Clearside Biomedical Inc (CLSD) 2020 Q2 法說會逐字稿

Good afternoon, ladies and gentlemen and welcome to the Clearside Biomedical Second Quarter 2020 Financial Results and Corporate Update Conference Call. (Operator Instructions) As a reminder, this conference call is being recorded.

I would now like to turn the conference over to your host, speaker, Jenny Kobin, Investor Relations for Clearside. Please go ahead, madam.

Good afternoon, everyone and thank you for joining us on the call today. Before we begin, I would like to remind you that during today's call, we will be making certain forward-looking statements. Various remarks that we make during this call about the company's future expectations, plans and prospects, constitute forward-looking statements for purposes of the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by these forward-looking statements as a result of various important factors, including those discussed in the Risk Factors section of our annual report on Form 10-K for the year ended December 31, 2019, our quarterly report on Form 10-Q for the quarter ended June 30, 2020 and our other SEC filings available on our website.

In addition, any forward-looking statements represent our views as of today and should not be relied upon as representing our views as of any subsequent date. While we may elect to update these forward-looking statements in the future, we specifically disclaim any obligation to do so even if our views change.

On today's call, we have George Lasezkay, our Chief Executive Officer; Dr. Thomas Ciulla, our Chief Medical Officer and Chief Development Officer; and Charlie Deignan, our Chief Financial Officer. After our formal remarks, we will open the call for your questions.

I would now like to turn the call over to George.

Thank you, Jenny. Good afternoon to everyone and thank you for joining us on the call today. Over the past year, we've worked hard to execute our strategy to reorient Clearside from a single-product company to one that has multiple innovative and relevant opportunities, targeting unmet medical needs through the suprachoroidal space. As a result, we are initiating a new clinical program, targeting a large and growing market through suprachoroidal injection of a tyrosine kinase inhibitor. We're also advancing our suprachoroidal gene therapy and small molecule preclinical programs.

These actions represent important progress, creating value through the expansion of our internal pipeline, which we'd like to highlight this afternoon. Also, we have selected a new, very experienced and highly motivated manufacturing partner to help us obtain our first commercial product improvement.

I'll begin with our new clinical program and lead development asset, CLS-AX, which is our proprietary suspension of axitinib for suprachoroidal injection. We are pleased to announce that our investigational new drug application was accepted by the FDA. With this open IND, we are now able to progress CLS-AX into human clinical trials. We are targeting the initiation of our Phase I/IIa clinical trial by the end of this year in patients with neurovascular age-related macular degeneration, typically referred to as wet AMD.

As many of you know, wet AMD is a serious type of macular degeneration, leading to central vision loss that occurs when a protein called vascular endothelial growth factor, or VEGF, causes abnormal blood vessels to grow and leak in the back of the eye. In looking at the treatment landscape for wet AMD, there were 4 key factors that are considered by physicians and their patients, safety, efficacy, duration of action and patient convenience. Most common treatment options currently used by physicians to slow vision loss from wet AMD are anti-VEGF intravitreal injections given every 4 to 8 weeks, which helped stop the bleeding and leaking of blood vessels in the back of the eye. These treatments have shown good efficacy and safety, but have limited duration, thus requiring frequent injections.

In clinical practice, however, most patients have difficulty complying with a need for such frequently scheduled appointments. Therefore, compliance is a real-world issue in patients suffering with wet AMD.

CLS-AX could fit very well in the wet AMD treatment landscape. We believe that a small molecule tyrosine kinase inhibitor, or TKI, could provide safety and efficacy comparable to or better than current standard of care. By delivering a TKI into the suprachoroidal space using our in-office SCS Microinjector, we may also potentially extend duration of therapeutic action and enhance patient compliance. Our Phase I/IIa clinical trial will begin by the end of this year to assess the safety of suprachoroidal administration of CLS-AX. We look forward to reporting initial safety data from the first cohort in mid-2021.

Building on the momentum of our CLS-AX program and the growing data and interest in suprachoroidal space, we are expanding our internal pipeline with promising preclinical programs. First is our therapeutic biofactory program, which is based on suprachoroidal administration of nonviral vector gene therapy for retinal diseases. This is the second gene era in preclinical program in our suprachoroidal pipeline. This biofactory program is designed to cause the expression and secretion of an anti-VEGF therapeutic protein from retinal cells. This approach potentially provides versatility to deliver not only anti-VEGF transgenes but also a variety of different transgenes leading to the expression of other clinically relevant therapeutic proteins in the back of the eye. We are encouraged by our early research and preclinical data in these programs.

