10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2024

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______ to _______

COMMISSION FILE NUMBER 000-51122

EyePoint Pharmaceuticals, Inc.

(Exact name of registrant as specified in its charter)

Delaware (State or other jurisdiction of incorporation or organization)	26-2774444 (I.R.S. Employer Identification No.)
480 Pleasant Street Watertown, MA (Address of principal executive offices)	02472 (Zip Code)

(617) 926-5000

(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.001	EYPT	The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

There were 68,251,031 shares of the registrant’s common stock, $0.001 par value, outstanding as of October 31, 2024.

EYEPOINT PHARMACEUTICALS, INC. AND SUBSIDIARIES

INDEX TO FORM 10-Q

		Page
PART I. FINANCIAL INFORMATION
Item 1.	Unaudited Financial Statements
	Condensed Consolidated Balance Sheets – September 30, 2024 and December 31, 2023	3
	Condensed Consolidated Statements of Operations and Comprehensive Loss – Three and nine months ended September 30, 2024 and 2023	4
	Condensed Consolidated Statements of Stockholders’ Equity – Three and nine months ended September 30, 2024 and 2023	5
	Condensed Consolidated Statements of Cash Flows – Nine months ended September 30, 2024 and 2023	6
	Notes to Condensed Consolidated Financial Statements	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	22
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	30
Item 4.	Controls and Procedures	30
PART II: OTHER INFORMATION
Item 1.	Legal Proceedings	31
Item 1A.	Risk Factors	31
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	33
Item 3.	Defaults Upon Senior Securities	33
Item 4.	Mine Safety Disclosures	33
Item 5.	Other Information	33
Item 6.	Exhibits	35
Signatures		37
Certifications

2

PART I. FINANCIAL INFORMATION

Item 1. Unaudited Financial Statements

EYEPOINT PHARMACEUTICALS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In thousands except share data)

	September 30,			December 31,
	2024			2023
Assets
Current assets:
Cash and cash equivalents	$	79,830		$	281,263
Marketable securities		173,963			49,787
Accounts and other receivables, net		378			805
Prepaid expenses and other current assets		11,571			9,039
Inventory		2,807			3,906
Total current assets		268,549			344,800
Property and equipment, net		8,391			5,251
Operating lease right-of-use assets		21,405			4,983
Restricted cash		150			150
Other assets		2,422			—
Total assets	$	300,917		$	355,184
Liabilities and stockholders' equity
Current liabilities:
Accounts payable	$	7,343		$	6,504
Accrued expenses		14,166			17,521
Deferred revenue		25,996			38,592
Other current liabilities		1,289			646
Total current liabilities		48,794			63,263
Deferred revenue – noncurrent		11,234			20,692
Operating lease liabilities – noncurrent		21,922			4,906
Other noncurrent liabilities		233			—
Total liabilities		82,183			88,861
Contingencies (Note 12)
Stockholders' equity:
Preferred stock, $.001 par value, 5,000,000 shares authorized, no shares    issued and outstanding		—			—
Common stock, $.001 par value, 300,000,000 shares authorized at September 30, 2024    and December 31, 2023; 53,524,364 and 49,043,074 shares issued and outstanding at September 30, 2024 and December 31, 2023, respectively		53			49
Additional paid-in capital		1,049,127			1,007,556
Accumulated deficit		(831,617	)		(742,146	)
Accumulated other comprehensive income		1,171			864
Total stockholders' equity		218,734			266,323
Total liabilities and stockholders' equity	$	300,917		$	355,184

See notes to condensed consolidated financial statements.

3

EYEPOINT PHARMACEUTICALS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(Unaudited)

(In thousands except per share data)

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2024			2023			2024			2023
Revenues:
Product sales, net	$	664		$	816		$	2,390		$	13,483
License and collaboration agreements		9,561			14,137			27,906			17,768
Royalty income		299			249			1,389			739
Total revenues		10,524			15,202			31,685			31,990
Operating expenses:
Cost of sales		736			1,202			2,896			3,634
Research and development		29,542			17,363			89,554			46,711
Sales and marketing		24			479			80			11,504
General and administrative		12,970			10,556			39,770			28,854
Total operating expenses		43,272			29,600			132,300			90,703
Loss from operations		(32,748	)		(14,398	)		(100,615	)		(58,713	)
Other (expense) income:
Interest and other income, net		3,387			1,786			11,144			4,611
Interest expense		—			—			—			(1,247	)
Loss on extinguishment of debt		—			—			—			(1,347	)
Total other income, net		3,387			1,786			11,144			2,017
Net loss	$	(29,361	)	$	(12,612	)	$	(89,471	)	$	(56,696	)
Net loss per share:
Basic and diluted	$	(0.54	)	$	(0.33	)	$	(1.67	)	$	(1.50	)
Weighted average common shares outstanding:
Basic and diluted		54,449			38,341			53,526			37,804
Net loss	$	(29,361	)	$	(12,612	)	$	(89,471	)	$	(56,696	)
Other comprehensive gain (loss):
Unrealized gain (loss) on available-for-sale    securities		379			(1	)		307			55
Comprehensive loss	$	(28,982	)	$	(12,613	)	$	(89,164	)	$	(56,641	)

See notes to condensed consolidated financial statements.

4

EYEPOINT PHARMACEUTICALS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(Unaudited)

(In thousands except share data)

	Common Stock				Additional						Accumulated Other			Total
	Number of Shares		Par Value Amount		Paid-In Capital			Accumulated Deficit			Comprehensive Income			Stockholders’ Equity
Balance at July 1, 2023		34,306,118	$	34	$	771,821		$	(715,435	)	$	842		$	57,262
Net loss		—		—		—			(12,612	)		—			(12,612	)
Other comprehensive loss		—		—		—			—			(1	)		(1	)
Issuance of stock, net of issue costs		902,769		1		9,539			—			—			9,540
Employee stock purchase plan		43,335		—		174			—			—			174
Exercise of stock options		55,210		—		629			—			—			629
Vesting of stock units		2,000		—		—			—			—			—
Stock-based compensation		—		—		3,629			—			—			3,629
Balance at September 30, 2023		35,309,432	$	35	$	785,792		$	(728,047	)	$	841		$	58,621
Balance at July 1, 2024		52,160,305	$	52	$	1,029,717		$	(802,256	)	$	792		$	228,305
Net loss		—		—		—			(29,361	)		—			(29,361	)
Other comprehensive gain		—		—		—			—			379			379
Issuance of stock, net of issue costs		1,299,506		1		11,792			—			—			11,793
Employee stock purchase plan		24,881		—		202			—			—			202
Exercise of stock options		14,216		—		48			—			—			48
Vesting of stock units		25,456		—		(78	)		—			—			(78	)
Stock-based compensation		—		—		7,446			—			—			7,446
Balance at September 30, 2024		53,524,364	$	53	$	1,049,127		$	(831,617	)	$	1,171		$	218,734

	Common Stock				Additional						Accumulated Other		Total
	Number of Shares		Par Value Amount		Paid-In Capital			Accumulated Deficit			Comprehensive Income		Stockholders’ Equity
Balance at January 1, 2023		34,082,934	$	34	$	766,899		$	(671,351	)	$	786	$	96,368
Net loss		—		—		—			(56,696	)		—		(56,696	)
Other comprehensive gain		—		—		—			—			55		55
Issuance of stock, net of issue costs		902,769		1		9,539			—			—		9,540
Employee stock purchase plan		107,056		—		422			—			—		422
Exercise of stock options		56,090		—		634			—			—		634
Vesting of stock units		160,583		—		(169	)		—			—		(169	)
Stock-based compensation		—		—		8,467			—			—		8,467
Balance at September 30, 2023		35,309,432	$	35	$	785,792		$	(728,047	)	$	841	$	58,621
Balance at January 1, 2024		49,043,074	$	49	$	1,007,556		$	(742,146	)	$	864	$	266,323
Net loss		—		—		—			(89,471	)		—		(89,471	)
Other comprehensive gain		—		—		—			—			307		307
Issuance of stock, net of issue costs		1,299,506		1		11,810			—			—		11,811
Cashless exercise of warrants		2,206,442		2		(2	)		—			—		—
Employee stock purchase plan		49,896		—		470			—			—		470
Exercise of stock options		535,932		1		4,965			—			—		4,966
Vesting of stock units		389,514		—		(4,512	)		—			—		(4,512	)
Stock-based compensation		—		—		28,840			—			—		28,840
Balance at September 30, 2024		53,524,364	$	53	$	1,049,127		$	(831,617	)	$	1,171	$	218,734

See notes to condensed consolidated financial statements.

5

EYEPOINT PHARMACEUTICALS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(In thousands)

	Nine Months Ended
	September 30,
	2024			2023
Cash flows from operating activities:
Net loss	$	(89,471	)	$	(56,696	)
Adjustments to reconcile net loss to cash flows used in    operating activities:
Depreciation and amortization		1,073			352
Amortization of debt discount and premium and discount on    available-for-sale marketable securities		(4,143	)		(334	)
Provision for excess and obsolete inventory		—			693
Loss on extinguishment of debt		—			1,347
Stock-based compensation		28,840			8,467
Changes in operating assets and liabilities:
Accounts receivable and other current assets		(2,107	)		14,701
Other assets		(2,422	)		—
Inventory		1,098			(2,224	)
Accounts payable and accrued expenses		(2,402	)		791
Right-of-use assets and operating lease liabilities		1,211			467
Deferred revenue		(22,054	)		57,420
Other noncurrent liabilities		—			—
Net cash (used in) provided by operating activities		(90,377	)		24,984
Cash flows from investing activities:
Purchases of marketable securities		(234,225	)		(5,851	)
Sales and maturities of marketable securities		114,500			52,284
Purchases of property and equipment		(3,668	)		(2,600	)
Net cash (used in) provided by investing activities		(123,393	)		43,833
Cash flows from financing activities:
Proceeds from issuance of stock		11,793			9,974
Payment of equity issue costs		(307	)		(415	)
Payment of long-term debt		—			(30,000	)
Payment of extinguishment of debt costs		—			(1,350	)
Borrowings under revolving facility		—			5,300
Repayment under revolving facility		—			(15,775	)
Net settlement of stock units to satisfy statutory tax withholding		(4,512	)		(169	)
Proceeds from exercise of stock options		5,436			1,056
Principal payments on finance lease obligations		(73	)		(36	)
Net cash provided by (used in) financing activities		12,337			(31,415	)
Net (decrease) increase in cash, cash equivalents and restricted cash		(201,433	)		37,402
Cash, cash equivalents and restricted cash at beginning of period		281,413			95,783
Cash, cash equivalents and restricted cash at end of period	$	79,980		$	133,185
Reconciliation of cash, cash equivalents and restricted cash to the consolidated balance sheets:
Cash and cash equivalents	$	79,830		$	133,035
Restricted cash		150			150
Total cash, cash equivalents and restricted cash at end of period	$	79,980		$	133,185
Supplemental cash flow information:
Cash interest paid	$	—		$	1,405
Supplemental disclosure of non-cash investing and financing activities:
Lease liability arising from obtaining right-of-use assets	$	17,544		$	—
Property and equipment additions in accounts payable and accrued expenses	$	141		$	—
Stock issuance costs	$	—		$	19

See notes to condensed consolidated financial statements.

6

EYEPOINT PHARMACEUTICALS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1.Operations

The accompanying condensed consolidated financial statements of EyePoint Pharmaceuticals, Inc., a Delaware corporation (together with its subsidiaries, the Company), as of September 30, 2024 and for the three and nine months ended September 30, 2024 and 2023 are unaudited. Certain information in the footnote disclosures of these financial statements has been condensed or omitted in accordance with the rules and regulations of the Securities and Exchange Commission. These financial statements should be read in conjunction with the Company’s audited consolidated financial statements and footnotes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023. In the opinion of management, these statements have been prepared on the same basis as the audited consolidated financial statements as of and for the year ended December 31, 2023, and include all adjustments, consisting only of normal recurring adjustments, that are necessary for the fair presentation of the Company’s financial position, results of operations, and cash flows for the periods indicated. The preparation of financial statements in accordance with United States (U.S.) generally accepted accounting principles requires management to make assumptions and estimates that affect, among other things, (i) reported amounts of assets and liabilities; (ii) disclosure of contingent assets and liabilities at the date of the consolidated financial statements; and (iii) reported amounts of revenues and expenses during the reporting period. The results of operations for the three and nine months ended September 30, 2024 are not necessarily indicative of the results that may be expected for the entire 2024 fiscal year or any future period.

The Company is committed to developing and commercializing innovative therapeutics to help improve the lives of patients with serious retinal diseases. The Company’s pipeline leverages its proprietary bioerodible Durasert E™ technology (Durasert E™) for sustained intraocular drug delivery. The Company’s lead product candidate, DURAVYU™, f/k/a EYP-1901, is an investigational sustained delivery treatment for anti-vascular endothelial growth factor (anti-VEGF) mediated retinal diseases combining vorolanib, a selective and patent-protected tyrosine kinase inhibitor with Durasert E™. DURAVYU™ is currently in Phase 3 clinical trials for wet age-related macular degeneration (wet AMD), the leading cause of vision loss among people 50 years of age and older in the United States and a Phase 2 clinical trial for diabetic macular edema (DME). The Company is also advancing EYP-2301, a promising TIE-2 agonist, razuprotafib, formulated in Durasert E™ to potentially improve outcomes in serious retinal diseases.

The Company plans to identify and advance additional product candidates through clinical and regulatory development for its pipeline. This may be accomplished through internal discovery efforts, research collaborations and/or in-licensing arrangements and potential acquisitions of additional products, product candidates or technologies.

Liquidity

The Company had cash, cash equivalents and investments in marketable securities of $253.8 million at September 30, 2024. The Company has a history of operating losses and has not had significant recurring cash inflows from revenue. The Company’s operations have been financed primarily from sales of its equity securities, issuance of debt and a combination of license fees, milestone payments, royalty income, and other fees received from its collaboration partners. The Company anticipates that it will continue to incur losses as it continues the research and development of its product candidates, and the Company does not expect revenues to generate sufficient funding to sustain its operations in the near-term. The Company expects to continue fulfilling its funding needs through cash inflows from revenues, licensing and research collaboration transactions, additional equity capital raises and other arrangements. The Company believes that its cash, cash equivalents and investments in marketable securities of $253.8 million at September 30, 2024 will enable the Company to fund its current and planned operations for at least the next twelve months from the date these condensed consolidated financial statements were issued. Actual cash requirements could differ from management’s projections due to many factors, including the timing and results of the Company’s clinical trials for DURAVYU™, additional investments in research and development programs, competing technological and market developments and the costs of any strategic acquisitions and/or development of complementary business opportunities.

2.Summary of Significant Accounting Policies

The Company’s significant accounting policies are disclosed in the audited consolidated financial statements for the year ended December 31, 2023, and notes thereto, which are included in the Company’s Annual Report on Form 10-K that was filed with the Securities and Exchange Commission, or the SEC, on March 8, 2024, or the 2023 Form 10-K. Since the date of those financial statements, there have been no material changes to the Company's significant accounting policies.

7

Revenue Recognition

Revenue is recognized when a customer obtains control of promised goods or services, in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that an entity determines are within the scope of ASC 606, Revenue from Contracts with Customers (ASC 606), the Company performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined to be within the scope of ASC 606, the Company assesses the goods or services promised within the contract, determines those that are performance obligations and assesses whether each promised good or service is distinct. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. Sales, value-add and other taxes collected on behalf of third parties are excluded from revenue.

Product sales, net — Effective January 2023, commercial sales of DEXYCU® were no longer supported by the Company, remaining available only through specialty distributors. Effective May 2023, YUTIQ® has been and continues to be sold under commercial supply agreements with Alimera Sciences, Inc. (Alimera) and Ocumension Therapeutics (Ocumension). On September 16, 2024, ANI Pharmaceuticals, Inc. (ANI) announced the completion of the acquisition of Alimera. The acquisition does not impact the terms of the commercial supply agreements (see Note 3).

Prior to the above dates, the Company sold YUTIQ® and DEXYCU® to a limited number of specialty distributors and specialty pharmacies (collectively the Distributors) in the U.S., with whom the Company had entered into formal agreements, for delivery to physician practices for YUTIQ® and to hospital outpatient departments and ambulatory surgical centers (ASCs) for DEXYCU®. The Company recognized revenue on sales of its products when Distributors obtained control of the products, which occurred at a point in time, typically upon delivery. In addition to agreements with Distributors, the Company also entered into arrangements with healthcare providers, ASCs, and payors that provided for government mandated and/or privately negotiated rebates, chargebacks, and discounts with respect to their purchase of the Company's products from Distributors.

Reserves for variable consideration — Product sales were recorded at the wholesale acquisition costs, net of applicable reserves for variable consideration. Components of variable consideration included trade discounts and allowances, provider chargebacks and discounts, payor rebates, product returns, and other allowances that were offered within contracts between the Company and its Distributors, payors, and other contracted purchasers relating to the Company's product sales. These reserves were based on the amounts earned, or to be claimed on the related sales, and were classified either as reductions of product revenue and accounts receivable or a current liability, depending on how the amount was to be settled. Overall, these reserves reflected the Company's best estimates of the amount of consideration to which it was entitled based on the terms of the respective underlying contracts. The actual amounts of consideration ultimately received may differ from the Company's estimates. If actual results in the future vary from the estimates, the Company adjusts these estimates, which would affect product revenue and earnings in the period such variances become known.

Distribution fees — The Company compensated its Distributors for services explicitly stated in the Company’s contracts and were recorded as a reduction of revenue in the period the related product sale was recognized.

Provider chargebacks and discounts — Chargebacks were discounts that represented the estimated obligations resulting from contractual commitments to sell products at prices lower than the list prices charged to the Company’s Distributors. These Distributors charged the Company for the difference between what they paid for the product and the Company’s contracted selling price. These reserves were established in the same period that the related revenue was recognized, resulting in a reduction of product revenue and the establishment of a current liability. Reserves for chargebacks consisted of amounts that the Company expected to pay for units that remained in the distribution channel inventories at each reporting period-end that the Company expected to be sold under a contracted selling price, and chargebacks that Distributors had claimed, but for which the Company had not yet settled.

Government rebates — The Company was subject to discount obligations under state Medicaid programs and Medicare. These reserves were recorded in the same period the related revenue was recognized, resulting in a reduction of product revenue and the establishment of a current liability which was included in accrued expenses and other current liabilities on the consolidated balance sheets. The Company’s liability for these rebates consisted of invoices received for claims from prior quarters that had not been paid or for which an invoice had not yet been received, estimates of claims for the current quarter, and estimated future claims that would be made for product that had been recognized as revenue, but which remained in the distribution channel inventories at the end of each reporting period.

8

Payor rebates — The Company contracted with certain private payor organizations, primarily insurance companies, for the payment of rebates with respect to utilization of its products. The Company estimated these rebates and recorded such estimates in the same period the related revenue was recognized, resulting in a reduction of product revenue and the establishment of a current liability.

Co-Payment assistance — The Company offered co-payment assistance to commercially insured patients meeting certain eligibility requirements. The calculation of the accrual for co-pay assistance was based on an estimate of claims and the cost per claim that the Company expected to receive associated with product that had been recognized as revenue.

Product returns — The Company generally offered a limited right of return based on its returned goods policy, which included damaged product and remaining shelf life. The Company estimated the amount of its product sales that may be returned and recorded.

License and collaboration agreement revenue — The Company analyzes each element of its license and collaboration arrangements to determine the appropriate revenue recognition. The terms of the license agreement may include payment to the Company of non-refundable upfront license fees, milestone payments if specified objectives are achieved, and/or royalties on product sales. The Company recognizes revenue from upfront payments at a point in time, typically upon fulfilling the delivery of the associated intellectual property to the customer. For licenses that are combined with other promises, the Company determines whether the combined performance obligation is satisfied over time or at a point in time, when (or as) the associated performance obligation in the contract is satisfied.

If the contract contains a single performance obligation, the entire transaction price is allocated to the single performance obligation. Contracts that contain multiple performance obligations require an allocation of the transaction price based on the estimated relative standalone selling prices of the promised products or services underlying each performance obligation. The Company determines standalone selling prices based on the price at which the performance obligation is sold separately. If the standalone selling price is not observable through past transactions, the Company estimates the standalone selling price taking into account available information such as market conditions and internally approved pricing guidelines related to the performance obligations.

The Company recognizes sales-based milestone payments as revenue upon the achievement of the cumulative sales amount specified in the contract in accordance with ASC 606-10-55-65. For those milestone payments which are contingent on the occurrence of particular future events, the Company determines that these need to be considered for inclusion in the calculation of total consideration from the contract as a component of variable consideration using the most-likely amount method. As such, the Company assesses each milestone to determine the probability and substance behind achieving each milestone. Given the inherent uncertainty associated with these future events, the Company will not recognize revenue from such milestones until there is a high probability of occurrence, which typically occurs near or upon achievement of the event.

When determining the transaction price of a contract, an adjustment is made if payment from a customer occurs either significantly before or significantly after performance, resulting in a significant financing component. Applying the practical expedient in paragraph 606-10-32-18, the Company does not assess whether a significant financing component exists if the period between when the Company performs its obligations under the contract and when the customer pays is one year or less. None of the Company’s contracts contained a significant financing component as of September 30, 2024.

Royalties — The Company recognizes revenue from license arrangements with its commercial partners’ net sales of products. Such revenues are included as royalty income. In accordance with ASC 606-10-55-65, royalties are recognized when the subsequent sale of the commercial partner’s products occurs. The Company’s commercial partners are obligated to report their net product sales and the resulting royalty due to the Company typically within 60-days from the end of each quarter. Based on historical product sales, royalty receipts and other relevant information, the Company recognizes royalty income each quarter and subsequently determines a true-up when it receives royalty reports and payment from its commercial partners. Historically, these true-up adjustments have been immaterial.

Sale of Future Royalties — The Company has sold its rights to receive certain royalties on product sales. In the circumstance where the Company has sold its rights to future royalties under a royalty purchase agreement (RPA) and also maintains limited continuing involvement in the arrangement (but not significant continuing involvement in the generation of the cash flows that are due to the purchaser), the Company defers recognition of the proceeds it receives for the sale of royalty streams and recognizes such unearned revenue as revenue under the units-of-revenue method over the life of the underlying license agreement. Under the units-of-revenue method, amortization for a reporting period is calculated by computing a ratio of the proceeds received from the purchaser to the total payments expected to be made to the purchaser over the term of the agreement, and then applying that ratio to the period’s cash payment.

9

Estimating the total payments expected to be received by the purchaser over the term of such arrangements requires management to use subjective estimates and assumptions. Changes to the Company’s estimate of the payments expected to be made to the purchaser over the term of such arrangements could have a material effect on the amount of revenues recognized in any particular period.

Research Collaborations — The Company recognizes revenue over the term of the statements of work under any funded research collaborations. Revenue recognition for consideration, if any, related to a license option right is assessed based on the terms of any such future license agreement or is otherwise recognized at the completion of the research collaborations.

Please refer to Note 3 for further details on the license and collaboration agreements into which the Company has entered and corresponding amounts of revenue recognized during the current and prior year periods.

Cost of sales — Cost of sales consist of costs associated with the manufacture of YUTIQ® and DEXYCU®, certain period costs for DEXYCU® product revenue, product shipping, and as applicable, royalty expense. The inventory costs for YUTIQ® include purchases of various components, the active pharmaceutical ingredient (API), and direct labor and overhead for the product manufactured in the Company’s Watertown, Massachusetts facility. The inventory costs for DEXYCU® include purchased components, the API and third-party manufacturing, and assembly.

For the three and nine months ended September 30, 2024 and 2023, DEXYCU® product revenue-based royalty expense as a component of cost of sales was immaterial.

Recently Adopted and Recently Issued Accounting Pronouncements

In November 2023, the FASB issued ASU 2023-07—Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. This ASU was issued to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. This ASU applies to all public entities that are required to report segment information in accordance with Topic 280, Segment Reporting. ASU 2023-07 is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted and the standard should be applied retrospectively. ASU 2023-07 will be effective for the Company for the annual period of its fiscal year ending December 31, 2024. The Company does not anticipate the adoption of this ASU will have a material impact on its consolidated financial statement disclosures.

In December 2023, the FASB issued ASU 2023-09—Income Taxes (Topic 740): Improvements to Income Tax Disclosures. This ASU was issued to address investor requests for more transparency about income tax information through improvements to income tax disclosure primarily related to the rate reconciliation and income taxes paid information, and to improve the effectiveness of income tax disclosures. This ASU is effective for public entities for annual periods beginning after December 15, 2024. Early adoption is permitted. ASU 2023-09 will be effective for the Company in the first quarter of its fiscal year ending December 31, 2025. The Company is currently evaluating the impact the adoption of this ASU will have on its consolidated financial statement disclosures.

3.Revenue

Product Revenue Reserves and Allowances

From January 1, 2023 through May 17, 2023 (the date the Company entered into the product rights agreement (PRA) with ANI (formerly Alimera), pursuant to which the Company granted an exclusive license and rights to its YUTIQ® (fluocinolone acetonide intravitreal implant) 0.18 mg (YUTIQ®) product to ANI, the Company’s product revenues were primarily from sales of YUTIQ® in the U.S.

For the three and nine months ended September 30, 2024, the Company’s product revenues were primarily from the Company’s existing commercial supply agreements with ANI and Ocumension. For the three and nine months ended September 30, 2024, the Company’s product revenues were made up of $0.7 million and $2.4 million, respectively, from the sales of YUTIQ®. For the three and nine months ended September 30, 2023, the Company’s product revenues were made up of $0.8 million and $13.4 million, respectively, from the sales of YUTIQ®. Sales of DEXYCU® for the three and nine months ended September 30, 2024 and 2023 were immaterial.

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The following table summarizes activity in each of the product revenue allowance and reserve categories for the nine months ended September 30, 2024 and 2023 (in thousands):

	Chargebacks, Discounts			Government and Other
	and Fees			Rebates			Returns			Total
Beginning balance at January 1, 2024	$	83		$	—		$	677		$	760
Provision related to sales in the current year		—			—			—			—
Adjustments related to prior period sales		70			—			—			70
Deductions applied and payments made		(148	)		—			(403	)		(551	)
Ending Balance at September 30, 2024	$	5		$	—		$	274		$	279
	Chargebacks, Discounts			Government and Other
	and Fees			Rebates			Returns			Total
Beginning balance at January 1, 2023	$	859		$	158		$	871		$	1,888
Provision related to sales in the current year		1,561			—			—			1,561
Adjustments related to prior period sales		40			(55	)		(154	)		(169	)
Deductions applied and payments made		(2,279	)		(103	)		(156	)		(2,538	)
Ending Balance at September 30, 2023	$	181		$	—		$	561		$	742

Chargebacks, discounts and fees and rebates are recorded as a component of accrued expenses on the condensed consolidated balance sheets (See Note 6).

License and Collaboration Agreements and Royalty Income

Eyebiotech Limited

On May 17, 2024, the Company entered into a license agreement (the Eyebio License Agreement) with Eyebiotech Limited (Eyebio). Under this agreement, the Company granted Eyebio a non-exclusive, sublicensable, assignable license to certain patent rights to make, have made, use, offer to sell, sell, import, and export licensed products for therapeutic ophthalmological uses worldwide.

