Good afternoon, ladies and gentlemen. Thank you for standing by. And welcome to the Ocular Therapeutix Fourth Quarter and Year End 2020 Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that time. It is now my pleasure to turn the call over to Donald Notman, Chief Financial Officer of Ocular Therapeutix. Please go ahead, sir.

Thank you, Valerie. Good afternoon everyone and thank you for joining us on our fourth quarter and year end 2020 financial results and business update conference call. This afternoon, after the close, we issued a press release providing an update on the company's product development programs and details of the company's financial results for the quarter and year ended December 31, 2020. The press release can be accessed on the Investors portion of our Web site at investors.ocutx.com. Leading the call today will be Antony Mattessich, our Chief Executive Officer, who will provide a summary of our corporate developments and an update on the commercial progress of DEXTENZA. Also speaking on the call will be Dr. Michael Goldstein, our President, Ophthalmology and Chief Medical Officer, who will give an update on our clinical developments and pipeline. Following Michael's remarks, I will provide an overview of the financial highlights for the fourth quarter before turning the call back over to Anthony for a summary and questions. For Q&A, we will also be joined by Patricia Kitchen, our Chief Operating Officer; and Scott Corning, our Senior Vice President, Commercial. As a reminder, on today's call, certain statements we will be making may be considered forward-looking for the purposes of the Private Securities Litigation Reform Act of 1995. In particular, any statements regarding our regulatory and product development plans as well as our research activities are forward-looking statements. These statements are subject to a variety of risks and uncertainties that may cause actual results to differ from those forecasted, including those risks described in our most recent annual report on Form 10-K file this afternoon with the SEC. I will now turn the call over to Antony.

Thank you, Donald, and welcome everyone to Ocular Therapeutix's fourth quarter and yearend earnings report. On all counts, it was a great quarter capping a notable year for Ocular, despite the challenges due to global pandemic, Ocular made tremendous progress with the commercial uptake of DEXTENZA, as well as advancing our pipeline of product candidates being developed to target several of the largest market opportunities in ophthalmology. For all of our success this past year, I would like to thank our dedicated employees, our patients and clinical investigators, but hundreds of individuals involved in our clinical trials and our investors. Thank you all. Been with DEXTENZA, this past quarter we seem to extend the net sales rise to $6.9 million for the fourth quarter 2020, which represents more than 25% growth over the previous quarter and more then million 330% increase year-over-year comparison. Going forward we expect DEXTENZA to be an increasingly significant net contributor to the company's cash position. While we have no hard data to determine cataract volumes in the U.S., we are aware of a number of closures and slowdowns in key ASCs and particular HOPDs in response to the recent spike in COVID cases. The bulk of these actions took place in January and February of this year. Fortunately DEXTENZA in-market sales, that is sales from distributors to ASCs and HOPDs were brisk. Billable units neared 9500 for the first two months of the year, representing greater than 10% increase over the first two months of the fourth quarter and nearly a 230% increase over prior year. Clearly, despite the pandemic DEXTENZA's increasing share of cataract volume continues to drive impressive growth. In the final three quarters of the year, we expect what was a headwind in cataract volumes to become a tailwind of the backlog…