Second, we have initiated another small molecule program utilizing suprachoroidal administration of an integrin inhibitor suspension that will initially be focused on diabetic macular edema.

While it's still early days for these programs, we are excited about expanding our preclinical pipeline to leverage the benefits of suprachoroidal delivery. We will continue to advance these new programs through additional preclinical studies and hopefully on towards clinical trials. Tom will provide some additional detail on the scientific rationale for these programs in his remarks.

Next, I have an update on our plans for XIPERE, our potential treatment option for patients suffering from macular edema associated with uveitis. We announced today that we have secured a new commercial manufacturing partner for XIPERE. Our previous contract manufacturing organization recently notified us that they are no longer willing to serve as our commercial supplier and they are uncertain about being fully prepared for an FDA pre-approval inspection on our time line. As a result, we were left with no workable options to continue with the previous CMO. After working closely with the CMO for many years, this news was unexpected and disappointing both to us and our XIPERE commercial partners. However, given previous disclosed delays due to manufacturing and facility issues, we had been proactively evaluating alternative manufacturers. Therefore, upon receiving this news, we were able to quickly identify, engage a new CMO and have already initiated the process of transferring this IPO manufacturing technology.

During this transfer period, however, our previous CMO has agreed to manufacture initial clinical supplies of XIPERE for our Greater China partner, Arctic Vision, to support its IND filing in China and for use in clinical trials in China planned to start early next year. Our new CMO has an established track record with respect to FDA inspections and they have extensive experience with the production of small molecule suspensions, steroids and ophthalmic products. We believe this transition is a positive step forward to achieving XIPERE approval as the new CMO provides us with a very experienced, high-quality and motivated partner for manufacturing XIPERE.

With significant and relevant operating expertise and an experienced staff, we believe they will prove to be a collaborative and dependable partner to manufacture XIPERE. While the transfer of the manufacturing process will cause a short-term delay, we are convinced it will allow for a more efficient and predictable process for NDA resubmission and review. We look forward to resubmitting the XIPERE NDA as quickly as possible after the technical transfer to the new CMO is completed and the required stability data are generated. Although we are still in the process of finalizing the time lines with the new CMO, our current expectation is that resubmission will occur no later than the first half of 2021. We expect the FDA will review the NDA within 6 months of the resubmission date.

We believe the strategy and timing of this transition is the most reasonable and prudent option for Clearsight to successfully move forward with XIPERE. We believe this change is in the best long-term interest of Clearside as well as our commercial partners to XIPERE, Bausch Health Companies and our division. We have discussed the transition with both companies and they understand the circumstances and the rationale for making this change in CMOs.

I'll wrap up my initial remarks today with a note on corporate governance. During the second quarter, we enhanced our Board of Directors with the addition of Dr. Nancy Hutson. With over 25 years of R&D leadership adviser, Nancy brings a deep understanding of the pharmaceutical industry, coupled with an in-depth knowledge of research, clinical drug development and dynamic business situations. She has also served on a number of biopharmaceutical company boards over the past 10 years, so she has a broad perspective on the industry. Nancy is already highly engaged in our strategic planning and we are pleased to have her input as we advance our internal pipeline.

With that, I will now turn the call over to Dr. Tom Ciulla, our Chief Medical Officer and Chief Development Officer, to expand more on CLS-AX and our other research programs. Tom?

Thank you, George. I'm eager to start by diving a bit deeper into our CLS-AX clinical trial plans and then I'll summarize our other pipeline programs.

As George mentioned, we were pleased to announce today that our IND was accepted by the FDA. With this open IND, we are now able to progress CLS-AX into human studies and plan to initiate our Phase I/IIa clinical trial in patients with wet AMD by the end of the year. We are excited to advance this asset for its intrinsic characteristics that can be further leveraged through suprachoroidal delivery.

First, as a tyrosine kinase inhibitor, or TKI, axitinib is designed to achieve pan-VEGF inhibition and independent preclinical studies show that axitinib more potently inhibited neovascularization that either focused anti-VEGF A inhibition or other TKIs. Second, suprachoroidally administered CLS-AX demonstrated targeted high drug concentration in the retina and choroid with lower concentration in the vitreous, leading to effective reduction of fluorescein leakage and new vessel growth versus controls in models of wet AMD. Third, in animal models, CLS-AX demonstrated some compartmentalization benefits when administered suprachoroidally, sparing the anterior chamber of the eye and the systemic circulation. It was well tolerated with no signs of toxicity at the intended clinical dose. And finally, CLS-AX administered suprachoroidally showed multi-month durability in animal models. This supports the potential to address treatment burden in wet AMD, a large and current unmet need.