In consideration for the rights granted, Eyebio made a one-time upfront payment of $0.5 million to the Company upon execution of the Eyebio License Agreement. Additionally, Eyebio agreed to pay certain milestone payments and tiered royalties based on the achievement of development and regulatory milestones and the annual net sales of licensed products, respectively.

The Company classified the cash proceeds of the $0.5 million upfront payment received from Eyebio as license and collaboration revenue upon the execution of the Eyebio License Agreement, as this was the only performance obligation identified. This amount is not an advance payment for the provision of future goods or services and is included in the current transaction price. The non-exclusive, sublicensable, assignable license is a functional, right-to-use license, and, therefore, any consideration associated with it is recognized at a point in time.

During the nine months ended September 30, 2024, the Company recorded $0.5 million in license and collaboration revenue related to the upfront payment.

On July 12, 2024, Merck & Co., Inc. announced the completion of the acquisition of Eyebio. Eyebio is now a wholly-owned subsidiary of Merck & Co., Inc. The acquisition does not materially impact the terms of the Eyebio License Agreement.

ANI Product Rights Agreement and Commercial Supply Agreement

On May 17, 2023 (the Closing Date), the Company entered into a PRA with ANI (formerly Alimera). Under the PRA, the Company granted to ANI an exclusive and sublicensable right and license (the License) under the Company’s and its affiliates’ interest in certain of the Company’s and its affiliates’ intellectual property to develop, manufacture, sell, commercialize, and otherwise exploit certain products, including YUTIQ®, for the treatment and prevention of uveitis in the entire world except Europe, the Middle East and Africa (EMEA).

Additionally, pursuant to the PRA, the Company transferred and assigned to ANI certain assets (the Transferred Assets) and certain contracts with third parties related to YUTIQ®, including the new drug application for YUTIQ® (collectively, the Asset

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Transfer). Pursuant to the PRA, ANI paid the Company a $75.0 million upfront payment. ANI will also make four quarterly payments of $1.875 million to the Company totaling $7.5 million during 2024. ANI will also pay royalties to the Company from 2025 to 2028 at a percentage of low-to-mid double digits of ANI’s related U.S. annual net sales of certain products (including YUTIQ®) in excess of certain thresholds, beginning at $70 million in 2025, and increasing annually thereafter. Upon ANI’s payment of the Upfront Payment and the 2024 quarterly payments, the licenses and rights granted to ANI will automatically become perpetual and irrevocable. Payments received from ANI are non-refundable.

On the Closing Date, the Company and ANI also entered into a commercial supply agreement (CSA), pursuant to which, during the term of the PRA, the Company agreed to manufacture and exclusively supply to ANI agreed-upon quantities of YUTIQ® necessary for ANI to commercialize YUTIQ® in the United States at certain cost plus amounts, subject to adjustments and potential extensions and terminations set forth in the CSA (the Supply Transaction and together with the License and the Asset Transfer, the Transaction).

The Company classified the cash proceeds of the $75.0 million Upfront Payment received from ANI as deferred revenue at the Closing Date, pursuant to the PRA and the CSA because the License and supply units to be delivered under both agreements comprise a single, combined performance obligation as ANI will not have the right or ability to manufacture YUTIQ® (or have YUTIQ® manufactured by a third-party contract manufacturing organization) over the initial two-year term pursuant to the CSA. The combined performance obligation is satisfied over time using the units delivered output method to measure progress based on initial estimated supply units of YUTIQ® over the two-year term for purposes of recognizing revenue, such that revenue is recognized based on the value transferred in the form of units of product in the satisfaction of a performance obligation. Through this method, the Company compares the actual units delivered to date with the current estimated total to be delivered in the contractual term to measure the satisfaction of the performance obligation and recognize revenue. The Company will monitor its estimate of total units to be delivered to determine if an adjustment is needed to ensure that revenue is recognized proportionally for units delivered to date relative to the total units expected to be delivered for the combined performance obligation. Such estimates of the total delivery will be reassessed on an ongoing basis. If the Company determines that a change in estimate is necessary, it will adjust revenue using a cumulative catch-up method.

Revenue from sales of product supply to ANI under the CSA was $0.7 million and $1.9 million during the three and nine months ended September 30, 2024, respectively, and $1.0 million and $1.2 million during the three and nine months ended September 30, 2023, respectively. License and Collaboration revenue related to the PRA was $9.4 million and $26.8 million during the three and nine months ended September 30, 2024, respectively and $13.6 million and $16.8 million during the three and nine months ended September 30, 2023, respectively. License and collaboration revenue, related to additional transitional services was $0.2 million and $0.5 million for the three and nine months ended September 30, 2024, respectively and $0.4 million and $0.8 million during the three and nine months ended September 30, 2023, respectively. As of September 30, 2024, the Company had $24.3 million and $0 as current and non-current deferred revenue recognized under the PRA.

SWK Royalty Purchase Agreement

Pursuant to a royalty purchase agreement (RPA) with SWK Funding LLC (SWK), the Company sold its right to receive royalty payments on future sales of products subject to a licensing and development agreement, as amended, with ANI (the Amended ANI Agreement) for an upfront cash payment of $16.5 million. The Company classified the proceeds received from SWK as deferred revenue at inception of the RPA and is recognizing revenue as royalty payments are made from ANI to SWK. The Company recognized $0.3 million and $0.9 million of royalty revenue related to the RPA for the three and nine months ended September 30, 2024, respectively, and $0.3 million and $0.7 million of royalty revenue related to the RPA for the three and nine months ended September 30, 2023, respectively. As of September 30, 2024, the Company had $1.7 million and $11.2 million as current and non-current deferred revenue recognized under the RPA, respectively. As of December 31, 2023, the Company classified $1.4 million and $12.4 million as current and non-current deferred revenue recognized under the RPA, respectively.

Ocumension Therapeutics

Pursuant to license agreements and Memorandum of Understanding signed with the Company, Ocumension has:

•An exclusive license for the development and commercialization of its three-year micro insert using the Durasert technology for the treatment of posterior segment uveitis of the eye (YUTIQ® in the U.S.) in Mainland China, Hong Kong, Macau, and Taiwan at its own cost and expense in return for royalties based on sales with the Company supplying products for clinical trials and commercial sale;

•An exclusive license for the development and commercialization in Mainland China, Hong Kong, Macau, and Taiwan of DEXYCU® for the treatment of post-operative inflammation following ocular surgery at its own cost and expense in return for royalties based on sales with the Company supplying product for clinical trials and commercial sale; and

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•Exclusive rights to develop and commercialize YUTIQ® and DEXYCU® products under its own brand names in South Korea and other jurisdictions across Southeast Asia in Brunei, Burma (Myanmar), Cambodia, Timor-Leste, Indonesia, Laos, Malaysia, the Philippines, Singapore, Thailand, and Vietnam (the Territory), at its own cost and expense in return for royalties based on sales with the Company supplying product for clinical trials and commercial sale.

•The right and obligation to manufacture YUTIQ®, either by itself or through affiliates or sub-contractors, for sale and use in the Territory following completion of a technology and know-how transfer from the Company to Ocumension.

During the nine months ended September 30, 2024 and 2023, the Company recognized $0.5 million of revenue from sales of product supply to Ocumension under the supply agreement and recorded this amount in product sales, net on the condensed consolidated statements of operations and comprehensive loss. No amounts were recorded during the three months ended September 30, 2024 and 2023 from sales of product supply to Ocumension under the supply agreement. Royalty income of $0 and $0.5 million was recorded for the three and nine months ended September 30, 2024. No royalty income was recorded for the three and nine months ended September 30, 2023. License and collaboration revenue related to additional technical assistance during the three and nine months ended September 30, 2024 and 2023 was immaterial.

Exclusive License Agreement with Betta Pharmaceuticals, Co., Ltd.

On May 2, 2022, the Company entered into an exclusive license agreement (the Betta License Agreement) with Betta Pharmaceuticals Co., Ltd. (Betta), an affiliate of Equinox Sciences, LLC (Equinox) (see Note 10). Under the Betta License Agreement, the Company granted to Betta an exclusive, sublicensable, royalty-bearing license under certain of the Company’s intellectual property to develop, use (but not make or have made), sell, offer for sale, and import the Company’s product candidate, DURAVYU™, an investigational sustained delivery treatment for anti-VEGF-mediated retinal diseases combining vorolanib, a selective and patent-protected tyrosine kinase inhibitor (TKI) with Durasert E™ (the Licensed Product), in the field of ophthalmology (the Betta Field) in the greater area of China, including China, the Hong Kong Special Administrative Region, the Macau Special Administrative Region, and Taiwan (the Betta Territory). The Company retained rights under the Company’s intellectual property to, among other things, conduct clinical trials on the Licensed Product in the Betta Field in the Betta Territory.

In consideration for the rights granted by the Company, Betta agreed to pay the Company tiered, mid-to-high single-digit royalties based upon annual net sales of Licensed Products in the Betta Territory. The royalties are payable on a Licensed Product-by-Licensed Product and region-by-region basis commencing on the first commercial sale of a Licensed Product in a region and continuing until the later of (i) the date that is twelve (12) years after first commercial sale of such Licensed Product in such region, and (ii) the first day of the month following the month in which a generic product corresponding to such Licensed Product is launched in the relevant region. The royalty rate is subject to reduction under certain circumstances, including when there is no valid claim of a licensed patent that covers a Licensed Product in a particular region.

Betta is responsible for all costs relating to development, registration, manufacturing, marketing, advertising, promotional, launch, and sales activities in connection with the Licensed Products in the Betta Field in the Betta Territory. Betta is required to use commercially reasonable efforts to develop, seek regulatory approval for, and commercialize at least one Licensed Product in the Betta Field in the Betta Territory. The Betta License Agreement also requires Betta to achieve certain diligence milestones relating to regulatory filings, patient dosing, and regulatory approval by certain specified deadlines set forth in the Betta License Agreement, subject to certain exceptions and extensions as set forth in the Betta License Agreement. Betta’s development activities will be conducted pursuant to a development plan subject to periodic updates. In the event that the Company conducts a global registrational clinical trial for a Licensed Product in the Betta Field, Betta will have the right to participate in such clinical trial by including clinical trial sites in the Betta Territory in accordance with the terms of the Betta License Agreement. The Company has also agreed to provide certain technology transfer and other support services to Betta subject to certain conditions and limitations set forth in the Betta License Agreement.

Revenue from license and collaboration revenue or royalty income for the three and nine months ended September 30, 2024 and 2023 related to this agreement was immaterial.

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4.Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consisted of the following (in thousands):

	September 30, 2024		December 31, 2023
Prepaid expenses	$	2,441	$	1,695
Prepaid clinical		7,832		6,335
Other		1,298		1,009
Total prepaid expenses and other current assets	$	11,571	$	9,039

5.Inventory

Inventory consisted of the following (in thousands):

	September 30, 2024		December 31, 2023
Raw materials	$	1,496	$	1,303
Work in process		649		882
Finished goods		662		1,721
Total inventory	$	2,807	$	3,906

6.Accrued Expenses

Accrued expenses consisted of the following (in thousands):

	September 30,		December 31,
	2024		2023
Personnel costs	$	8,910	$	12,631
Clinical trial costs		3,861		3,305
Professional fees		682		666
Sales chargebacks, rebates and other revenue reserves		279		760
Other		434		159
Total accrued expenses	$	14,166	$	17,521

7.Leases

On January 23, 2023, the Company entered into a lease agreement (Northbridge Lease) for its new standalone commercial manufacturing facility, including office and lab space located at 600 Commerce Drive, Northbridge, Massachusetts. The new 41,141 square-foot manufacturing facility will be Current Good Manufacturing Practice (cGMP) compliant to meet U.S. FDA and European Medicines Agency (EMA) standards and will support DURAVYU™ clinical supply and commercial readiness upon regulatory approval. In addition, the building will have the capacity and capabilities for pipeline expansion. The lease includes a non-cancellable lease term of fifteen years and four months, with two options to extend the lease term for two additional terms of either five years or ten years at 95% of the then-prevailing fair market rent. The lease term, under ASC 842, commenced during the second quarter of 2024. The Company entered into an amendment to the Northbridge Lease, effective September 30, 2024. Pursuant to the amendment, the Company's obligation to pay base rent will begin March 1, 2025. The Company is responsible for real estate taxes, maintenance, and other operating expenses applicable to the leased premises. The Company recognized an initial increase of $17.7 million to its lease liabilities and $17.9 million to its right-of-use (ROU) assets resulting from the Northbridge Lease during the second quarter of 2024.

Since the Company elected to account for each lease component and its associated non-lease components as a single combined component, all contract consideration was allocated to the respective lease components. The expected lease terms include non-cancellable lease periods. Renewal option periods have not been included in the determination of the lease terms as they are not deemed reasonably certain of exercise. Variable lease payments, such as common area maintenance, real estate taxes, and property insurance are not included in the determination of the lease’s ROU asset or lease liability.

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As of September 30, 2024 the weighted average remaining term of the Company’s operating leases was 12.4 years and the weighted average discount rate was 11.6%.

Supplemental balance sheet information related to operating leases as of September 30, 2024 and December 31, 2023 are as follows (in thousands):

	September 30,		December 31,
	2024		2023
Other current liabilities – operating lease current portion	$	1,188	$	563
Operating lease liabilities – noncurrent portion		21,922		4,906
Total operating lease liabilities	$	23,110	$	5,469

The elements of lease expense were as follows (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
Lease expense included in:
Research and development	$	965	$	291	$	1,774	$	873
General and administrative		65		65		195		194
Variable lease costs		60		47		195		106
Total lease expense	$	1,090	$	403	$	2,164	$	1,173

Cash paid for amounts included in the measurement of operating lease liabilities was $0.5 million and $0.6 million for the nine months ended September 30, 2024 and 2023.

The Company’s total future minimum lease payments under non-cancellable leases at September 30, 2024 were as follows (in thousands):

	Operating Leases
Remainder of 2024	$	630
2025		3,585
2026		4,133
2027		4,222
2028		3,319
Thereafter		31,860
Total lease payments	$	47,749
Less imputed interest		(24,639	)
Total	$	23,110

8.Stockholders’ Equity

ATM Facility

In August 2020, the Company entered into an at-the-market facility (the ATM Facility) with Cantor Fitzgerald & Co (Cantor). Pursuant to the ATM Facility, the Company may, at its option, offer and sell shares of its common stock from time to time, through or to Cantor, acting as sales agent. The Company will pay Cantor a commission of 3.0% of the gross proceeds from any future sales of such shares.

During the three and nine months ended September 30, 2024, the Company sold 1,299,506 shares of its common stock under the ATM facility at a weighted average price of $9.36 per share for gross proceeds of approximately $12.2 million. Share issue costs, including sales agent commissions, totaled approximately $0.4 million.

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Warrants to Purchase Common Shares

Pursuant to a credit agreement, the Company issued a warrant to SWK to purchase (i) 40,910 shares of the Company’s common stock on March 28, 2018 at an exercise price of $11.00 per share with a seven-year term and (ii) 7,773 shares of the Company’s common stock on June 26, 2018 at an exercise price of $19.30 per share with a seven-year term.

In January 2024, SWK exercised their warrants in full via cashless exercise resulting in the net share issuance of 25,666 shares.

The Company issued 3,272,727 shares of Pre-Funded Warrants (PFW) to purchase common stock, in connection with the November 2021 underwritten public offering. On April 18, 2024, 2,181,818 PFWs were exercised in full as a cashless exercise, resulting in a net issuance of 2,180,776 shares of common stock.

As of September 30, 2024, 1,090,909 PFWs were outstanding. The PFWs were included in the basic and diluted net loss per share calculation during the three and nine months ended September 30, 2024.

9.Share-Based Payment Awards

Equity Incentive Plan

Prior to June 20, 2024, the Company had authorized the issuance of 9,400,000 shares of the Company’s common stock under the 2016 Long-Term Incentive Plan (the 2016 Plan), of which 373,256 shares remained available for future grants.

The 2023 Long-Term Incentive Plan (the “2023 Plan”), approved by the Company’s stockholders on June 20, 2023 (the “Adoption Date”), originally provided for the issuance of up to 3,500,000 shares of the Company’s common stock reserved for issuance under the 2023 Plan plus any additional shares of the Company’s common stock that were available for grant under the 2008 and the 2016 Incentive Plan (the “2008 & 2016 Plan”) at the Adoption Date or would otherwise become available for grant under the 2008 Plan as a result of subsequent termination or forfeiture of awards under the 2008 or 2016 Plan. At the Company’s Annual Meeting of Stockholders held on June 20, 2024, the Company’s stockholders approved an amendment to the 2023 Plan to increase the number of shares authorized for issuance by 4,000,000 shares. At September 30, 2024, a total of approximately 4,311,535 shares were available for new awards under the 2023 Plan.

Starting March 2022, the Company granted non-statutory stock options to new employees as inducement awards to enter into employment with the Company. The grants were approved by the Compensation Committee of the Board of Directors and awarded in accordance with Nasdaq Listing Rule 5635(c)(4). Although not awarded under any equity incentive plans, the grants are subject to and governed by the terms and conditions of the applicable plan in effect at the time of the grant.

Stock Options

The following table provides a reconciliation of stock option activity under the Company’s equity incentive plan and for inducement awards for the nine months ended September 30, 2024:

	Number of Options			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life		Aggregate Intrinsic Value
						(in years)		(in thousands)
Outstanding at January 1, 2024		6,304,767		$	9.98
Granted		2,248,252			18.71
Exercised		(535,932	)		9.27
Forfeited		(254,198	)		9.72
Expired		(63,356	)		24.37
Outstanding at September 30, 2024		7,699,533		$	12.47		7.54	$	8,973
Exercisable at September 30, 2024		3,531,549		$	11.89		6.08	$	4,268

The Company's stock options generally vest over four years with 25% vesting after one year of service followed by ratable monthly vesting over the remaining three years. Nonemployee awards are granted similar to the Company’s employee awards. All option grants have a 10-year term. Options to purchase a total of 1,836,170 shares of the Company’s common stock vested during the nine months ended September 30, 2024.

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In determining the grant date fair value of option awards during the nine months ended September 30, 2024, the Company applied the Black-Scholes option pricing model based on the following key assumptions:

Option life (in years)	5.50 - 6.08
Stock volatility	97% - 100%
Risk-free interest rate	3.45% - 4.60%
Expected dividends	0.0%

The following table summarizes information about employee, non-executive director and external consultant stock options for the nine months ended September 30, 2024 (in thousands except per share amount):

	Nine Months
	Ended
	September 30, 2024
Weighted average grant date fair value per share	$	14.90
Total cash received from exercise of stock options		4,966
Total intrinsic value of stock options exercised		7,355

Time-Vested Restricted Stock Units

Time-vested restricted stock units (RSUs) issued to date under the 2016 Plan and the 2023 Plan generally vest on a ratable annual basis over 3 years. The related stock-based compensation expense is recorded over the requisite service period, which is the vesting period. The fair value of all time-vested RSUs is based on the closing share price of the Company’s common stock on the date of grant.

The following table provides a reconciliation of RSU activity under the 2016 Plan and the 2023 Plan for the nine months ended September 30, 2024:

	Number of Restricted Stock Units			Weighted Average Grant Date Fair Value
Nonvested at January 1, 2024		1,333,192		$	5.31
Granted		670,120			19.81
Vested		(591,277	)		6.39
Forfeited		(80,672	)		10.64
Nonvested at September 30, 2024		1,331,363		$	11.81

At September 30, 2024, the weighted average remaining vesting term of the RSUs was 1.5 years.

Employee Stock Purchase Plan

The Company’s Employee Stock Purchase Plan (the ESPP) allows qualified participants to purchase the Company’s common stock twice a year at 85% of the lesser of the average of the high and low sales price of the Company’s common stock on (i) the first trading day of the relevant offering period and (ii) the last trading day of the relevant offering period. The number of shares of the Company’s common stock each employee may purchase under this plan, when combined with all other employee stock purchase plans, is limited to the lower of an aggregate fair market value of $25,000 during each calendar year, or 5,000 shares of the Company’s common stock in any one offering period. The Company has maintained consecutive six-month offering periods since August 1, 2019. During the three and nine months ended September 30, 2024, 24,881 and 49,896 shares of the Company’s common stock were issued pursuant to the ESPP.

The Company estimated the fair value of the option component of the ESPP shares at the date of grant using a Black-Scholes valuation model. During the three and nine months ended September 30, 2024, the compensation expense from ESPP shares was approximately $0.1 million and $0.2 million. During the three and nine months ended September 30, 2023, the compensation expense from ESPP shares was immaterial.

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Stock-Based Compensation Expense

The Company’s condensed consolidated statements of comprehensive loss included total compensation expense from stock-based payment awards as follows (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
Compensation expense included in:
Research and development	$	3,382	$	1,263	$	14,820	$	3,405
Sales and marketing		—		60		—		290
General and administrative		4,064		2,306		14,020		4,772
	$	7,446	$	3,629	$	28,840	$	8,467

During the three and nine months ended September 30, 2024, the Company modified certain stock options and restricted stock awards in connection with the resignation of board members and terminations of executives resulting in a reduction of expense of $0.5 million and incremental expense of $5.2 million, respectively.

At September 30, 2024, there was approximately $30.2 million of unrecognized compensation expense related to outstanding equity awards under the 2023 Plan, the 2016 Plan, the inducement awards and the ESPP that is expected to be recognized as expense over a weighted average period of approximately 1.7 years.

10.License and Asset Purchase Agreements

Equinox Science, LLC

In February 2020, the Company entered into an Exclusive License Agreement (the Equinox License Agreement) with Equinox, pursuant to which Equinox granted the Company an exclusive, sublicensable, royalty-bearing right and license to certain patents and other Equinox intellectual property to research, develop, make, have made, use, sell, offer for sale, and import the compound vorolanib and any pharmaceutical products comprising the compound for local delivery to the eye for the prevention or treatment of age-related macular degeneration, diabetic retinopathy, and retinal vein occlusion using the Company’s proprietary localized delivery technologies (the Original Field), in each case, throughout the world except China, Hong Kong, Taiwan, and Macau (the Company Territory).

In consideration for the rights granted by Equinox, the Company (i) made a one time, non-refundable, non-creditable upfront cash payment of $1.0 million to Equinox in February 2020, and (ii) agreed to pay milestone payments totaling up to $50 million upon the achievement of certain development and regulatory milestones, consisting of (a) completion of a Phase 2 clinical trial for the compound or a licensed product, (b) the filing of a new drug application or foreign equivalent for the compound or a licensed product in the United States, European Union, or United Kingdom, and (c) regulatory approval of the compound or a licensed product in the United States, European Union or United Kingdom.

The Company also agreed to pay Equinox tiered royalties based upon annual net sales of licensed products in the Company Territory. The royalties are payable with respect to a licensed product in a particular country in the Company Territory on a country-by-country and licensed product-by-licensed product basis until the later of (i) twelve years after the first commercial sale of such licensed product in such country and (ii) the first day of the month following the month in which a generic product corresponding to such licensed product is launched in such country. The royalty rates range from the high-single digits to low-double digits depending on the level of annual net sales. The royalty rates are subject to reduction during certain periods when there is no valid patent claim that covers a licensed product in a particular country.

On May 2, 2022, concurrent with the Company entering into the Betta License Agreement (see Note 3), the Company entered into Amendment #1 to the Equinox License Agreement, pursuant to which the Original Field was expanded to cover the prevention or treatment of ophthalmology indications using the Company’s proprietary localized delivery technologies and certain conforming changes were made to the Equinox License Agreement in connection therewith.

For the three and nine months ended September 30, 2024, the Company recorded $0 and $5.0 million of R&D expenses in connection with the milestone payment for completion of a Phase 2 clinical trial for the compound or a licensed product under the Equinox License Agreement. No R&D expense was recorded for the three and nine months ended September 30, 2023 related to the Equinox License Agreement.

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11.Fair Value Measurements

The following tables summarize the Company’s assets by significant categories carried at fair value measured on a recurring basis by valuation hierarchy (in thousands):

	September 30, 2024
	Carrying Value		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value		Cash Equivalents		Marketable Securities
Level 1:
Money market funds	$	64,612	$	—	$	—	$	64,612	$	64,612	$	—
Subtotal	$	64,612	$	—	$	—	$	64,612	$	64,612	$	—
Level 2:
Commercial paper	$	53,009	$	22	$	—	$	53,031	$	4,949	$	48,082
U.S. Treasury securities	$	57,886	$	169	$	—	$	58,055	$	—	$	58,055
U.S. Agency securities	$	67,686	$	140	$	—	$	67,826	$	—	$	67,826
Subtotal	$	178,581	$	331	$	—	$	178,912	$	4,949	$	173,963
Total	$	243,193	$	331	$	—	$	243,524	$	69,561	$	173,963

	December 31, 2023
	Carrying Value		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value		Cash Equivalents		Marketable Securities
Level 1:
Money market funds	$	270,476	$	—	$	—		$	270,476	$	270,476	$	—
Subtotal	$	270,476	$	—	$	—		$	270,476	$	270,476	$	—
Level 2:
Commercial paper	$	19,295	$	8	$	—		$	19,303	$	1,998	$	17,305
U.S. Treasury securities		17,762		8		—			17,771		2,990		14,781
U.S. Agency securities		17,694		8		(1	)		17,701		—		17,701
Subtotal	$	54,751	$	24	$	(1	)	$	54,775	$	4,988	$	49,787
Total	$	325,227	$	24	$	(1	)	$	325,251	$	275,464	$	49,787

At September 30, 2024 and December 31, 2023, a total of $64.6 million or 92.9%, and a total of $270.5 million or 98.2%, respectively, of the Company’s interest-bearing cash equivalent balances were concentrated in one institutional money market fund that has investments consisting primarily of Repurchase Agreements, U.S Treasuries, and U.S. Government Agency Debts. The Company had $4.9 million or 7.1%, and a total $5.0 million or 1.8% of the Company's interest-bearing cash equivalent balance which consisted of investment-grade Commercial paper and investment-grade U.S. Treasury securities at September 30, 2024, and December 31, 2023, respectively. Generally, these deposits may be redeemed upon demand and, therefore, the Company believes they have minimal risk.

The Company’s cash equivalents and marketable securities are classified within Level 1 or Level 2 on the basis of valuations using quoted market prices or alternative pricing sources and models utilizing market observable inputs, respectively. The marketable securities have been valued on the basis of valuations provided by third-party pricing services, as derived from such services’ pricing models. Inputs to the models may include, but are not limited to, reported trades, executable bid and ask prices, broker/dealer quotations, prices, or yields of securities with similar characteristics, benchmark curves, or information pertaining to the issuer, as well as industry and economic events. The pricing services may use a matrix approach, which considers information regarding securities with similar characteristics to determine the valuation for a security, and have been classified as Level 2.

The carrying amounts of accounts receivable, accounts payable, and accrued expenses approximate fair value because of their short-term maturity.

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12.Contingencies

Legal Proceedings

The Company is subject to various routine legal proceedings and claims incidental to its business, which management believes will not have a material effect on the Company’s financial position, results of operations or cash flows.

U.S. Department of Justice Subpoena

In August 2022, the Company received a subpoena from the U.S. Attorney’s Office for the District of Massachusetts seeking production of documents related to sales, marketing, and promotional practices, including as pertain to DEXYCU® (DOJ Investigation). The Company is cooperating fully with the government in connection with this matter. At this time, the Company is unable to predict the duration, scope or outcome of this matter or whether it could have a material impact on the Company's financial condition, results of operations, or cash flow.

