, varenicline solution) Nasal Spray for dealing with dry eye condition, and it is also in the pipeline for Neurotrophic Keratopathy Stage 1. NK is a exceptional condition characterized by diminished corneal sensitivity and lousy corneal healing. For the pipeline plan, the company claims in its earnings connect with:
We continue on to enroll individuals in our OLYMPIA Stage 2 examine of OC-01 nasal spray aimed at dealing with Phase 1 NK. We stay on keep track of to hope outcomes of this demo in the 2nd 50 percent of this 12 months.
Now, coming to the approval, Tyrvaya was accredited in October 2021 and started in the sector by early November. So this was effectively the to start with whole quarter of reported earnings for Tyrvaya.
Dry eye disorder occurs in more than 38 million Americans. Current treatment method alternatives are Allergan’s Restasis and Shire’s Xiidra the two are presented as eye drops. Restasis is a mild immunosuppressant even though Xiidra is an anti-inflammatory drug. Having said that, offered the formulation that necessitates providing the medications instantly to the eye – often a cumbersome and unpleasant system – compliance is low. Moreover, these therapies choose months to get the job done from the onset of therapy. The business states there are 7 million clients that have tried using and abandoned the common therapies.
Tyrvaya takes advantage of a totally new supply method, as effectively as a exceptional mechanism of action. It is used as a nasal drop, and it operates by triggering the trigeminal nerve which in its switch triggers tear production. In 3 clinical trials in in excess of 1000 sufferers in moderate, reasonable and significant dry eye sickness – ONSET-1, ONSET-2 and MYSTIC – the drug has shown safety and efficacy. Individuals confirmed statistically sizeable enhancements in tear film production as assessed working with the Schirmer’s score at Week 4, with extra than 50% patients demonstrating optimal tear manufacturing in comparison to about 50 percent that number in the placebo group:
TYRVAYA-taken care of clients showed statistically important advancements in tear film manufacturing as assessed employing the anesthetized Schirmer’s rating (-35 mm) at 7 days 4. Of the patients handled with TYRVAYA, 52% accomplished ≥10 mm enhance in Schirmer’s score from baseline in the ONSET-1 analyze, and 47% achieved ≥10 mm increase in Schirmer’s rating from baseline in the ONSET-2 analyze, as opposed to 14% and 28% of car or truck-taken care of patients in the ONSET-1 analyze and the ONSET-2 examine, respectively at Week 4 (p<0.01 in both studies). Of the patients treated with TYRVAYA, the mean change in Schirmer's score was 11.7 mm and 11.3 mm as compared to 3.2 mm and 6.3 mm in the vehicle treated patients in the ONSET-1 study and ONSET-2 study, respectively at Week 4.
So the first full quarter revenue is $2.7mn. Around 19,000 prescriptions were filled, and these were written by 4500 unique prescribers. 65% of all patients went for refills. A number of patients have continued using the medicine for 6 months starting from November.
The company has also taken great strides on the mediclaim front. In February, TYRVAYA was placed on Express Scripts National Preferred basic and high performance formularies, which collectively make up around 26 million lives. The company has gone on to add more payers, and now it has commercial coverage for up to approximately 95 million lives, which represents 52% of all U.S. commercial lives.
OYST has a market cap of $134mn and a cash balance of $144mn. This is a terrible state of affairs. There’s a short interest of 22%, which says that the market still thinks the company is overvalued. For a commercial stage company with a clinically successful drug to be in this sorry state is unnerving for investors.
Sales and marketing expenses for the three months ended March 31, 2022, were $27.0 million, General and administrative expenses were $12.9 million, and Research and development expenses were $4.7 million. Net product revenues for the three months ended March 31, 2022, were $2.7 million. At this rate, and ignoring any major improvement in sales, the company hardly has cash for 2 more quarters.
In order to curtail some of these high expenses – high for a small company, that is – the company has gone through a restructuring process. This, it says, will lead to $6M-$8M in savings this year but also include laying off up to 50 workers. The company expects savings of $40-$48mn in 2023. These measures will allow it to commercialize Tyrvaya better, and also put focus on the NK pipeline program. This plan will also include retiring John Snisarenko, Chief Commercial Officer, effective July 1.
The company signed a deal with a Chinese firm last year to commercialize Tyrvaya in China against $17.5mn in upfront payment and a stake in that Chinese company.
I really have nothing to say. Restasis is a billion dollar drug, while Xiidra is a half-a-billion dollar drug. Tyrvaya has an admittedly better mechanism of action and mode of delivery. Yet it is floundering in the market, and I cannot find any reason for that except perhaps lack of execution, which is also difficult to allege given what the company has been doing. All in all, this is a perplexing situation, and when I am perplexed, I tend to avoid buying.
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