We look forward to starting our first human clinical trials with CLS-AX. We are planning our Phase I/IIa clinical trial in wet AMD patients to be an open-label dose-escalation study to assess the safety and tolerability of a single dose of CLS-AX administered through suprachoroidal injection. Eligible patients are those who demonstrate stable visual acuity, following 2 or more previous injections with an intravitreal anti-VEGF agent. For this trial, we plan to use aflibercept as our anti-VEGF agent. The primary endpoint for the trial will be to assess the safety and tolerability of CLS-AX in these wet AMD patients. Secondary endpoints will evaluate the pharmacokinetics, visual function, oculo anatomy and the need for additional treatment with intravitreal aflibercept.

The study design is targeted to include 3 cohorts of 5 patients each, for a total study population of approximately 15 patients. Eligible patients will receive a 2-milligram intravitreal injection of aflibercept at screening, followed by one suprachoroidal injection of CLS-AX at baseline a month later.

Patients returned for 3 further visits for assessments on safety, tolerability, visual function, ocular anatomy and the potential need for additional treatment with aflibercept. All patients will be followed through the fifth visit regardless of whether additional therapy is given.

For CLS-AX, the study design calls for dose escalation in each of the 3 cohorts. Cohort 1 will start at the lowest dose of 0.03 milligrams of axitinib delivered by suprachoroidal injection. Dose escalation will then proceed following the review and recommendation of the safety data by the safety monitoring committee to advance the next higher dose cohort. With the time line for each cohort at approximately 6 months, we expect the initial safety data from the first cohort in mid-2021. We are excited about the potential for CLS-AX as a long-acting therapy for wet AMD. And this Phase I/IIA trial is our first step to reach that goal.

Internally, our research and discovery teams continue to advance our preclinical programs. We have a DNA nanoparticle biofactory gene program in preclinical development for our internal pipeline. There is well-established literature supporting subretinal DNA nanoparticle gene therapy in preclinical models of retinal disease. DNA nanoparticles can transfer genes that are too large for common viral vectors like AAV.

In addition, since they lack viral capsid antigens, DNA nanoparticles are less immunogenic than viral vectors and could potentially undergo repeat office-based dosing via our suprachoroidal approach. In a recently published paper, researchers at Johns Hopkins demonstrated that suprachoroidal injection of nonviral nanoparticles can yield expression of a reporter gene and rat photoreceptors in RTE throughout the eye for at least 8 months. They have also showed successful expression of an anti-VEGF protein with suprachoroidal administration of nonviral nanoparticles containing the corresponding gene.

With this therapeutic biofactory approach, they were able to suppress VEGF-induced vascular leakage and experimental neovascularization in their preclinical model. We have previously shown that suprachoroidal administration of DNA nanoparticles yield similar marker gene activity compared to subretinal administration. Over the last year, we've been working with DNA nanoparticles containing therapeutic transgenes in a preclinical model. We have observed that suprachoroidal administration is better tolerated clinically than intravitreal administration in this animal model. We have also imaged a suprachoroidal space opening posteriorly all the way to the optic nerve after suprachoroidal administration of DNA nanoparticles, supporting the potential to address both macular and peripheral retinal disorders.

And most importantly, we have seen preliminary signs of protein expression for the duration of the studies to 3 months and are in the process of more thoroughly quantitating these results.

Suprachoroidal administration of DNA nanoparticle gene therapy has potential as an office-based repeatable gene therapy without the risk of vitrectomy surgery and subretinal administration. Furthermore, as demonstrated by the Johns Hopkins team, there is potential to swap out the transgene to address different targets and disorders. We are excited about the potential of this platform using our SCS Microinjector for both a biofactory and native gene replacement approach.

Next, I want to discuss another preclinical program targeting a potential important pathway in retinal disease. We have recently added an integrin inhibitor to our early preclinical development program. Integrins represent a novel target with limited competition. Integrins are multifunctional cell adhesion molecules that regulate critical cell processes such as adhesion, migration, proliferation, invasion, survival and ptosis. Most importantly, they play a role in pathologic processes such as inflammation, angiogenesis and fibrosis.