13.Net Loss per Share

Basic net loss per share is computed by dividing the net loss by the weighted average number of common shares outstanding during the period. For periods in which the Company reports net income, diluted net income per share is determined by adding to the basic weighted average number of common shares outstanding the total number of dilutive common equivalent shares using the treasury stock method, unless the effect is anti-dilutive. Potentially dilutive shares were not included in the calculation of diluted net loss per share for each of the three and nine months ended September 30, 2024 and 2023 as their inclusion would be anti-dilutive.

Potential common stock equivalents excluded from the calculation of diluted earnings per share because the effect would have been anti-dilutive were as follows:

	As of September 30,
	2024		2023
Stock options		7,699,533		6,340,662
ESPP		18,031		8,522
Warrants		—		48,683
Restricted stock units		1,331,363		1,333,742
		9,048,927		7,731,609

14.Related Party Transactions

On May 17, 2024, the Company executed the Eyebio License Agreement with Eyebio. The Chief Executive Officer (David Guyer) and Chief Scientific Officer (Anthony Adamis) of Eyebio were members of the Company’s board of directors when the agreement was executed. During the nine months ended September 30, 2024, the Company recorded $0.5 million in license and collaboration revenue in connection with the upfront payment pursuant to the Eyebio License Agreement. On September 3, 2024, Anthony P. Adamis, M.D. and David Guyer, M.D. resigned from their positions as directors on the Company’s Board due to their transition to full-time roles at Merck & Co.

On December 18, 2023, the Company entered into a consulting agreement with Dr. John Landis who also serves as the Company's Chair of the Science Committee and a member of the board of directors. Pursuant to the terms of the consulting agreement, Dr. Landis was entitled to receive an annual compensation payment of up to $0.6 million in exchange for performing certain research and development services as the Company's interim head of development. On January 5, 2024, pursuant to the consulting agreement, the Company granted Dr. Landis (i) stock options to purchase 20,000 shares of the Company’s common stock and (ii) 10,000 of restricted stock units. All equity grants to Dr. Landis vest after one year. He also received the Board stock option award to purchase 25,014 shares of the Company’s common stock. The compensation expense related to the consulting agreement recognized by the Company for the three and nine months ended September 30, 2024, was $0 million and $0.4 million, respectively. Additionally, the Company recorded accounts payable of $0 in the accompanying consolidated balance sheets related to services provided by Dr. Landis, as of September 30, 2024. Services under this agreement concluded during the second quarter of 2024.

Nancy S. Lurker, the former Chief Executive Officer and Executive Vice Chair of the Company and current Vice Chair of the Board is a member of the board of directors of Altasciences, the parent company of Calvert Laboratories, Inc. (Calvert Labs), an entity with which the Company conducts business. The Company recorded $0.3 million and $1.2 million of research and development expense in the accompanying condensed consolidated statements of operations and comprehensive loss related to preclinical and

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analytical services provided by Altasciences for the three and nine months ended September 30, 2024, respectively. Additionally, the Company recorded accounts payable of $0.5 million and $0.3 million, and prepaid expenses of $0.1 million and $0.5 million in the accompanying condensed consolidated balance sheets related to services provided by Altasciences, as of September 30, 2024 and December 31, 2023, respectively.

15.Subsequent Events

On October 31, 2024, the Company completed an underwritten public offering with gross proceeds of $161.0 million. The Company sold 14,636,363 shares of its common stock, which included the exercise in full by the underwriters of their option to purchase an additional 1,909,090 shares of common stock. The shares of common stock were sold at a public offering price of $11.00 per share.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Note Regarding Forward-Looking Statements

Various statements made in this Quarterly Report on Form 10-Q are forward-looking and involve risks and uncertainties. All statements that address activities, events or developments that we intend, expect or believe may occur in the future are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements give our current expectations or forecasts of future events and are not statements of historical or current facts. These statements include, among others, statements about:

•the potential for DURAVYU™, as an investigational sustained delivery intravitreal treatment deploying a bioerodible Durasert E™ insert of vorolanib, a selective and patented tyrosine kinase inhibitor (TKI) targeting wet age-related macular degeneration (wet AMD) and diabetic macular edema (DME);

•our expectations regarding the timing and outcome of our ongoing and planned clinical trials for DURAVYU™ for the treatment of wet AMD and DME;

•our expectations regarding the timing and clinical development of our other product candidates, including EYP-2301, a TIE-2 agonist, razuprotafib, formulated in Durasert E™ to potentially improve outcomes in serious retinal diseases;

•our strategic alliances with other companies;

•our belief that our cash, cash equivalents, and investments in marketable securities of $253.8 million at September 30, 2024, along with the net proceeds from the October $161.0 million equity financing will enable us to fund operations into 2027;

•our ability to obtain additional capital in sufficient amounts and on terms acceptable to us, and the consequences of failing to do so;

•our future expenses and capital expenditures;

•our expectations regarding the timing and results of the August 2022 subpoena from the U.S. Attorney’s Office for the District of Massachusetts (DOJ) seeking production of documents related to sales, marketing and promotional practices (DOJ Subpoena), including as pertain to DEXYCU®;

•our ability to manufacture DURAVYU™ or any other products or product candidates, in sufficient quantities and quality;

•our expectations regarding our ability to obtain and adequately maintain sufficient intellectual property protection for DURAVYU™ and any other products or product candidates, and to avoid claims of infringement of third-party intellectual property rights;

•our expectations regarding the warning letter the Company received from the FDA in July 2024, or the Warning Letter, pertaining to YUTIQ® manufacturing, citing alleged violations of cGMP requirements in connection with an FDA inspection at the Company’s Watertown facility in February 2024 and our plans to implement corrective and preventive actions required by the Warning Letter;

•the effect of legal and regulatory developments; and

•our expectation that we will continue to incur significant expenses and that our operating losses and our net cash outflows to fund operations will continue for the foreseeable future.

Forward-looking statements also include statements other than statements of current or historical fact, including, without limitation, all statements related to any expectations of revenues, expenses, cash flows, earnings or losses from operations, cash required to maintain current and planned operations, capital or other financial items; any statements of the plans, strategies, and objectives of management for future operations; any plans or expectations with respect to product research, development, and commercialization, including regulatory approvals; any other statements of expectations, plans, intentions or beliefs; and any statements of assumptions underlying any of the foregoing. We often, although not always, identify forward-looking statements by using words or phrases such as “likely”, “expect”, “intend”, “anticipate”, “believe”, “estimate”, “plan”, “project”, “forecast”, and “outlook”.

The following are some of the factors that could cause actual results to differ materially from the anticipated results or other expectations expressed, anticipated or implied in our forward-looking statements:

•the effectiveness and timeliness of our clinical trials, and the usefulness of the data;

•the sufficiency of our existing cash resources;

•our access to needed capital;

•fluctuations in our operating results;

•the duration, scope, and outcome of any governmental inquiries or investigations;

•the success of current and future license and collaboration agreements, including our agreements with ANI Pharmaceuticals, Inc. (ANI), Betta Pharmaceuticals Co., Ltd. (Betta), Equinox Science, LLC (Equinox), and Ocumension Therapeutics (Ocumension);

•our dependence on contract research organizations, vendors, and investigators;

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•our ability to manufacture clinical and commercial supply of our products and product candidates;

•the extent to which the global economic conditions, uncertainty caused by geopolitical violence and unrest and public health crises impact our business, the medical community, and the global economy;

•market acceptance of our product candidates, if approved;

•protection of intellectual property and avoiding intellectual property infringement;

•our ability to implement corrective and preventive actions required by the Warning Letter to the satisfaction of the FDA;

•product liability; and

•other factors described in our filings with the SEC.

We cannot guarantee that the results and other expectations expressed, anticipated or implied in any forward-looking statement will be realized. The risks set forth under Item 1A of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, as supplemented by the risks set forth under Item 1A of this Quarterly Report on Form 10-Q, describe major risks to our business, and you should read and interpret any forward-looking statements together with these risks. A variety of factors, including these risks, could cause our actual results and other expectations to differ materially from the anticipated results or other expectations expressed, anticipated or implied in our forward-looking statements. Should known or unknown risks materialize, or should underlying assumptions prove inaccurate, actual results could differ materially from past results and those anticipated, estimated, or projected in the forward-looking statements. You should bear this in mind as you consider any forward-looking statements.

Our forward-looking statements speak only as of the dates on which they are made. We do not undertake any obligation to publicly update or revise our forward-looking statements even if experience or future changes makes it clear that any projected results expressed or implied in such statements will not be realized.

EYEPOINT®, DEXYCU®, YUTIQ®, DURASERT®, DURAVYU®, DELIVERING INNOVATION TO THE EYE®, and WITH AN EYE ON PATIENTS® are our trademarks. Retisert® and Vitrasert® are Bausch & Lomb’s trademarks. YUTIQ® is licensed to ANI Pharmaceuticals, Inc. and Ocumension Therapeutics in their respective territories. ILUVIEN® is ANI Pharmaceuticals, Inc.’s trademark. The reports we file or furnish with the SEC, including this Quarterly Report on Form 10-Q, also contain trademarks, trade names, and service marks of other companies, which are the property of their respective owners.

Our Business

Overview

We are a company committed to developing and commercializing innovative therapeutics to help improve the lives of patients with serious retinal diseases. Our pipeline leverages our proprietary bioerodible Durasert E™ technology for sustained intraocular drug delivery. The Company’s lead product candidate, DURAVYU™, is an investigational sustained delivery treatment for anti-vascular endothelial growth factor (anti-VEGF) -mediated retinal diseases combining vorolanib, a selective and patent-protected tyrosine kinase inhibitor with bioerodible Durasert E™. DURAVYU™ is presently in Phase 3 clinical trials as a sustained delivery treatment for wet age-related macular degeneration (wet AMD), the leading cause of vision loss among people 50 years of age and older in the United States, and in Phase 2 clinical trial for diabetic macular edema (DME).

Recent Developments

•Completed an underwritten public offering with gross proceeds of $161.0 million in October. The Company sold 14,636,363 shares of its common stock, which included the exercise in full by the underwriters of their option to purchase an additional 1,909,090 shares of common stock. The shares of common stock were sold at a public offering price of $11.00 per share.

•Announced the grand opening of EyePoint’s Northbridge, MA manufacturing facility in October. The 40,000 square foot Good Manufacturing Process (cGMP) compliant commercial manufacturing facility was built to meet U.S. FDA and European Medicines Agency (EMA) and will support global manufacturing across the Company’s portfolio, including lead pipeline asset, DURAVYU™ upon potential regulatory approval.

•Announced the appointment of esteemed industry leader Fred Hassan to the Company’s Board of Directors in September.

R&D Highlights

•Announced positive interim 16-week data for the ongoing open label Phase 2 VERONA clinical trial of DURAVYU™ for diabetic macular edema (DME) in October. DURAVYU™ 2.7mg demonstrated an early, sustained, and clinically meaningful improvement in best-corrected visual acuity (BCVA) with a gain of +8.9 letters compared to baseline versus +3.2 letters for aflibercept control. DURAVYU 2.7mg also demonstrated concomitant structural improvement with CST (central subfield thickness) improvement of 68.1 microns versus 30.5 microns for aflibercept control. Notably, both DURAVYU™ doses

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showed an immediate benefit over aflibercept control in both BCVA and CST demonstrating the differentiated drug release profile of DURAVYU™ with immediate bioavailability. Additionally, a favorable safety and tolerability profile continued for both DURAVYU™ arms. The Company expects to report the full topline results in the first quarter of 2025, once all patients complete the trial.

•Announced first patient dosed in the Phase 3 LUGANO clinical trial of DURAVYU™ in wet age-related macular degeneration (wet AMD). The second Phase 3 LUCIA pivotal trial initiation is expected to have first patient dosing by end of 2024. The LUGANO and LUCIA clinical trials are designed for potential global regulatory and commercial success with every six-month re-dosing in both trials. With over 160 trial sites committed and robust DAVIO 2 data the company anticipates rapid enrollment of both trials with topline data anticipated in 2026.

•Presented DAVIO 2 twelve-month data at the American Academy of Ophthalmology (AAO) 2024 Subspecialty Day in October, at the 24th EURetina Congress in September and the Retina Society 57th Annual Meeting in September.

•Presented a comparison of tyrosine kinase inhibitors being developed for intravitreal delivery at the Retina Society 57th Annual Meeting in September, demonstrating the differentiation of DURAVYU™ with immediate bioavailability and controlled release via zero-order kinetics for at least six months.

•Presented on sustained-release vorolanib highlighting selective pan-VEGF receptor inhibition and anti-angiogenic effects in VEGF-mediated ocular diseases at the American Retina Forum (ARF) 2024 National Meeting in August demonstrating the durable efficacy, reliable safety and reduced injection burden of treatment with DURAVYU™.

Critical Accounting Policies and Estimates

The preparation of consolidated financial statements in conformity with GAAP requires that we make certain estimates, judgments, and assumptions that affect the reported amounts of assets, liabilities, revenues, and expenses. We base our estimates, judgments, and assumptions on historical experience, anticipated results, and trends, and on various other factors that we believe are reasonable under the circumstances at the time. By their nature, these estimates, judgments, and assumptions are subject to an inherent degree of uncertainty. Actual results may differ from our estimates under different assumptions or conditions. In our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, we set forth our critical accounting policies and estimates, which included revenue recognition, reserves for variable consideration associated with our commercial revenue and recognition of expense in outsourced clinical trial agreements. See Note 2 of the notes to our unaudited condensed consolidated financial statements contained in this Quarterly Report on Form 10-Q for a description of our accounting policies and estimates.

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Results of Operations

Three Months Ended September 30, 2024 Compared to Three Months Ended September 30, 2023:

	Three Months Ended
	September 30,						Change
	2024			2023			Amounts			%
Revenues:
Product sales, net	$	664		$	816		$	(152	)		-19	%
License and collaboration agreements		9,561			14,137			(4,576	)		-32	%
Royalty income		299			249			50			20	%
Total revenues		10,524			15,202			(4,678	)		-31	%
Operating expenses:
Cost of sales		736			1,202			(466	)		-39	%
Research and development		29,542			17,363			12,179			70	%
Sales and marketing		24			479			(455	)		-95	%
General and administrative		12,970			10,556			2,414			23	%
Total operating expenses		43,272			29,600			13,672			46	%
Loss from operations		(32,748	)		(14,398	)		(18,350	)		127	%
Other income (expense):
Interest and other income, net		3,387			1,786			1,601			90	%
Interest expense		—			—			—		-
Loss on extinguishment of debt		—			—			—		-
Total other income, net		3,387			1,786			1,601			90	%
Net loss	$	(29,361	)	$	(12,612	)	$	(16,749	)		133	%
Net loss per share - basic and diluted	$	(0.54	)	$	(0.33	)	$	(0.21	)		64	%
Weighted average shares outstanding - basic and diluted		54,449			38,341			16,108			42	%

Product Sales, Net

Product sales, net represents the gross sales of YUTIQ® and DEXYCU® less provisions for product sales allowances. Product sales, net decreased by $0.2 million, or 19%, to $0.7 million for the three months ended September 30, 2024 compared to the same period the prior year. This decrease was driven by lower sales of YUTIQ® product supply to ANI. For the three months ended September 30, 2024, product sales, net included $0.7 million of product supply under the existing commercial supply agreement (CSA) with ANI.

License and Collaboration Agreement

License and collaboration agreement revenue decreased by $4.6 million, or 32%, to $9.6 million for the three months ended September 30, 2024 compared to the same period the prior year. This decrease was due to lower recognition of deferred revenue related to the agreement to license YUTIQ® product rights to ANI due to lower product sales to ANI.

Royalty Income

Royalty income increased by less than $0.1 million, or 20%, to $0.3 million for the three months ended September 30, 2024 compared to the same period the prior year. The increase was attributable to higher non-cash Alimera royalties payable to SWK Funding LLC.

Cost of Sales, Excluding Amortization of Acquired Intangible Assets

Cost of sales decreased by $0.5 million, or 39%, to $0.7 million for the three months ended September 30, 2024 compared to the same period the prior year. This decrease was primarily due to lower commercial product sales year over year.

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Research and Development

Research and development expenses increased by $12.2 million, or 70%, to $29.5 million for the three months ended September 30, 2024 compared to the same period the prior year. This increase was attributable primarily to (i) $4.0 million in increased clinical trial costs related to the initiation of DURAVYU™ in Phase 3 clinical trials (LUGANO and LUCIA) for wet AMD, (ii) $3.8 million higher personnel expense to support clinical trial activity and product development, including $2.1 million of non-cash stock compensation, (iii) $1.4 million higher clinical trial material expense to be used in phase 3 clinical trials for wet AMD, (iv) $1.3 million in higher professional services, (v) $1.0 million higher facility and IT expenses, and (vi) $0.7 million in other R&D expenses. We anticipate an increase in future periods of clinical trials expenses due to our continuing Phase 3 clinical trials.

Sales and Marketing

Sales and marketing expenses decreased by $0.5 million, or 95%, for the three months ended September 30, 2024 compared to the same period the prior year. This decrease was driven by discontinued YUTIQ® promotion due to the agreement that granted YUTIQ® license and rights to ANI in the second quarter of 2023 and the Company's exit from the commercial business.

General and Administrative

General and administrative expenses increased by $2.4 million, or 23%, to $13.0 million for the three months ended September 30, 2024 compared to the same period the prior year. This increase was primarily attributable to $1.8 million in stock-based compensation and $0.8 million in personnel costs, partially offset by lower legal and other administrative expenses.

Interest (Expense) Income

Interest income from investments in marketable securities and institutional money market funds increased by $1.6 million, or 90%, to $3.4 million for the three months ended September 30, 2024 compared to the same period the prior year. This increase was due primarily to an increase in cash and marketable securities on hand.

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Nine Months Ended September 30, 2024 Compared to Nine Months Ended September 30, 2023:

	Nine months ended September 30,						Change
	2024			2023			Amounts			%
Revenues:
Product sales, net	$	2,390		$	13,483		$	(11,093	)		-82	%
License and collaboration agreements		27,906			17,768			10,138			57	%
Royalty income		1,389			739			650			88	%
Total revenues		31,685			31,990			(305	)		-1	%
Operating expenses:
Cost of sales, excluding amortization of acquired intangible assets		2,896			3,634			(738	)		-20	%
Research and development		89,554			46,711			42,843			92	%
Sales and marketing		80			11,504			(11,424	)		-99	%
General and administrative		39,770			28,854			10,916			38	%
Total operating expenses		132,300			90,703			41,597			46	%
Loss from operations		(100,615	)		(58,713	)		(41,902	)		71	%
Other income (expense):
Interest and other income, net		11,144			4,611			6,533			142	%
Interest expense		—			(1,247	)		1,247			-100	%
Gain (loss) on extinguishment of debt		—			(1,347	)		1,347			-100	%
Total other income, net		11,144			2,017			9,127			453	%
Net loss before income taxes	$	(89,471	)	$	(56,696	)	$	(32,775	)		58	%
Net loss per share - basic and diluted	$	(1.67	)	$	(1.50	)	$	(0.17	)		11	%
Weighted average shares outstanding - basic and diluted		53,526			37,804			15,722			42	%

Product Sales, Net

Product sales, net represents the gross sales of YUTIQ® and DEXYCU® less provisions for product sales allowances. Product sales, net decreased by $11.1 million, or 82%, to $2.4 million for the nine months ended September 30, 2024 compared to the same period the prior year. This decrease was driven by the agreement that granted license and rights to YUTIQ® to ANI in May 2023 as the Company exited its commercial business. For the nine months ended September 30, 2024, product sales, net were primarily from the sales of product supply under the existing commercial supply agreement (CSA) with ANI of $1.9 million, as well as $0.5 million of product supply to Ocumension.

License and Collaboration Agreement

License and collaboration agreement revenue increased by $10.1 million, or 57%, to $27.9 million for the nine months ended September 30, 2024 compared to the same period the prior year. This increase was due to higher recognition of deferred revenue related to the agreement to license YUTIQ® product rights to ANI from 9 months of revenue in 2024 compared to a partial year in 2023.

Royalty Income

Royalty income increased by $0.7 million, or 88%, to $1.4 million for the nine months ended September 30, 2024 compared to the same period the prior year. The increase was primarily attributable to increased Ocumension Therapeutics royalties from YUTIQ® product sales in China.

Cost of Sales, Excluding Amortization of Acquired Intangible Assets

Cost of sales decreased by $0.7 million, or 20%, to $2.9 million for the nine months ended September 30, 2024 compared to the same period the prior year. This decrease was primarily due to lower commercial product sales year over year.

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Research and Development

Research and development expenses increased by $42.8 million, or 92%, to $89.6 million for the nine months ended September 30, 2024 compared to the same period the prior year. This increase was attributable primarily to (i) $10.0 million higher personnel expense to support clinical trial activity and product development, including $5.7 million of non-cash stock compensation, (ii) $8.8 million in increased clinical trial costs related to DURAVYU™ in Phase 2 (DAVIO2) and Phase 3 (LUGANO and LUCIA) clinical trials for wet AMD, NPDR (PAVIA), and DME (VERONA), (iii) $5.7 million associated with non-cash equity award modifications expense, (iv) $5.0 million for a milestone payment due for completion of our Phase 2 wet AMD (DAVIO2) clinical trial, (v) $4.4 million in higher clinical trial material expense, (vi) $3.2 million higher DURAVYU™ non-clinical expenses, (vii) $1.5 million in higher facility costs, (viii) $1.6 million in severance related expense, and (ix) $2.5 million of other R&D expenses. We anticipate an increase in future periods of clinical trials expenses due to our continuing Phase 3 clinical trials.

Sales and Marketing

Sales and marketing expenses decreased by $11.4 million, or 99%, to $0.1 million for the nine months ended September 30, 2024 compared to the same period the prior year. This decrease was driven by discontinued YUTIQ® promotion due to the agreement that granted YUTIQ® license and rights to ANI in the second quarter of 2023 and the Company's exit from the commercial business. Expenses for the nine months ended September 30, 2024 included support for ongoing government reporting requirements.

General and Administrative

General and administrative expenses increased by $10.9 million, or 38%, to $39.8 million for the nine months ended September 30, 2024 compared to the same period the prior year. This increase was driven by (i) $9.2 million in stock-based compensation, (ii) $3.0 million in higher personnel costs, partially offset by $1.4 million in lower legal and other administrative expenses.

Interest (Expense) Income

Interest income from investments in marketable securities and institutional money market funds increased by $6.5 million, or 142%, to $11.1 million for the nine months ended September 30, 2024 compared to the same period the prior year. This increase was due primarily to an increase in cash and marketable securities and higher interest rates in the current year to date period.

There was no interest expense in the nine months ended September 30, 2024 due to the repayment of the loan under the loan and security agreement with Silicon Valley Bank (SVB Loan Agreement) on May 17, 2023. Interest expense for the nine months ended September 30, 2023 was $1.2 million.

Liquidity and Capital Resources

We have had a history of operating losses and an absence of significant recurring cash inflows from revenue, and at September 30, 2024 we had a total accumulated deficit of $831.6 million. Our operations have been financed primarily from sales of our equity securities, issuance of debt and a combination of license fees, milestone payments, royalty income and other fees received from collaboration partners.

Financing Activities

During the nine months ended September 30, 2024, we sold 1,299,506 shares of our common stock under the ATM facility at a weighted average price of $9.36 per share for gross proceeds of approximately $12.2 million. Share issue costs, including sales agent commissions, totaled approximately $0.4 million.

Future Funding Requirements

At September 30, 2024, we had cash, cash equivalents, and investments in marketable securities of $253.8 million. We expect the cash, cash equivalents and investments on September 30, 2024, along with the net proceeds from the October $161.0 million equity financing will enable us to fund operations into 2027. Due to the difficulty and uncertainty associated with the design and implementation of preclinical studies and clinical trials, we will continue to assess our cash and cash equivalents and future funding requirements. However, there is no assurance that additional funding will be achieved and that we will succeed in our future operations. We expect to continue to incur substantial additional operating losses for at least the next several years as we continue to develop our product candidates and seek marketing approval and, subject to obtaining such approval, the eventual commercialization of our product candidates. If we obtain marketing approval for any of our product candidates, we will incur significant sales,

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marketing, and manufacturing expenses. We also expect to continue to incur significant costs to comply with corporate governance, internal controls, and similar requirements associated with operating as a public reporting company.

Actual cash requirements could differ from management’s projections due to many factors including additional investments in research and development programs, clinical trial expenses for DURAVYU™ and EYP-2301, competing technological and market developments and the costs of any strategic acquisitions and/or development of complementary business opportunities.

The amount of additional capital we will require will be influenced by many factors, including, but not limited to:

1.the scope, progress, results, and costs of clinical trials of DURAVYU™, as a sustained delivery intravitreal treatment for wet AMD and DME;

2.our expectations regarding the timing and clinical development of our product candidates, including DURAVYU™ and EYP-2301;

3.the duration, scope, and outcome of the DOJ Subpoena and its impact on our financial condition, results of operations, or cash flows;

4.whether and to what extent we internally fund, whether and when we initiate, and how we conduct additional pipeline product development programs;

5.payments we receive under any new collaboration agreements or payments expected from existing agreements;

6.whether and when we are able to enter into strategic arrangements for our products or product candidates and the nature of those arrangements;

7.the costs involved in preparing, filing, prosecuting, maintaining, defending, and enforcing any patent claims;

8.the costs and timing to implement corrective and preventive actions required by the Warning Letter to the satisfaction of the FDA;

9.changes in our operating plan, resulting in increases or decreases in our need for capital; and

10.our views on the availability, timing, and desirability of raising capital.

We expect to seek additional funding to sustain our future operations and while we have successfully raised capital in the past, the ability to raise capital in future periods is not assured. We do not know if additional capital will be available when needed or on terms favorable to us or our stockholders. Collaboration, licensing or other agreements may not be available on favorable terms, or at all. If we seek to sell our equity securities, we do not know whether and to what extent we will be able to do so, or on what terms. If available, additional equity financing may be dilutive to stockholders, debt financing may involve restrictive covenants or other unfavorable terms and dilute our existing stockholders’ equity, and funding through collaboration, licensing or other commercial agreements may be on unfavorable terms, including requiring us to relinquish rights to certain of our technologies or products. If adequate financing is not available if and when needed, we may delay, reduce the scope of, or eliminate research or development programs, if any, postpone or cancel the pursuit of product candidates, or otherwise significantly curtail our operations to reduce our cash requirements and extend our capital.

Our consolidated statements of historical cash flows are summarized as follows (in thousands):

	Nine Months Ended September 30,
	2024			2023			Change
Cash flows from operating activities:
Net loss	$	(89,471	)	$	(56,696	)	$	(32,775	)
Changes in operating assets and liabilities		(26,676	)		71,155			(97,831	)
Other adjustments to reconcile net loss to cash flows from    operating activities:		25,770			10,525			15,245
Net cash (used in) provided by operating activities	$	(90,377	)	$	24,984		$	(115,361	)
Net cash (used in) provided by investing activities	$	(123,393	)	$	43,833		$	(167,226	)
Net cash provided by (used in) financing activities	$	12,337		$	(31,415	)	$	43,752

Operating cash outflows for the nine months ended September 30, 2024 totaled $90.4 million primarily due to our net loss of $89.5 million reduced by $25.8 million of non-cash expenses, which included $28.8 million of stock-based compensation, partially offset by $4.1 million for amortization of discount on available for sale of marketable securities. In addition, there was a change in working capital of $26.7 million, including $22.1 million of deferred revenue related to the agreement to license YUTIQ® product rights to ANI.

