Earnings Call Transcript - ALDX Q3 2021

Operator, Operator

Thank you all for joining us for the Aldeyra Therapeutics Third Quarter 2021 Financial Results Conference Call. I will now turn it over to the company's Chief Financial Officer, Mr. Joshua Reed. Please proceed, Mr. Reed.

Joshua Reed, CFO

Good morning, everyone. With me is Dr. Todd Brady, President and Chief Executive Officer of Aldeyra. This morning, we issued a press release reporting our financial results for the quarter ended September 30, 2021. A copy of the press release is available on the Investors & Media section of our website, www.aldeyra.com. Please note that this morning's conference call contains forward-looking statements regarding future events and the future performance of Aldeyra. Forward-looking statements include statements regarding submission of potential new drug applications, potential commercialization, the anticipated timing of results from our clinical trials, our projected cash runway, our possible or assumed future results of operations, expenses and financial position, and potential growth opportunities among other things. These statements are based upon the information available to the company today. These statements reflect Aldeyra's current views concerning future events. They are based on assumptions and subject to risks and uncertainties, including the development, clinical, and regulatory plans or expectations for Aldeyra's product candidates and systems-based approaches; the risk that results from clinical trials or portions of clinical trials may not accurately predict the results of future trials for the same or different indications; and Aldeyra's continuing review and quality control analysis of clinical data. As a result of the COVID-19 pandemic, clinical site availability, staffing, and patient recruitment have been negatively affected, and the timelines to complete our clinical trials may be delayed. Aldeyra assumes no obligation to update these statements as circumstances change. Future events and actual results could differ materially from those projected in the company's forward-looking statements, including the current and potential future impact of the COVID-19 pandemic on our business, results of operations and financial position. Additional information concerning factors that could cause results to differ materially from our forward-looking statements are described in greater detail in the company's press release issued this morning and our filings with the SEC. I will now turn the call over to Dr. Brady.

Todd Brady, CEO

Thank you, Joshua. This morning, I’m excited to share with you important progress we’ve made in the development of our novel therapeutic approaches for ocular and systemic immunological diseases as we continue to strive to improve the lives of patients with significant unmet medical needs. Let me begin by updating you on our anterior segment ocular programs. This quarter, we expect to report top-line results from the TRANQUILITY and TRANQUILITY-2 clinical trials of reproxalap in dry eye disease. The primary endpoint of these trials is ocular redness, which is arguably the only objective sign of dry eye disease that matters to patients. Secondary endpoints are tear RASP levels, Schirmer's test, and dry eye symptoms. Additionally, enrollment has completed in a multicenter double-masked randomized vehicle-controlled parallel group, Phase II clinical trial of reproxalap in dry eye disease. The purpose of the Phase II trial is to optimize the tear collection process to measure RASP. Pending ongoing discussions with the FDA and the timing of clinical results including our 12-month safety trial of reproxalap and consistent with prior guidance, we expect to be in a position to file a new drug application or NDA early next year for dry eye disease. In addition, we remain in discussions with the FDA regarding NDA requirements for allergic conjunctivitis, and expect to be able to provide an NDA update for reproxalap by the end of this year. During the year, several peer-reviewed journals have published articles highlighting the safety and efficacy profile of reproxalap in dry eye disease and allergic conjunctivitis. Most recently, the Journal of Clinical Ophthalmology reported results of the clinical trial evaluating the subjective eyedrop experience of two formulations of reproxalap versus lifitegrast in patients with dry eye disease. The paper entitled “A Post-Acute Ocular Tolerability Comparison of reproxalap and lifitegrast” is open access and available on PubMed. Turning to our retina programs, as many of you know, ADX-2191 has been granted orphan drug designation for three distinct clinical indications that affect the retina: retinitis pigmentosa, proliferative vitreoretinopathy or PVR, and primary vitreoretinal lymphoma. Retinitis pigmentosa is a group of rare genetic eye diseases that affects an estimated 80,000 to 100,000 individuals in the United States, and approximately 1 in 4,000 people worldwide. Last quarter, we announced our plan to initiate a Phase II clinical trial of ADX-2191 in patients with retinitis pigmentosa, and we remain on track to do so by the end of this year. The primary endpoint of the trial will be safety and tolerability of ADX-2191. Secondary endpoints include visual acuity, central retinal sensitivity, dark adapted retinal sensitivity, and retinal morphology. PVR is a sight-threatening condition and the leading cause of failure of retinal detachment surgery. We remain on track to conclude enrollment at the end of this year for Part 1 of our ongoing Phase III GUARD trial in PVR, and we expect results from GUARD next year. We continue to be excited about the broad ADX-2191 platform and the potential of ADX-2191 to treat rare, immune-mediated retinal diseases that today have no currently approved therapies. Turning to our systemic disease program, we remain on track to report Phase II proof-of-concept clinical results from ADX-629 in asthma, psoriasis, and COVID-19 in the fourth quarter of 2021, or the first quarter of 2022. ADX-629 is our orally available RASP inhibitor. It represents a first-in-class systems-based therapeutic approach for the potential treatment of many immune-mediated diseases that are currently treated with single target drugs that can lead to toxicity. We've also continued to evaluate the possibility of expanding clinical testing for ADX-629 in other indications where RASP may mediate pathology and where current therapy is either inadequately effective or toxic. We expect to update you on our progress later this year. With that, I'll turn the call back over to Joshua to review our third quarter financial results.

