LENZ Therapeutics - Earnings Call - Q4 2024

Executive Summary

• Clean regulatory progress and commercial readiness; cash, cash equivalents and marketable securities ended at $209.1M with stated runway to post‑launch positive operating cash flow.
• Q4 operating expenses rose sequentially on commercialization spend (SG&A +44% q/q to $9.4M), while R&D continued to fall post-CLARITY completion; net loss was $12.7M (EPS $(0.46)).
• FDA mid‑cycle review completed in January with “no significant review issues”; management reiterated no AdCom planned and guided to product availability in Q4 2025, explaining the post‑approval packaging/distribution lead time.
• No S&P Global consensus for Q4 2024/FY 2024 revenue or EPS was available to benchmark results; focus remains on regulatory catalysts and launch preparedness as likely stock drivers [GetEstimates returned no data].

What Went Well and What Went Wrong

What Went Well

• FDA review track intact: NDA accepted (Oct-2024) with Aug 8, 2025 PDUFA; mid‑cycle review completed with “no significant review issues” and no AdCom planned.
• Commercial execution: initiated manufacturing of potential commercial product in Feb (to be packaged post‑labeling), sales leadership fully in place (2 Regional Directors, all 10 District Managers), and strong ECP engagement (2M+ digital impressions targeting 30K+ ECPs; >1,000 1:1 MSL interactions since Q4 start).
• Clinical validation: China Phase 3 met endpoints—74% achieved ≥3-line near vision improvement at 3 hours (p<0.0001); rapid onset and durability (69% ≥3 lines at 30 minutes; 30% at 10 hours).

Management quote: “We completed our mid-cycle review… noting no significant review issues… [and] initiated production to support our potential commercial launch.”

What Went Wrong

• Spending ramp pressuring opex: SG&A +44% q/q to $9.4M as pre‑launch activities intensify; total opex +18% q/q to ~$15.2M.
• No revenue yet; continuing losses: Q4 net loss of $12.7M (vs. $10.2M in Q3) as the company remains pre‑commercial.
• Timing gap post‑approval: even with potential Aug approval, product availability guided to Q4 2025 due to final labeling, packaging, 3PL logistics—pushing initial script visibility into late 2025 and beyond.

Transcript

Operator (participant)

Good morning, ladies and gentlemen, and welcome to the LENZ Therapeutics Year End 2024 Financial Results Conference Call. At this time, all participants are in a listen-only mode. Following prepared remarks from the management, we will conduct a question-and-answer session with instructions that will follow at that time. As a reminder, this call is being recorded. At this time, I would like to turn the call over to Dan Chevallard, Chief Financial Officer. Please go ahead.

Dan Chevallard (CFO)

Thank you. Good afternoon, and thank you for joining us today. My name is Dan Chevallard, Chief Financial Officer of LENZ Therapeutics. We are joined today by Eef Schimmelpennink, our President and Chief Executive Officer, and Shawn Olsson, our Chief Commercial Officer, as well as Dr. Marc Odrich, Chief Medical Officer, who will join us for the question-and-answer session. Before we begin, I would like to remind you that this call will contain forward-looking statements regarding LENZ's future expectations, plans, prospects, corporate strategy, regulatory and commercial plans and expectations, cash runway projections, and performance.

Actual results may differ materially from those indicated by these forward-looking statements as a result of various important factors and risks, including those discussed in our filings with the Securities and Exchange Commission, which can also be found on our website.

In addition, any forward-looking statements represent only our views as of the date of this webcast and should not be relied upon as representing our views as of any subsequent date. We specifically disclaim any obligations to update such statements. The company encourages you to consult the risk factors contained in our SEC filings for additional detail, including in our 2024 Form 10-K, which is being filed today. With that, I will now turn the call over to Eef .

Eef Schimmelpennink (President and CEO)

Thank you, Dan, and good afternoon, everyone. 2024 has been a highly successful year for LENZ, and I'm extremely proud of all we have accomplished. We are truly building something special, and I strongly believe we have put ourselves in a position to have an even greater and transformational year in 2025 as we aim to emerge as a commercial company. On previous calls, I have mentioned the consistent pattern of execution by the team, and I would like to take a moment and acknowledge their efforts. We are a team that is at our best when we are together. We go fast with purpose, we relish ingenuity, and we are relentless.

On the back of these core values, we had a tremendous year in 2024, highlighted by our emergence as a public company in March and completion of our Phase 3 CLARITY study and announcement of stellar data for LNZ100 in April. This was followed by the execution of a $30 million pipe financing with Richback Capital in July, submission of our NDA in August, and its acceptance in October, all contributing to significant progress and momentum as we work towards the potential approval and launch of LNZ100.