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Operating cash inflows for the nine months ended September 30, 2023 totaled $25.0 million, primarily due to our net loss of $56.7 million reduced by $10.5 million of non-cash expenses, which included $8.5 million of stock-based compensation, $1.3 million of loss on extinguishment of debt, $0.7 million for the provision of excess and obsolete inventory, and less than $0.1 million of other non-cash charges. This was further offset by changes in working capital of $71.2 million, including $57.4 million of deferred revenue related to the agreement to license YUTIQ® product rights to ANI, and $13.7 million of other working capital changes.

For the nine months ended September 30, 2024, $119.7 million of net cash was used for the purchase of marketable securities, and $3.7 million was used for the purchase of property and equipment.

For the nine months ended September 30, 2023, $46.4 million of net cash was provided by the sales of marketable securities, and $2.6 million was used for the purchase of property and equipment.

Net cash provided by financing activities for the nine months ended September 30, 2024 totaled $12.3 million and consisted of the following:

(i)$11.8 million of net proceeds from the issuance of 1,299,506 shares of our Common Stock sold utilizing our ATM.

(ii)$5.4 million from the exercise of stock options; and

(iii)$4.5 million used for the settlement of stock units and payment of equity issue costs

Net cash used in financing activities for the nine months ended September 30, 2023 totaled $31.4 million and consisted of the following:

(i)$40.5 million used to pay off the SVB loan

(ii)$1.4 million used to extinguish debt costs related to the SVB loan; and

(iii)$9.6 million of net proceeds from the issuance of 902,769 shares of our Common Stock sold utilizing our ATM.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934, as amended, and are not required to provide the information under this item.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our principal executive officer and principal financial officer, evaluated the effectiveness of our disclosure controls and procedures as of September 30, 2024. The term "disclosure controls and procedures," as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, means controls and other procedures of an issuer that are designed to ensure that information required to be disclosed by the issuer in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Commission's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to the issuer's management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure, particularly during the period in which this Quarterly Report on Form 10-Q was being prepared.

Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving its desired objectives, and our management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Based on the evaluation of our disclosure controls and procedures as of September 30, 2024, our principal executive officer and principal financial officer concluded that, as of such date, our disclosure controls and procedures were effective at the reasonable assurance level.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting during the quarter ended September 30, 2024 covered by this Quarterly Report on Form 10-Q that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II: OTHER INFORMATION

Item 1. Legal Proceedings

We are subject to various routine legal proceedings and claims incidental to our business, which management believes will not have a material effect on our financial position, results of operations or cash flows.

We previously disclosed that in August 2022, we received a subpoena from the U.S. Attorney’s Office for the District of Massachusetts seeking production of documents related to sales, marketing, and promotional practices, including as pertain to DEXYCU®. We are cooperating fully with the government in connection with this matter. At this time, we are unable to predict the duration, scope or outcome of this matter or whether it could have a material impact on our financial condition, results of operations or cash flow.

Item 1A. Risk Factors

This section augments and updates certain risk factors disclosed in Item 1A of Part I of our Annual Report on Form 10-K for the year ended December 31, 2023 (the Annual Report). The following risk factors should be read together with the other risk factors disclosed in the Annual Report. In addition to the other information in this Quarterly Report on Form 10-Q, all of the risk factors should be carefully considered in evaluating us and our common stock. Any of these risks, many of which are beyond our control, could materially and adversely affect our financial condition, results of operations or cash flows, or cause our actual results to differ materially from those projected in any forward-looking statements. We may also face other risks and uncertainties that are not presently known, are not currently believed to be material, or are not identified below because they are common to all businesses. Past financial performance may not be a reliable indicator of future performance, and historical trends should not be used to anticipate results or trends in future periods. For more information, see “Note Regarding Forward-Looking Statements” in this Quarterly Report on Form 10-Q.

We use our own facility for the manufacturing of YUTIQ® and rely on third party suppliers for key components, and any disruptions to our or our suppliers’ operations could adversely affect YUTIQ®’s commercial viability and our ability to supply YUTIQ® to ANI and Ocumension.

Pursuant to our agreements with our commercialization partners, we currently manufacture commercial supplies of YUTIQ® ourselves at our Watertown, MA facility and rely on third party suppliers for key components of YUTIQ®. We have, and will continue, to perform extensive audits of our suppliers, vendors, and contract laboratories. The cGMP requirements govern, among other things, recordkeeping, production processes, and controls, personnel, and quality control. To ensure that we continue to meet these requirements, we have and will continue to expend significant time, money, and effort.

The commercial manufacture of medical products is complex and requires significant expertise and capital investment, including the development of advanced manufacturing techniques and process controls. Manufacturers of medical products often encounter difficulties in production, particularly in scaling up and validating initial production and ensuring the absence of contamination. These problems include difficulties with production costs and yields, quality control, including stability of the product, quality assurance testing, operator error, shortages of qualified personnel, as well as compliance with strictly enforced federal, state, and foreign regulations. We cannot assure you that any issue relating to the manufacture of YUTIQ® will not occur in the future.

The FDA also may, at any time following approval of a product for sale, audit our manufacturing facilities. If any such inspection or audit identifies a failure to comply with applicable regulations or if a violation of our product specifications or applicable regulation occurs independent of such an inspection or audit, the FDA may issue a Form FDA-483 and/or a warning letter, which may require remedial measures that may be costly and time consuming for us to implement and that may include the temporary or permanent suspension of commercial sales, recalls, market withdrawals, seizures or the temporary or permanent closure of a facility. In February 2024, we received an FDA Form-483 at the conclusion of an FDA inspection of our Watertown facility which included certain observations specifically related to the manufacturing of YUTIQ®, and a subsequent determination that our facility had been classified as Official Action Indicated (OAI), which could lead to an enforcement action or, if left un-addressed, negatively affect our manufacturing of YUTIQ®. We submitted written responses to the FDA in March 2024 and May 2024 addressing the FDA’s observations.

On July 12, 2024, we received a warning letter from the FDA (“Warning Letter”), citing alleged violations of current good manufacturing practice (CGMP) requirements in connection with the February 2024 FDA inspection at the Watertown facility and the associated February 2024 Form FDA-483, specifically related to the manufacturing of YUTIQ®. The Warning Letter does not represent a final FDA determination of compliance. The Warning Letter requires that we implement certain corrective and preventive actions, including improvements to the process by which we investigate unexplained discrepancies, the implementation of additional

31

written procedures for production and process control, and the adoption of additional control procedures to monitor the output and to validate the performance of manufacturing processes. Addressing FDA observations and advancing quality initiatives are key priorities for the Company, and the Company has implemented and plans to further implement improvements to strengthen quality and sustainable compliance. We responded to the FDA on August 1, 2024 and, based on current information, we believe the supply of YUTIQ® to patients should not be materially interrupted. However, if we are unable to remediate the findings to the FDA’s satisfaction, we may face additional consequences including an inability to satisfy our obligations under our supply agreements with ANI and Ocumension and possible FDA regulatory or legal actions. Notwithstanding, based on current information, we believe our other products in development, including DURAVYU™, are not impacted by this regulatory action.

If our Contract Research Organizations (CROs), Contract Manufacturing Organizations (CMOs), Contract Development Manufacturing Organizations (CDMOs), vendors, and investigators do not successfully carry out their responsibilities or if we lose our relationships with them, our development efforts with respect to our product candidates could be delayed.

We are dependent on CROs, CMOs, CDMOs, vendors, and investigators for pre-clinical testing and clinical trials related to our product development programs, including for DURAVYU™ and other product candidates. These parties are not our employees, and we cannot control the amount or timing of resources that they devote to our programs. If they do not timely fulfill their responsibilities or if their performance is inadequate, the development, and commercialization of our product candidates could be delayed.

The parties with which we contract for execution of clinical trials play a significant role in the conduct of the trials and the subsequent collection and analysis of data. Their failure to meet their obligations could adversely affect clinical development of our product candidates. In addition, if we or our CROs fail to comply with applicable current Good Clinical Practices (GCP), the clinical data generated in our clinical trials may be deemed unreliable and the Food and Drug Administration (FDA) may require us to perform additional clinical trials before approving any marketing applications. Upon inspection, the FDA may determine that our clinical trials did not comply with GCP.

Switching or adding additional CROs involves additional cost and requires management time and focus. Identifying, qualifying, and managing performance of third-party service providers can be difficult, time-consuming, and cause delays in our development programs. In addition, there is a natural transition period when a new CRO commences work and the new CRO may not provide the same type or level of services as the original provider. Though we carefully manage our relationships with our CROs, there can be no assurance that we will not encounter challenges or delays in the future or that these delays or challenges will not have a material adverse impact on our business, financial condition, and prospects. If any of our relationships with our CROs terminate, we may not be able to enter into arrangements with alternative CROs or to do so on commercially reasonable terms. As a result, delays may occur, which can materially impact our ability to meet our desired clinical development timelines.

Additionally, our CMOs may experience manufacturing difficulties due to resource constraints or as a result of labor disputes or unstable political environments. If our CMOs were to encounter any of these difficulties, our ability to provide our product candidate to patients in clinical trials, or to provide product for the treatment of patients once approved, would be jeopardized.

In addition, any facilities located outside the United States (U.S.) that are used by us or by our CMOs or CDMOs to manufacture, test, and optimize our product candidates will be subject to various regulatory requirements of the jurisdiction in which they are located and in addition be subject to trade laws and regulations of the U.S. that may restrict our ability to continue to utilize certain CMOs or CDMOs. Foreign CMOs or CDMOs may be subject to U.S. legislation or investigations, including the proposed BIOSECURE Act, sanctions, trade restrictions, and other foreign regulatory requirements, which could increase the cost or reduce the supply of material available to us, delay the procurement or supply of such material, delay or impact clinical trials, have an adverse effect on our clinical drug development efforts and could adversely affect our financial condition and business prospects. For example, we currently engage with WuXi Apptec (WuXi), to perform certain process development, manufacturing, and testing associated with one of our product candidates, EYP-2301. WuXi has been identified as a U.S. national security threat in the proposed BIOSECURE Act, which, if enacted, or if alternatively implemented through executive or administrative action, could restrict WuXi’s business in the U.S. or the ability of businesses in the U.S. to conduct business with WuXi.

Moreover, if a foreign regulatory authority curtails operations at such foreign facilities of our CMOs or CDMOs, or if trade laws are adopted limiting our ability to use such CMO or CDMO facilities, we may need to find alternative facilities, which could negatively impact our clinical development timelines.

Because we have relied on third parties, our internal capacity to perform certain functions is limited. Outsourcing these functions involves risks that third parties may not perform to our standards, may not produce results in a timely manner or may fail to perform at all. In addition, the use of third-party service providers requires us to disclose our proprietary information to these parties,

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which could increase the risk that this information will be misappropriated. We currently have a small number of employees, which limits the internal resources we have available to identify and monitor our third-party providers. To the extent we are unable to identify and successfully manage the performance of third-party service providers in the future, our ability to advance our product candidates through clinical trials will be compromised. Though we carefully manage our relationships with our CROs, CMOs, and CDMOs, there can be no assurance that we will not encounter similar challenges or delays in the future or that these delays or challenges will not have a material adverse impact on our business, financial condition, and prospects.

Interim, top-line, initial and preliminary data from our clinical trials that we announce or publish from time to time may change as more patient data become available and are subject to confirmation, audit and verification procedures that could result in material changes in the final data.

From time to time, we may publicly disclose interim, top-line, initial or preliminary data from our clinical trials, which is based on a preliminary analysis of then-available data, and the results and related findings and conclusions are subject to change following a more comprehensive review of the data. For example, in October 2024, we announced preliminary results from our Phase 2 VERONA trial for DME. DURAVYU™ is still being studied in the Phase 2 VERONA trial for diabetic macular edema and topline data is expected in the first quarter of 2025. When reporting interim, top-line, initial or preliminary data from an ongoing trial, we may make assumptions, estimations, calculations and conclusions as part of our analyses of data, and may not have received or had the opportunity to fully and carefully evaluate all data. As a result, the interim, top-line, initial or preliminary results that we report, including the preliminary results from our Phase 2 VERONA trial for DME, may differ from future results of the same trials, or different conclusions or considerations may qualify such results, once additional data have been received and fully evaluated. Interim, top-line, initial and preliminary data from clinical trials are subject to the risk that one or more of the clinical outcomes may materially change as patient enrollment continues and more patient data become available. Interim, top-line, initial and preliminary data also remain subject to audit and verification procedures that may result in the final data being materially different from the interim, top-line, initial or preliminary data we previously published. As a result, interim, top-line, initial and preliminary data, including the preliminary results from our Phase 2 VERONA trial for DME, should be viewed with caution until the final data are available. Adverse differences between interim, top-line, initial or preliminary data and final data could significantly harm our business prospects and may cause the price of our common stock to fluctuate or decline.

Further, regulatory agencies and others, may not accept or agree with our assumptions, estimates, calculations, conclusions or analyses or may interpret or weigh the importance of data differently, which could adversely impact the potential of the particular program, the likelihood of obtaining regulatory approval of the particular product candidate, commercialization of any approved product and the business prospects of the company in general. In addition, the information we choose to publicly disclose regarding a particular study or clinical trial is derived from information that is typically extensive, and you or others may not agree with what we determine is material or otherwise appropriate information to include in our disclosure.

If the interim, top-line, initial or preliminary data that we report differs from actual results, or if regulatory authorities or others, disagree with the conclusions reached, our ability to obtain approval for, and commercialize, our product candidates may be significantly impaired, which could materially harm our business, operating results, prospects or financial condition.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

None.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

None.

Item 5. Other Information

(c)

Rule 10b5-1 Trading Arrangements

The Company permits officers and directors to adopt written trading plans, known as “Rule 10b5-1 trading arrangements”, as such term defined in Item 408(a) of Regulation S-K for the purchase or sale of the Company's securities, which are intended to satisfy

33

the affirmative defense conditions of Rule 10b5-1(c) under the Exchange Act. During the three months ended September 30, 2024, none of our executive officers and directors adopted, modified or terminated Rule 10b5-1 trading arrangements for the purchase or sale of our common stock.

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Item 6. Exhibits

		Incorporated by Reference to SEC Filing
Exhibit No.	Exhibit Description	Form	SEC Filing Date	Exhibit No.
2.1#	Product Rights Agreement, dated May 17, 2023, by and between EyePoint Pharmaceuticals, Inc. and Alimera Sciences, Inc.	8-K	05/18/23	2.1
3.1	Certificate of Incorporation of pSivida Corp.	8-K12G3	06/19/08	3.1
3.2	Certificate of Amendment of the Certificate of Incorporation of pSivida Corp.	10-K	09/13/17	3.2
3.3	Certificate of Correction to Certificate of Amendment of the Certificate of Incorporation of pSivida Corp.	8-K	04/02/18	3.1
3.4	Certificate of Amendment of Certificate of Incorporation, as amended, of EyePoint Pharmaceuticals, Inc.	8-K	06/27/18	3.1
3.5	By-Laws of EyePoint Pharmaceuticals, Inc.	10-K	09/18/18	3.5
3.6	Amendment No. 1 to the By-Laws of EyePoint Pharmaceuticals, Inc.	8-K	11/06/18	3.1
3.7	Certificate of Amendment of the Certificate of Incorporation, as amended, of EyePoint Pharmaceuticals, Inc.	8-K	06/23/20	3.1
3.8	Certificate of Amendment of the Certificate of Incorporation, as amended, of EyePoint Pharmaceuticals, Inc.	8-K	12/08/20	3.1
4.1	Form of Specimen Stock Certificate for Common Stock	8-K12G3	06/19/08	4.1
4.2	Form of Pre-Funded Warrant to Purchase Common Stock	8-K	11/19/21	4.1
10.1*	First Amendment to Northbridge Lease, dated September 30, 2024, by and between EyePoint Pharmaceuticals US, Inc. and 600 CPK LLC
10.2*#	Memorandum of Understanding, dated August 26, 2024, by and between EyePoint Pharmaceuticals, Inc. and Ocumension Therapeutics
10.3+	Severance Agreement and General Release, dated August 6, 2024, by and between EyePoint Pharmaceuticals, Inc. and Nancy S. Lurker	10-Q	08/08/2024	10.3
31.1*	Certification of Principal Executive Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2*	Certification of Principal Financial Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1**	Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2**	Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

101.INS	Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because XBRL tags are embedded within the Inline XBRL document.
101.SCH	Inline XBRL Taxonomy Extension Schema Document
104	Cover Page Interactive Data File (embedded within the inline XBRL document and included in Exhibit 101)

35

# Portions of this exhibit have been omitted in compliance with Item 601(b)(10) of Regulation S-K. The Company agrees to furnish a supplemental copy of the exhibit or any omitted schedule or similar attachment to the Securities and Exchange Commission upon request.

* Filed herewith

** Furnished herewith

+ Indicates management contract or compensatory arrangement.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	EyePoint Pharmaceuticals, Inc.
Date: November 7, 2024	By:	/s/ Jay S. Duker
	Name:	Jay S. Duker, M.D.
	Title:	President and Chief Executive Officer (Principal Executive Officer)

Date: November 7, 2024	By:	/s/ George O. Elston
	Name:	George O. Elston
	Title:	Executive Vice President and Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer)

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EX-10.1

Exhibit 10.1

FIRST AMENDMENT TO LEASE

This FIRST AMENDMENT TO LEASE (this “Amendment”) is dated as of September 30, 2024 (the “Effective Date”) by and between 600 CPK LLC, a Delaware limited liability company (“Lessor”), and EYEPOINT PHARMACEUTICALS US, INC., a Delaware corporation (“Lessee”).

WHEREAS, Lessor, successor in interest to V.E. Properties IX, LLC, and Lessee are parties to that certain Lease dated January 23, 2023 (together with this Amendment, collectively, the “Lease”), for the lease of certain premises known as Building 6 (“Building”) and located at 600 Commerce Drive, Northbridge, Massachusetts, as more particularly described in the Lease (the “Demised Premises”); and

WHEREAS, Lessor and Lessee wish to amend the Lease as provided herein;

NOW, THEREFORE, for good and valuable consideration, the receipt and legal sufficiency of which are hereby acknowledged, Lessor and Lessee hereby agree as follows.

AGREEMENT

1.Definitions. Capitalized terms used in this Amendment shall have the same meaning ascribed to such capitalized terms in the Lease, unless otherwise provided for herein.

2.Modifications. Modifications to Lease:

A.Lease Commencement Date. Notwithstanding that Lessor has additional work to complete in order to achieve substantial completion of the Lessor Improvements as described on Exhibit A attached hereto (subject only to reasonable punch list items that do not interfere with Lessee’s use of the Demised Premises for its intended purpose, collectively, the “Remaining Work”), the parties hereby acknowledge and agree that the Lease Commencement Date shall be October 1, 2024. Relatedly, Lessor hereby revokes its Lease Commencement Date notice previously delivered to Lessee dated September 13, 2024 and agrees such notice is of no further force or effect.

B.Rent Commencement Date. Notwithstanding Section 1(j) of the Lease, the parties hereby acknowledge and agree that the Rent Commencement Date shall be March 1, 2025, provided, however, that such agreement is conditioned upon Lessor substantially completing the Remaining Work no later than October 28, 2024 to the mutual satisfaction of both parties. Upon Lessor notifying Lessee in writing that it believes substantial completion of the Remaining Work has been achieved, the parties shall promptly perform a joint walk-through of the Building to confirm their mutual agreement that such work has been substantially completed. In the event the Remaining Work has not been substantially completed to allow Lessee to occupy the Building for its business purposes by October 28, 2024, then the Rent Commencement Date of March 1, 2025 shall be extended on a day-for-day basis for each day of delay to the extent not directly caused by or attributed to a Lessee Risk Event or Force Majeure or Lessee’s willful misconduct. The parties hereby further acknowledge and agree that the references in Section 1(j) of the Lease to two (2) days’ abatement of Rent for every single day of delay beyond sixty (60) days and the right of Lessee to terminate the Lease for failure to substantially complete the Lessor Improvements prior to December 31, 2024 are hereby deleted from the Lease and of no further force or effect.

3.Governing Law. This Amendment shall be governed by and construed in accordance with the laws of the Commonwealth of Massachusetts (without regard to conflicts of law).

4.Ratification of Lease, No Consents Required. Except as modified hereby, all other terms and conditions of the Lease remain unchanged and in full force and effect and are hereby ratified and confirmed by the parties hereto. Lessor hereby represents and warrants that it has obtained all consents or approvals necessary from any third parties in connection with the execution and delivery of this Amendment, including without limitation the consent or approval of any condominium association, ground lessor or similar superior interest holder, or lender.

5.Entire Agreement. This Amendment, in conjunction with the Lease, constitutes the entire agreement of Lessor and Lessee with respect to the subject matter hereof and supersedes all oral and written agreements and understandings made and entered into by the parties prior to the date hereof.

6.Multiple Counterparts; Facsimile Signature. This Amendment may be executed in multiple counterparts, all of which, when taken together, shall constitute one and the same instrument. Any signature to this Amendment transmitted via PDF, DocuSign, or other electronic means shall be deemed an original signature and be binding upon the parties hereto with the same force and effect as an original signature.

[Signatures on the Following Page]

IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the Effective Date stated above.

LESSEE:			LESSOR:
EYEPOINT PHARMACEUTICALS US, INC.,			600 CPK LLC, a Delaware limited liability company
a Delaware corporation
By:	/s/ Ron Honig		By:
	Name:	Ron Honig		Name:
	Title:	Chief Legal Officer		Title:
Trustees of Osterman Commerce Park Condominium			Osterman Management LLC
By:			By:
	Name:			Name:
	Title:			Title:
The Trustees execute this Lease with the consent of all Unit Owners (as defined in the Declaration of Trust of Osterman Park Condominium Trust) for the purpose of acknowledging the appointment of Lessee as attorney in fact for Lessor and agree Lessee shall have the self-help rights as provided in Article V, Section 3(f) of this Lease.			Osterman Management LLC executes this Amendment for the purpose of guaranteeing all of the monetary and non-monetary obligations of Lessor relating to the Lessor Improvements set forth in this Lease until the date the Remaining Work is substantially complete, following which Osterman Management LLC shall have no continuing liability.

IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the Effective Date stated above.

LESSEE:		LESSOR:
EYEPOINT PHARMACEUTICALS US, INC.,		600 CPK LLC, a Delaware limited liability company
a Delaware corporation
By:		By:	/s/ Thomas Keane
	Name:		Name:	Thomas Keane
	Title:		Title:	Manager
Trustees of Osterman Commerce Park Condominium		Osterman Management LLC
By:		By:
	Name:		Name:
	Title:		Title:
The Trustees execute this Lease with the consent of all Unit Owners (as defined in the Declaration of Trust of Osterman Park Condominium Trust) for the purpose of acknowledging the appointment of Lessee as attorney in fact for Lessor and agree Lessee shall have the self-help rights as provided in Article V, Section 3(f) of this Lease.		Osterman Management LLC executes this Amendment for the purpose of guaranteeing all of the monetary and non-monetary obligations of Lessor relating to the Lessor Improvements set forth in this Lease until the date the Remaining Work is substantially complete, following which Osterman Management LLC shall have no continuing liability.

IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the Effective Date stated above.

LESSEE:			LESSOR:
EYEPOINT PHARMACEUTICALS US, INC.,			600 CPK LLC, a Delaware limited liability company
a Delaware corporation
By:			By:	/s/ Thomas Keane
	Name:			Name:	Thomas Keane
	Title:			Title:	Manager
TrusteesofOstermanCommerceParkCondominium			OstermanManagementLLC
By:	/s/ Tim Osterman		By:	/s/ Tim Osterman
	Name:	Tim Osterman		Name:	Tim Osterman
	Title:	Manager		Title:	Manager
The Trustees execute this Lease with the consent of all Unit Owners (as defined in the Declaration of Trust of Osterman Park Condominium Trust) for the purpose of acknowledging the appointment of Lessee as attorney in fact for Lessor and agree Lessee shall have the self-help rights as provided in Article V, Section 3(f) of this Lease.			Osterman Management LLC executes this Amendment for the purpose of guaranteeing all of the monetary and non-monetary obligations of Lessor relating to the Lessor Improvements set forth in this Lease until the date the Remaining Work is substantially complete, following which Osterman Management LLC shall have no continuing liability.

EX-10.2

Exhibit 10.2

CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY “[***]”, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) IS THE TYPE THAT THE REGISTRANT TREATS AS PRIVATE OR CONFIDENTIAL.

Memorandum of Understanding

This Memorandum of Understanding, (the “2024 MOU”), dated as of August 26, 2024 (“Effective Date”), is entered into by and between EyePoint Pharmaceuticals, Inc., a company organized and existing under the laws of the State of Delaware, United States of America (“EyePoint”), Ocumension Therapeutics, a company organized and existing under the laws of Cayman Islands (“Ocumension”). EyePoint and Ocumension are referred to herein individually as a “Party” and collectively as the “Parties”.

WHEREAS,

EyePoint and Ocumension have entered into an Exclusive License Agreement on November 2, 2018 (“LA”), as amended by a Memorandum of Understanding dated March 1, 2019 (“2019 MOU”) and a Memorandum of Understanding dated 18 August 2020 (“2020 MOU”) and a Supply and Quality Agreement on February 19, 2019 (“SQA”). According to the LA, EyePoint granted an exclusive license to Ocumension to enable Ocumension and its sublicensees, if any, to import, test, use, have used, register, sell, offer to sell, Develop and Commercialize the Product in the Field in the Territory during the Term of the LA.

The LA, the 2019 MOU, the 2020 MOU and the SQA are herein referred to collectively as the “Existing Agreements”.

The Parties are exploring both a short-term and long-term solution to address the growing demand for YUTIQ within the Territory, which includes (i) incremental production by EyePoint, with related costs and expenses proportionately borne by the Parties as a short-term solution, and (ii) as a long-term solution, EyePoint is willing to grant YUTIQ manufacturing rights to Ocumension, and to conduct a technology transfer to Ocumension that will help enable Ocumension to produce YUTIQ for its licensed markets. In the interest of time, the short-term and long-term solutions will be addressed separately.

NOW, THEREFORE, in consideration of the foregoing and other good and valuable consideration, the receipt and sufficiency of which hereby is acknowledged, the Parties agree as follows:

1Manufacturing by Ocumension. EyePoint hereby grants Ocumension the right and obligation to manufacture, either by itself or through its affiliates or sub-contractors, the Product within the Territory in return for the Compensation and Technology Transfer Reimbursement.