Joshua Reed, CFO

Thank you, Todd. Cash and cash equivalents as of September 30, 2021, were $241.4 million. Based on our current operating plan, we believe that existing cash and cash equivalents will be sufficient to fund currently projected operating expenses through the end of 2023, including potential NDA submissions, initial commercialization of reproxalap if approved, and continued development of our product candidates in ocular and systemic immune-mediated diseases. Turning now to our third quarter 2021 results. Research and development expenses were $12.9 million for the quarter ended September 30, 2021, compared with $6.1 million for the same period of 2020. The increase of $6.8 million is primarily related to increases in clinical research and development expenditures and consulting costs, partially offset by decreases in personnel-related costs, including stock-based compensation and manufacturing activities. General and administrative expenses were $2.5 million for the quarter ended September 30, 2021, compared with $2.3 million for the quarter ended September 30, 2020. The increase of $200,000 is primarily due to an increase in miscellaneous administrative expenses. The net loss for the third quarter of 2021 was $15.8 million, or $0.27 per share compared with a net loss of $8.9 million or $0.23 per share for the quarter ended September 30, 2020. Looking at our upcoming investor calendar, Todd and I will be participating virtually in conferences hosted by Jefferies, Berenberg, and BTIG. On November 11, Todd will be presenting at Eyecelerator at AAO 2021, a featured event ahead of next month's American Academy of Ophthalmology's 2021 Annual Meeting in New Orleans. Please check the Events and Presentations section of our website for details. If you're attending any of the conferences and would like to schedule a one-on-one, please email our Investor Relations team at [email protected]. Now, I'll hand the call back to Todd for closing comments.

Todd Brady, CEO

Thank you, Joshua. We continue to make meaningful progress in developing safe and effective treatments for ocular and systemic diseases. In addition to the present quarter, we have several busy and exciting quarters with significant clinical development milestones ahead. We're excited about the first-line potential for reproxalap as a treatment for anterior surface inflammatory diseases that are not being adequately controlled by standard of care approaches versus a significant percentage of patients. And beyond the anterior segment, we're developing innovative medicines for retinal inflammatory diseases that we believe will create near-term high-value commercial opportunities for our company. And we are committed to expanding our therapeutic applications to systemic inflammatory diseases, representing a broad array of conditions that are not sufficiently treated by current therapies today. With that, Joshua and I will be happy to take your questions. Operator?

Operator, Operator

Your first question is from Tom Shrader from BTIG. Your line is now open.

Tom Shrader, Analyst

Hi, good morning. Thank you for taking the questions. I had a question on the commercialization front. We've seen some young companies, first product companies use a short-term commercial alliance with an existing company. Is that something that's easy to set up in this space? Have you thought about that? Or do you think whatever you do, you're likely to do on your own?

Joshua Reed, CFO

So thanks for the question, Tom. Let me start off by saying the data that shows reproxalap's early onset of activity, effect on redness, and broad symptom improvement profile is unmatched by existing products in dry eye. This makes our commercial prospects extremely attractive. Of course, that is if the product is approved, this is only the success of our clinical trials and our NDA submission. The anticipated top line could support us building a commercial infrastructure on our own, and it makes it attractive for potential strategic partners. So we have lots of options available to us, including the one that you mentioned, using a different organization to commercialize for us, at least on a short-term basis, is something that's extremely easy to set up. But again, with reproxalap's commercial potential, we have lots of options available to us.