Integrant inhibition has had some recent validation in preclinical models and in early clinical studies of diabetic macular edema and macular generation. Given their unique mechanism of action, integrin inhibition could potentially serve as primary therapy, adjunctive therapy to anti-VEGF agents and/or secondary therapy in refractory cases of diabetic macular edema and macular degeneration.

Suprachoroidal delivery of an integrin inhibitor suspension may provide targeted, compartmentalization and durability advantages over intravitreal or topical delivery, just as we have seen with small molecule suspensions of triamcinolone acetonide clinically and axitinib preclinically. Given the potential to address the pathologic processes in diabetic macular edema and macular generation, we are planning a series of additional preclinical studies with our integrin inhibitor suspension.

Next, I would like to touch briefly on the plans from our development partners. We are very pleased with the progress of our oncology partner, Aura Biosciences. Aura has a worldwide licensing agreement for the use of our SCS Microinjector to deliver its proprietary drug candidates into the suprachoroidal space for the potential treatment of certain ocular cancers. At ARVO in June, Aura presented preclinical research regarding the ocular distribution and efficacy of their asset, AU-011, delivered via our SCS Microinjector. According to Aura, the data showed distribution of AU-011 in the suprachoroidal space and very impressive necrosis of tumors following laser activation in a rabbit model of choroidal melanoma. Preclinical studies have been completed and Aura expects to initiate a Phase II clinical trial evaluating suprachoroidal delivery of AU-011 during the third quarter of 2020.

Our AAV gene partner, REGENXBIO, is utilizing our proprietary SCS Microinjector to deliver RGX-314 to 2 different patient populations with the hope of offering nonsurgical, in-office access to their onetime gene therapy treatment. They announced last week that their Phase II trial is active and is entitled AAVIATE. The trial will evaluate suprachoroidal delivery of RGX-314 in patients with wet AMD. AAVIATE will enroll 40 patients with severe wet AMD who are responsive to anti-VEGF treatment. They plan to begin dosing patients this quarter and expect to report interim data from their first cohort of this trial by the end of 2020. In addition to wet AMD, REGENXBIO also expects to initiate a Phase II trial for RGX-314 using suprachoroidal delivery and diabetic retinopathy in the second half of 2020.

Importantly and despite the current pandemic environment, we continue to stay top of mind with the ophthalmic and retinal communities, with over 20 posters and publications presented at the Virtual Annual Meetings for the Association for Research and Vision and Ophthalmology and the American Society of Retina Specialists. At these events, several wetness specialists presented data on axitinib, our suprachoroidal delivery platform, our early gene therapy programs and XIPERE. We continue to receive positive feedback from clinicians and how our suprachoroidal treatment approach could target unmet needs for their patients.

To leverage this input, we recently formed a scientific advisory board comprised of 5 world-renowned retina physicians to tap into their expertise as we advance our pipeline development plans.

I will now turn the call over to our CFO, Charlie Deignan, to review our financial results.

Thanks, Tom. Our financial results for the second quarter were published this afternoon in our earnings press release and are available on our website. Therefore, I will summarize our current financial status.

As we reported, our cash and cash equivalents at the end of June 2020 totaled $15.1 million. During the second quarter of 2020, we elected to pay off our outstanding bank loan due to various restrictions and other limiting covenants in the agreement. The total amount paid was $5.3 million and included the remaining principal balance, accrued interest and final payment fee. As a result, we now have a very clean balance sheet.

We are continually assessing options to preserve cash and our monitoring anticipated revenue from near-term partner milestones. We are evaluating the most advantageous ways to fund our programs, get to our approval milestones and meet our future financial needs. We will monitor market conditions and be opportunistic about increasing our capital resources in multiple ways, while always remaining cognizant of maintaining shareholder value with the goal of raising money at the lowest cost of capital.

We are controlling expenses tightening and continue to prioritize gaining approval of XIPERE, while also expanding our internal pipeline. The planned investments in our near-term clinical and preclinical work are incorporated into our operating plans and we currently expect to have sufficient resources to fund planned operations into the second quarter of 2021. We look forward to presenting at the Wedbush PacGrow Virtual Healthcare Conference tomorrow and I will now turn the call back over to George for his closing remarks.