Thanks, Anthony. Let me begin with an update on our back-of-the-eye program, OTX-TKI. We continue to those subjects in a multicenter open label dose escalation Phase 1 clinical trial being conducted in Australia that is designed to assess the safety and tolerability of OTX-TKI, as well as to assess preliminary biological activity in subjects by measuring anatomical and functional changes. Last month, we presented interim data from the study at the angiogenesis exudation and degeneration 2021 virtual meeting, highlighting data from all three cohorts. The first three cohorts, Cohort 1, 200 micrograms, Cohort 2, 400 micrograms and Cohort 3a, 600 micrograms, have now been fully enrolled, or Cohort 3b, 400 micrograms of OTX-TKI used in combination with anti-VEGF induction therapy continued to enroll. We are seeing early signs of biological activity, including decreases in retinal fluid in some subjects as early as two months, following assertions in Cohort 2 and 3a. Additionally, we are seeing encouraging durability of six months or longer in all cohorts, and durability up to 13 and a half months in one subject in Cohort 2. OTX-TKI has generally been well tolerated with a favorable safety profile, no ocular serious adverse events, no subjects with elevated intraocular pressure, and those subjects needing steroids to treat ocular inflammation have been observed or reported to date. While the drug product profile is still emerging, we were pleased with the interim data and OTX-TKI is potential to reduce intraretinal and/or subretinal fluid. In terms of next steps, we now have an exploratory IND in place in the United States, and we plan to initiate a randomized controlled clinical trial starting in the middle of the year using a single 600 microgram OTX-TKI implant along with anti-VEGF induction therapy. Moving to our glaucoma program OTX-TIC. In January, we presented interim…

Thanks, Mike. Gross product revenue net of discounts rebates and returns, which the company refers to as total net product revenue was approximately $7.4 million for the three months ended December 31, 2020, reflecting a roughly 25% sequential increase over the third quarter of 2020 and a 226% increase over the fourth quarter of 2019. Net product revenue of DEXTENZA in the fourth quarter of 2020 was $6.9 million versus $5.4 million in the third quarter, and reflects an approximate 28% sequential increase. Total Net product revenue for the fourth quarter of 2020 also includes net product revenue of $0.5 million for ReSure Sealant. Overall net product revenue for the year was $17.4 million versus $4.2 million for 2019 and primarily reflects a strong uptake in DEXTENZA sales during the second half of 2020. Research and development expenses for the fourth quarter were $7.6 million versus $10.1 million for the comparable period in 2019, and primarily reflect the decrease in allocated costs, driven largely by the reduction in force executed in the fourth quarter of 2019. And reduced clinical trial costs associated with the Phase 3 DEXTENZA allergic conjunctivitis trial. And the Phase 3 OTX-TP trial, offset by increases in the cost associated with the Phase 1 clinical trials of OTX-PKI. OTX-TIC and OTX-CSI, as well as the commencement of the Phase 2 clinical trial of OTX-CSI. Overall R&D expenses for the full year decreased $12.4 million to $28.7 million from $48 -- from $41.1 million in 2019, reflecting the decrease in unallocated costs, and the trends in clinical trial expenses mentioned above. Selling and marketing expenses for the fourth quarter were $6.8 million as compared to $7.1 million for the same quarter in 2019. The modest decrease relates to reduce consulting fees and travel related costs offset by increased…

Thanks, Donald. So before opening up the call for questions, let me do a quick summary. With successful capital raises a new licensing agreement and momentum in DEXTENZA sales, we believe we have the resources to fully fund our four clinical stage pipeline assets through completion of their plan Phase 2 programs in disease states within large ophthalmology markets, estimated to account for over $20 billion in the aggregate and annual global sales. In wet AMD, the performance of OTX-TKI and our Phase 1 trial continues to support a product profile that could potentially set a new standard of care for durability. We plan to initiate a prospective randomized U.S. based trial by the middle of 2021. In glaucoma, OTX-TIC continues to support a product for a while that could potentially set the standard of care for patient compliance. We plan to advance that program into a Phase 2 clinical trial in the middle of 2021. In dry eye disease, we initiated two Phase 2 clinical trials, one for OTX-CSI, and one for OTX-DED. For OTX-CSI, we now expect top line data in the fourth quarter of this year. For OTX-DED, we expect top line data in the first half of 2022. Beyond dry eye disease, we submitted our sNDA for DEXTENZA and allergic conjunctivitis in December 2020 and have a PDUFA target action date of October 18, 2021. We look forward to a busy productive 2021. And with that, I'll turn the call over for questions.

Thank you. [Operator Instructions] Our first question comes from Dane Leone with RJF. Your line is open.