Tom Shrader, Analyst

Okay. I have an unrelated follow-up question. We have seen how influential the Schirmer test has been for the FDA. It seems somewhat like a loophole. However, if we focus on redness and not on the Schirmer results, it’s clear that patients are benefiting in a way that differs from traditional eyedrops. Do you think the label still holds its value, or might we need to go back to negotiations? I'm interested in your perspective on the significance of Schirmer, as it is fundamentally different from measuring redness.

Todd Brady, CEO

Hi, Tom. Good morning. It's Todd. Thanks for the question. I still resonate with that question because it seems that there are so many products beginning with Restasis years ago that focused on the Schirmer's test as the objective time for dry eye disease. As I mentioned in my prepared comments this morning, I don't think that patients care about objective signs of dry eye disease. That is signs that can be assessed by physicians or staff with one major exception, and that is ocular redness, which is a sign of dry eye disease. And it's obvious why patients care about redness; no one wants to have a red eye. Now, I don't think having ocular redness in our label is in any way a detriment. In fact, I think it is a significant commercial advantage for physicians, healthcare providers, optometrists, and patients to see that there is a drug available, potentially, that whitens their eyes that diminishes ocular redness. I think it's very, very powerful commercially and a tremendous advantage relative to drugs on the market today for chronic treatment of dry eye disease. We continue to be asked about Schirmer's. Schirmer's test is a secondary endpoint in our current dry eye disease trials that I described in my prepared comments this morning. But in the end, we're focused on ocular redness for all the reasons that I just described.

Tom Shrader, Analyst

Okay, thank you.

Operator, Operator

Your next question is from the line of Justin Kim from Oppenheimer & Company. Your line is now open.

Justin Kim, Analyst

Hi, good morning all and thanks for taking the question. Maybe just a couple on dry eye. With the Phase II dry eye data being first available, can the team comment a little bit as to what might be disclosed and available from the study? And how we can think about those results in forming the anticipated Phase III program?

Todd Brady, CEO

Right. Justin, excellent question, and thanks for that. The Phase II trial that I mentioned in my prepared comments is designed to optimize the RASP signal. In particular, it's designed to optimize the collection of tears so that we're able to collect more tears from dry eye patients. As you can imagine, collecting tears from a patient population for lack of tears is a challenging process. The Phase II trial is roughly half the size of the two TRANQUILITY trials. Each of the TRANQUILITY trials is approximately 300 subjects. The Phase II trial is 150 subjects. And I think your assumption that the Phase II trial will complete or results will be available first is correct, simply because as we've announced this morning enrollment is complete in that Phase II trial, and the trial is smaller than the TRANQUILITY trials. I think it's also reasonable to assume that we'll be able to assess the data from the Phase II trial in order to optimize the completion of the TRANQUILITY trials. In itself, the Phase II RASP trial is not pivotal. It is not critical path for NDA filing. I think that trial, depending on the results, could be both of those things. But we'll just have to see the data. I think whether we have a data release that concerns the Phase II trial is a materiality question that we'll need to answer once we have the data in our possession. Otherwise, I think the data from that trial, the RASP data and so forth, could be announced in conjunction with other data releases.

Justin Kim, Analyst

Understood. Understood. And maybe on the point that you had mentioned about sort of the sizes of the studies and considering sort of the timing of the initiation of those studies, is it fair to sort of assume that TRANQUILITY is at least half enrolled and TRANQUILITY-2 at least a little less than half, sort of given the timing of the initiations and the study sizes?

Todd Brady, CEO

Well, we typically don't comment on the trial enrollment, at least, not until enrollment has been completed. I do think it's fair to assume that TRANQUILITY-1 is well on its way towards completion, as you mentioned, given the start dates of those trials. One option based on the data from the Phase II trial is to expand enrollment in either of the TRANQUILITY trials, if needed. That is, if the data from the Phase II suggests that either of the TRANQUILITY trials is not sufficiently powered, we have the option prior to database lock of either TRANQUILITY trial of expanding those trials. So in a sense, we don't quite know what enrollment is complete in either TRANQUILITY trial until we have the Phase II data.