With all of the exciting progress we've made over 2024, the fourth quarter and most recent period has been a critical time as we have completely transitioned to a pre-commercial company and advanced to 2025 in a position of financial strength, ending 2024 with over $209 million in cash.

I'd now like to take a few minutes to highlight five key areas of corporate focus where we've seen excellent progress in recent months: regulatory, manufacturing readiness, medical affairs, intellectual property, and pre-launch commercial planning. First, on the regulatory front, in what has been a very constructive and highly engaged process thus far, we continue to make encouraging progress with the FDA on our NDA review. In January of this year, we completed our mid-cycle review, which is a key milestone in the agency's review process.

We were very pleased that the agency noted no significant review issues and that they reiterated they had no plans to request an advisory committee meeting.

Importantly, in light of the recent developments around federally funded agencies, FDA inspections on our clinical trial sites are now underway, and we are pleased to report that we have confidence that our NDA review has been uninterrupted and is making great progress. As such, we continue to believe that we are well positioned for a potential on-time approval in August 2025, which, if granted, will be immediately followed by commercial launch activities in the United States, with product anticipated to be available in the market in the fourth quarter of 2025.

Second, on manufacturing readiness, I am particularly pleased with the progress the manufacturing operations team has made in recent months. Importantly, and signifying an important milestone, in February, we initiated the manufacturing of potential commercial products.

The team, together with our manufacturing partners, has been working tirelessly to enable the achievement of this important landmark and will continue to focus over the coming months on manufacturing adequate commercial sample and product inventory to support a successful launch. For the time being, this product will be kept in bulk and, following label discussions and potential approval of our NDA, undergo final packaging. As a result, and following FDA approval, we expect to have commercial products available in the market in Q4 of this year. Third, I'm very excited to highlight key progress from our medical affairs team.

We are seeing noteworthy eye care professional engagement nationwide, led by meaningful interactions by our all optometrists Medical Science Liaison team, who have been very active at state and national medical conferences, educating the ECP community on the importance of being pupil-selective and the differentiation of a ciliary body-sparing mechanism of action, as well as on the data from the Phase 3 CLARITY study. Just a few weeks ago, the medical team held a fantastic event at CICO in Atlanta, where we hosted over 100 ECPs at the College Football Hall of Fame.

Since the beginning of Q4, we've had meaningful medical interactions with more than 1,000 individual ECPs. Our intent is to have our MSL team engage with the majority of our key target ECPs ahead of our PDUFA date.

Next, a foundational area of focus and recent progress has been on intellectual property, more specifically our domestic and international patent estate for LNZ100. We have continued to strengthen our patent tickets and currently have seven granted patents in the United States that go out to 2039, with an additional 10 patents on the review that aim to extend our patent protection to at least 2044. Together with the expected five years of NCE exclusivity, we believe our product is extremely well protected and set up for longevity. In addition, we continue to extend our patent portfolio ex U.S. to support the significant commercial opportunity we believe exists there.

Lastly, I'll turn to pre-launch commercial planning. The commercial team has been hard at work, and before I turn it over to Shawn to step through in more detail, I would like to highlight a few key items.

First, the hiring of our sales force is in its final stage. Both of our regional directors were hired in Q4, and we now have hired all 10 of our district managers. We've been extremely pleased with the excellent quality of candidates we are attracting with significant eye-care experiences across the board. As you may have seen, last week we launched a hiring campaign for our 88 territory sales force, our last sales hires, and as an indication of the anticipation we believe exists in the market, we received over 1,300 applications within the first 24 hours of posting the job profiles.

We are looking forward to hiring only the best and most talented candidates to LENZ and have them fully onboarded ahead of our PDUFA date.

This will ensure that they can be in the field promoting our product immediately after potential approval and get one or more call cycles in ahead of product being available in the market. Second, we're very much looking forward to our upcoming commercial day on April 15, where we'll have the opportunity to elaborate on our commercial strategy and pre-launch preparations, as well as bring forward additional key opinion leader and ECP perspectives as we approach the potential approval and launch of LNZ100, something Shawn will touch on in more detail shortly.

As I mentioned in my opening remarks, 2024 has been a highly successful year, and the recent period has continued to be extremely productive as we prepare for the potential approval of LNZ100. I will now hand the call over to Shawn Olsson, our Chief Commercial Officer, to provide additional comments on our pre-commercial planning efforts. Shawn.

