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The Company
9 Months Ended
Sep. 30, 2017
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
The Company
The Company
Aerie Pharmaceuticals, Inc. (“Aerie”), with its wholly-owned subsidiaries Aerie Distribution, Inc., Aerie Pharmaceuticals Limited and Aerie Pharmaceuticals Ireland Limited (“Aerie Distribution,” “Aerie Limited” and “Aerie Ireland Limited,” respectively, together with Aerie, the “Company”), is a clinical-stage pharmaceutical company focused on the discovery, development and commercialization of first-in-class therapies for the treatment of patients with glaucoma and other diseases of the eye. The Company has its principal executive offices in Irvine, California, and operates as one business segment.
The Company has two advanced-stage product candidates designed to lower intraocular pressure (“IOP”) in patients with open-angle glaucoma or ocular hypertension that it intends to commercialize on its own in North American markets, if approved. The Company’s strategy also includes pursuing regulatory approval for these product candidates in Europe and Japan on its own. The first product candidate, RhopressaTM (netarsudil ophthalmic solution) 0.02% (“RhopressaTM”), is a once-daily eye drop designed to lower IOP in patients with glaucoma or ocular hypertension, which the Company has submitted a New Drug Application (“NDA”) with the U.S. Food and Drug Administration (“FDA”) on February 28, 2017. The Prescription Drug User Fee Act goal date has been set for February 28, 2018. The Company also intends to file for European regulatory approval of RhopressaTM in the second half of 2018. Additionally, the Company has commenced Phase 1 and Phase 2 clinical trial activities for RhopressaTM on Japanese patients in the United States and anticipates conducting future Phase 3 clinical trials in Japan with the objective of receiving regulatory approval of RhopressaTM in Japan. The second product candidate is once-daily RoclatanTM (netarsudil/latanoprost ophthalmic solution) 0.02%/0.005% (“RoclatanTM”), a fixed-dose combination of RhopressaTM and latanoprost for which the Company plans to submit an NDA with the FDA in the second quarter of 2018. The Company is currently conducting a Phase 3 trial named Mercury 3 in Europe comparing RoclatanTM to Ganfort®, which if successful, is expected to improve its commercialization prospects in that region. Mercury 3 is not necessary for approval in the United States. The Company is also conducting ongoing research to evaluate injectable sustained release formulation technologies with the potential capability of delivering Aerie’s preclinical molecule AR-13154 internally in the eye over several months for the treatment of retinal diseases such as wet age-related macular degeneration (“AMD”) and diabetic macular edema (“DME”), and is also evaluating possible uses for its existing proprietary portfolio of Rho kinase inhibitors beyond ophthalmology.
In 2015, the Company revised its corporate structure to align with its business strategy outside of North America by establishing Aerie Limited and Aerie Ireland Limited. Aerie assigned the beneficial rights to its non-U.S. and non-Canadian intellectual property for its lead product candidates to Aerie Limited (the “IP Assignment”). As part of the IP Assignment, Aerie and Aerie Limited entered into a research and development cost-sharing agreement pursuant to which Aerie and Aerie Limited will share the costs of the development of intellectual property and Aerie Limited and Aerie Ireland Limited entered into a license arrangement pursuant to which Aerie Ireland Limited will develop and commercialize the beneficial rights of the intellectual property assigned as part of the IP Assignment. In 2016, Aerie assigned the beneficial rights to certain of Aerie’s intellectual property in the U.S. and Canada to Aerie Distribution, and amended and restated the research and development cost-sharing agreement to transfer Aerie’s rights and obligations under the agreement to Aerie Distribution.
The Company has not yet commenced commercial operations and therefore has not generated product revenue. The Company’s activities since inception have primarily consisted of developing product candidates, raising capital and performing research and development activities. The Company does not expect to generate revenue until and unless it receives regulatory approval of and successfully commercializes its current product candidates. The Company has incurred losses and experienced negative operating cash flows since inception. The Company has funded its operations primarily through the sale of equity securities and issuance of convertible notes (Note 7).
If the Company does not successfully commercialize any of its current product candidates, it may be unable to generate product revenue or achieve profitability. Accordingly, the Company may be required to obtain further funding through other public or private offerings, debt financing, collaboration and licensing arrangements or other sources. Adequate additional funding may not be available to the Company on acceptable terms, or at all. If the Company is unable to raise capital when needed or on attractive terms, it may be forced to delay, reduce or eliminate its research and development programs or commercialization efforts.