Justin Kim, Analyst

Okay, great. Very helpful. Thanks for the question and answers.

Todd Brady, CEO

Thanks, Justin.

Operator, Operator

Your next question is from the line of Yigal Nochomovitz from Citigroup. Your line is now open.

Yigal Nochomovitz, Analyst

Hi, Todd and Josh. Thank you for taking the questions. Todd, could you just explain in a bit more detail the purpose for this additional Phase II for reproxalap in dry eye? If the goal is to optimize the measurement of tear RASP levels, could you just clarify why this Phase II wasn't completed before heading into the TRANQUILITY trials, where RASP levels is a secondary endpoint?

Todd Brady, CEO

Good morning, Yigal. That's a great question. I'll start by explaining our interest in RASP. The FDA designated RASP as an indicator of dry eye disease last year, but as I mentioned in response to Tom's question earlier, we believe ocular redness is a more significant indicator for both providers and patients. Therefore, we are focusing on redness, especially since we continue to show positive redness data in allergic conjunctivitis. The redness data from the ongoing TRANQUILITY cohort announced in January was also very encouraging. Additionally, being able to include RASP modulating data in the pharmacology section of our potential drug label is commercially advantageous, which is why we are keen on demonstrating the reduction of RASP in patients' tears. RASP is the target of reproxalap, and we would likely be the first eyedrop to show target modulation in a clinical trial. Our Phase II trial modified how we collect tears. There are two main methods for this. One involves using a small glass capillary inserted into the tear lake after retracting the lower lid; this capillary can stay in or near the eye's surface for about 10 minutes. We require about 5 microliters of fluid for RASP analysis, and surprisingly, many dry eye patients don't produce this amount. For perspective, a standard eyedrop is 40 microliters. When you drop an eyedropper's content into your hand, that’s about 40 microliters, yet many trial participants don’t have enough volume to assess RASP, which is why we conducted the Phase II trial. We have modified some of the capillary extraction processes and adjusted the order of the other tear collection method, the Schirmer test. As you know, the Schirmer test uses a small strip of paper placed into the tear lake after retracting the lower lid. The strip remains in the eye for roughly 10 minutes, allowing tear fluid to be absorbed, after which it can be removed, centrifuged, and analyzed. As I noted in response to Justin's question, it’s reasonable to expect that Phase II results will be available before the TRANQUILITY results. The timing of the RASP data differs from our other clinical data on redness and symptoms because the tears need to be sent to a third-party lab for analysis through an ELISA process to measure RASP levels. Those results are then sent to our statisticians for separate analysis. For the running cohort announced in January, we first shared clinical data on redness and symptoms, followed by RASP data. A similar pattern may occur with our clinical trials, with RASP data potentially following clinical data. Does that address your question, Yigal?

Yigal Nochomovitz, Analyst

Yes, thank you. And I just had one for Josh. I think you mentioned in the press release that you have cash to support the initial commercialization of reproxalap. I’m wondering if you could just be a bit more specific about the definition of initial and what that encompasses?

Joshua Reed, CFO

Thanks, Yigal. Essentially, I am referring to the development of the home office, and an additional consideration is our runway extending into 2023. It's important to clarify that we have sufficient cash to sustain a full commercialization effort well beyond the product launch.

Yigal Nochomovitz, Analyst

Got it. Thank you.

Operator, Operator

Your next question is from the line of Marc Goodman from SVB Leerink. Your line is now open.

Marc Goodman, Analyst

Yes, good morning. I was wondering if you could just walk us through TRANQUILITY-1, TRANQUILITY-2. You get the data. Talk to us about from there what's left, so that we understand all the boxes being checked towards when you actually file. Thanks.