Thank you, Charlie. To sum up, we believe strongly in the versatility of our suprachoroidal injection platform and its use in small molecules in gene therapy. We have an array of valuable assets, our proprietary SCS Microinjector, lead clinical development programs, CLS-AX, multiple preclinical programs as well as our lead commercial product, XIPERE, all of which are well protected with related intellectual property. We lead the industry with our experience in targeting the suprachoroidal space and maintaining strong relationships with researchers and clinicians in the ophthalmic community.

We continue to transition from a one product company to an ophthalmology company with exciting clinical collaborations and an innovative and expanding internal pipeline. Importantly, there will be 3 novel assets delivered via our SCS Microinjector in 4 clinical trials by the end of this year. We are positioning ourselves to have a strong year in 2021 with potential FDA approval of XIPERE and the initial data from our Phase I/IIA CLS-AX clinical trial in wet AMD as well as progress on our other preclinical programs.

Our team is very energized and optimistic about our growing pipeline with the potential to improve patient outcomes through our innovative super choroidal technology.

I would now like to ask the operator to open the call for questions.

(Operator Instructions) First question is from the line of Liana Moussatos of Wedbush.

This is Shveta for Liana. Congrats on all the progress. What are some of the steps remaining for resubmission of XIPERE NDA? And how long will it take for the new CMO to manufacture registration batches? And has COVID-19 had any impact on the new CMO's daily operations?

Okay. Liana, I'll take that question. First of all, to the best of our knowledge and our discussions with the new CMO, COVID has not had any significant impact on their operations. So that does not seem to be a significant factor. Secondly, what needs to be done is we need to manufacture registration batches and put them on 3-months real-time stability in order to resubmit our NDA. And we're working with the CMO now -- the new CMO on a very aggressive time line to make that happen. And as I said, we're still working out those details of exactly when the registration batches will be made. But they've given us a very aggressive time line and there's incentives in place to go even faster. We're moving as fast as we possibly can and they possibly can to get the registration batches made. I think as we indicated already, the technology transfer is already underway. We've purchased the necessary equipment. It wasn't too much, but we purchased that equipment. It's already on site. And the teams are already working to put it in place and start to make batches.

Your next question comes from the line of Annabel Samimy of Stifel.

This is Avatar Jones on for Annabel. Congrats on all the new developments. We have 2 questions, if you may. First is on axitinib. Are you actively exploring partnership opportunities? Or has there been any interest externally? And secondly, regarding OpEx, how should we -- or what are your expectations for R&D expenses through 2020 and 2021, now that there are multiple programs underway?

Okay. Let me take the first part of that question. And then, Charlie, you can answer the second part of that question. Currently, at this point in time, we have not explored partnership relationships around axitinib. We intend to push axitinib forward into clinical trials by ourselves at this point in time. So we have not had those discussions. We've not sought those discussions at this time. Charlie, do you want to answer the second part of that question?

Sure. Yes, as I said on the call, we had $15 million -- just over $15 million in cash. Currently, we'll be receiving potentially some milestones from our partners. So I would look at R&D spending. The trials are -- the axitinib trials are not -- they're Phase Ia, IIa studies, not significant big studies, 35 patients. So I wouldn't expect a dramatic increase in R&D, slight increases. And we'll also see some of the manufacturing costs are starting to decline next year. So I wouldn't see a big jump. We can manage the programs as well we have getting into Q2 of next year.

Next question is from the line of Boris Peaker of Cowen.

Great. My question was on the CLS-AX. You mentioned that initial data is expected in the middle of next year. I'm just curious how many patients should we expect to see? And also, is it reasonable based on this patient number to see some initial efficacy as well?

Tom, I think that's your question to handle.

Sure. Well, thank you for the question, Boris. As you know, it's a Phase I/IIa study, the primary endpoints are really geared around safety. This is the first time in man that axitinib has been injected suprachoroidally. And so again, the primary endpoint will be safety. Obviously, we're going to start at the lowest dose, but we will be looking at a safety signal, some of the usual signals that you might face efficacy on. For example, the need for retreatment, visual acuity and central subfield thickness, so some of the parameters that we'll be assessing.

Got you. And in terms of the actual number of patients?

There'll be 5 patients per cohort and there'll be 3 cohorts is what we're planning.

Next question comes from the line of Jonathan Wolleben of JMP Securities.

Just another follow-up on CLS-AX. What are you expecting going into this study as far as the durability of response with a single injection? And then also, I guess, onset of response? Is it something that you're going to be able to see in this interim readout, if not from the first cohort, maybe the second?

