Clearside Biomedical, Inc. (CLSD)·Q1 2024 Earnings Summary

Executive Summary

• Q1 2024 delivered modest license revenue ($0.230M) with a wider net loss ($11.8M; $0.17 EPS) as ODYSSEY Phase 2b trial costs and warrant-related items weighed on results .
• Pipeline and clinical momentum intact: ODYSSEY topline remains on track for end of Q3 2024; management reiterated Phase 3 planning workstreams tied to the readout .
• Organizational and financing catalysts: new CMO (Dr. Victor Chong) and director (Tony Gibney) added; February 2024 registered direct offering raised $15M gross; new permanent Category 1 CPT code for XIPERE effective Jan 1, 2024 .
• Liquidity runway extended: cash and cash equivalents $35.4M at quarter-end; company guides funding into Q3 2025, covering ODYSSEY readout and Phase 3 planning .
• Street consensus comparison: S&P Global estimates for Q1 2024 EPS and revenue were unavailable due to request limit; no beat/miss determination can be made (will revisit when accessible).

What Went Well and What Went Wrong

What Went Well

• ODYSSEY timing intact and Phase 3 planning underway: “ODYSSEY… remains on track for the end of the third quarter of this year… as we begin planning our CLS-AX Phase 3 clinical development program.” .
• Strengthened leadership: “We added Dr. Victor Chong… as our Chief Medical Officer… [and] appointed Tony Gibney… to our Board of Directors.” Dr. Chong emphasized CLS-AX’s potential 6‑month durability and a differentiated, multi-dose Phase 2b design .
• Platform validation and structural tailwinds: new permanent Category 1 CPT code for XIPERE; multiple positive partner/real‑world data presentations highlighting suprachoroidal delivery durability (≥75% of eyes with no retreatment for 6 months after one XIPERE dose) .

What Went Wrong

• Increased loss and expense line items: net loss widened to $11.8M (from $9.3M YoY) driven by higher R&D (ODYSSEY trial costs), and $1.5M “Other expense” tied to offering issuance costs and warrant liability fair value change .
• Non-cash interest expense elevated: $2.4M vs $2.2M YoY from imputed interest on the royalties liability and issuance cost amortization .
• Minimal top-line contribution: license and other revenue remained small at $0.230M, underscoring reliance on future milestone/license flows and clinical catalysts rather than product sales in Q1 .

Financial Results

Notes:

• Q4 2023 revenue uplift was driven by $5.0M BioCryst upfront and $1.0M milestone from Aura .
• Q1 2024 “Other expense” comprised offering issuance costs and warrant liability fair value change .

Segment breakdown: No segmented revenue reported in the period .

KPIs:

Guidance Changes

Earnings Call Themes & Trends

Management Commentary

• CEO strategic framing: “We expect 2024 will be a transformative year… We believe that the data readout from ODYSSEY later this year will demonstrate that CLS‑AX could be a valuable addition to the treatment regimen in the multibillion‑dollar wet AMD market.” .
• CMO on ODYSSEY differentiators: “The trial was designed to allow retreatment with our own drug candidate… protocol mandate participants… to be redosed at month 6… trial duration of 36 weeks… treating patients with confirmed active disease… top line results at the end of the third quarter of this year.” .
• CEO on leadership and platform: “Our SCS Microinjector technology has been used in thousands of injections… strong safety record that includes no cases of endophthalmitis to date.” .
• CFO on runway: “As of March 31, 2024, our cash and cash equivalents totaled approximately $35 million… sufficient resources to fund our planned operations into the third quarter of 2025.” .

Q&A Highlights

• TKI comparisons and potency: Discussion contrasted CLS‑AX with other TKIs, emphasizing axitinib potency (IC50) and the importance of durability and visual acuity endpoints in interpreting Phase 2b results .
• Phase 3 design considerations: Company is internally planning designs pending ODYSSEY data; differentiator is ability to retreat with CLS‑AX itself; engagement with consultants ongoing .
• FDA guidance status: Draft guidance over a year old; not finalized; company will engage FDA multiple times before Phase 3 design announcement .
• Safety and retreatment protocol: Suprachoroidal administration safety compared favorably to intravitreal; ODYSSEY design (3 aflibercept loading doses, strict criteria) aims to minimize off‑protocol rescues seen early in OASIS 1 mg cohort .
• XIPERE revenue mechanics: Royalties excluded on first $45M of sales; consequently, CLSD cannot report royalties until the threshold is surpassed .

Estimates Context

• S&P Global Wall Street consensus for Q1 2024 EPS and revenue was unavailable due to exceeded daily request limits at the time of analysis; we cannot assess beat/miss versus Street. We will update when SPGI access is restored.

Key Takeaways for Investors

• Near‑term catalyst path is clear: ODYSSEY Phase 2b topline for wet AMD slated for end of Q3 2024; expect immediate implications for Phase 3 initiation plans .
• CLS‑AX value proposition centers on 6‑month durability with multi‑dose evidence and treatment of active disease; if achieved, positioning as maintenance therapy alongside anti‑VEGF is compelling .
• Liquidity supports execution through major readout and Phase 3 planning; cash $35.4M and runway into Q3 2025 reduces financing overhang near‑term .
• Expense profile will remain elevated around ODYSSEY and Phase 3 readiness; expect R&D intensity and non‑cash interest related to royalty financing to persist .
• Structural tailwinds: permanent Category 1 CPT code for XIPERE, partner program progress, and real‑world durability data reinforce platform credibility and optionality for collaborations .
• Trading setup: shares likely sensitive to any ODYSSEY readout signals on durability and vision maintenance; clarity on Phase 3 design and FDA dialogues can reset risk perception .
• Monitor warrant liability mark‑to‑market and offering‑related items in “Other expense” for quarterly P&L noise; these do not reflect core operating performance .