Todd Brady, CEO

Hi, Mark. Good morning. Happy to comment on the remaining boxes to check prior to NDA filing. As you know, the FDA requires symptoms and signs for NDA submission in dry eye disease. We believe we've completed our symptom requirements. Those data are prominently highlighted in our corporate deck with two 12-week pivotal trials that using eye dryness as our symptom. The remaining trials particularly the TRANQUILITY-1 and 2 trials are focused on the sign requirements for NDA submission. And as we've discussed this morning, that sign is ocular redness, though we were also assessing RASP and Schirmer's test. In addition to the efficacy requirements for NDA submission, our safety requirements consistent with NDA submissions generally, there is a safety trial that must be part of the submitted package. As I said in my prepared comments this morning, we are currently running a 12-month safety trial to support the chronic use for reproxalap in dry eye disease. I continue to believe that the 12 months safety trial will be the gating factor for us in terms of NDA submission timing. In addition, there are chemistry manufacturing and control requirements for NDA submission. I believe that we are in excellent position with regard to our C&C requirements. And I think that rounds out the basic components of what we need to file the NDA.

Marc Goodman, Analyst

So you're thinking that the 12-month safety is going to run into early next year and that's the gating issue. And as soon as that's done, that's when the filing occurs. So that will be whatever early next year means that's the gating issue?

Todd Brady, CEO

The FDA requires six months of data from the safety trial and I believe 100 drug-treated patients are needed for submission. The timing of that will be one of the key factors for NDA submission. After the NDA submission, the remaining six months of data, covering months seven through twelve, must be submitted to the FDA. Therefore, at the time of NDA submission, approximately eight months of safety data will be required so that by the 120-day update, the remaining safety data is complete.

Marc Goodman, Analyst

And it's also on 629, noticing that you're saying the data could come in the fourth quarter could come in the first quarter. Has there been any enrollment impact by COVID or anything like that? Or is this basically it's always been around the end of the year early next year in your mind?

Todd Brady, CEO

It's certainly the latter. We've always thought that the results of the trials could be available towards the end of this year, early next year. We have had COVID impact on some of these trials, particularly the asthma trial where respiratory disease patients are understandably concerned about presenting to clinics or hospital environments or enrolling in clinical trials given COVID. We’ve also seen recent impact on our COVID trial itself. The reason there are being vaccinations and boosters and therapeutic antibodies and new drugs to treat a COVID that has diminished interest in the COVID trial. Nonetheless, we do expect to be able to announce data per our guidance. We also expect to announce all three of those trials in aggregate. To remind the listeners on the call, these are proof-of-concept Phase II trials. They are not designed, nor are they powered statistically to indicate the clinical results, rather the trials are designed to indicate pharmacodynamic of ADX-629 which includes cytokine levels, the RASP levels, and potential early clinical signals as we evaluate future trials, particularly Phase IIb clinical trials that can be run with ADX-629 starting next year.

Marc Goodman, Analyst

Thanks.

Todd Brady, CEO

Thanks, Marc.

Operator, Operator

Your next question is from the line of Kelly Shi from Jefferies. Your line is now open.

Kelly Shi, Analyst

Thank you for answering my questions. I have two inquiries regarding the statistics design. In the Phase III INVIGORATE conjunctivitis trial, you noted that the results were impressive and consistent across patients, with a standard error of approximately 0.03 units for each arm. What did you observe regarding the standard error of redness scores in the TRANQUILITY run-in cohort? Additionally, what is your expectation for the standard error of redness in the two Phase III TRANQUILITY trials? Another relevant point is that since you will be seeing the new Phase II trial first, and ocular redness is one of the endpoints, the standard error data from that new Phase II trial could provide insights for the Phase III outcomes. Thank you.

Todd Brady, CEO

Thank you for your questions, Kelly. I may not be as skilled in math, so please excuse my straightforward answers. The allergy trials differ somewhat from the dry eye trial. Both trials, such as the INVIGORATE trial in allergy and the TRANQUILITY trial in dry eye disease, are conducted in chambers. However, the allergy trials involve allergens in the chamber, while the dry eye trials use chambers with low to no humidity air. While the patient populations are related, they are distinct for obvious reasons. I estimate about a 50% overlap between the populations of allergic conjunctivitis and dry eye disease. So, there are similarities between the allergy chamber trials and the dry eye chamber trials, but there are also significant differences. One major difference is that the allergy trials were crossover trials, which reduces standard error and allows control of intra-patient differences. This is not true for the dry eye chamber trials, which are parallel group trials, so intra-patient differences cannot be controlled. Therefore, I would expect the standard errors to be slightly higher for those trials, though we can't know for sure without the data. We evaluated the powering in the TRANQUILITY trials using the TRANQUILITY run-in cohort. Based on what we've discussed, we currently believe the TRANQUILITY trials are around 90% powered for ocular redness, based on the delta seen in the run-in cohort and the standard errors. It’s possible to infer the standard error or standard deviations used to power TRANQUILITY, considering that the trials are about 90% powered with 300 patients or 150 patients per arm, using the observed delta from the run-in cohort. I connect with your final question regarding the Phase II RASP trial influencing the future conduct of TRANQUILITY. As I mentioned earlier, we can adjust the enrollment numbers for TRANQUILITY if the Phase II data indicates that it is underpowered, which was planned. We intentionally sequenced the Phase II trial and TRANQUILITY-1 and TRANQUILITY-2, allowing us to modify powering as necessary between the trials. I hope that addresses your questions, Kelly, and I apologize if I didn't cover all the mathematical details you were seeking.