Hi. Congratulations on 2020 and the updates today. Thank you for taking the questions. So, I guess, the first one for me would be going back to Michael's comments around the study for OTX-TKI in the U.S. That's expected that would start next year. Maybe you guys can just elaborate a little bit on the study design. Just in terms of how you're thinking about what you want to get out of that first U.S. study. And how does that set the stage for later stage studies. Obviously, another company in this space, earlier this week just had data with a product that didn't seem to be a peer of yours or a competitor. That data looks horrendous. And I think the general consensus, it might not be a viable product for very specific reasons to them. But that said, does that inform anything in terms of how you guys are thinking about later stage development? Or just kind of any thoughts around that would be appreciated. Thanks.

Hi, Dane. Thanks for the question. This is Michael Goldstein. So, the study that you're referring to OTX-TKI study is the U.S. study that we're planning on starting mid-year this year. It's being conducted under the exploratory IND pathway. So we're looking to enroll 20 subjects with a three to one randomization. And patients need to be randomized to receive the OTX-TKI drug at a single implant of 600 micrograms, along with an anti-VEGF drug for induction. And that'll be compared to an aflibercept group that will receive aflibercept every eight weeks. And we will follow those patients out and we will be looking for changes in vision. And we will be looking at retinal anatomy looking -- using the OCT. Patients to get into that trial will have been placed into previously treated. So there'll be wet AMD patients who will start being -- started out in a dry state. And what we'll be looking for is can we maintain them in that dry state with the single implant or the 600 microgram. Obviously, looking at safety, but also looking at durability of effect. You had mentioned the other company, we believe that the data that you saw from that other company was really related to a different delivery system. And we believe that with our delivery system where the drug is delivered with a single implant into the vitreous, there really is not the opportunity to see the migrations that was recorded in that study. But obviously, we'll be looking at safety in our study as well.

Great. And sorry, what's the duration of the study?

So, we'll be following patients out for a year.

Okay. And just in terms of thinking about study design in later stages, you have actually not a direct comp, but some of the gene therapy, companies are starting to do later stage pivotal studies. Do you see any parallel in terms of how you would approach your study at a later stage, or is it still kind of CPT to see what the result is from this exploratory study?

Yes. I mean, I would say we haven't made final decisions for later stage studies. But there are a number of options on the table.

Okay, great. I'll get back in the queue. Thank you.

Thanks, Dane.

Thank you. Our next question comes from David Steinberg with Jefferies. Your line is now open.

Okay, thanks. I had a couple questions. First, on your -- in terms of your October PDUFA for allergic conjunctivitis, I know your reps aren't really calling on? And the doctor also said. But just curious, is there any off label use you think right now in that indication? Secondly, do you have a sense of what percent of the business for DEXTENZA from Medicare patients versus commercial insurance? And then I have a couple of other follow-ups. Thanks.

Yes. I think we can answer both the questions from the same answer, which is that we have launched with an extraordinary focus on Medicare Part D patients in ASCs. So that being said, we have -- we expect very little off label edge for allergic conjunctivitis. Clearly, when we get the indication, we will start moving into the ophthalmology office environment both in the surgical sphere and in the -- for ocular surface disease. But given our approach and given the idea that we really are advising the people that we go see not to paint outside the lines, so they don't have bad experiences with the product from a reimbursement standpoint, the vast majority of our usage is in hospitals and in Medicare Part D.

Got it. And then, just a couple of financial questions. So, you received the $12 million upfront, but didn't book it on the P&L? What's the accounting treatment you're going to use for this upfront? And then there are about 90 million plus in future aggregate milestones. Are you running the programs? Are they being run by AffaMed? And when would the next tranche of payments from them hits the P&L?

Hey, David, it's Donald. Thanks for the question. So with regard to the accounting around it, you'll see the $12 million record is deferred revenue on the balance sheet. And when we begin to deliver either clinical and/or commercial product, we will begin to ratchet that down and recognize the revenue in the future. And maybe I'll turn it over back to Anthony, on the AffaMed question with regard to the U.S. in addition to that.