1.1Technology Transfer and Support. EyePoint shall, by itself and/or procure necessary contractor(s) to coordinate with Ocumension from a manufacturing, regulatory, and technology support perspective to help Ocumension seek necessary approvals to become a manufacturer and supplier of Product in the Territory, including but not limited to: (i) assist Ocumension in establishing connections between Ocumension and the suppliers

MACROBUTTON DocID \\4151-7649-1860 v3

of the required production materials and manufacturing equipments; (ii) fully disclose all relevant documentation necessary to help to ensure the successful and replicable manufacture of the product; (iii) furnish on-demand, on-site technical assistance via a 3rd party as required throughout the collaboration; (iv) actively support Ocumension with the API and other material suppliers in progressing the Active Pharmaceutical Ingredient (API) registration process within China, or providing necessary technical documentation per the CDE’s requirement of filing the drug product (to the extent EyePoint has it); and(v) based on Ocumension's reasonable request, other necessary support related to Ocumension's manufacture and/or regulatory register of the Product within the Territory. The technology transfer will have been deemed completed when Ocumension produces their first commercial batch for sale (“First Batch”). The parties will communicate about supply expectations and timing so that EyePoint can cease production at the earliest possible date. EyePoint recognizes that Ocumension may continue to need supply from EyePoint while ramping up to full Ocumension production. If Ocumension continues to require supply for more than [***] after First Batch, the price of EyePoint sourced supply will become [***] for the next [***]. In no case will EyePoint be required to manufacture beyond [***] after First Batch.

1.2Technology Transfer Reimbursement. EyePoint will be reimbursed for technology transfer costs at 1) [***] for external costs (such as consultants and materials) and 2) [***] for internal resources such as regulatory and technical advisors.

1.3Audit. The Technology Transfer Reimbursement will be auditable by Ocumension itself or by a third party auditor delegated by Ocumension, no more than once per year. If the audit reveals that Ocumension has overpaid by [***], corresponding penalties will apply. This penalty will consist of twice the amount of the overpayment plus the auditing costs incurred by Ocumension. If [***], or if underpayment was made by any amount, then the parties will reimburse each other the appropriate amount either via near-term credit or cash payment.

1.4Trade Secrets and Know-how. The Parties agree that Confidentiality Clauses of the Existing Agreement shall apply to the proprietary manufacturing technology related to the Product transmitted by EyePoint to Ocumension under this 2024 MOU, and subject to the Confidentiality Clauses, the said will not be disclosed to any third parties without EyePoint’s express written consent or otherwise agreed.

1.5Manufacturing for Outside Territory. In the event that a third party authorized to market and sell the branded Product outside the Territory expresses its interest in purchasing the branded Product manufactured by Ocumension, the Parties may engage in good faith negotiations with the third party and enter into a separate tripartite agreement.

2Sales Expansion Incentives. In consideration for OcuMension’s effectively expansion of sales capacity in the long term and for the Technology Transfer, Ocumension will make the following one-time milestone payments (the “Compensation”) to EyePoint upon the first achievement of the quantity of annual sales quantity in the Territory in one Calendar Year, provided that these sales are the majority from products produced by Ocumension:

MACROBUTTON DocID \\4151-7649-1860 v3

Milestone#	OcuMension Annual Sales Unit	Milestone Payment (in USD)
Milestone 1	[***]	[***]
Milestone 2	[***]	[***]
Milestone 3	[***]	[***]
Milestone 4	[***]	[***]

In the event that more than one Milestones are first achieved in the same Calendar Year, then Ocumension will pay to EyePoint each of the corresponding Milestone Payment(s) for each such Milestone that has been achieved in that Calendar Year.

3Representations, Warranties and Covenants. Each Party has obtained and made any and all required consents, approvals, authorizations, orders, filings, or notices with any Governmental Authority or other Third Party in connection with the authorization, execution, and delivery of this 2024 MOU. Unless modified by the terms of this 2024 MOU, the Existing Agreement shall remain in full force and effect, in accordance with its terms.

4Counterparts. This 2024 MOU may be executed in counterparts, each of which shall be deemed an original, but all of which together shall be deemed to be one and the same agreement. A signed copy of this 2024 MOU delivered by facsimile, email or other means of electronic transmission shall be deemed to have the same legal effect as delivery of an original signed copy of this 2024 MOU.

IN WITNESS WHEREOF, each of the undersigned has executed this 2024 MOU as of the Effective Date set forth above.

EyePoint Pharmaceuticals, Inc. Ocumension Therapeutics

By: [***] By: [***]

[***] [***]

[***] [***]

MACROBUTTON DocID \\4151-7649-1860 v3

EX-31.1

Exhibit 31.1

Certification of Principal Executive Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended.

CERTIFICATIONS

I, Jay S. Duker, certify that:

1.I have reviewed this quarterly report on Form 10-Q of EyePoint Pharmaceuticals, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 7, 2024

/s/ Jay S. Duker

Name: Jay S. Duker, M.D.

Title: President and Chief Executive Officer (Principal Executive Officer)

EX-31.2

Exhibit 31.2

Certification of Principal Financial Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended.

CERTIFICATIONS

I, George O. Elston, certify that:

1.I have reviewed this quarterly report on Form 10-Q of EyePoint Pharmaceuticals, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 7, 2024

/s/ George O. Elston

Name: George O. Elston

Title: Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer)

EX-32.1

Exhibit 32.1

Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

In connection with the Quarterly Report of EyePoint Pharmaceuticals, Inc. (the “Company”) on Form 10-Q for the quarter ended September 30, 2024, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Jay S. Duker, President and Chief Executive Officer of the Company, certify that to the best of my knowledge:

1.The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2.The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: November 7, 2024

/s/ Jay S. Duker

Name: Jay S. Duker, M.D.

Title: President and Chief Executive Officer (Principal Executive Officer)

EX-32.2

Exhibit 32.2

Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

In connection with the Quarterly Report of EyePoint Pharmaceuticals, Inc. (the “Company”) on Form 10-Q for the quarter ended September 30, 2024, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, George O. Elston, Chief Financial Officer of the Company, certify that to the best of my knowledge:

1.The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2.The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: November 7, 2024

/s/ George O. Elston

Name: George O. Elston

Title: Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer)

XML

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2024	Oct. 31, 2024
Cover [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 30, 2024
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	Q3
Entity Registrant Name	EyePoint Pharmaceuticals, Inc.
Entity Central Index Key	0001314102
Current Fiscal Year End Date	--12-31
Entity Filer Category	Non-accelerated Filer
Trading Symbol	EYPT
Entity Common Stock, Shares Outstanding		68,251,031
Entity Emerging Growth Company	false
Entity Small Business	true
Entity Shell Company	false
Entity File Number	000-51122
Entity Tax Identification Number	26-2774444
Entity Address, Address Line One	480 Pleasant Street
Entity Address, City or Town	Watertown
Entity Address, State or Province	MA
Entity Address, Postal Zip Code	02472
City Area Code	617
Local Phone Number	926-5000
Document Quarterly Report	true
Document Transition Report	false
Entity Incorporation, State or Country Code	DE
Title of 12(b) Security	Common Stock, par value $0.001
Security Exchange Name	NASDAQ
Entity Interactive Data Current	Yes
Entity Current Reporting Status	Yes

XML

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Current assets:
Cash and cash equivalents	$ 79,830	$ 281,263
Marketable securities	173,963	49,787
Accounts and other receivables, net	378	805
Prepaid expenses and other current assets	11,571	9,039
Inventory	2,807	3,906
Total current assets	268,549	344,800
Property and equipment, net	8,391	5,251
Operating lease right-of-use assets	21,405	4,983
Restricted cash	150	150
Other assets	2,422	0
Total assets	300,917	355,184
Current liabilities:
Accounts payable	7,343	6,504
Accrued expenses	14,166	17,521
Deferred revenue	25,996	38,592
Other current liabilities	1,289	646
Total current liabilities	48,794	63,263
Deferred revenue - noncurrent	11,234	20,692
Operating lease liabilities - noncurrent	21,922	4,906
Other noncurrent liabilities	233	0
Total liabilities	82,183	88,861
Contingencies (Note 12)
Stockholders' equity:
Preferred stock, $.001 par value, 5,000,000 shares authorized, no shares issued and outstanding	0	0
Common stock, $.001 par value, 300,000,000 shares authorized at September 30, 2024 and December 31, 2023; 53,524,364 and 49,043,074 shares issued and outstanding at September 30, 2024 and December 31, 2023, respectively	53	49
Additional paid-in capital	1,049,127	1,007,556
Accumulated deficit	(831,617)	(742,146)
Accumulated other comprehensive income	1,171	864
Total stockholders' equity	218,734	266,323
Total liabilities and stockholders' equity	$ 300,917	$ 355,184

XML

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Sep. 30, 2024	Dec. 31, 2023
Statement of Financial Position [Abstract]
Preferred stock, par value	$ 0.001	$ 0.001
Preferred stock, shares authorized	5,000,000	5,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares authorized	300,000,000	300,000,000
Common stock, shares issued	53,524,364	49,043,074
Common stock, shares outstanding	53,524,364	49,043,074

XML

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Revenues:
Total revenues	$ 10,524	$ 15,202	$ 31,685	$ 31,990
Operating expenses:
Cost of sales	736	1,202	2,896	3,634
Research and development	29,542	17,363	89,554	46,711
Sales and marketing	24	479	80	11,504
General and administrative	12,970	10,556	39,770	28,854
Total operating expenses	43,272	29,600	132,300	90,703
Loss from operations	(32,748)	(14,398)	(100,615)	(58,713)
Other (expense) income:
Interest and other income, net	3,387	1,786	11,144	4,611
Interest expense	0	0	0	(1,247)
Loss on extinguishment of debt	0	0	0	(1,347)
Total other income, net	3,387	1,786	11,144	2,017
Net loss	$ (29,361)	$ (12,612)	$ (89,471)	$ (56,696)
Net loss per share - basic	$ (0.54)	$ (0.33)	$ (1.67)	$ (1.5)
Net loss per share - diluted	$ (0.54)	$ (0.33)	$ (1.67)	$ (1.5)
Weighted average common shares outstanding - basic	54,449	38,341	53,526	37,804
Weighted average common shares outstanding - diluted	54,449	38,341	53,526	37,804
Net Income (Loss)	$ (29,361)	$ (12,612)	$ (89,471)	$ (56,696)
Other comprehensive gain (loss):
Unrealized gain (loss) on available-for-sale securities	379	(1)	307	55
Comprehensive loss	(28,982)	(12,613)	(89,164)	(56,641)
Product [Member]
Revenues:
Total revenues	664	816	2,390	13,483
License and Collaboration Agreements [Member]
Revenues:
Total revenues	9,561	14,137	27,906	17,768
Royalty Income [Member]
Revenues:
Total revenues	$ 299	$ 249	$ 1,389	$ 739

XML

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands	Total	Common Stock [Member]	Additional Paid-In Capital [Member]	Accumulated Deficit [Member]	Accumulated Other Comprehensive Income [Member]
Balance at Dec. 31, 2022	$ 96,368	$ 34	$ 766,899	$ (671,351)	$ 786
Balance, shares at Dec. 31, 2022		34,082,934
Net Income (Loss)	(56,696)			(56,696)
Other comprehensive gain (loss)	55				55
Issuance of stock, net of issue costs	9,540	$ 1	9,539
Issuance of stock, net of issue costs, shares		902,769
Employee stock purchase plan	422		422
Employee stock purchase plan, shares		107,056
Exercise of stock options	634		634
Exercise of stock options, shares		56,090
Vesting of stock units	(169)		(169)
Vesting of stock units, shares		160,583
Stock-based compensation	8,467		8,467
Balance at Sep. 30, 2023	58,621	$ 35	785,792	(728,047)	841
Balance, shares at Sep. 30, 2023		35,309,432
Balance at Jun. 30, 2023	57,262	$ 34	771,821	(715,435)	842
Balance, shares at Jun. 30, 2023		34,306,118
Net Income (Loss)	(12,612)			(12,612)
Other comprehensive gain (loss)	(1)				(1)
Issuance of stock, net of issue costs	9,540	$ 1	9,539
Issuance of stock, net of issue costs, shares		902,769
Employee stock purchase plan	174		174
Employee stock purchase plan, shares		43,335
Exercise of stock options	629		629
Exercise of stock options, shares		55,210
Vesting of stock units, shares		2,000
Stock-based compensation	3,629		3,629
Balance at Sep. 30, 2023	58,621	$ 35	785,792	(728,047)	841
Balance, shares at Sep. 30, 2023		35,309,432
Balance at Dec. 31, 2023	$ 266,323	$ 49	1,007,556	(742,146)	864
Balance, shares at Dec. 31, 2023	49,043,074	49,043,074
Net Income (Loss)	$ (89,471)			(89,471)
Other comprehensive gain (loss)	307				307
Issuance of stock, net of issue costs	11,811	$ 1	11,810
Issuance of stock, net of issue costs, shares		1,299,506
Cashless exercise of warrants		$ 2	(2)
Cashless exercise of warrants, shares		2,206,442
Employee stock purchase plan	470		470
Employee stock purchase plan, shares		49,896
Exercise of stock options	4,966	$ 1	4,965
Exercise of stock options, shares		535,932
Vesting of stock units	(4,512)		(4,512)
Vesting of stock units, shares		389,514
Stock-based compensation	28,840		28,840
Balance at Sep. 30, 2024	$ 218,734	$ 53	1,049,127	(831,617)	1,171
Balance, shares at Sep. 30, 2024	53,524,364	53,524,364
Balance at Jun. 30, 2024	$ 228,305	$ 52	1,029,717	(802,256)	792
Balance, shares at Jun. 30, 2024		52,160,305
Net Income (Loss)	(29,361)			(29,361)
Other comprehensive gain (loss)	379				379
Issuance of stock, net of issue costs	11,793	$ 1	11,792
Issuance of stock, net of issue costs, shares		1,299,506
Employee stock purchase plan	202		202
Employee stock purchase plan, shares		24,881
Exercise of stock options	48		48
Exercise of stock options, shares		14,216
Vesting of stock units	(78)		(78)
Vesting of stock units, shares		25,456
Stock-based compensation	7,446		7,446
Balance at Sep. 30, 2024	$ 218,734	$ 53	$ 1,049,127	$ (831,617)	$ 1,171
Balance, shares at Sep. 30, 2024	53,524,364	53,524,364

XML

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Cash flows from operating activities:
Net loss	$ (89,471)	$ (56,696)
Adjustments to reconcile net loss to cash flows used in operating activities:
Depreciation and amortization	1,073	352
Amortization of debt discount and premium and discount on available-for-sale marketable securities	(4,143)	(334)
Provision for excess and obsolete inventory	0	693
Loss on extinguishment of debt	0	1,347
Stock-based compensation	28,840	8,467
Changes in operating assets and liabilities:
Accounts receivable and other current assets	(2,107)	14,701
Other assets	(2,422)	0
Inventory	1,098	(2,224)
Accounts payable and accrued expenses	(2,402)	791
Right-of-use assets and operating lease liabilities	1,211	467
Deferred revenue	(22,054)	57,420
Other noncurrent liabilities	0	0
Net cash (used in) provided by operating activities	(90,377)	24,984
Cash flows from investing activities:
Purchases of marketable securities	(234,225)	(5,851)
Sales and maturities of marketable securities	114,500	52,284
Purchases of property and equipment	(3,668)	(2,600)
Net cash (used in) provided by investing activities	(123,393)	43,833
Cash flows from financing activities:
Proceeds from issuance of stock	11,793	9,974
Payment of equity issue costs	(307)	(415)
Payment of long-term debt	0	(30,000)
Payment of extinguishment of debt costs	0	(1,350)
Borrowings under revolving facility	0	5,300
Repayment under revolving facility	0	(15,775)
Net settlement of stock units to satisfy statutory tax withholding	(4,512)	(169)
Proceeds from exercise of stock options	5,436	1,056
Principal payments on finance lease obligations	(73)	(36)
Net cash provided by (used in) financing activities	12,337	(31,415)
Net (decrease) increase in cash, cash equivalents and restricted cash	(201,433)	37,402
Cash, cash equivalents and restricted cash at beginning of period	281,413	95,783
Cash, cash equivalents and restricted cash at end of period	79,980	133,185
Reconciliation of cash, cash equivalents and restricted cash to the consolidated balance sheets:
Cash and cash equivalents	79,830	133,035
Restricted cash	150	150
Total cash, cash equivalents and restricted cash at end of period	79,980	133,185
Supplemental cash flow information:
Cash interest paid	0	1,405
Supplemental disclosure of non-cash investing and financing activities:
Lease liability arising from obtaining right-of-use assets	17,544	0
Property and equipment additions in accounts payable and accrued expenses	141	0
Stock issuance costs	$ 0	$ 19

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Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Pay vs Performance Disclosure
Net Income (Loss)	$ (29,361)	$ (12,612)	$ (89,471)	$ (56,696)

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Insider Trading Arrangements	3 Months Ended
	Sep. 30, 2024
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Rule 10b5-1 Arrangement Modified	false
Rule 10b5-1 Arrangement Terminated [Flag]	false

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Operations

9 Months Ended

Sep. 30, 2024

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Operations

1.Operations

The accompanying condensed consolidated financial statements of EyePoint Pharmaceuticals, Inc., a Delaware corporation (together with its subsidiaries, the Company), as of September 30, 2024 and for the three and nine months ended September 30, 2024 and 2023 are unaudited. Certain information in the footnote disclosures of these financial statements has been condensed or omitted in accordance with the rules and regulations of the Securities and Exchange Commission. These financial statements should be read in conjunction with the Company’s audited consolidated financial statements and footnotes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023. In the opinion of management, these statements have been prepared on the same basis as the audited consolidated financial statements as of and for the year ended December 31, 2023, and include all adjustments, consisting only of normal recurring adjustments, that are necessary for the fair presentation of the Company’s financial position, results of operations, and cash flows for the periods indicated. The preparation of financial statements in accordance with United States (U.S.) generally accepted accounting principles requires management to make assumptions and estimates that affect, among other things, (i) reported amounts of assets and liabilities; (ii) disclosure of contingent assets and liabilities at the date of the consolidated financial statements; and (iii) reported amounts of revenues and expenses during the reporting period. The results of operations for the three and nine months ended September 30, 2024 are not necessarily indicative of the results that may be expected for the entire 2024 fiscal year or any future period.

The Company is committed to developing and commercializing innovative therapeutics to help improve the lives of patients with serious retinal diseases. The Company’s pipeline leverages its proprietary bioerodible Durasert E™ technology (Durasert E™) for sustained intraocular drug delivery. The Company’s lead product candidate, DURAVYU™, f/k/a EYP-1901, is an investigational sustained delivery treatment for anti-vascular endothelial growth factor (anti-VEGF) mediated retinal diseases combining vorolanib, a selective and patent-protected tyrosine kinase inhibitor with Durasert E™. DURAVYU™ is currently in Phase 3 clinical trials for wet age-related macular degeneration (wet AMD), the leading cause of vision loss among people 50 years of age and older in the United States and a Phase 2 clinical trial for diabetic macular edema (DME). The Company is also advancing EYP-2301, a promising TIE-2 agonist, razuprotafib, formulated in Durasert E™ to potentially improve outcomes in serious retinal diseases.

The Company plans to identify and advance additional product candidates through clinical and regulatory development for its pipeline. This may be accomplished through internal discovery efforts, research collaborations and/or in-licensing arrangements and potential acquisitions of additional products, product candidates or technologies.

Liquidity

The Company had cash, cash equivalents and investments in marketable securities of $253.8 million at September 30, 2024. The Company has a history of operating losses and has not had significant recurring cash inflows from revenue. The Company’s operations have been financed primarily from sales of its equity securities, issuance of debt and a combination of license fees, milestone payments, royalty income, and other fees received from its collaboration partners. The Company anticipates that it will continue to incur losses as it continues the research and development of its product candidates, and the Company does not expect revenues to generate sufficient funding to sustain its operations in the near-term. The Company expects to continue fulfilling its funding needs through cash inflows from revenues, licensing and research collaboration transactions, additional equity capital raises and other arrangements. The Company believes that its cash, cash equivalents and investments in marketable securities of $253.8 million at September 30, 2024 will enable the Company to fund its current and planned operations for at least the next twelve months from the date these condensed consolidated financial statements were issued. Actual cash requirements could differ from management’s projections due to many factors, including the timing and results of the Company’s clinical trials for DURAVYU™, additional investments in research and development programs, competing technological and market developments and the costs of any strategic acquisitions and/or development of complementary business opportunities.

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Summary of Significant Accounting Policies

9 Months Ended

Sep. 30, 2024

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

2.Summary of Significant Accounting Policies

The Company’s significant accounting policies are disclosed in the audited consolidated financial statements for the year ended December 31, 2023, and notes thereto, which are included in the Company’s Annual Report on Form 10-K that was filed with the Securities and Exchange Commission, or the SEC, on March 8, 2024, or the 2023 Form 10-K. Since the date of those financial statements, there have been no material changes to the Company's significant accounting policies.

Revenue Recognition

Revenue is recognized when a customer obtains control of promised goods or services, in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that an entity determines are within the scope of ASC 606, Revenue from Contracts with Customers (ASC 606), the Company performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined to be within the scope of ASC 606, the Company assesses the goods or services promised within the contract, determines those that are performance obligations and assesses whether each promised good or service is distinct. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. Sales, value-add and other taxes collected on behalf of third parties are excluded from revenue.

Product sales, net — Effective January 2023, commercial sales of DEXYCU® were no longer supported by the Company, remaining available only through specialty distributors. Effective May 2023, YUTIQ® has been and continues to be sold under commercial supply agreements with Alimera Sciences, Inc. (Alimera) and Ocumension Therapeutics (Ocumension). On September 16, 2024, ANI Pharmaceuticals, Inc. (ANI) announced the completion of the acquisition of Alimera. The acquisition does not impact the terms of the commercial supply agreements (see Note 3).

Prior to the above dates, the Company sold YUTIQ® and DEXYCU® to a limited number of specialty distributors and specialty pharmacies (collectively the Distributors) in the U.S., with whom the Company had entered into formal agreements, for delivery to physician practices for YUTIQ® and to hospital outpatient departments and ambulatory surgical centers (ASCs) for DEXYCU®. The Company recognized revenue on sales of its products when Distributors obtained control of the products, which occurred at a point in time, typically upon delivery. In addition to agreements with Distributors, the Company also entered into arrangements with healthcare providers, ASCs, and payors that provided for government mandated and/or privately negotiated rebates, chargebacks, and discounts with respect to their purchase of the Company's products from Distributors.

Reserves for variable consideration — Product sales were recorded at the wholesale acquisition costs, net of applicable reserves for variable consideration. Components of variable consideration included trade discounts and allowances, provider chargebacks and discounts, payor rebates, product returns, and other allowances that were offered within contracts between the Company and its Distributors, payors, and other contracted purchasers relating to the Company's product sales. These reserves were based on the amounts earned, or to be claimed on the related sales, and were classified either as reductions of product revenue and accounts receivable or a current liability, depending on how the amount was to be settled. Overall, these reserves reflected the Company's best estimates of the amount of consideration to which it was entitled based on the terms of the respective underlying contracts. The actual amounts of consideration ultimately received may differ from the Company's estimates. If actual results in the future vary from the estimates, the Company adjusts these estimates, which would affect product revenue and earnings in the period such variances become known.

Distribution fees — The Company compensated its Distributors for services explicitly stated in the Company’s contracts and were recorded as a reduction of revenue in the period the related product sale was recognized.

Provider chargebacks and discounts — Chargebacks were discounts that represented the estimated obligations resulting from contractual commitments to sell products at prices lower than the list prices charged to the Company’s Distributors. These Distributors charged the Company for the difference between what they paid for the product and the Company’s contracted selling price. These reserves were established in the same period that the related revenue was recognized, resulting in a reduction of product revenue and the establishment of a current liability. Reserves for chargebacks consisted of amounts that the Company expected to pay for units that remained in the distribution channel inventories at each reporting period-end that the Company expected to be sold under a contracted selling price, and chargebacks that Distributors had claimed, but for which the Company had not yet settled.

Government rebates — The Company was subject to discount obligations under state Medicaid programs and Medicare. These reserves were recorded in the same period the related revenue was recognized, resulting in a reduction of product revenue and the establishment of a current liability which was included in accrued expenses and other current liabilities on the consolidated balance sheets. The Company’s liability for these rebates consisted of invoices received for claims from prior quarters that had not been paid or for which an invoice had not yet been received, estimates of claims for the current quarter, and estimated future claims that would be made for product that had been recognized as revenue, but which remained in the distribution channel inventories at the end of each reporting period.

Payor rebates — The Company contracted with certain private payor organizations, primarily insurance companies, for the payment of rebates with respect to utilization of its products. The Company estimated these rebates and recorded such estimates in the same period the related revenue was recognized, resulting in a reduction of product revenue and the establishment of a current liability.

Co-Payment assistance — The Company offered co-payment assistance to commercially insured patients meeting certain eligibility requirements. The calculation of the accrual for co-pay assistance was based on an estimate of claims and the cost per claim that the Company expected to receive associated with product that had been recognized as revenue.

Product returns — The Company generally offered a limited right of return based on its returned goods policy, which included damaged product and remaining shelf life. The Company estimated the amount of its product sales that may be returned and recorded.

License and collaboration agreement revenue — The Company analyzes each element of its license and collaboration arrangements to determine the appropriate revenue recognition. The terms of the license agreement may include payment to the Company of non-refundable upfront license fees, milestone payments if specified objectives are achieved, and/or royalties on product sales. The Company recognizes revenue from upfront payments at a point in time, typically upon fulfilling the delivery of the associated intellectual property to the customer. For licenses that are combined with other promises, the Company determines whether the combined performance obligation is satisfied over time or at a point in time, when (or as) the associated performance obligation in the contract is satisfied.

If the contract contains a single performance obligation, the entire transaction price is allocated to the single performance obligation. Contracts that contain multiple performance obligations require an allocation of the transaction price based on the estimated relative standalone selling prices of the promised products or services underlying each performance obligation. The Company determines standalone selling prices based on the price at which the performance obligation is sold separately. If the standalone selling price is not observable through past transactions, the Company estimates the standalone selling price taking into account available information such as market conditions and internally approved pricing guidelines related to the performance obligations.

The Company recognizes sales-based milestone payments as revenue upon the achievement of the cumulative sales amount specified in the contract in accordance with ASC 606-10-55-65. For those milestone payments which are contingent on the occurrence of particular future events, the Company determines that these need to be considered for inclusion in the calculation of total consideration from the contract as a component of variable consideration using the most-likely amount method. As such, the Company assesses each milestone to determine the probability and substance behind achieving each milestone. Given the inherent uncertainty associated with these future events, the Company will not recognize revenue from such milestones until there is a high probability of occurrence, which typically occurs near or upon achievement of the event.

When determining the transaction price of a contract, an adjustment is made if payment from a customer occurs either significantly before or significantly after performance, resulting in a significant financing component. Applying the practical expedient in paragraph 606-10-32-18, the Company does not assess whether a significant financing component exists if the period between when the Company performs its obligations under the contract and when the customer pays is one year or less. None of the Company’s contracts contained a significant financing component as of September 30, 2024.

Royalties — The Company recognizes revenue from license arrangements with its commercial partners’ net sales of products. Such revenues are included as royalty income. In accordance with ASC 606-10-55-65, royalties are recognized when the subsequent sale of the commercial partner’s products occurs. The Company’s commercial partners are obligated to report their net product sales and the resulting royalty due to the Company typically within 60-days from the end of each quarter. Based on historical product sales, royalty receipts and other relevant information, the Company recognizes royalty income each quarter and subsequently determines a true-up when it receives royalty reports and payment from its commercial partners. Historically, these true-up adjustments have been immaterial.