Kelly Shi, Analyst

Thank you very much. It was super helpful. If I could ask a quick question: how should I estimate the covariance for the Phase III trials based on the run-in cohort data? Should I expect similar numbers or a significant change in the covariance?

Todd Brady, CEO

Right. Generally, I am a big fan of ANOVA and COVA in MRM because those statistical techniques allow for assessment of repeated measures, which is a fancy way of saying that each subject is assessed at multiple time points. I believe in the TRANQUILITY chamber, there are 13 different time points during which ocular redness symptoms and so forth are assessed. Those are referred to statistically as repeated measures because within each subject there are 13 different values. And the standard error is accounted for differently based on the fact that those measures are repeated. The covariance matrix that you refer to is a method of adjusting for the correlation between time points. In fact, it's a correlation matrix is mathematically related to covariance matrix. That makes sense that within a particular subject, adjacent time points are correlated. Time 10 minutes is probably fairly similar to time 5 minutes or time 15 minutes. And that is exactly what the covariance matrix attempts to adjust for. We typically have used the same covariance matrices across clinical trials for the very reason that I just described. That is, there is a fairly clear relationship amongst adjacent time points. We haven't disclosed the exact statistical model. Perhaps one day you'll see it when the SAP is posted on clinical trials.gov. But for now, I think you have a fairly good understanding of how we think about repeated measures and the correlation between time points.

Kelly Shi, Analyst

Thank you for the thorough answers. Thanks, Todd.

Todd Brady, CEO

Thanks, Kelly.

Operator, Operator

Your next question is from the line of Edwin Zhang from H.C. Wainwright. Your line is now open.

Edwin Zhang, Analyst

Hi. Thanks for taking my question. A question on the new trial of ADX-2191 retinitis pigmentosa. Can you briefly talk about the trial design for the efficacy endpoint? What should we look at and what improvement to expect from this Phase II trial? And lastly, are we going to see some data of this trial next year? Thank you.

Todd Brady, CEO

Yes, thanks, Edwin, for the question. We're still working on getting that design up and running. I do expect it will be able to be in process this year, as I mentioned in my prepared comments this morning. Essentially, this is an open-label trial, and we are going to assess a couple of different dosing regimens. And as I mentioned, the primary endpoint will be safety because this particular compound, ADX-2191, has not been previously tested before. So, in particular, as we've posted in our corporate deck, Edwin, you can see that we expect this to be a single-center trial. We're looking at approximately, I don't know, four or five patients per dosing cohort, a couple of different dosing cohorts and more or less a 3-month evaluation period. But we're looking at all the standard secondary endpoints that most retinitis pigmentosa trials focus on, including, obviously, visual acuity, but also retinal function and retinal morphology.

Edwin Zhang, Analyst

Great, thanks.

Operator, Operator

Your next question is from the line of Prakhar Agrawal from JonesTrading. Your line is now open.

Prakhar Agrawal, Analyst

Hi, good morning, and thanks for taking my questions. My first is on allergic conjunctivitis. On your comment around the NDA update for this indication by the end of the year. Is it more of a question of getting clarity around how much safety exposure is needed? Could you confirm whether you have the necessary efficacy data for submission in allergic conjunctivitis? And then I had a couple of follow-ups.