Yes. They will be driving -- we handle the regulatory issues within China. And they will be doing the clinical trials. So they're driving whatever clinical work may need to have firm in that. I'm sorry, Patricia, you're on the line. Do you have to add from a regulatory standpoint about how it works in China.

No. As they say, I think you've hit a spot on. So Ocular Therapeutix will actually be the holder for the MAH in China. So once we perform the submission and actually get positive feedback from the Chinese authorities, additional milestones would take place after then.

Okay. Thanks a lot.

Thank you. Our next question comes from Joe Catanzaro with Piper Sandler. Your line is open.

Hey, guys. Thanks so much for taking my questions. And congrats on all the progress here. I'm wondering if I could follow up on the exploratory IND for TKI. I think you guys have previously spoken about the opportunity for that trial to potentially expand beyond the initial 20 patients. At what point do you think you could have that that conversation with the FDA? And what triggers that? Is it just additional data from the ongoing Phase 1? Or will you need some data from patients actually treated within the U.S. trial?

So Joe, this is Patricia. Thank you for the question. So, we do intend to have a meeting with the FDA to talk about the plans for transition from an exploratory IND to a traditional IND. There is data that we need to compile in order to be able to do this. So we're hoping to have additional information and a plan set later this year.

Okay. Got it. And I'm wondering if you can -- when we should expect the next update out of the Phase 1 trial for OTX-TKI. And what we should expect to see there versus what we saw back in February?

Hi, Joe. Its Mike again. So, I think we've been pretty consistent that we would give data updates when we have something meaningful to say. And the cadence has been about every three or four months that said, look for something around the ARVO meeting, which is in early May.

Okay. Got it. But if I could just squeeze one last one in on OTX-CSI, are there any expectations there that that Phase 2 trial could potentially serve as one of the registrational studies? And is it powered like a Phase 3?

So, great question. It is not powered like a Phase 3. It's powered like a Phase 2 study. So we are in -- we're planning on enrolling approximately 140 subjects. If it was a phase three, the general size of that study is more like 500 patients. So with that said, the primary endpoint here is looking at tier production. In order to get regulatory approval, generally you need to show improvement in signs and symptoms into adequate and well controlled trials. One of the exceptions is that you can show an increase tier production of 10 millimeters and in certain percentage of subjects greater than the vehicle control. And in such a case, you don't need to also show symptomatic data. So we would -- to answer your question is, it's possible that you could see a statistically significant improvement, but it's not powered to show that in this trial

Okay. Got it. That's really helpful. Thanks for taking my question.

Thank you.

Thank you. Our next question comes from Jon Wolleben with JMP Securities. Your line is open.

Hey, good afternoon. Congrats on all the progress. Piggybacking on some of the OTX-TKI questions. You mentioned that you're going to be moving to a single 600 milligram insert in the next study. And I was hoping you could kind of walk us through your thoughts on how that might change the observations you saw with three 200 milligram inserts in the current study?

Yes. It's a great question. Thanks for asking, Jon. So as we -- in the current trial design, we have a 600 microgram group, which is Cohort 3. To do that, we actually use three 200 microgram implants that are all essentially administered at a similar time. And -- but moving forward and including the U.S. trial, we're going to a single implant 600 microgram dose, which -- and the primary driver for that was that -- we think that's a better commercial product obviously, having one implant is better than three. But it turns out, there's a secondary benefit, which is that, by having a higher concentration of drugs in the implant, there's a larger concentration gradient for the drug to diffuse out of. And that means that the release rate of the drug per day is actually higher. So going from the three 200 microgram implants to the single 600 microgram implant from a dose delivery per day perspective, is that dose escalation. And I think that is a lot of potential upside for us.

It's interesting. And then I was hoping you could discuss the opportunity in allergic conjunctivitis and how you're thinking about it? Obviously, you're going to be changing the paradigm of treatment with the DEXTENZA available. So I was hoping you can talk about how you think about the opportunity, any incremental investment to realize that? And then as far as big picture, what it means for Ocular Therapeutix to move into the office setting.