Sale of Future Royalties — The Company has sold its rights to receive certain royalties on product sales. In the circumstance where the Company has sold its rights to future royalties under a royalty purchase agreement (RPA) and also maintains limited continuing involvement in the arrangement (but not significant continuing involvement in the generation of the cash flows that are due to the purchaser), the Company defers recognition of the proceeds it receives for the sale of royalty streams and recognizes such unearned revenue as revenue under the units-of-revenue method over the life of the underlying license agreement. Under the units-of-revenue method, amortization for a reporting period is calculated by computing a ratio of the proceeds received from the purchaser to the total payments expected to be made to the purchaser over the term of the agreement, and then applying that ratio to the period’s cash payment.

Estimating the total payments expected to be received by the purchaser over the term of such arrangements requires management to use subjective estimates and assumptions. Changes to the Company’s estimate of the payments expected to be made to the purchaser over the term of such arrangements could have a material effect on the amount of revenues recognized in any particular period.

Research Collaborations — The Company recognizes revenue over the term of the statements of work under any funded research collaborations. Revenue recognition for consideration, if any, related to a license option right is assessed based on the terms of any such future license agreement or is otherwise recognized at the completion of the research collaborations.

Please refer to Note 3 for further details on the license and collaboration agreements into which the Company has entered and corresponding amounts of revenue recognized during the current and prior year periods.

Cost of sales — Cost of sales consist of costs associated with the manufacture of YUTIQ® and DEXYCU®, certain period costs for DEXYCU® product revenue, product shipping, and as applicable, royalty expense. The inventory costs for YUTIQ® include purchases of various components, the active pharmaceutical ingredient (API), and direct labor and overhead for the product manufactured in the Company’s Watertown, Massachusetts facility. The inventory costs for DEXYCU® include purchased components, the API and third-party manufacturing, and assembly.

For the three and nine months ended September 30, 2024 and 2023, DEXYCU® product revenue-based royalty expense as a component of cost of sales was immaterial.

Recently Adopted and Recently Issued Accounting Pronouncements

In November 2023, the FASB issued ASU 2023-07—Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. This ASU was issued to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. This ASU applies to all public entities that are required to report segment information in accordance with Topic 280, Segment Reporting. ASU 2023-07 is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted and the standard should be applied retrospectively. ASU 2023-07 will be effective for the Company for the annual period of its fiscal year ending December 31, 2024. The Company does not anticipate the adoption of this ASU will have a material impact on its consolidated financial statement disclosures.

In December 2023, the FASB issued ASU 2023-09—Income Taxes (Topic 740): Improvements to Income Tax Disclosures. This ASU was issued to address investor requests for more transparency about income tax information through improvements to income tax disclosure primarily related to the rate reconciliation and income taxes paid information, and to improve the effectiveness of income tax disclosures. This ASU is effective for public entities for annual periods beginning after December 15, 2024. Early adoption is permitted. ASU 2023-09 will be effective for the Company in the first quarter of its fiscal year ending December 31, 2025. The Company is currently evaluating the impact the adoption of this ASU will have on its consolidated financial statement disclosures.

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Revenue

9 Months Ended

Sep. 30, 2024

Revenue from Contract with Customer [Abstract]

Revenue

3.Revenue

Product Revenue Reserves and Allowances

From January 1, 2023 through May 17, 2023 (the date the Company entered into the product rights agreement (PRA) with ANI (formerly Alimera), pursuant to which the Company granted an exclusive license and rights to its YUTIQ® (fluocinolone acetonide intravitreal implant) 0.18 mg (YUTIQ®) product to ANI, the Company’s product revenues were primarily from sales of YUTIQ® in the U.S.

For the three and nine months ended September 30, 2024, the Company’s product revenues were primarily from the Company’s existing commercial supply agreements with ANI and Ocumension. For the three and nine months ended September 30, 2024, the Company’s product revenues were made up of $0.7 million and $2.4 million, respectively, from the sales of YUTIQ®. For the three and nine months ended September 30, 2023, the Company’s product revenues were made up of $0.8 million and $13.4 million, respectively, from the sales of YUTIQ®. Sales of DEXYCU® for the three and nine months ended September 30, 2024 and 2023 were immaterial.

The following table summarizes activity in each of the product revenue allowance and reserve categories for the nine months ended September 30, 2024 and 2023 (in thousands):

	Chargebacks, Discounts			Government and Other
	and Fees			Rebates			Returns			Total
Beginning balance at January 1, 2024	$	83		$	—		$	677		$	760
Provision related to sales in the current year		—			—			—			—
Adjustments related to prior period sales		70			—			—			70
Deductions applied and payments made		(148	)		—			(403	)		(551	)
Ending Balance at September 30, 2024	$	5		$	—		$	274		$	279
	Chargebacks, Discounts			Government and Other
	and Fees			Rebates			Returns			Total
Beginning balance at January 1, 2023	$	859		$	158		$	871		$	1,888
Provision related to sales in the current year		1,561			—			—			1,561
Adjustments related to prior period sales		40			(55	)		(154	)		(169	)
Deductions applied and payments made		(2,279	)		(103	)		(156	)		(2,538	)
Ending Balance at September 30, 2023	$	181		$	—		$	561		$	742

Chargebacks, discounts and fees and rebates are recorded as a component of accrued expenses on the condensed consolidated balance sheets (See Note 6).

License and Collaboration Agreements and Royalty Income

Eyebiotech Limited

On May 17, 2024, the Company entered into a license agreement (the Eyebio License Agreement) with Eyebiotech Limited (Eyebio). Under this agreement, the Company granted Eyebio a non-exclusive, sublicensable, assignable license to certain patent rights to make, have made, use, offer to sell, sell, import, and export licensed products for therapeutic ophthalmological uses worldwide.

In consideration for the rights granted, Eyebio made a one-time upfront payment of $0.5 million to the Company upon execution of the Eyebio License Agreement. Additionally, Eyebio agreed to pay certain milestone payments and tiered royalties based on the achievement of development and regulatory milestones and the annual net sales of licensed products, respectively.

The Company classified the cash proceeds of the $0.5 million upfront payment received from Eyebio as license and collaboration revenue upon the execution of the Eyebio License Agreement, as this was the only performance obligation identified. This amount is not an advance payment for the provision of future goods or services and is included in the current transaction price. The non-exclusive, sublicensable, assignable license is a functional, right-to-use license, and, therefore, any consideration associated with it is recognized at a point in time.

During the nine months ended September 30, 2024, the Company recorded $0.5 million in license and collaboration revenue related to the upfront payment.

On July 12, 2024, Merck & Co., Inc. announced the completion of the acquisition of Eyebio. Eyebio is now a wholly-owned subsidiary of Merck & Co., Inc. The acquisition does not materially impact the terms of the Eyebio License Agreement.

ANI Product Rights Agreement and Commercial Supply Agreement

On May 17, 2023 (the Closing Date), the Company entered into a PRA with ANI (formerly Alimera). Under the PRA, the Company granted to ANI an exclusive and sublicensable right and license (the License) under the Company’s and its affiliates’ interest in certain of the Company’s and its affiliates’ intellectual property to develop, manufacture, sell, commercialize, and otherwise exploit certain products, including YUTIQ®, for the treatment and prevention of uveitis in the entire world except Europe, the Middle East and Africa (EMEA).

Additionally, pursuant to the PRA, the Company transferred and assigned to ANI certain assets (the Transferred Assets) and certain contracts with third parties related to YUTIQ®, including the new drug application for YUTIQ® (collectively, the Asset

Transfer). Pursuant to the PRA, ANI paid the Company a $75.0 million upfront payment. ANI will also make four quarterly payments of $1.875 million to the Company totaling $7.5 million during 2024. ANI will also pay royalties to the Company from 2025 to 2028 at a percentage of low-to-mid double digits of ANI’s related U.S. annual net sales of certain products (including YUTIQ®) in excess of certain thresholds, beginning at $70 million in 2025, and increasing annually thereafter. Upon ANI’s payment of the Upfront Payment and the 2024 quarterly payments, the licenses and rights granted to ANI will automatically become perpetual and irrevocable. Payments received from ANI are non-refundable.

On the Closing Date, the Company and ANI also entered into a commercial supply agreement (CSA), pursuant to which, during the term of the PRA, the Company agreed to manufacture and exclusively supply to ANI agreed-upon quantities of YUTIQ® necessary for ANI to commercialize YUTIQ® in the United States at certain cost plus amounts, subject to adjustments and potential extensions and terminations set forth in the CSA (the Supply Transaction and together with the License and the Asset Transfer, the Transaction).

The Company classified the cash proceeds of the $75.0 million Upfront Payment received from ANI as deferred revenue at the Closing Date, pursuant to the PRA and the CSA because the License and supply units to be delivered under both agreements comprise a single, combined performance obligation as ANI will not have the right or ability to manufacture YUTIQ® (or have YUTIQ® manufactured by a third-party contract manufacturing organization) over the initial two-year term pursuant to the CSA. The combined performance obligation is satisfied over time using the units delivered output method to measure progress based on initial estimated supply units of YUTIQ® over the two-year term for purposes of recognizing revenue, such that revenue is recognized based on the value transferred in the form of units of product in the satisfaction of a performance obligation. Through this method, the Company compares the actual units delivered to date with the current estimated total to be delivered in the contractual term to measure the satisfaction of the performance obligation and recognize revenue. The Company will monitor its estimate of total units to be delivered to determine if an adjustment is needed to ensure that revenue is recognized proportionally for units delivered to date relative to the total units expected to be delivered for the combined performance obligation. Such estimates of the total delivery will be reassessed on an ongoing basis. If the Company determines that a change in estimate is necessary, it will adjust revenue using a cumulative catch-up method.

Revenue from sales of product supply to ANI under the CSA was $0.7 million and $1.9 million during the three and nine months ended September 30, 2024, respectively, and $1.0 million and $1.2 million during the three and nine months ended September 30, 2023, respectively. License and Collaboration revenue related to the PRA was $9.4 million and $26.8 million during the three and nine months ended September 30, 2024, respectively and $13.6 million and $16.8 million during the three and nine months ended September 30, 2023, respectively. License and collaboration revenue, related to additional transitional services was $0.2 million and $0.5 million for the three and nine months ended September 30, 2024, respectively and $0.4 million and $0.8 million during the three and nine months ended September 30, 2023, respectively. As of September 30, 2024, the Company had $24.3 million and $0 as current and non-current deferred revenue recognized under the PRA.

SWK Royalty Purchase Agreement

Pursuant to a royalty purchase agreement (RPA) with SWK Funding LLC (SWK), the Company sold its right to receive royalty payments on future sales of products subject to a licensing and development agreement, as amended, with ANI (the Amended ANI Agreement) for an upfront cash payment of $16.5 million. The Company classified the proceeds received from SWK as deferred revenue at inception of the RPA and is recognizing revenue as royalty payments are made from ANI to SWK. The Company recognized $0.3 million and $0.9 million of royalty revenue related to the RPA for the three and nine months ended September 30, 2024, respectively, and $0.3 million and $0.7 million of royalty revenue related to the RPA for the three and nine months ended September 30, 2023, respectively. As of September 30, 2024, the Company had $1.7 million and $11.2 million as current and non-current deferred revenue recognized under the RPA, respectively. As of December 31, 2023, the Company classified $1.4 million and $12.4 million as current and non-current deferred revenue recognized under the RPA, respectively.

Ocumension Therapeutics

Pursuant to license agreements and Memorandum of Understanding signed with the Company, Ocumension has:

•An exclusive license for the development and commercialization of its three-year micro insert using the Durasert technology for the treatment of posterior segment uveitis of the eye (YUTIQ® in the U.S.) in Mainland China, Hong Kong, Macau, and Taiwan at its own cost and expense in return for royalties based on sales with the Company supplying products for clinical trials and commercial sale;

•An exclusive license for the development and commercialization in Mainland China, Hong Kong, Macau, and Taiwan of DEXYCU® for the treatment of post-operative inflammation following ocular surgery at its own cost and expense in return for royalties based on sales with the Company supplying product for clinical trials and commercial sale; and

•Exclusive rights to develop and commercialize YUTIQ® and DEXYCU® products under its own brand names in South Korea and other jurisdictions across Southeast Asia in Brunei, Burma (Myanmar), Cambodia, Timor-Leste, Indonesia, Laos, Malaysia, the Philippines, Singapore, Thailand, and Vietnam (the Territory), at its own cost and expense in return for royalties based on sales with the Company supplying product for clinical trials and commercial sale.

•The right and obligation to manufacture YUTIQ®, either by itself or through affiliates or sub-contractors, for sale and use in the Territory following completion of a technology and know-how transfer from the Company to Ocumension.

During the nine months ended September 30, 2024 and 2023, the Company recognized $0.5 million of revenue from sales of product supply to Ocumension under the supply agreement and recorded this amount in product sales, net on the condensed consolidated statements of operations and comprehensive loss. No amounts were recorded during the three months ended September 30, 2024 and 2023 from sales of product supply to Ocumension under the supply agreement. Royalty income of $0 and $0.5 million was recorded for the three and nine months ended September 30, 2024. No royalty income was recorded for the three and nine months ended September 30, 2023. License and collaboration revenue related to additional technical assistance during the three and nine months ended September 30, 2024 and 2023 was immaterial.

Exclusive License Agreement with Betta Pharmaceuticals, Co., Ltd.

On May 2, 2022, the Company entered into an exclusive license agreement (the Betta License Agreement) with Betta Pharmaceuticals Co., Ltd. (Betta), an affiliate of Equinox Sciences, LLC (Equinox) (see Note 10). Under the Betta License Agreement, the Company granted to Betta an exclusive, sublicensable, royalty-bearing license under certain of the Company’s intellectual property to develop, use (but not make or have made), sell, offer for sale, and import the Company’s product candidate, DURAVYU™, an investigational sustained delivery treatment for anti-VEGF-mediated retinal diseases combining vorolanib, a selective and patent-protected tyrosine kinase inhibitor (TKI) with Durasert E™ (the Licensed Product), in the field of ophthalmology (the Betta Field) in the greater area of China, including China, the Hong Kong Special Administrative Region, the Macau Special Administrative Region, and Taiwan (the Betta Territory). The Company retained rights under the Company’s intellectual property to, among other things, conduct clinical trials on the Licensed Product in the Betta Field in the Betta Territory.

In consideration for the rights granted by the Company, Betta agreed to pay the Company tiered, mid-to-high single-digit royalties based upon annual net sales of Licensed Products in the Betta Territory. The royalties are payable on a Licensed Product-by-Licensed Product and region-by-region basis commencing on the first commercial sale of a Licensed Product in a region and continuing until the later of (i) the date that is twelve (12) years after first commercial sale of such Licensed Product in such region, and (ii) the first day of the month following the month in which a generic product corresponding to such Licensed Product is launched in the relevant region. The royalty rate is subject to reduction under certain circumstances, including when there is no valid claim of a licensed patent that covers a Licensed Product in a particular region.

Betta is responsible for all costs relating to development, registration, manufacturing, marketing, advertising, promotional, launch, and sales activities in connection with the Licensed Products in the Betta Field in the Betta Territory. Betta is required to use commercially reasonable efforts to develop, seek regulatory approval for, and commercialize at least one Licensed Product in the Betta Field in the Betta Territory. The Betta License Agreement also requires Betta to achieve certain diligence milestones relating to regulatory filings, patient dosing, and regulatory approval by certain specified deadlines set forth in the Betta License Agreement, subject to certain exceptions and extensions as set forth in the Betta License Agreement. Betta’s development activities will be conducted pursuant to a development plan subject to periodic updates. In the event that the Company conducts a global registrational clinical trial for a Licensed Product in the Betta Field, Betta will have the right to participate in such clinical trial by including clinical trial sites in the Betta Territory in accordance with the terms of the Betta License Agreement. The Company has also agreed to provide certain technology transfer and other support services to Betta subject to certain conditions and limitations set forth in the Betta License Agreement.

Revenue from license and collaboration revenue or royalty income for the three and nine months ended September 30, 2024 and 2023 related to this agreement was immaterial.

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Prepaid Expenses and Other Current Assets

9 Months Ended

Sep. 30, 2024

Prepaid Expense and Other Assets, Current [Abstract]

Prepaid Expenses and Other Current Assets

4.Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consisted of the following (in thousands):

	September 30, 2024		December 31, 2023
Prepaid expenses	$	2,441	$	1,695
Prepaid clinical		7,832		6,335
Other		1,298		1,009
Total prepaid expenses and other current assets	$	11,571	$	9,039

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Inventory

9 Months Ended

Sep. 30, 2024

Inventory Disclosure [Abstract]

Inventory

5.Inventory

Inventory consisted of the following (in thousands):

	September 30, 2024		December 31, 2023
Raw materials	$	1,496	$	1,303
Work in process		649		882
Finished goods		662		1,721
Total inventory	$	2,807	$	3,906

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Accrued Expenses

9 Months Ended

Sep. 30, 2024

Payables and Accruals [Abstract]

Accrued Expenses

6.Accrued Expenses

Accrued expenses consisted of the following (in thousands):

	September 30,		December 31,
	2024		2023
Personnel costs	$	8,910	$	12,631
Clinical trial costs		3,861		3,305
Professional fees		682		666
Sales chargebacks, rebates and other revenue reserves		279		760
Other		434		159
Total accrued expenses	$	14,166	$	17,521

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Leases

9 Months Ended

Sep. 30, 2024

Leases [Abstract]

Leases

7.Leases

On January 23, 2023, the Company entered into a lease agreement (Northbridge Lease) for its new standalone commercial manufacturing facility, including office and lab space located at 600 Commerce Drive, Northbridge, Massachusetts. The new 41,141 square-foot manufacturing facility will be Current Good Manufacturing Practice (cGMP) compliant to meet U.S. FDA and European Medicines Agency (EMA) standards and will support DURAVYU™ clinical supply and commercial readiness upon regulatory approval. In addition, the building will have the capacity and capabilities for pipeline expansion. The lease includes a non-cancellable lease term of fifteen years and four months, with two options to extend the lease term for two additional terms of either five years or ten years at 95% of the then-prevailing fair market rent. The lease term, under ASC 842, commenced during the second quarter of 2024. The Company entered into an amendment to the Northbridge Lease, effective September 30, 2024. Pursuant to the amendment, the Company's obligation to pay base rent will begin March 1, 2025. The Company is responsible for real estate taxes, maintenance, and other operating expenses applicable to the leased premises. The Company recognized an initial increase of $17.7 million to its lease liabilities and $17.9 million to its right-of-use (ROU) assets resulting from the Northbridge Lease during the second quarter of 2024.

Since the Company elected to account for each lease component and its associated non-lease components as a single combined component, all contract consideration was allocated to the respective lease components. The expected lease terms include non-cancellable lease periods. Renewal option periods have not been included in the determination of the lease terms as they are not deemed reasonably certain of exercise. Variable lease payments, such as common area maintenance, real estate taxes, and property insurance are not included in the determination of the lease’s ROU asset or lease liability.

As of September 30, 2024 the weighted average remaining term of the Company’s operating leases was 12.4 years and the weighted average discount rate was 11.6%.

Supplemental balance sheet information related to operating leases as of September 30, 2024 and December 31, 2023 are as follows (in thousands):

	September 30,		December 31,
	2024		2023
Other current liabilities – operating lease current portion	$	1,188	$	563
Operating lease liabilities – noncurrent portion		21,922		4,906
Total operating lease liabilities	$	23,110	$	5,469

The elements of lease expense were as follows (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
Lease expense included in:
Research and development	$	965	$	291	$	1,774	$	873
General and administrative		65		65		195		194
Variable lease costs		60		47		195		106
Total lease expense	$	1,090	$	403	$	2,164	$	1,173

Cash paid for amounts included in the measurement of operating lease liabilities was $0.5 million and $0.6 million for the nine months ended September 30, 2024 and 2023.

The Company’s total future minimum lease payments under non-cancellable leases at September 30, 2024 were as follows (in thousands):

	Operating Leases
Remainder of 2024	$	630
2025		3,585
2026		4,133
2027		4,222
2028		3,319
Thereafter		31,860
Total lease payments	$	47,749
Less imputed interest		(24,639	)
Total	$	23,110

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Stockholders' Equity

9 Months Ended

Sep. 30, 2024

Equity [Abstract]

Stockholders' Equity

8.Stockholders’ Equity

ATM Facility

In August 2020, the Company entered into an at-the-market facility (the ATM Facility) with Cantor Fitzgerald & Co (Cantor). Pursuant to the ATM Facility, the Company may, at its option, offer and sell shares of its common stock from time to time, through or to Cantor, acting as sales agent. The Company will pay Cantor a commission of 3.0% of the gross proceeds from any future sales of such shares.

During the three and nine months ended September 30, 2024, the Company sold 1,299,506 shares of its common stock under the ATM facility at a weighted average price of $9.36 per share for gross proceeds of approximately $12.2 million. Share issue costs, including sales agent commissions, totaled approximately $0.4 million.

Warrants to Purchase Common Shares

Pursuant to a credit agreement, the Company issued a warrant to SWK to purchase (i) 40,910 shares of the Company’s common stock on March 28, 2018 at an exercise price of $11.00 per share with a seven-year term and (ii) 7,773 shares of the Company’s common stock on June 26, 2018 at an exercise price of $19.30 per share with a seven-year term.

In January 2024, SWK exercised their warrants in full via cashless exercise resulting in the net share issuance of 25,666 shares.

The Company issued 3,272,727 shares of Pre-Funded Warrants (PFW) to purchase common stock, in connection with the November 2021 underwritten public offering. On April 18, 2024, 2,181,818 PFWs were exercised in full as a cashless exercise, resulting in a net issuance of 2,180,776 shares of common stock.

As of September 30, 2024, 1,090,909 PFWs were outstanding. The PFWs were included in the basic and diluted net loss per share calculation during the three and nine months ended September 30, 2024.

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Share-Based Payment Awards

9 Months Ended

Sep. 30, 2024

Share-Based Payment Arrangement [Abstract]

Share-Based Payment Awards

9.Share-Based Payment Awards

Equity Incentive Plan

Prior to June 20, 2024, the Company had authorized the issuance of 9,400,000 shares of the Company’s common stock under the 2016 Long-Term Incentive Plan (the 2016 Plan), of which 373,256 shares remained available for future grants.

The 2023 Long-Term Incentive Plan (the “2023 Plan”), approved by the Company’s stockholders on June 20, 2023 (the “Adoption Date”), originally provided for the issuance of up to 3,500,000 shares of the Company’s common stock reserved for issuance under the 2023 Plan plus any additional shares of the Company’s common stock that were available for grant under the 2008 and the 2016 Incentive Plan (the “2008 & 2016 Plan”) at the Adoption Date or would otherwise become available for grant under the 2008 Plan as a result of subsequent termination or forfeiture of awards under the 2008 or 2016 Plan. At the Company’s Annual Meeting of Stockholders held on June 20, 2024, the Company’s stockholders approved an amendment to the 2023 Plan to increase the number of shares authorized for issuance by 4,000,000 shares. At September 30, 2024, a total of approximately 4,311,535 shares were available for new awards under the 2023 Plan.

Starting March 2022, the Company granted non-statutory stock options to new employees as inducement awards to enter into employment with the Company. The grants were approved by the Compensation Committee of the Board of Directors and awarded in accordance with Nasdaq Listing Rule 5635(c)(4). Although not awarded under any equity incentive plans, the grants are subject to and governed by the terms and conditions of the applicable plan in effect at the time of the grant.

Stock Options

The following table provides a reconciliation of stock option activity under the Company’s equity incentive plan and for inducement awards for the nine months ended September 30, 2024:

	Number of Options			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life		Aggregate Intrinsic Value
						(in years)		(in thousands)
Outstanding at January 1, 2024		6,304,767		$	9.98
Granted		2,248,252			18.71
Exercised		(535,932	)		9.27
Forfeited		(254,198	)		9.72
Expired		(63,356	)		24.37
Outstanding at September 30, 2024		7,699,533		$	12.47		7.54	$	8,973
Exercisable at September 30, 2024		3,531,549		$	11.89		6.08	$	4,268

The Company's stock options generally vest over four years with 25% vesting after one year of service followed by ratable monthly vesting over the remaining three years. Nonemployee awards are granted similar to the Company’s employee awards. All option grants have a 10-year term. Options to purchase a total of 1,836,170 shares of the Company’s common stock vested during the nine months ended September 30, 2024.

In determining the grant date fair value of option awards during the nine months ended September 30, 2024, the Company applied the Black-Scholes option pricing model based on the following key assumptions:

Option life (in years)	5.50 - 6.08
Stock volatility	97% - 100%
Risk-free interest rate	3.45% - 4.60%
Expected dividends	0.0%

The following table summarizes information about employee, non-executive director and external consultant stock options for the nine months ended September 30, 2024 (in thousands except per share amount):

	Nine Months
	Ended
	September 30, 2024
Weighted average grant date fair value per share	$	14.90
Total cash received from exercise of stock options		4,966
Total intrinsic value of stock options exercised		7,355

Time-Vested Restricted Stock Units

Time-vested restricted stock units (RSUs) issued to date under the 2016 Plan and the 2023 Plan generally vest on a ratable annual basis over 3 years. The related stock-based compensation expense is recorded over the requisite service period, which is the vesting period. The fair value of all time-vested RSUs is based on the closing share price of the Company’s common stock on the date of grant.

The following table provides a reconciliation of RSU activity under the 2016 Plan and the 2023 Plan for the nine months ended September 30, 2024:

	Number of Restricted Stock Units			Weighted Average Grant Date Fair Value
Nonvested at January 1, 2024		1,333,192		$	5.31
Granted		670,120			19.81
Vested		(591,277	)		6.39
Forfeited		(80,672	)		10.64
Nonvested at September 30, 2024		1,331,363		$	11.81

At September 30, 2024, the weighted average remaining vesting term of the RSUs was 1.5 years.

Employee Stock Purchase Plan

The Company’s Employee Stock Purchase Plan (the ESPP) allows qualified participants to purchase the Company’s common stock twice a year at 85% of the lesser of the average of the high and low sales price of the Company’s common stock on (i) the first trading day of the relevant offering period and (ii) the last trading day of the relevant offering period. The number of shares of the Company’s common stock each employee may purchase under this plan, when combined with all other employee stock purchase plans, is limited to the lower of an aggregate fair market value of $25,000 during each calendar year, or 5,000 shares of the Company’s common stock in any one offering period. The Company has maintained consecutive six-month offering periods since August 1, 2019. During the three and nine months ended September 30, 2024, 24,881 and 49,896 shares of the Company’s common stock were issued pursuant to the ESPP.

The Company estimated the fair value of the option component of the ESPP shares at the date of grant using a Black-Scholes valuation model. During the three and nine months ended September 30, 2024, the compensation expense from ESPP shares was approximately $0.1 million and $0.2 million. During the three and nine months ended September 30, 2023, the compensation expense from ESPP shares was immaterial.

Stock-Based Compensation Expense

The Company’s condensed consolidated statements of comprehensive loss included total compensation expense from stock-based payment awards as follows (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
Compensation expense included in:
Research and development	$	3,382	$	1,263	$	14,820	$	3,405
Sales and marketing		—		60		—		290
General and administrative		4,064		2,306		14,020		4,772
	$	7,446	$	3,629	$	28,840	$	8,467

During the three and nine months ended September 30, 2024, the Company modified certain stock options and restricted stock awards in connection with the resignation of board members and terminations of executives resulting in a reduction of expense of $0.5 million and incremental expense of $5.2 million, respectively.