Todd Brady, CEO

Sure. Thanks, Prakhar. No, it is not a function of safety data. The questions currently under discussion with the FDA have to do with efficacy requirements. I can go into a bit more detail along those lines. In particular, we have two Phase III trials that have been completed, both of which were highly statistically significant and hit their primary and key secondary endpoints. It should be pointed out though, that those trials are different. So the ALLEVIATE trial which was announced, I believe in 2020 or 2019 has to do with conjunctival allergen challenge which is a method of directly exposing the ocular surface to pollen. In this case, whereas the INVIGORATE trial that was released earlier this year, is an allergen chamber trial, which is a more real world. The pollen exposure in that case of pollen is aerosolized into a chamber, and subjects are exposed in that manner. So the two Phase III trials are different. And as you know, that requires discussion with the agency, which is currently ongoing, and that's the subject of those discussions.

Prakhar Agrawal, Analyst

Got it. And secondly, on early-stage pipeline, you have previously talked about testing RASP innovation for backup indications. Just wondering if there are any updates there? Is that something we can expect to hear in the next 6 to 9 months? Thanks for taking my questions.

Todd Brady, CEO

We are committed, Prakhar, to continuing to develop the new RASP inhibitors. As you can tell from my excitement this morning, we remain very positive on the potential of RASP broadly in immunological disease. We're in the process of discovering, optimizing, testing preclinically a variety of new RASP inhibitor analogues with extended patent lives and so forth. And we look forward to updating you and the Street on our new approaches along those lines at some point next year.

Operator, Operator

Your next question is from the line of Esther Hong from Berenberg. Your line is now open.

Esther Hong, Analyst

Good morning. So I just wanted to know if you could remind us of the findings in the publication that you mentioned regarding the comparison reproxalap versus lifitegrast. And then second, what's the feedback you're getting from practicing physicians regarding currently available therapies for dry eye disease and where reproxalap might fit in? Thanks.

Todd Brady, CEO

Good morning, Esther. Speaking with key opinion leaders, both on the ophthalmology side of the fence and the optometry side of the fence is something that is of key importance to us these days, so your question is particularly appropriate. We're getting very positive feedback, particularly for the reasons that I think we all know, namely, that reproxalap in dry eye disease appears to be the only therapeutic option that's either in late-stage development or currently available, that works quickly, within minutes, according to the data presented in January from the dry eye chamber. It's also the only drug that can be, in theory, used chronically that is whitening that eliminates or reduces ocular redness, which as we discussed earlier this morning, I think is a key commercial advantage. The paper that you reference is open access and available on PubMed. The idea was to compare tolerability between a couple of different formulations for reproxalap, including the one that we're currently advancing, that we call the standard formulation. The difference between those two formulations is minor. We increase the percentage of an excipient and attempt to delay the release of the drug on the ocular surface. But as you can see from the results of the paper, the two formulations perform similarly. You can also see that in our corporate deck based on the 12-week symptom data that we present, one trial is a standard formulation and one trial is from the novel formulation. The tolerability evidenced in the paper is considerably better for both formulations of reproxalap compared to lifitegrast. Lifitegrast is often plagued by acute discomfort, taste disturbances, blurry vision; those are the three elements that are tested directly in the paper. And you can go see how reproxalap performed relative to lifitegrast in the manuscript itself. The only other thing I'll say is that the ocular discomfort score, which was I would say one of the key symptoms assessed in the paper has also been used as a pivotal symptom score for the approval of at least one compound in a dry eye disease. That's the same measure that is evidenced in the paper. And I think it could represent a direct head-to-head comparison of a dry disease activity, not just tolerability but activity of reproxalap versus lifitegrast.

Esther Hong, Analyst

Got it. Thanks.

Todd Brady, CEO

Thanks, Esther.

Operator, Operator

Your next question is from the line of Yale Jen from Laidlaw & Company. Your line is now open.

Yale Jen, Analyst

Good morning, Todd, and thank you for answering my questions. My first question is to confirm that the main aim of the Phase II study for reproxalap is to assess whether the TRANQUILITY study might need to increase its size mainly to achieve statistical significance for RASP, rather than for redness or Schirmer scores; is that correct?