I'll talk about the business side of it first, and then Mike, I guess, can talk about the medical aspects for it. Clearly there's a massive population, those are conducted by us and an even sort of large slice of that slice that seeks secondary medical attention for their allergic conjunctivitis. So there's a large bolus of patients out there. But we have to expect that there's going to be some reticence among payers to have widespread use of a product like DEXTENZA for the treatment of your [Indiscernible] allergic conjunctivitis patient. So the way we're planning on going about it at first is to go with the targets where we are already seeing positions where there's a greater than 90% overlap for anterior segment surgeons, and ophthalmologist who treats allergic conjunctivitis or refractory allergic conjunctivitis. So in that overlap, we will be in both the office and in the ASC in hospital environment with a portion of those physicians. So that won't require immediately an increase in our promotional expenses. But what we will do in that environment is start building out platforms with payers where the allergic conjunctivitis will be reimbursed. The good news is that we've had discussions with payers and it's important to note that the type or the part of the bureaucracy that pays for medical benefit is different than the part of the bureaucracy within payers that pay for Part D type products or pharmacy benefit products. And the approvers or the payers who approve the medical benefits actually see very, very expensive drugs, sometimes upwards of $10,000, $15,000 per dose. So we haven't actually had pushback on the price, which we expect to be the same in the allergic conjunctivitis sector as it is in the hospital sector. But they do expect us to filter out patients so that appropriate patients with appropriate physicians will be getting allergic conjunctivitis. Once we get a foothold, we'll build out. And as we build out, we probably will need to add to our promotional resources in order to more broadly reach the office environment. But initially, we'll be looking at that Venn diagram confluence where we have both our surgical targets and the AC targets in the same practice. So I don't know, Mike, you want to add something to that?

A lot there. I'll just say, clinically, we do use steroids for allergic conjunctivitis in the office, it does work exceedingly well. We don't do it more commonly because of the risk of abuse, meaning, patient gets it, it works well. They take it home. They keep using it. Then you end up with some of the adverse events related to chronic use of steroids. So, I think clinically as you know, most of the current ocular allergy therapies, antihistamine/mast cell stabilizers have now gone over the counter. So we think patients would be -- try those over the counter. Those weren't adequate. They come into the office. We'd ordinarily give them topical steroids. And that's where DEXTENZA could fit in with the physician administered approach that the patient couldn't reuse. It also has the extra advantage of being preservative free, and there are no preservative free, commercially available steroids. So we think there's a pretty significant value proposition potentially here.

It’s very helpful. Thanks again for taking the questions.

Thanks, Jon.

Thank you. Our next question comes from Georgi Yordanov with Cowen & Company. Your line is now open.

Thank you so much for taking the questions and congratulations on all the progress. So I guess, starting with a broader question, even with the next generation anti-VEGFs which is Roche's, faricimab and Kodiak, KSI 301, up to 10%, 15% even 20% of patients require a very frequent injections once every month, once every other month. Do you anticipate that OTX-TKI could be actually used in combination? Or I guess, in the background of such therapies? And then have a couple more specific questions?

Yes. It's a great question. We've seen a very strong safety profiles to date. And if that holds up, as we enroll more and more subjects and learn more about this drug, it gives us a lot of flexibility. One of the really nice things about the OTX-TKI is administered in the office, using the same techniques as we do with anti-VEGF therapy. And does not displace much volume in the vitreous. All that means, to your question is that if you get a great response without OTX-TKI, that's great. If you needed to use anti-VEGF for some breakthrough, that wouldn't be a problem.

Got it. That's helpful. And then it goes on a question that on the Cohort 2 subject, which you mentioned, has demonstrated there will be up to 13 months. Do you know what is driving this response? Are you worried that the implant has not been fully degraded? And could this be an issue regarding re-dosing?