At September 30, 2024, there was approximately $30.2 million of unrecognized compensation expense related to outstanding equity awards under the 2023 Plan, the 2016 Plan, the inducement awards and the ESPP that is expected to be recognized as expense over a weighted average period of approximately 1.7 years.

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License and Asset Purchase Agreements

9 Months Ended

Sep. 30, 2024

Organization, Consolidation and Presentation of Financial Statements [Abstract]

License and Asset Purchase Agreements

10.License and Asset Purchase Agreements

Equinox Science, LLC

In February 2020, the Company entered into an Exclusive License Agreement (the Equinox License Agreement) with Equinox, pursuant to which Equinox granted the Company an exclusive, sublicensable, royalty-bearing right and license to certain patents and other Equinox intellectual property to research, develop, make, have made, use, sell, offer for sale, and import the compound vorolanib and any pharmaceutical products comprising the compound for local delivery to the eye for the prevention or treatment of age-related macular degeneration, diabetic retinopathy, and retinal vein occlusion using the Company’s proprietary localized delivery technologies (the Original Field), in each case, throughout the world except China, Hong Kong, Taiwan, and Macau (the Company Territory).

In consideration for the rights granted by Equinox, the Company (i) made a one time, non-refundable, non-creditable upfront cash payment of $1.0 million to Equinox in February 2020, and (ii) agreed to pay milestone payments totaling up to $50 million upon the achievement of certain development and regulatory milestones, consisting of (a) completion of a Phase 2 clinical trial for the compound or a licensed product, (b) the filing of a new drug application or foreign equivalent for the compound or a licensed product in the United States, European Union, or United Kingdom, and (c) regulatory approval of the compound or a licensed product in the United States, European Union or United Kingdom.

The Company also agreed to pay Equinox tiered royalties based upon annual net sales of licensed products in the Company Territory. The royalties are payable with respect to a licensed product in a particular country in the Company Territory on a country-by-country and licensed product-by-licensed product basis until the later of (i) twelve years after the first commercial sale of such licensed product in such country and (ii) the first day of the month following the month in which a generic product corresponding to such licensed product is launched in such country. The royalty rates range from the high-single digits to low-double digits depending on the level of annual net sales. The royalty rates are subject to reduction during certain periods when there is no valid patent claim that covers a licensed product in a particular country.

On May 2, 2022, concurrent with the Company entering into the Betta License Agreement (see Note 3), the Company entered into Amendment #1 to the Equinox License Agreement, pursuant to which the Original Field was expanded to cover the prevention or treatment of ophthalmology indications using the Company’s proprietary localized delivery technologies and certain conforming changes were made to the Equinox License Agreement in connection therewith.

For the three and nine months ended September 30, 2024, the Company recorded $0 and $5.0 million of R&D expenses in connection with the milestone payment for completion of a Phase 2 clinical trial for the compound or a licensed product under the Equinox License Agreement. No R&D expense was recorded for the three and nine months ended September 30, 2023 related to the Equinox License Agreement.

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Fair Value Measurements

9 Months Ended

Sep. 30, 2024

Fair Value Disclosures [Abstract]

Fair Value Measurements

11.Fair Value Measurements

The following tables summarize the Company’s assets by significant categories carried at fair value measured on a recurring basis by valuation hierarchy (in thousands):

	September 30, 2024
	Carrying Value		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value		Cash Equivalents		Marketable Securities
Level 1:
Money market funds	$	64,612	$	—	$	—	$	64,612	$	64,612	$	—
Subtotal	$	64,612	$	—	$	—	$	64,612	$	64,612	$	—
Level 2:
Commercial paper	$	53,009	$	22	$	—	$	53,031	$	4,949	$	48,082
U.S. Treasury securities	$	57,886	$	169	$	—	$	58,055	$	—	$	58,055
U.S. Agency securities	$	67,686	$	140	$	—	$	67,826	$	—	$	67,826
Subtotal	$	178,581	$	331	$	—	$	178,912	$	4,949	$	173,963
Total	$	243,193	$	331	$	—	$	243,524	$	69,561	$	173,963

	December 31, 2023
	Carrying Value		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value		Cash Equivalents		Marketable Securities
Level 1:
Money market funds	$	270,476	$	—	$	—		$	270,476	$	270,476	$	—
Subtotal	$	270,476	$	—	$	—		$	270,476	$	270,476	$	—
Level 2:
Commercial paper	$	19,295	$	8	$	—		$	19,303	$	1,998	$	17,305
U.S. Treasury securities		17,762		8		—			17,771		2,990		14,781
U.S. Agency securities		17,694		8		(1	)		17,701		—		17,701
Subtotal	$	54,751	$	24	$	(1	)	$	54,775	$	4,988	$	49,787
Total	$	325,227	$	24	$	(1	)	$	325,251	$	275,464	$	49,787

At September 30, 2024 and December 31, 2023, a total of $64.6 million or 92.9%, and a total of $270.5 million or 98.2%, respectively, of the Company’s interest-bearing cash equivalent balances were concentrated in one institutional money market fund that has investments consisting primarily of Repurchase Agreements, U.S Treasuries, and U.S. Government Agency Debts. The Company had $4.9 million or 7.1%, and a total $5.0 million or 1.8% of the Company's interest-bearing cash equivalent balance which consisted of investment-grade Commercial paper and investment-grade U.S. Treasury securities at September 30, 2024, and December 31, 2023, respectively. Generally, these deposits may be redeemed upon demand and, therefore, the Company believes they have minimal risk.

The Company’s cash equivalents and marketable securities are classified within Level 1 or Level 2 on the basis of valuations using quoted market prices or alternative pricing sources and models utilizing market observable inputs, respectively. The marketable securities have been valued on the basis of valuations provided by third-party pricing services, as derived from such services’ pricing models. Inputs to the models may include, but are not limited to, reported trades, executable bid and ask prices, broker/dealer quotations, prices, or yields of securities with similar characteristics, benchmark curves, or information pertaining to the issuer, as well as industry and economic events. The pricing services may use a matrix approach, which considers information regarding securities with similar characteristics to determine the valuation for a security, and have been classified as Level 2.

The carrying amounts of accounts receivable, accounts payable, and accrued expenses approximate fair value because of their short-term maturity.

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Contingencies

9 Months Ended

Sep. 30, 2024

Commitments and Contingencies Disclosure [Abstract]

Contingencies

12.Contingencies

Legal Proceedings

The Company is subject to various routine legal proceedings and claims incidental to its business, which management believes will not have a material effect on the Company’s financial position, results of operations or cash flows.

U.S. Department of Justice Subpoena

In August 2022, the Company received a subpoena from the U.S. Attorney’s Office for the District of Massachusetts seeking production of documents related to sales, marketing, and promotional practices, including as pertain to DEXYCU® (DOJ Investigation). The Company is cooperating fully with the government in connection with this matter. At this time, the Company is unable to predict the duration, scope or outcome of this matter or whether it could have a material impact on the Company's financial condition, results of operations, or cash flow.

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Net Loss per Share

9 Months Ended

Sep. 30, 2024

Earnings Per Share [Abstract]

Net Loss per Share

13.Net Loss per Share

Basic net loss per share is computed by dividing the net loss by the weighted average number of common shares outstanding during the period. For periods in which the Company reports net income, diluted net income per share is determined by adding to the basic weighted average number of common shares outstanding the total number of dilutive common equivalent shares using the treasury stock method, unless the effect is anti-dilutive. Potentially dilutive shares were not included in the calculation of diluted net loss per share for each of the three and nine months ended September 30, 2024 and 2023 as their inclusion would be anti-dilutive.

Potential common stock equivalents excluded from the calculation of diluted earnings per share because the effect would have been anti-dilutive were as follows:

	As of September 30,
	2024		2023
Stock options		7,699,533		6,340,662
ESPP		18,031		8,522
Warrants		—		48,683
Restricted stock units		1,331,363		1,333,742
		9,048,927		7,731,609

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Related Party Transactions

9 Months Ended

Sep. 30, 2024

Related Party Transactions [Abstract]

Related Party Transactions

14.Related Party Transactions

On May 17, 2024, the Company executed the Eyebio License Agreement with Eyebio. The Chief Executive Officer (David Guyer) and Chief Scientific Officer (Anthony Adamis) of Eyebio were members of the Company’s board of directors when the agreement was executed. During the nine months ended September 30, 2024, the Company recorded $0.5 million in license and collaboration revenue in connection with the upfront payment pursuant to the Eyebio License Agreement. On September 3, 2024, Anthony P. Adamis, M.D. and David Guyer, M.D. resigned from their positions as directors on the Company’s Board due to their transition to full-time roles at Merck & Co.

On December 18, 2023, the Company entered into a consulting agreement with Dr. John Landis who also serves as the Company's Chair of the Science Committee and a member of the board of directors. Pursuant to the terms of the consulting agreement, Dr. Landis was entitled to receive an annual compensation payment of up to $0.6 million in exchange for performing certain research and development services as the Company's interim head of development. On January 5, 2024, pursuant to the consulting agreement, the Company granted Dr. Landis (i) stock options to purchase 20,000 shares of the Company’s common stock and (ii) 10,000 of restricted stock units. All equity grants to Dr. Landis vest after one year. He also received the Board stock option award to purchase 25,014 shares of the Company’s common stock. The compensation expense related to the consulting agreement recognized by the Company for the three and nine months ended September 30, 2024, was $0 million and $0.4 million, respectively. Additionally, the Company recorded accounts payable of $0 in the accompanying consolidated balance sheets related to services provided by Dr. Landis, as of September 30, 2024. Services under this agreement concluded during the second quarter of 2024.

Nancy S. Lurker, the former Chief Executive Officer and Executive Vice Chair of the Company and current Vice Chair of the Board is a member of the board of directors of Altasciences, the parent company of Calvert Laboratories, Inc. (Calvert Labs), an entity with which the Company conducts business. The Company recorded $0.3 million and $1.2 million of research and development expense in the accompanying condensed consolidated statements of operations and comprehensive loss related to preclinical and

analytical services provided by Altasciences for the three and nine months ended September 30, 2024, respectively. Additionally, the Company recorded accounts payable of $0.5 million and $0.3 million, and prepaid expenses of $0.1 million and $0.5 million in the accompanying condensed consolidated balance sheets related to services provided by Altasciences, as of September 30, 2024 and December 31, 2023, respectively.

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Subsequent Events

9 Months Ended

Sep. 30, 2024

Subsequent Events [Abstract]

Subsequent Events

15.Subsequent Events

On October 31, 2024, the Company completed an underwritten public offering with gross proceeds of $161.0 million. The Company sold 14,636,363 shares of its common stock, which included the exercise in full by the underwriters of their option to purchase an additional 1,909,090 shares of common stock. The shares of common stock were sold at a public offering price of $11.00 per share.

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Summary of Significant Accounting Policies (Policies)

9 Months Ended

Sep. 30, 2024

Accounting Policies [Abstract]

Revenue Recognition

Revenue Recognition

Revenue is recognized when a customer obtains control of promised goods or services, in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that an entity determines are within the scope of ASC 606, Revenue from Contracts with Customers (ASC 606), the Company performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined to be within the scope of ASC 606, the Company assesses the goods or services promised within the contract, determines those that are performance obligations and assesses whether each promised good or service is distinct. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. Sales, value-add and other taxes collected on behalf of third parties are excluded from revenue.

Product sales, net — Effective January 2023, commercial sales of DEXYCU® were no longer supported by the Company, remaining available only through specialty distributors. Effective May 2023, YUTIQ® has been and continues to be sold under commercial supply agreements with Alimera Sciences, Inc. (Alimera) and Ocumension Therapeutics (Ocumension). On September 16, 2024, ANI Pharmaceuticals, Inc. (ANI) announced the completion of the acquisition of Alimera. The acquisition does not impact the terms of the commercial supply agreements (see Note 3).

Prior to the above dates, the Company sold YUTIQ® and DEXYCU® to a limited number of specialty distributors and specialty pharmacies (collectively the Distributors) in the U.S., with whom the Company had entered into formal agreements, for delivery to physician practices for YUTIQ® and to hospital outpatient departments and ambulatory surgical centers (ASCs) for DEXYCU®. The Company recognized revenue on sales of its products when Distributors obtained control of the products, which occurred at a point in time, typically upon delivery. In addition to agreements with Distributors, the Company also entered into arrangements with healthcare providers, ASCs, and payors that provided for government mandated and/or privately negotiated rebates, chargebacks, and discounts with respect to their purchase of the Company's products from Distributors.

Reserves for variable consideration — Product sales were recorded at the wholesale acquisition costs, net of applicable reserves for variable consideration. Components of variable consideration included trade discounts and allowances, provider chargebacks and discounts, payor rebates, product returns, and other allowances that were offered within contracts between the Company and its Distributors, payors, and other contracted purchasers relating to the Company's product sales. These reserves were based on the amounts earned, or to be claimed on the related sales, and were classified either as reductions of product revenue and accounts receivable or a current liability, depending on how the amount was to be settled. Overall, these reserves reflected the Company's best estimates of the amount of consideration to which it was entitled based on the terms of the respective underlying contracts. The actual amounts of consideration ultimately received may differ from the Company's estimates. If actual results in the future vary from the estimates, the Company adjusts these estimates, which would affect product revenue and earnings in the period such variances become known.

Distribution fees — The Company compensated its Distributors for services explicitly stated in the Company’s contracts and were recorded as a reduction of revenue in the period the related product sale was recognized.

Provider chargebacks and discounts — Chargebacks were discounts that represented the estimated obligations resulting from contractual commitments to sell products at prices lower than the list prices charged to the Company’s Distributors. These Distributors charged the Company for the difference between what they paid for the product and the Company’s contracted selling price. These reserves were established in the same period that the related revenue was recognized, resulting in a reduction of product revenue and the establishment of a current liability. Reserves for chargebacks consisted of amounts that the Company expected to pay for units that remained in the distribution channel inventories at each reporting period-end that the Company expected to be sold under a contracted selling price, and chargebacks that Distributors had claimed, but for which the Company had not yet settled.

Government rebates — The Company was subject to discount obligations under state Medicaid programs and Medicare. These reserves were recorded in the same period the related revenue was recognized, resulting in a reduction of product revenue and the establishment of a current liability which was included in accrued expenses and other current liabilities on the consolidated balance sheets. The Company’s liability for these rebates consisted of invoices received for claims from prior quarters that had not been paid or for which an invoice had not yet been received, estimates of claims for the current quarter, and estimated future claims that would be made for product that had been recognized as revenue, but which remained in the distribution channel inventories at the end of each reporting period.

Payor rebates — The Company contracted with certain private payor organizations, primarily insurance companies, for the payment of rebates with respect to utilization of its products. The Company estimated these rebates and recorded such estimates in the same period the related revenue was recognized, resulting in a reduction of product revenue and the establishment of a current liability.

Co-Payment assistance — The Company offered co-payment assistance to commercially insured patients meeting certain eligibility requirements. The calculation of the accrual for co-pay assistance was based on an estimate of claims and the cost per claim that the Company expected to receive associated with product that had been recognized as revenue.

Product returns — The Company generally offered a limited right of return based on its returned goods policy, which included damaged product and remaining shelf life. The Company estimated the amount of its product sales that may be returned and recorded.

License and collaboration agreement revenue — The Company analyzes each element of its license and collaboration arrangements to determine the appropriate revenue recognition. The terms of the license agreement may include payment to the Company of non-refundable upfront license fees, milestone payments if specified objectives are achieved, and/or royalties on product sales. The Company recognizes revenue from upfront payments at a point in time, typically upon fulfilling the delivery of the associated intellectual property to the customer. For licenses that are combined with other promises, the Company determines whether the combined performance obligation is satisfied over time or at a point in time, when (or as) the associated performance obligation in the contract is satisfied.

If the contract contains a single performance obligation, the entire transaction price is allocated to the single performance obligation. Contracts that contain multiple performance obligations require an allocation of the transaction price based on the estimated relative standalone selling prices of the promised products or services underlying each performance obligation. The Company determines standalone selling prices based on the price at which the performance obligation is sold separately. If the standalone selling price is not observable through past transactions, the Company estimates the standalone selling price taking into account available information such as market conditions and internally approved pricing guidelines related to the performance obligations.

The Company recognizes sales-based milestone payments as revenue upon the achievement of the cumulative sales amount specified in the contract in accordance with ASC 606-10-55-65. For those milestone payments which are contingent on the occurrence of particular future events, the Company determines that these need to be considered for inclusion in the calculation of total consideration from the contract as a component of variable consideration using the most-likely amount method. As such, the Company assesses each milestone to determine the probability and substance behind achieving each milestone. Given the inherent uncertainty associated with these future events, the Company will not recognize revenue from such milestones until there is a high probability of occurrence, which typically occurs near or upon achievement of the event.

When determining the transaction price of a contract, an adjustment is made if payment from a customer occurs either significantly before or significantly after performance, resulting in a significant financing component. Applying the practical expedient in paragraph 606-10-32-18, the Company does not assess whether a significant financing component exists if the period between when the Company performs its obligations under the contract and when the customer pays is one year or less. None of the Company’s contracts contained a significant financing component as of September 30, 2024.

Royalties — The Company recognizes revenue from license arrangements with its commercial partners’ net sales of products. Such revenues are included as royalty income. In accordance with ASC 606-10-55-65, royalties are recognized when the subsequent sale of the commercial partner’s products occurs. The Company’s commercial partners are obligated to report their net product sales and the resulting royalty due to the Company typically within 60-days from the end of each quarter. Based on historical product sales, royalty receipts and other relevant information, the Company recognizes royalty income each quarter and subsequently determines a true-up when it receives royalty reports and payment from its commercial partners. Historically, these true-up adjustments have been immaterial.

Sale of Future Royalties — The Company has sold its rights to receive certain royalties on product sales. In the circumstance where the Company has sold its rights to future royalties under a royalty purchase agreement (RPA) and also maintains limited continuing involvement in the arrangement (but not significant continuing involvement in the generation of the cash flows that are due to the purchaser), the Company defers recognition of the proceeds it receives for the sale of royalty streams and recognizes such unearned revenue as revenue under the units-of-revenue method over the life of the underlying license agreement. Under the units-of-revenue method, amortization for a reporting period is calculated by computing a ratio of the proceeds received from the purchaser to the total payments expected to be made to the purchaser over the term of the agreement, and then applying that ratio to the period’s cash payment.

Estimating the total payments expected to be received by the purchaser over the term of such arrangements requires management to use subjective estimates and assumptions. Changes to the Company’s estimate of the payments expected to be made to the purchaser over the term of such arrangements could have a material effect on the amount of revenues recognized in any particular period.

Research Collaborations — The Company recognizes revenue over the term of the statements of work under any funded research collaborations. Revenue recognition for consideration, if any, related to a license option right is assessed based on the terms of any such future license agreement or is otherwise recognized at the completion of the research collaborations.

Please refer to Note 3 for further details on the license and collaboration agreements into which the Company has entered and corresponding amounts of revenue recognized during the current and prior year periods.

Cost of sales — Cost of sales consist of costs associated with the manufacture of YUTIQ® and DEXYCU®, certain period costs for DEXYCU® product revenue, product shipping, and as applicable, royalty expense. The inventory costs for YUTIQ® include purchases of various components, the active pharmaceutical ingredient (API), and direct labor and overhead for the product manufactured in the Company’s Watertown, Massachusetts facility. The inventory costs for DEXYCU® include purchased components, the API and third-party manufacturing, and assembly.

For the three and nine months ended September 30, 2024 and 2023, DEXYCU® product revenue-based royalty expense as a component of cost of sales was immaterial.

Recently Adopted and Recently Issued Accounting Pronouncements

In November 2023, the FASB issued ASU 2023-07—Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. This ASU was issued to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. This ASU applies to all public entities that are required to report segment information in accordance with Topic 280, Segment Reporting. ASU 2023-07 is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted and the standard should be applied retrospectively. ASU 2023-07 will be effective for the Company for the annual period of its fiscal year ending December 31, 2024. The Company does not anticipate the adoption of this ASU will have a material impact on its consolidated financial statement disclosures.

In December 2023, the FASB issued ASU 2023-09—Income Taxes (Topic 740): Improvements to Income Tax Disclosures. This ASU was issued to address investor requests for more transparency about income tax information through improvements to income tax disclosure primarily related to the rate reconciliation and income taxes paid information, and to improve the effectiveness of income tax disclosures. This ASU is effective for public entities for annual periods beginning after December 15, 2024. Early adoption is permitted. ASU 2023-09 will be effective for the Company in the first quarter of its fiscal year ending December 31, 2025. The Company is currently evaluating the impact the adoption of this ASU will have on its consolidated financial statement disclosures.

Recently Adopted and Recently Issued Accounting Pronouncements

Recently Adopted and Recently Issued Accounting Pronouncements

In November 2023, the FASB issued ASU 2023-07—Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. This ASU was issued to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. This ASU applies to all public entities that are required to report segment information in accordance with Topic 280, Segment Reporting. ASU 2023-07 is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted and the standard should be applied retrospectively. ASU 2023-07 will be effective for the Company for the annual period of its fiscal year ending December 31, 2024. The Company does not anticipate the adoption of this ASU will have a material impact on its consolidated financial statement disclosures.

In December 2023, the FASB issued ASU 2023-09—Income Taxes (Topic 740): Improvements to Income Tax Disclosures. This ASU was issued to address investor requests for more transparency about income tax information through improvements to income tax disclosure primarily related to the rate reconciliation and income taxes paid information, and to improve the effectiveness of income tax disclosures. This ASU is effective for public entities for annual periods beginning after December 15, 2024. Early adoption is permitted. ASU 2023-09 will be effective for the Company in the first quarter of its fiscal year ending December 31, 2025. The Company is currently evaluating the impact the adoption of this ASU will have on its consolidated financial statement disclosures.

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Revenue (Tables)

9 Months Ended

Sep. 30, 2024

Revenue from Contract with Customer [Abstract]

Product Revenue Allowances and Reserves

The following table summarizes activity in each of the product revenue allowance and reserve categories for the nine months ended September 30, 2024 and 2023 (in thousands):

	Chargebacks, Discounts			Government and Other
	and Fees			Rebates			Returns			Total
Beginning balance at January 1, 2024	$	83		$	—		$	677		$	760
Provision related to sales in the current year		—			—			—			—
Adjustments related to prior period sales		70			—			—			70
Deductions applied and payments made		(148	)		—			(403	)		(551	)
Ending Balance at September 30, 2024	$	5		$	—		$	274		$	279
	Chargebacks, Discounts			Government and Other
	and Fees			Rebates			Returns			Total
Beginning balance at January 1, 2023	$	859		$	158		$	871		$	1,888
Provision related to sales in the current year		1,561			—			—			1,561
Adjustments related to prior period sales		40			(55	)		(154	)		(169	)
Deductions applied and payments made		(2,279	)		(103	)		(156	)		(2,538	)
Ending Balance at September 30, 2023	$	181		$	—		$	561		$	742

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Prepaid Expenses and Other Current Assets (Tables)

9 Months Ended

Sep. 30, 2024

Prepaid Expense and Other Assets, Current [Abstract]

Schedule of Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consisted of the following (in thousands):

	September 30, 2024		December 31, 2023
Prepaid expenses	$	2,441	$	1,695
Prepaid clinical		7,832		6,335
Other		1,298		1,009
Total prepaid expenses and other current assets	$	11,571	$	9,039

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Inventory (Tables)

9 Months Ended

Sep. 30, 2024

Inventory Disclosure [Abstract]

Schedule of Inventory

Inventory consisted of the following (in thousands):

	September 30, 2024		December 31, 2023
Raw materials	$	1,496	$	1,303
Work in process		649		882
Finished goods		662		1,721
Total inventory	$	2,807	$	3,906

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Accrued Expenses (Tables)

9 Months Ended

Sep. 30, 2024

Payables and Accruals [Abstract]

Schedule of Accrued Expenses

Accrued expenses consisted of the following (in thousands):

	September 30,		December 31,
	2024		2023
Personnel costs	$	8,910	$	12,631
Clinical trial costs		3,861		3,305
Professional fees		682		666
Sales chargebacks, rebates and other revenue reserves		279		760
Other		434		159
Total accrued expenses	$	14,166	$	17,521

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Leases (Tables)

9 Months Ended

Sep. 30, 2024

Leases [Abstract]

Schedule of Supplemental Balance Sheet Information Related to Operating Leases

Supplemental balance sheet information related to operating leases as of September 30, 2024 and December 31, 2023 are as follows (in thousands):

	September 30,		December 31,
	2024		2023
Other current liabilities – operating lease current portion	$	1,188	$	563
Operating lease liabilities – noncurrent portion		21,922		4,906
Total operating lease liabilities	$	23,110	$	5,469

Summary of Lease Expense

The elements of lease expense were as follows (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
Lease expense included in:
Research and development	$	965	$	291	$	1,774	$	873
General and administrative		65		65		195		194
Variable lease costs		60		47		195		106
Total lease expense	$	1,090	$	403	$	2,164	$	1,173

Schedule of Future Minimum Lease Payments Under Non-Cancellable Leases

The Company’s total future minimum lease payments under non-cancellable leases at September 30, 2024 were as follows (in thousands):

	Operating Leases
Remainder of 2024	$	630
2025		3,585
2026		4,133
2027		4,222
2028		3,319
Thereafter		31,860
Total lease payments	$	47,749
Less imputed interest		(24,639	)
Total	$	23,110

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Share-Based Payment Awards (Tables)

9 Months Ended

Sep. 30, 2024

Share-Based Payment Arrangement [Abstract]

Stock Option Activity Under Plan

The following table provides a reconciliation of stock option activity under the Company’s equity incentive plan and for inducement awards for the nine months ended September 30, 2024:

	Number of Options			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life		Aggregate Intrinsic Value
						(in years)		(in thousands)
Outstanding at January 1, 2024		6,304,767		$	9.98
Granted		2,248,252			18.71
Exercised		(535,932	)		9.27
Forfeited		(254,198	)		9.72
Expired		(63,356	)		24.37
Outstanding at September 30, 2024		7,699,533		$	12.47		7.54	$	8,973
Exercisable at September 30, 2024		3,531,549		$	11.89		6.08	$	4,268

Schedule of Key Assumptions Used

In determining the grant date fair value of option awards during the nine months ended September 30, 2024, the Company applied the Black-Scholes option pricing model based on the following key assumptions:

Option life (in years)	5.50 - 6.08
Stock volatility	97% - 100%
Risk-free interest rate	3.45% - 4.60%
Expected dividends	0.0%

Summary of Information about Stock Options

The following table summarizes information about employee, non-executive director and external consultant stock options for the nine months ended September 30, 2024 (in thousands except per share amount):

	Nine Months
	Ended
	September 30, 2024
Weighted average grant date fair value per share	$	14.90
Total cash received from exercise of stock options		4,966
Total intrinsic value of stock options exercised		7,355

Summary of Restricted Stock Unit Activity

The following table provides a reconciliation of RSU activity under the 2016 Plan and the 2023 Plan for the nine months ended September 30, 2024:

	Number of Restricted Stock Units			Weighted Average Grant Date Fair Value
Nonvested at January 1, 2024		1,333,192		$	5.31
Granted		670,120			19.81
Vested		(591,277	)		6.39
Forfeited		(80,672	)		10.64
Nonvested at September 30, 2024		1,331,363		$	11.81

