Release Date: August 01, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Sight Sciences Inc (SGHT, Financial) reported total revenue of $21.4 million for Q2 2024, reflecting an 11% sequential growth.
- The company achieved a significant milestone with the publication of the SAHARA one-year data in the dry eye segment.
- Quarterly cash usage declined by almost 30% compared to the prior-year period, indicating disciplined expense management.
- The proposed Medicare payment rules for 2025 could result in a 29% increase in Medicare's ASC facility payment rate for procedures using OMNI technology.
- Sight Sciences Inc (SGHT) trained over 150 surgeons on OMNI and over 100 surgeons on SION in the first half of 2024, positioning the company for future growth.
Negative Points
- Total revenue for Q2 2024 decreased by 9% compared to the second quarter of 2023.
- Dry eye revenue for Q2 2024 was $1.1 million, down 46% compared to the second quarter of 2023.
- Gross margin for the dry eye segment declined to 47% in Q2 2024 from 55% in the same period in the prior year.
- The company expects dry eye revenue to decrease further due to an increase in dry eye pricing effective October 1, 2024.
- Sight Sciences Inc (SGHT) narrowed its full-year 2024 revenue guidance to $81 million to $83 million, representing growth of approximately 0% to 2% compared to 2023.
Q & A Highlights
Q: Can you talk about why the potential deceleration in the back half for surgical glaucoma on a two-year CAGR basis?
A: Alison Bauerlein, CFO: In 2023, we were significantly impacted by proposed LCDs that were ultimately withdrawn. Recently, more favorable LCDs have been proposed without coverage restrictions for OMNI or SION. Our focus in 2024 has been to regain momentum and achieve double-digit growth. We expect double-digit surgical glaucoma revenue growth in the second half of 2024 and are set up nicely for 2025 with the proposal of device-intensive status and the efficacy profile of OMNI.
Q: Are you maintaining the 2025 double-digit growth expectations? And what's a rough revenue run rate that gets you to cash flow breakeven?
A: Alison Bauerlein, CFO: We are not prepared to give 2025 guidance yet but are confident in our ability to gain share and grow the market. We see significant growth potential in both combination cataract and standalone markets. TearCare is also an accelerant for growth if we achieve market access wins. We haven't set a specific revenue target for cash flow breakeven but have made substantial improvements in cash usage, indicating we are on track to reach our goals.
Q: What are your expectations for the second half of '24 for cash burn?
A: Alison Bauerlein, CFO: We expect to continue improving cash burn in the second half of 2024 and into 2025. We are focused on being efficient with our spending while investing in key commercial and R&D activities. More dry eye investments will come in 2025 as we see market access wins.
Q: For any doctors or practices that have gotten TearCare claims paid out, what are you seeing in terms of volumes?
A: Alison Bauerlein, CFO: We are still early in the process of getting claims paid for TearCare. While we have seen some claims paid at reasonable rates, it is too early to extrapolate any significant trends or volume increases from this data.
Q: Can you discuss the mix of OMNI usage in standalone and combination procedures and expectations for adoption with updated facility fees?
A: Alison Bauerlein, CFO: We estimate about 85% of procedures are done in combination with cataract and 15% on a standalone basis. The proposed increase in reimbursement for CPT 66174, pending final approval, applies broadly and could enhance OMNI utilization. We are encouraged by the growth and development of the standalone market and believe real-world evidence will further support this.
Q: How are conversations going with commercial payers regarding dry eye?
A: Matthew Link, Chief Commercial Officer: We are early in our conversations with payers but are encouraged by the positive reception to our clinical evidence and economic benefits. We believe our data positions us well for future coverage decisions.
Q: How did you arrive at the $1,200 price for TearCare, and is there confidence that payers will reimburse at this level?
A: Matthew Link, Chief Commercial Officer: The price increase is informed by the quality of our clinical evidence and health economic impact. We have been judicious in our approach, consulting with advisors and analyzing real-world implications. We are confident in our data and the ongoing payer conversations.
Q: What are the key drivers for TearCare coverage?
A: Paul Badawi, CEO: The key drivers are the SAHARA Phase 1 and Phase 2 studies, the budget impact model, and the cost-effectiveness analysis. These elements are critical for productive coverage conversations, and we are optimistic about achieving positive outcomes.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