So another great question. So, with a single implant, we see durability of about nine to 10 and a half months. When we put in more than one implant, one of the effects I mentioned earlier, applies, which is that that one implant does have an effect on the other implant in its degradation. And we are seeing the implant class a little bit longer in some patients. And so that possibly could be could be an explanation. It could also be that, once you've got the patient to a dry state, you've sort of eliminated the need for additional therapy for a period of time. So we need to see more patients. We need to see how that plays out. But, but again, as we go to a single implant, we really expect the durability of about nine to 10 and a half months.

Got it. It is helpful. And then lastly, on the glaucoma program, what influenced your decision to perform a head-to-head against the risks rather than eye drops? And I guess, the major commercial setback for Duresta. Was that -- it was an indicated for reducing, based on your conversations with the FDA, what would you need to show for the label to allow re dosing? And is that something you plan to do kind of have with the initial NDA submission? Obviously, if everything is successful, or would that be a supplement some sometime down the road?

Yes. Great question. So there's actually two active competitors in the Phase 2 trial. So subjects are randomized, as you said, to one of the two doses of OTX-TIC or Duresta in one eye. But the other eye will receive a topical prostaglandin. So you'll have both an eye drop comparators as well as the Duresta comparator in the trial. As you also note, their label is limited to a single implant. We believe that's related to effects on the corneal epithelium. To date with our single implant we have not seen any meaningful changes in the corneal epithelium as measured by direct cell counts, functional measurements like pachymetry or direct observation with a so lamp. So we not in the Phase 2, but we will do repeat dosing, obviously. And we will have discussion, additional discussions with FDA just to see what we need to show in order to be able to get repeat dosing.

Thank you so much, Dr. Goldstein. You've been super helpful. Thank you.

Thanks for your questions.

Thank you. [Operator Instructions] Our next question comes from Anita Dushyanth with Berenberg Capital Market. Your line is open.

Hi, good afternoon. Congrats on the progress. And thank you for taking my questions. I have a few here regarding the dry eye disease candidate, both CSI and DED. Just wanted to know in terms of the design, I know, CSI was -- is probably designed to last for 12 weeks. Could you just remind us how the DED candidate is designed for the acute condition? And also in terms of the population size? Do we sort of expect the acute conditions patients to be sort of the same size as the chronic conditions? And also one more regarding the acute dry eye condition patients? Do you think there might be pushed back in terms of patients maybe being happy with the eyedrops and not having to have an implant?

Okay. Lots of questions there. So as you know, we have two dry eye programs. So one is OTX-CSI, which is really designed for the chronic treatment of dry eye disease with a cyclosporine product that lasts three to four months. And then OTX-DED, which is a low dose dexamethasone designed release dexamethasone for two to three weeks for the acute treatment of dry eye. I will say clinically, there are -- we sort of think about dry eyes as a chronic disease. But we also for -- know that there are acute fliers, and these are pretty common, you know, happening anywhere between one or two or three times a year for many dry eye patients. And for years, we've treated these drugs, these patients with topical low dose steroids off label. As you know, there's now an approved product, which has gone through the regulatory path. And it'll be interesting to see how that product plays out in this space. We think the opportunity for OTX-DED is that, as mentioned -- as I mentioned with DEXTENZA, some of the things apply here. The risk of steroids is not that they won't work, they do work, it's probably one of most effective ways we can treat dry eye. The risk is really with abuse with chronic therapy. And so, by having a physician administered product, it's in the physicians hands, the patient can't do repeat dosing. In addition, that the steroids here also is delivered in a preservative free fashion. We have two different formulations of the OTX-DED. One is designed released for two weeks, and one is designed to release for three weeks. The other advantage, huge advantage of both products, both the CSI and the DED is that the hydrogel component basically performed punctal occlusion. And one of the main treatments that we currently use for dry eye disease is to occlude the Punctum with a Punctum plug. So you're essentially getting the benefit of both of these products of a drug release and the punctal occlusion. So to your question about whether we push back? Yes, there may be some pushback from some patients, but many, many of them will have been used to having punctal occlusion as part of their dry therapy. And so, I think that it'll be -- those patients will obviously be very easy to accept.

