With Positive Phase III Results, Oyster Point Pharma Banks $120 Million from Public Offering

Oyster Point Pharma has taken two big steps recently to advance development of its OC-01 nasal-spray candidate to treat dry eye disease: the closing of a $120.8 million public stock offering and reporting of positive top-line results from the Phase III ONSET-2 trial. The company’s lead candidate, varenicline, a highly selective nicotinic acetylcholine receptor (nAChR) agonist, showed statistically significant improvement for both sign and symptom endpoints in the trial.

“The patients we enrolled are reflective of a real-world setting – that is the thing I am most proud of with our studies,” said CEO Jeffrey Nau, PhD, MMS, in an interview with OIS Weekly. “Patients had symptoms that ranged in severity across the entire spectrum – with eye dryness scores from 0 to 100 – and we still showed statistically significant improvement in both our Phase IIb and III studies. That is something that no one else has ever done.”

He said the results will translate to the real world when the nasal spray hits the market, and expressed confidence that patients’ success will mimic what was shown in the trials.

Cash in Hand
The trial results appear to have investors believing, too. With $120 million, the company boasts a strong cash position as it readies a New Drug Application submission for the second half of this year with a potential US product launch in the fourth quarter of 2021. That offering translates into 4.3 million shares at $28 per share.

“We are fortunate to be where we are with no debt on our balance sheet as we transition into a commercial company,” Dr. Nau continued. “We are putting the necessary infrastructure in place as we build a strong sales force, and we are doing so at a time when other front-of-the-eye companies have consistently shrunk theirs.”

OC-01, using a novel delivery method for its well-known active ingredient, is a preservative-free aqueous nasal spray designed to re-establish tear film homeostasis. It works by activating the trigeminal parasympathetic pathway in the nasal cavity to stimulate natural tear film production.

The US dry-eye market is massive, with an estimated 30 million afflicted and counting. The company says an estimated 16 million have been diagnosed with dry eye, which is still an unmet need in eye care. “We really see the product as a game changer in this space,” Dr. Nau said.

ONSET-2 Results
The ONSET-2 trial with 758 patients met the prespecified primary endpoint in both the 0.6 mg/mL and 1.2 mg/mL doses tested, demonstrating statistically significant improvement in Schirmer score from baseline to week four in subjects receiving OC-01 nasal spray versus the control group (p<0.0001).

For the higher-dose group, symptom improvement as determined by the eye dryness score in the normal clinic environment was seen at week four (p=0.002) and as early as week two (p=0.009). No new safety signals were observed and the overall safety profile of the nasal spray was found to be consistent with previous data. Sneeze was the most common side effect, reported in 50% of nasal-spray administrations, but it was transient and mild in severity.

“Oyster Point was built on a product that has a lot of potential in the marketplace for front-of-the-eye disease,” Dr. Nau explained. “There is somewhat of a vacuum of large players in the marketplace focused on just the ocular surface; we aim to be at the forefront. We are not looking to bring in a molecule with some small incremental value; rather we are seeking to develop innovative therapies to treat the front of the eye.”

Other Potential Indications
Oyster Point has its sights on other potential indications, such as contact lens intolerance-associated dry eye and presurgical ocular surface optimization for refractive procedures.

“We are excited about the opportunity to develop this product for indications outside of dry eye, as we think it will have utility in other diseases,” Dr. Nau said. “The ability to stimulate natural tear film can be leveraged across a number of additional therapies in the ophthalmic space through a novel mechanism.”

OC-01 is in preclinical stages for neurotrophic keratitis, and the company’s investigational agent, OC-02 (simpinicline), is in two Phase IIb clinical trials for dry-eye disease.