I guess I'll take that again.

Tom, again -- yes, sure. That's yours, Tom.

So a couple of things about axitinib. First of all, as a tyrosine kinase inhibitor, it has pan-VEGF inhibition. And there's been numerous independent preclinical studies assessing it in animal models of retinal, corneal and choroidal neovascularization. And it shows very robust inhibition of neovascularization. It shows an inhibition of leakage. And it's actually one study where not only does it cause inhibition, but actually causes regression of established corneal neovascularization. They are study suggesting that it's a more potent inhibitor of neovascularization in other TKIs. And other studies suggesting that it's a more potent inhibitor of neovascularization than a focused anti-VEGF A approach. So intrinsically, it had some very desirable qualities. And we're going to leverage that further with suprachoroidal delivery, where we know we can get very high levels targeted to the affected tissues to the retina and choroid. We know we can compartmentalize the drug there and keep it away from the anterior segment to minimize any off-target effects that we've seen with other TKIs that have previously been assessed. And we know in our own animal models that we have multi-month durability. So we're hoping that this will be a very durable, very efficacious therapy.

And I think the second part of question is, what can we expect out of this first cohort or even the second cohort? And as I just mentioned, it's really geared towards safety. This is first time in man axitinib is injected suprachoroidally. But I think we'll have some signals as to its potential efficacy. I don't know if that will be with the lowest dose or with the next dose, but we're eagerly looking forward to starting this trial because we think this is truly a differentiated or has potential to be a differentiated therapy in terms of its pan-VEGF inhibition, its durability and potential safety of benefits due to the fact that its compartmentalized and targeted to the affected tissues.

Got it. That's helpful. And then just a quick question on the preclinical program you announced today. I'm wondering what other work needs to get done before we can get these in the clinic? And could that be something we see maybe next year?

Well, I'll start that and George can finish.

Sure.

These are preclinical programs. We're very excited about the potential. As you know, integrin inhibitor has some very early validation and some early clinical trials. It's a novel target in retinal diseases. Due to its unique mechanism of action, it actually may have a role in patients who are -- don't respond well to anti-VEGF. It could be adjunctive to anti-VEGF. So we're very excited about that. But again, these are just preclinical programs. And we'll have a data-driven approach to a progression of that as well as the DNA nanoparticle gene therapy programs. And George may be able to give more specifics about plans and intentions?

Well, Tom, I'll just echo what you said is that they are preclinical. We have to do some more work. There may be some more optimization that's required, but we have kind of strong scientific underpinnings to these programs. So we really think that there is the potential to do something very interesting with -- certainly with the therapeutic biofactory approach and integrin has reasonable validation as a target. So we think that those 2 programs, in particular, have a lot of promise, but we're being very upfront about. These are early preclinical programs, we're encouraged. We think they're a good direction for us to go. But it's going to take some additional preclinical work before we know whether we can really take these things on and start any kind of clinical trials. So I think that's -- it's a little premature to discuss that seriously right now.

Next question is from the line of Zegbeh Jallah from ROTH Capital Partners.

Congrats on the R&D. Just a couple of questions here for me are starting with CLS-AX. Just kind of wanted to know what additional steps are required before you can begin treating patients at the end of the year? And how many sites do you plan to activate things like that? And then a follow-up question here is who will manufacture CLS-AX? Are you going to be using the new CMO that's doing your Xiidra -- not Xiidra but XIPERE manufacturing? Or who's going to be handling that? And then another follow-up question with regards to the study design. Just wanted to know why aflibercept is being used as the baseline treatment, which I think is interesting, but any clarifications there? And finally, is there any limitations on what you can use or what indications you can explore for your gene therapy nanoparticle delivery since you do have some existing agreements. I was just wondering, has that provided any limitations. And then maybe if you can even provide any idea as to what indications might be pursued initially?

Well, Zegbeh, thanks for a 4-parter. I hope Tom was writing as fast as I was writing there. Let me take several parts of that question and then I'll turn it over to Tom. First of all, in terms of the manufacturer for CLS-AX, that is a different -- entirely different CMO. It is not the previous CMO for XIPERE and it's not the new CMO. That's a completely separate CMO that we've been working with for some time. We're very happy with how things are working there. So that will be a different contract manufacturing organization that will manufacture CLS-AX.