Thank you. That was helpful. And just one more question. Just regarding the milestone payments that you will receive from AffaMed. Sorry, if I missed that. Is there a breakdown between milestones that would be received as part of the development versus the launch milestone? Is there something you can discuss?

Yes. We laid out in detail. You want to go ahead.

No. I think that was Patricia, Patricia, you can fill that one.

Patricia, you go ahead.

Sure. So for the milestone payments, there are several milestone payments that have to do with regulatory approvals in the different markets. And then there are four other programs, milestones for clinical development and the success and execution of clinical programs. So that's really where the different milestones like both regulatory as well as clinical milestones.

All-in-all there in excess of [Indiscernible] milestones and royalties in the significant royalties getting into the team.

Great. Thank you. That'll be for me.

Thank you. Our next question comes from Yi Chen with H.C. Wainwright. Your line is now open.

Thank you for taking my questions. My first question is with respect to the 40% sequential growth in DEXTENZA head up by units. How much of it was driven by recovery of surgical volume? And how much of there was driven by new accounts?

I think none of it was driven by recovery and surgical volume. And the surgeries are still down. The latest data we've seen is that in 2020, there's probably about 3.2 million cataract surgeries performed. That's against an average of about 4.1. The data that we've seen now is projecting that in 2021, there will probably be about 5 million cataract surgeries to be performed. So the rebound is yet to happen. Clearly, we've seen in --certainly in January in February of this year, a number of ASC is either slowing down or closing. Clearly, we're still experiencing double digit growth in market. So the share gain has been accelerating. Even though the total number of cataracts is still an innovative malaise, although we're starting to see the country wake up and starting to get some of those surgeries back now, but only really in March.

Okay. At what point would you consider providing some revenue guidance?

We're in consideration. I mean, the concepts should it be that after the second quarter that we will probably run out of excuses not to give guidance going forward. But we always reserve the right to not do that. Clearly, in this first quarter, I think is where we will be unless there's something that happens in COVID, that's unforeseen. We would expect a normalization going forward. And then we should be able to give some guidance on what we see our quarterly net sales moving toward.

Got it. So question OTX-DED, OTX-DED trial enrolling patients as fast as the OTX-CSI trial and is your chance to report data, the DED data by the end of 2021?

Hi, Yi. This is Mike. So the OTX-CSI trial started enrolling patients in September, and the cadence has been faster than we expected. And that's why we're able to change guidance. OTX-DED started enrolling patients last week. And so far things are going well. But I think it's too early for us to be able to change guidance on that. So right now we're saying first half of 2022. Obviously, if things enroll quickly, the way OTX-CSI did, there is the opportunity to move that earlier. And just to remind you, the CSI trial is four months, We follow patients for four months after they've been randomized. In the DED trial, to shorter trial, the primary endpoint of two weeks and we follow patients for two months after randomization. So it is a shorter trial. And so we will see, we will we will know much more over the next four to six weeks.

Got it. And my last question is with respect to OTX-TKI. For that to be become a commercially successful product. In your view, what's the lowest percentage of -- what's the lowest number in terms of percentage of patients that remain rescue free for at least six months?

Yes. It’s a complex. It’s a simple question with a lot of nuance to it. And it's -- the nuances around what is rescue mean? And what is rescue mean with DEXTENZA release drug and a number of other things. What I would say is our target and we believe what would be a really exciting drug is if half the patients get evidence of biological activity and can be sustained to six months or longer. I think that's our target. I think there's a product that its shorter. But I think -- and obviously if we see a higher response rate that's even better. But I think if we can show half the patients out to six months or longer, that becomes a really big product.

Got it. Thank you.

Thank you.

Thank you. Ladies and gentlemen, this concludes today's conference call. Thank you for participating. You may now disconnect