Todd Brady, CEO

Good morning, Yale, and thanks for the question. Well, the reason we perform the Phase II study is to optimize the RASP signal. I think we will be able to use the data from the Phase II to power TRANQUILITY for all the endpoints, if we wish. RASP included redness, included Schirmer's test symptoms, whatever, I think it's prudent for any biotech company to use current and available clinical trial data to adjust powering of ongoing trials. And that's exactly what we're doing with a Phase II trial. When we've designed the trial, when we initiated the trial, when the trial was ongoing in terms of clinical conduct and so forth, the idea really was to optimize RASP. And as I mentioned, adjust the timing and the sequencing and the order of tear collection processes. I think an added advantage, though, of the trial is exactly what you mentioned. And that is we're able to take the data from the Phase II and adjust the powering if needed for TRANQUILITY. But we could do that with any of the endpoints that we wish.

Yale Jen, Analyst

But should we assume that at least at this moment, in terms of TRANQUILITY, the study size is reasonably powered, assume the well powered for detecting the redness that does the current assumptions?

Todd Brady, CEO

I think that's an excellent point, Yale, that I have not made this morning. That is both the Phase II and the TRANQUILITY trials are powered for ocular redness. While the Phase II was designed to optimize the RASP signal, the Phase II was also powered based on ocular redness. The primary endpoint of the Phase II is ocular redness. The question then is, well, how can you reach 90% power with 150 subjects in one trial and 300 subjects in another trial? And the answer is we use slightly different powering techniques. And for those of you that are interested in the mathematics, in one case, we used individual group standard deviations. And in another case, we used pooled group standard deviations, the latter being much more conservative, obviously by a factor of approximately two in this case. So I think that both the Phase II and the Phase III trials are adequately powered for ocular redness. And if we believe the power and calculations, and the power and calculations reflect reality, then there should be no need to adjust powering going forward. But again, the run-in cohort was 23 patients. The Phase II trial is 150 patients. As I mentioned, I think it's prudent for any biotech company to take the most recent and fulsome clinical data to power or adjust the power for ongoing clinical trial.

Yale Jen, Analyst

Okay, great. That's a very comprehensive answer. Maybe one question on the 2191. Actually, two up here. The first one is for the RP. After the Phase II study, have you thought about what might be the potential approval endpoints for RP? Have you spoke with your consultants or with the FDA about this?

Todd Brady, CEO

Thanks for asking about RP, and I know Edwin brought up RP as well. I should say at the outset that we're extremely excited about retinitis pigmentosa. There is no approved drugs for retinitis pigmentosa. There's a tremendous unmet medical need. There is a tremendously motivated patient population and kudos to those patients and their providers for organizing so effectively. We've received many inbound well wishes and thoughts and requests and so forth, and we're just thrilled that we're able to participate in the RP development program broadly for that patient community. The pivotal endpoints, I think remain to be discussed in our case with the agency. We typically don't have those discussions until we have at least some clinical data to discuss with the agency. My understanding typically, though, with rare retinal diseases, possibly including retinitis pigmentosa is that pivotal endpoints concern functional studies, the ability for patients to see and operate in a variety of different lighting conditions. And as we get closer to generating data and as the initial data come in, we'll have those discussions for the agency and be able to provide more clarity on the endpoints needed for NDA submission at that point.

Yale Jen, Analyst

And maybe the last one also in 2191. Is that you mentioned recently that the drug also potentially can be used for lymphoma, vitreoretinal lymphoma. Any thoughts in terms of a discussion on this front?

Todd Brady, CEO

Lymphoma, as it occurs in the primary sense, in the eye is a serious condition. I believe the median survival is about 5 years. The challenge is that those cancers often metastasize to the CNS or the brain. There is currently one drug that is used to treat primary ocular lymphoma or PBRL, and that is methotrexate, which is the active ingredient in 2191. There is a considerable amount of literature, scientific literature on the use of methotrexate both in terms of systemic administration and intraocular administration for the treatment of lymphoma. And our discussions with the agency involve the scientific literature as well as other mechanisms we may be able to use for NDA submission for lymphoma, and those discussions are ongoing, Yale.

Yale Jen, Analyst

Okay, great. Thanks a lot, and congrats for all the progress.

Todd Brady, CEO

Yes, thanks, Yale. Thanks for the excellent questions.

Operator, Operator

There are no further questions. I will hand the call over back to Dr. Brady for closing comments.

Todd Brady, CEO

Thank you all for joining us this morning. As always, we look forward to keeping you updated on our progress.

Operator, Operator

And with that, this concludes today's conference call. Thank you for attending. You may now disconnect.