Compensation Expense from Stock-Based Payment Awards

The Company’s condensed consolidated statements of comprehensive loss included total compensation expense from stock-based payment awards as follows (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
Compensation expense included in:
Research and development	$	3,382	$	1,263	$	14,820	$	3,405
Sales and marketing		—		60		—		290
General and administrative		4,064		2,306		14,020		4,772
	$	7,446	$	3,629	$	28,840	$	8,467

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Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2024

Fair Value Disclosures [Abstract]

Assets and Liabilities Carried at Fair Value Measured on Recurring Basis

The following tables summarize the Company’s assets by significant categories carried at fair value measured on a recurring basis by valuation hierarchy (in thousands):

	September 30, 2024
	Carrying Value		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value		Cash Equivalents		Marketable Securities
Level 1:
Money market funds	$	64,612	$	—	$	—	$	64,612	$	64,612	$	—
Subtotal	$	64,612	$	—	$	—	$	64,612	$	64,612	$	—
Level 2:
Commercial paper	$	53,009	$	22	$	—	$	53,031	$	4,949	$	48,082
U.S. Treasury securities	$	57,886	$	169	$	—	$	58,055	$	—	$	58,055
U.S. Agency securities	$	67,686	$	140	$	—	$	67,826	$	—	$	67,826
Subtotal	$	178,581	$	331	$	—	$	178,912	$	4,949	$	173,963
Total	$	243,193	$	331	$	—	$	243,524	$	69,561	$	173,963

	December 31, 2023
	Carrying Value		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value		Cash Equivalents		Marketable Securities
Level 1:
Money market funds	$	270,476	$	—	$	—		$	270,476	$	270,476	$	—
Subtotal	$	270,476	$	—	$	—		$	270,476	$	270,476	$	—
Level 2:
Commercial paper	$	19,295	$	8	$	—		$	19,303	$	1,998	$	17,305
U.S. Treasury securities		17,762		8		—			17,771		2,990		14,781
U.S. Agency securities		17,694		8		(1	)		17,701		—		17,701
Subtotal	$	54,751	$	24	$	(1	)	$	54,775	$	4,988	$	49,787
Total	$	325,227	$	24	$	(1	)	$	325,251	$	275,464	$	49,787

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Net Loss per Share (Tables)

9 Months Ended

Sep. 30, 2024

Earnings Per Share [Abstract]

Potentially Dilutive Securities Excluded from Computation of Diluted Weighted-Average Shares

Potential common stock equivalents excluded from the calculation of diluted earnings per share because the effect would have been anti-dilutive were as follows:

	As of September 30,
	2024		2023
Stock options		7,699,533		6,340,662
ESPP		18,031		8,522
Warrants		—		48,683
Restricted stock units		1,331,363		1,333,742
		9,048,927		7,731,609

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Operations - Additional Information (Detail) $ in Millions	Sep. 30, 2024 USD ($)
Operations [Line Items]
Cash, cash equivalents and investments in marketable securities	$ 253.8

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Revenue - Additional Information (Detail) - USD ($)		3 Months Ended			9 Months Ended		12 Months Ended
	May 17, 2024	Dec. 31, 2024	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023	Dec. 31, 2025	Dec. 31, 2024	Dec. 31, 2023
Disaggregation Of Revenue [Line Items]
Revenue			$ 10,524,000	$ 15,202,000	$ 31,685,000	$ 31,990,000
ANI Pharmaceuticals, Inc. [Member]
Disaggregation Of Revenue [Line Items]
Product rights agreement, closing date					May 17, 2023
Receipt of upfront license fee					$ 75,000,000
Eyebiotech License Agreement [Member]
Disaggregation Of Revenue [Line Items]
Upfront cash payment	$ 500,000
Receipt of upfront license fee					500,000
RPA [Member] | SWK [Member]
Disaggregation Of Revenue [Line Items]
Upfront cash payment					16,500,000
Revenue			300,000	300,000	900,000	700,000
Deferred revenue, current			1,700,000		1,700,000				$ 1,400,000
Deferred revenue, non-current			11,200,000		11,200,000				$ 12,400,000
YUTIQ [Member]
Disaggregation Of Revenue [Line Items]
Revenue			700,000	800,000	2,400,000	13,400,000
Product [Member]
Disaggregation Of Revenue [Line Items]
Revenue			664,000	816,000	2,390,000	13,483,000
Product [Member] | Ocumension Therapeutics [Member]
Disaggregation Of Revenue [Line Items]
Revenue			0	0	500,000	500,000
Product [Member] | Product Rights Agreement and the Supply Agreement [Member]
Disaggregation Of Revenue [Line Items]
Revenue			700,000	1,000,000	1,900,000	1,200,000
License and Collaboration Agreement [Member]
Disaggregation Of Revenue [Line Items]
Revenue			9,561,000	14,137,000	27,906,000	17,768,000
License and Collaboration Agreement [Member] | ANI Pharmaceuticals, Inc. [Member]
Disaggregation Of Revenue [Line Items]
Revenue			200,000	400,000	500,000	800,000
License and Collaboration Agreement [Member] | Eyebiotech License Agreement [Member]
Disaggregation Of Revenue [Line Items]
Revenue					500,000
Royalty Income [Member]
Disaggregation Of Revenue [Line Items]
Revenue			299,000	249,000	1,389,000	739,000
Royalty Income [Member] | Ocumension Therapeutics [Member]
Disaggregation Of Revenue [Line Items]
Revenue			0	0	500,000	0
Product Rights Agreement [Member] | ANI Pharmaceuticals, Inc. [Member]
Disaggregation Of Revenue [Line Items]
Upfront cash payment					75,000,000
Deferred revenue, current			24,300,000		24,300,000
Deferred revenue, non-current			0		$ 0
Product Rights Agreement [Member] | ANI Pharmaceuticals, Inc. [Member] | Scenario, Forecast [Member]
Disaggregation Of Revenue [Line Items]
Guaranteed payments		$ 1,875,000						$ 7,500,000
Product Rights Agreement [Member] | ANI Pharmaceuticals, Inc. [Member] | Maximum [Member]
Disaggregation Of Revenue [Line Items]
Royalties payment period					2028
Product Rights Agreement [Member] | ANI Pharmaceuticals, Inc. [Member] | Maximum [Member] | Scenario, Forecast [Member]
Disaggregation Of Revenue [Line Items]
Royalty payments							$ 70,000,000
Product Rights Agreement [Member] | ANI Pharmaceuticals, Inc. [Member] | Minimum [Member]
Disaggregation Of Revenue [Line Items]
Royalties payment period					2025
Product Rights Agreement [Member] | Product Rights Agreement and the Supply Agreement [Member]
Disaggregation Of Revenue [Line Items]
Revenue			$ 9,400,000	$ 13,600,000	$ 26,800,000	$ 16,800,000
Supply Agreement [Member] | ANI Pharmaceuticals, Inc. [Member]
Disaggregation Of Revenue [Line Items]
Initial term of the supply agreement					2 years
Initial Term of Estimated Supply Units					2 years

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Revenue - Product Revenue Allowance and Reserves (Detail) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Disclosure Of Product Revenue Reserves And Allowances [Line Items]
Beginning balance	$ 760	$ 1,888
Provision related to sales in the current year		1,561
Adjustments related to prior period sales	70	(169)
Deductions applied and payments made	(551)	(2,538)
Ending balance	279	742
Chargebacks, Discounts and Fees [Member]
Disclosure Of Product Revenue Reserves And Allowances [Line Items]
Beginning balance	83	859
Provision related to sales in the current year		1,561
Adjustments related to prior period sales	70	40
Deductions applied and payments made	(148)	(2,279)
Ending balance	5	181
Government and Other Rebates [Member]
Disclosure Of Product Revenue Reserves And Allowances [Line Items]
Beginning balance		158
Adjustments related to prior period sales		(55)
Deductions applied and payments made		(103)
Returns [Member]
Disclosure Of Product Revenue Reserves And Allowances [Line Items]
Beginning balance	677	871
Adjustments related to prior period sales		(154)
Deductions applied and payments made	(403)	(156)
Ending balance	$ 274	$ 561

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Prepaid Expenses and Other Current Assets - Schedule of Prepaid Expenses and Other Current Assets (Detail) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Prepaid Expense and Other Assets, Current [Abstract]
Prepaid expenses	$ 2,441	$ 1,695
Prepaid clinical	7,832	6,335
Other	1,298	1,009
Total prepaid expenses and other current assets	$ 11,571	$ 9,039

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Inventory - Schedule of Inventory (Detail) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Inventory Disclosure [Abstract]
Raw materials	$ 1,496	$ 1,303
Work in process	649	882
Finished goods	662	1,721
Total inventory	$ 2,807	$ 3,906

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Accrued Expenses - Schedule of Accrued Expenses (Detail) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Payables and Accruals [Abstract]
Personnel costs	$ 8,910	$ 12,631
Clinical trial costs	3,861	3,305
Professional fees	682	666
Sales chargebacks, rebates and other revenue reserves	279	760
Other	434	159
Total accrued expenses	$ 14,166	$ 17,521

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Leases - Additional Information (Detail) $ in Millions		6 Months Ended	9 Months Ended
	Jan. 23, 2023 ft² Tranche	Jun. 30, 2024 USD ($)	Sep. 30, 2024 USD ($)	Sep. 30, 2023 USD ($)
Disclosure Of Leases [Line Items]
Operating lease weighted average remaining lease term			12 years 4 months 24 days
Operating lease weighted average discount rate			11.60%
Operating lease payments			$ 0.5	$ 0.6
Massachusetts [Member]
Disclosure Of Leases [Line Items]
Lease description	The lease term, under ASC 842, commenced during the second quarter of 2024. The Company entered into an amendment to the Northbridge Lease, effective September 30, 2024. Pursuant to the amendment, the Company's obligation to pay base rent will begin March 1, 2025.
Increase in lease liabilities		$ 17.7
Increase in right-of-use assets		$ 17.9
Massachusetts [Member] | New Premises [Member]
Disclosure Of Leases [Line Items]
Original lease term	15 years 4 months
Lease existence of option to extend	true
Lease option to extend	The lease includes a non-cancellable lease term of fifteen years and four months, with two options to extend the lease term for two additional terms of either five years or ten years at 95% of the then-prevailing fair market rent.
Number of renewal options | Tranche	2
Lease renewal rate at 95% of market rent at time of renewal	95.00%
Area of property covered | ft²	41,141
Massachusetts [Member] | Minimum [Member] | New Premises [Member]
Disclosure Of Leases [Line Items]
Additional lease renewal option period	5 years
Massachusetts [Member] | Maximum [Member] | New Premises [Member]
Disclosure Of Leases [Line Items]
Additional lease renewal option period	10 years

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Leases - Supplemental Balance Sheet Related to Operating Leases (Detail) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Leases [Abstract]
Other current liabilities – operating lease current portion	$ 1,188	$ 563
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List]	Other current liabilities	Other current liabilities
Operating lease liabilities - noncurrent portion	$ 21,922	$ 4,906
Total operating lease liabilities	$ 23,110	$ 5,469

XML

Leases - Summary of Lease Expense (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Lease expense included in:
Variable lease cost	$ 60	$ 47	$ 195	$ 106
Total lease expense	1,090	403	2,164	1,173
Research and Development [Member]
Lease expense included in:
Total lease expense, excluding variable lease costs	965	291	1,774	873
General and Administrative [Member]
Lease expense included in:
Total lease expense, excluding variable lease costs	$ 65	$ 65	$ 195	$ 194

XML

Leases - Schedule of Future Minimum Lease Payments Under Non-Cancellable Leases (Detail) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Operating Leases
Remainder of 2024	$ 630
2025	3,585
2026	4,133
2027	4,222
2028	3,319
Thereafter	31,860
Total lease payments	47,749
Less imputed interest	(24,639)
Total	$ 23,110	$ 5,469

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Loan Agreements - Additional Information (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Loan Agreement [Line Items]
Loss on extinguishment of debt	$ 0	$ 0	$ 0	$ (1,347)
Payment of exit fee			$ 0	$ 1,350

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Stockholders' Equity - Equity Financings - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Thousands		1 Months Ended	3 Months Ended		9 Months Ended
	Apr. 18, 2024	Aug. 31, 2020	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Class Of Stock [Line Items]
Common stock issued	2,180,776
Gross proceeds from issuance of common stock					$ 11,793	$ 9,974
Share issuance costs					$ 307	$ 415
Common Stock [Member]
Class Of Stock [Line Items]
Common stock issued			1,299,506	902,769	1,299,506	902,769
At-the-Market Offering [Member]
Class Of Stock [Line Items]
Price per share			$ 9.36		$ 9.36
Gross proceeds from issuance of common stock			$ 12,200		$ 12,200
Share issuance costs			$ 400		$ 400
Stock issuances, sales agent commission maximum percentage		3.00%
At-the-Market Offering [Member] | Common Stock [Member]
Class Of Stock [Line Items]
Common stock issued			1,299,506		1,299,506

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Stockholders' Equity - Warrants to Purchase Common Shares - Additional Information (Detail) - $ / shares				9 Months Ended
	Apr. 18, 2024	Jun. 26, 2018	Mar. 28, 2018	Sep. 30, 2024	Jan. 31, 2024	Nov. 30, 2021
Class Of Stock [Line Items]
Pre Funded Warrants to purchase common stock						3,272,727
Pre Funded Warrants Outstandings				1,090,909
Pre-funded warrants shares included in net loss per share calculation				1,090,909
Warrants were exercised in cashless exercise	2,181,818
Net issuance of common shares	2,180,776
SWK [Member] | Warrants [Member]
Class Of Stock [Line Items]
share issuance, net					25,666
SWK [Member] | Senior Secured Term Loan [Member] | Warrants [Member]
Class Of Stock [Line Items]
Warrants issued to purchase shares of common stock		7,773	40,910
Exercise price of issued warrants		$ 19.30	$ 11.00
Warrants exercise period		7 years	7 years

XML

Share-Based Payment Awards - Equity Incentive Plan - Additional Information (Detail) - shares	Jun. 20, 2024	Jun. 20, 2023	Sep. 30, 2024	Jun. 19, 2024
2016 Long Term Incentive Plan [Member]
Class Of Stock [Line Items]
Number of common stock, authorized for issuance				9,400,000
Shares remained available for grant				373,256
2023 Long Term Incentive Plan [Member]
Class Of Stock [Line Items]
Equity incentive plan, approval date	Jun. 20, 2024	Jun. 20, 2023
Number of common stock, authorized for issuance	4,000,000	3,500,000
Shares available for grant under the Long Term Incentive Plan			4,311,535

XML

Share-Based Payment Awards - Stock Option Activity Under Company's Equity Incentive Plan (Detail) - Equity Incentive Plan and Inducement Awards [Member] - USD ($) $ / shares in Units, $ in Thousands	9 Months Ended
	Sep. 30, 2024
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of Options Outstanding, Beginning balance	6,304,767
Number of Options, Granted	2,248,252
Number of Options, Exercised	(535,932)
Number of Options, Forfeited	(254,198)
Number of Options, Expired	(63,356)
Number of Options Outstanding, Ending balance	7,699,533
Number of Options, Exercisable at September 30, 2024	3,531,549
Weighted Average Exercise Price Outstanding, Beginning balance	$ 9.98
Weighted Average Exercise Price, Granted	18.71
Weighted Average Exercise Price, Exercised	9.27
Weighted Average Exercise Price, Forfeited	9.72
Weighted Average Exercise Price, Expired	24.37
Weighted Average Exercise Price Outstanding, Ending balance	12.47
Weighted Average Exercise Price, Exercisable at September 30, 2024	$ 11.89
Weighted Average Remaining Contractual Life, Outstanding at September 30, 2024	7 years 6 months 14 days
Weighted Average Remaining Contractual Life, Exercisable at September 30, 2024	6 years 29 days
Aggregate Intrinsic Value, Outstanding at September 30, 2024	$ 8,973
Aggregate Intrinsic Value, Exercisable at September 30, 2024	$ 4,268

XML

Share-Based Payment Awards - Stock Options - Additional Information (Detail)	9 Months Ended
	Sep. 30, 2024 shares
2016 and 2023 Long Term Incentive Plan [Member]
Class Of Stock [Line Items]
Contractual life of option grants	10 years
Stock Compensation Plan [Member]
Class Of Stock [Line Items]
Ratable monthly vesting period	4 years
Award vesting percentage	25.00%
Cliff vesting period	3 years
Common stock vested during the period	1,836,170

XML

Share-Based Payment Awards - Summary of Company Applied the Black-Scholes Option Pricing (Detail) - 2016 and 2023 Long Term Incentive Plan [Member]	9 Months Ended
	Sep. 30, 2024
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock volatility, minimum	97.00%
Stock volatility, maximum	100.00%
Risk-free interest rate, minimum	3.45%
Risk-free interest rate, maximum	4.60%
Expected dividends	0.00%
Minimum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Option life (in years)	5 years 6 months
Maximum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Option life (in years)	6 years 29 days

XML

Share-Based Payment Awards - Summary of Information about Stock Options (Detail) - USD ($) $ / shares in Units, $ in Thousands	9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Total cash received from exercise of stock options	$ 5,436	$ 1,056
Equity Incentive Plans [Member]
Weighted-average grant date fair value per share	$ 14.9
Total cash received from exercise of stock options	$ 4,966
Total intrinsic value of stock options exercised	$ 7,355

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Share-Based Payment Awards - Time-Vested Restricted Stock Units - Additional Information (Detail) - RSU [Member] - 2016 and 2023 Long Term Incentive Plan [Member]	9 Months Ended
	Sep. 30, 2024
Class Of Stock [Line Items]
Ratable annual vesting period of equity awards	1 year 6 months
Annual Basis [Member]
Class Of Stock [Line Items]
Ratable annual vesting period of equity awards	3 years

XML

Share-Based Payment Awards - Summary of Restricted Stock Unit Activity (Detail) - 2016 and 2023 Long Term Incentive Plan [Member] - RSU [Member]	9 Months Ended
	Sep. 30, 2024 $ / shares shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of Stock Units Outstanding, Beginning Balance | shares	1,333,192
Number of Stock Units, Granted | shares	670,120
Number of Stock Units, Vested | shares	(591,277)
Number of Stock Units, Forfeited | shares	(80,672)
Number of Stock Units Outstanding, Ending Balance | shares	1,331,363
Weighted Average Grant Date Fair Value Nonvested, Beginning balance | $ / shares	$ 5.31
Weighted Average Grant Date Fair Value, Granted | $ / shares	19.81
Weighted Average Grant Date Fair value, Vested | $ / shares	6.39
Weighted Average Grant Date Fair value, Forfeited | $ / shares	10.64
Weighted Average Grant Date Fair Value Nonvested, Ending balance | $ / shares	$ 11.81

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Share-Based Payment Awards - Employee Stock Purchase Plan - Additional Information (Detail) - USD ($)		3 Months Ended		9 Months Ended
	Jun. 25, 2019	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023	Dec. 31, 2023
Class Of Stock [Line Items]
Employee stock purchase plan		$ 202,000	$ 174,000	$ 470,000	$ 422,000
Common stock, shares issued		53,524,364		53,524,364		49,043,074
Stock-based compensation expense		$ 7,446,000	$ 3,629,000	$ 28,840,000	$ 8,467,000
ESPP [Member]
Class Of Stock [Line Items]
Price of common stock purchased twice a year under ESPP, percent	85.00%
Employee stock purchase plan	$ 25,000
Employee stock purchase plan, shares	5,000	24,881		49,896
Consecutive six month offering period	Aug. 01, 2019
Stock-based compensation expense		$ 100,000		$ 200,000

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Share-Based Payment Awards - Compensation Expense from Stock-Based Payment Awards (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total stock-based compensation expense	$ 7,446	$ 3,629	$ 28,840	$ 8,467
Research and Development Expense [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total stock-based compensation expense	3,382	1,263	14,820	3,405
Sales and Marketing [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total stock-based compensation expense	0	60	0	290
General and Administrative Expense [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total stock-based compensation expense	$ 4,064	$ 2,306	$ 14,020	$ 4,772

XML

Share-Based Payment Awards - Stock-Based Compensation Expense - Additional Information (Detail) $ in Millions	3 Months Ended	9 Months Ended
	Sep. 30, 2024 USD ($)	Sep. 30, 2024 USD ($)
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Unrecognized compensation expense	$ 30.2	$ 30.2
Unrecognized compensation expense weighted average period		1 year 8 months 12 days
Stock Option and Restricted Stock Awards [Member]
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Reduction of expense	$ 0.5
Incremental expense		$ 5.2

XML

License and Asset Purchase Agreements - Additional Information (Detail) - USD ($)	1 Months Ended	3 Months Ended		9 Months Ended
	Feb. 29, 2020	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Collaborative Agreements And Contracts [Line Items]
Research and development		$ 29,542,000	$ 17,363,000	$ 89,554,000	$ 46,711,000
Equinox Science, LLC [Member]
Collaborative Agreements And Contracts [Line Items]
Non-refundable and non-creditable upfront cash payment	$ 1,000,000
Research and development		$ 0	$ 0	$ 5,000,000	$ 0
Equinox Science, LLC [Member] | Maximum [Member]
Collaborative Agreements And Contracts [Line Items]
Payment upon achievement of development and regulatory milestones	$ 50,000,000

XML

Fair Value Measurements - Assets and Liabilities Carried at Fair Value Measured on Recurring Basis (Detail) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable Securities	$ 173,963	$ 49,787
Fair Value, Measurements, Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Carrying Value	243,193	325,227
Gross Unrealized Gains	331	24
Gross Unrealized Losses	0	(1)
Fair Value	243,524	325,251
Cash Equivalents	69,561	275,464
Marketable Securities	173,963	49,787
Fair Value, Measurements, Recurring [Member] | Quoted Prices in Active Markets (Level 1) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Carrying Value	64,612	270,476
Gross Unrealized Gains	0	0
Gross Unrealized Losses	0	0
Fair Value	64,612	270,476
Cash Equivalents	64,612	270,476
Marketable Securities	0	0
Fair Value, Measurements, Recurring [Member] | Quoted Prices in Active Markets (Level 1) [Member] | Money Market Funds [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Carrying Value	64,612	270,476
Gross Unrealized Gains	0	0
Gross Unrealized Losses	0	0
Fair Value	64,612	270,476
Cash Equivalents	64,612	270,476
Marketable Securities	0	0
Fair Value, Measurements, Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Carrying Value	178,581	54,751
Gross Unrealized Gains	331	24
Gross Unrealized Losses	0	(1)
Fair Value	178,912	54,775
Cash Equivalents	4,949	4,988
Marketable Securities	173,963	49,787
Fair Value, Measurements, Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | Commercial Paper [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Carrying Value	53,009	19,295
Gross Unrealized Gains	22	8
Gross Unrealized Losses	0	0
Fair Value	53,031	19,303
Cash Equivalents	4,949	1,998
Marketable Securities	48,082	17,305
Fair Value, Measurements, Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | U.S. Treasury Securities [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Carrying Value	57,886	17,762
Gross Unrealized Gains	169	8
Gross Unrealized Losses	0	0
Fair Value	58,055	17,771
Cash Equivalents	0	2,990
Marketable Securities	58,055	14,781
Fair Value, Measurements, Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | U.S. Agency securities [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Carrying Value	67,686	17,694
Gross Unrealized Gains	140	8
Gross Unrealized Losses	0	(1)
Fair Value	67,826	17,701
Cash Equivalents	0	0
Marketable Securities	$ 67,826	$ 17,701

XML

Fair Value Measurements - Additional Information (Detail) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2024	Dec. 31, 2023
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities	$ 173,963	$ 49,787
Interest-bearing cash equivalent consisted of money market fund	64,600	270,500
Interest-bearing cash equivalent consisted of investment-grade commercial paper	4,900	5,000
Interest-bearing cash equivalent consisted of investment-grade U.S.Treasury securities	$ 4,900	$ 5,000
Investment Instruments [Member] | Credit Concentration Risk [Member] | Money Market Funds [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Percentage of concentration risk	92.90%	98.20%
Investment Instruments [Member] | Credit Concentration Risk [Member] | Commercial Paper [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Percentage of concentration risk	7.10%	1.80%
Investment Instruments [Member] | Credit Concentration Risk [Member] | US Treasury Securities [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Percentage of concentration risk	7.10%	1.80%

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Net Loss per Share - Potentially Dilutive Securities Excluded from Computation of Diluted Weighted-Average Shares (Detail) - shares	9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive common stock equivalents outstanding excluded from diluted earnings per share calculation	9,048,927	7,731,609
Employee Stock Option
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive common stock equivalents outstanding excluded from diluted earnings per share calculation	7,699,533	6,340,662
ESPP [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive common stock equivalents outstanding excluded from diluted earnings per share calculation	18,031	8,522
Warrants [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive common stock equivalents outstanding excluded from diluted earnings per share calculation	0	48,683
Restricted stock units [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive common stock equivalents outstanding excluded from diluted earnings per share calculation	1,331,363	1,333,742

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Related Party Transactions - Additional Information (Detail) - USD ($) $ in Thousands			3 Months Ended		9 Months Ended
	Jan. 05, 2024	Dec. 18, 2023	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023	Dec. 31, 2023
Related Party Transaction [Line Items]
Revenues			$ 10,524	$ 15,202	$ 31,685	$ 31,990
Total stock-based compensation expense			7,446	3,629	28,840	8,467
Research and development expense			29,542	17,363	89,554	46,711
Prepaid expenses			2,441		2,441		$ 1,695
License and Collaboration Agreement [Member]
Related Party Transaction [Line Items]
Revenues			9,561	$ 14,137	27,906	$ 17,768
Eyebiotech License Agreement [Member] | License and Collaboration Agreement [Member]
Related Party Transaction [Line Items]
Revenues					500
Altasciences Company Inc [Member]
Related Party Transaction [Line Items]
Accounts payable			$ 500		$ 500		300
Other Liability, Related Party [Extensible Enumeration]			Accounts Payable, Current		Accounts Payable, Current
Research and development expense			$ 300		$ 1,200
Prepaid expenses			100		100		$ 500
Dr. John Landis [Member]
Related Party Transaction [Line Items]
Annual Compensation Payment		$ 600
Total stock-based compensation expense			0		400
Accounts payable			$ 0		$ 0
Other Liability, Related Party [Extensible Enumeration]			Accounts Payable, Current		Accounts Payable, Current
Dr. John Landis [Member] | Employee Stock Option
Related Party Transaction [Line Items]
Number of Options, Granted	20,000
Contractual life of option grants	1 year
Dr. John Landis [Member] | Restricted stock units [Member]
Related Party Transaction [Line Items]
Number of Stock Units, Granted	10,000
Dr. John Landis [Member] | Board Stock Option Award [Member]
Related Party Transaction [Line Items]
Number of Options, Granted	25,014

XML

Subsequent Events - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Thousands			9 Months Ended
	Oct. 31, 2024	Apr. 18, 2024	Sep. 30, 2024	Sep. 30, 2023
Subsequent Event [Line Items]
Common stock issued		2,180,776
Gross proceeds from issuance of common stock			$ 11,793	$ 9,974
Subsequent Event [Member] | Underwritten Public Offering [Member]
Subsequent Event [Line Items]
Common stock issued	14,636,363
Offer price per share	$ 11
Gross proceeds from issuance of common stock	$ 161,000
Subsequent Event [Member] | Additional Share Offering [Member]
Subsequent Event [Line Items]
Common stock issued	1,909,090