The -- I've already forgotten one part of your question that I was going to answer -- about the indications. We're going to proceed and we are not -- we are not very restricted in terms of how we can proceed using our nonviral vector therapy in terms of the indications we could explore and decide to go after if our preclinical data supports it. We're fairly open to where we can go. We're not as restricted as you might think in terms of potential indications as long as we're in the nonviral vector area. So I'll let Tom, if he was writing down answer the other 2 parts of your question. And if you require more amplification on that, I'm glad to give it to you, Zegbeh.

No, that was helpful. Perfect.

Yes. Thanks for the questions, Zegbeh. So I'll take, I think, the first question. And essentially, you were asking about steps required to get to the Phase I/IIa trial by the end of the year. So we've gone through a number of steps. We did the -- all the preclinical work that's been completed. We filed the IND. We've announced acceptance. We finalized the protocol already. That protocol has been reviewed by our SAB, which I mentioned in my remarks earlier, a great cohort of world renowned retina specialists who found the trial design to be very appropriate. In terms of going forward, we've identified sites. They fill that site feasibility questionnaires. What we've looked for in sites or sites that are experienced with Phase I trials, experienced with wet AMD trials, sites that are experienced with suprachoroidal injection. Many of these sites were previous sites in our prior trials with XIPERE. So they're familiar with suprachoroidal injection, very familiar with it. And then we have to have IRB approval, a site initiation study. And we feel confident that we can initiate this trial before the end of the year.

Awesome. And then, Tom, just a follow-up here was with regards to using aflibercept as the baseline therapeutic for the trial?

Yes. So the trial design is very similar to other sponsors that have done wet AMD trials with new assets. So we've spoken about REGENXBIO. Their trial design involves initial anti-VEGF injection to assess responsiveness. Our primary goal initially, because we feel this may be a very durable treatment, is really to assess durability and maintenance of visual acuity after anti-VEGF therapy initially. And so that's the reasoning for that. Again, it's very similar to what other companies have done. And as I mentioned, the protocol was reviewed carefully by our SAB and they found it to be very acceptable and appropriate.

Your next question comes from the line of Serge Belanger of Needham.

This is Tian for Serge. And congrats on the progress. I just had a couple of questions. So the first one is on XIPERE. In terms of the FDA review time line, so I guess, based on the new CMO, are you still expecting a 6-month review? Or could it be faster, just thinking about the potential likelihood for the approval and how this might impact your agreement with Bosch?

And then in terms of the milestone payments, I think you've got about $15 million that are tied to prelaunch and regulatory milestones with Bosch. Is there any, I guess, impact from the fact that you're using a new CMO to your ability to get this milestone payment?

Thanks, Serge. I'll take the first part of that and then I'll kind of share the second part with Charlie because it does go to the cash runway. In the first part, we believe that if we transfer essentially the same process that was in existence at our previous CMO, which is exactly what we intend to do, that the conditions that we need to meet and the requests that were made in the CRL that we received last year will remain the same. And that -- the most important one there is the 3-month real-time stability on the registration batches. So we have a very strong belief that as long as there's no significant change in the manufacturing process that exists today. Once it goes into the new CMO, that the CRL will be -- the requirements of the CML -- the CRL will hold. And we'll be able to submit with 3-month real-time stability data.

On the second question about the milestone payments, you're right. Just from Bausch, we expect around approval to get an approximately $15 million from them and some additional monies from other partners. Obviously, if the -- we do expect that we'll get a 6-month review date as well after we resubmit. So that's the issue about getting to the point where we can collect that milestone. I'll let Charlie talk to you about how we intend to do that and manage our cash runway. So we're sure to get there.

Yes. Thanks, George. Yes. So as we said, we'll -- depending on when the approval is and at this point, we don't know when that is, we do get north of $15 million in from those approval milestones. But until -- until we know when we get this resubmitted, I can't predict when approval is. Hopefully, like you said, it is faster than 6 months, but we can't commit to that. And we're monitoring our expenses and looking at our runway and doing everything we can to extend it. And we'll be up -- yes, thanks.

All right. There are no further questions. I will turn the call back over to Dr. Lasezkay.

Thank you. Once again, I want to thank all of you for joining us on this call this afternoon. I think you can tell we're excited about some of the new developments that have taken place here at Clearside. We certainly appreciate your continued interest in Clearside and we look forward to updating you on our progress. Operator, you may now disconnect the call. And thanks again.

Ladies and gentlemen, this concludes today's conference. Thank you for your participation. Have a wonderful day. You may all disconnect.