Shawn Olsson (Chief Commercial Officer)

Thank you, Eef, and good afternoon, everyone. As we have discussed on previous calls, the commercial potential for an effective presbyopia treatment represents one of the largest eye care market opportunities in the United States. Presbyopia impacts an estimated 128 million people in the US, a population incidence that's nearly four times larger than those impacted by dry eye and nearly six times larger than those impacted by Demodex blepharitis. For further context, presbyopia impacts more than the combined population in the US suffering from dry eye, Demodex blepharitis, childhood myopia, macular degeneration, diabetic retinopathy, and glaucoma combined.

The first eye drop treatment for presbyopia was approved in 2021 and confirmed that there is strong consumer desire for an eye drop treatment, as evidenced by initial paid new scripts of up to 6,000 per week.

Long-term usage beyond the trial period of this product did not materialize, as pilocarpine, even at the high concentration of 1.25%, cannot deliver the consumer-required performance. Other attempts at a lower dose BID strategies are being pursued, but given the efficacy profile is very similar to that of Vuity, we do not believe they will clear the consumer hurdle for performance or the ECP desire for a pupil-selective option. We continue to believe the category is wide open for an eye drop solution that can deliver what consumers desire: a once-a-day eye drop that provides seamless near vision for the full workday for the majority of presbyopes.

Unlocking this market requires an ideal presbyopia eye drop, and we are excited for the prospect of an aceclidine-based LNZ100.

We believe the commercial potential of LNZ100 was validated in our Phase 3 CLARITY study, with 90% of participants noticing an improvement in near vision and 75% of participants indicating they would continue to use LNZ100 after the study, of which 81% plan to use four to seven days per week. Together with our broad inclusion criteria, we believe this positions LNZ100 well for the estimated 3 billion-plus potential market opportunity, creating a potential category of one. Our commercial team continues to advance its commercial readiness as we progress towards our August 8th PDUFA date.

I would like to just take a moment to provide an update on the three primary pillars of our commercial strategy. First, we want to make sure doctors are there to recommend us.

As Abe mentioned, our all optometrists MSL team is already engaging with ECPs on medical education and fielding questions on the Phase 3 data. In addition, one year ago, our marketing team launched the I Am Selective unbranded campaign at CICO 2024. This is driving ECP awareness and excitement for the future presbyopia solutions that can achieve the necessary sub-2 pupil size to restore near vision while not overstimulating the ciliary muscle. Awareness continues for this campaign and has over 50 KOLs and over 2 million digital campaign impressions targeting over 30,000 ECPs.

Lastly, and following potential NDA approval, our sales force will be calling on approximately 15,000 ECPs with our potential best-in-class product to educate and equip them to recommend LNZ100 and to integrate our solution into their patient offering.

As we prepare for this, the hiring of our sales force has been a key focus over the recent months. Our full sales leadership team was hired in 2024, including both of our regional directors who joined LENZ in Q4. Since then, we've continued to grow our sales team and are happy to share that all 10 district managers are now also on board. This core leadership team within the sales force brings almost 150 years of eye care experience and over 300 years of total sales experience. Finally, we have now begun our field-based sales rep hiring, with job postings currently available for all 88 territories across the United States.

It's great to see the progress on our first pillar, and as a reminder of what was shared in the last earnings call, our primary market research survey of 426 ECPs yielded that an impressive 82% and 83% of ECPs are already being likely to prescribe and sample LNZ100 if FDA approved, respectively based on the Phase 3 data. The second pillar of our commercial strategy is for consumers to request us by name. This requires developing a product brand and consumer campaign that will elicit a strong emotional connection and activate consumer response.

LENZ has partnered with multiple New York and California-based advertising agencies to understand the consumer and develop a campaign that will connect emotionally, creating a desire for our brand. We have taken a consumer-centric focus in the development of this brand and have leaned into the lifestyle creative.

We are excited about the brand we have created and the proposed advertisements, which have been testing well in market research. Our creative is now locked, and the majority of the launch promotional materials are now completed, pending final product insert language. Upon approval, we will launch the ECP materials, and once we feel ECPs are well educated, we will turn on the direct consumer advertising. The third and final pillar will ensure ease of sample and product access for patients with a seamless journey to use. This requires enabling the patient to experience the product and move from trial to usage as quickly as possible.

To support this, our team has built out consumer sampling capabilities and commercial access across multiple channels, including the traditional retail pharmacy as well as e-pharmacy home delivery.

In our clinical trial, 95% of patients noticed two lines of improvement on hour one, day one. This immediate response lends itself incredibly well to product sampling. Our sample vendor has been contracted, and after approval, samples will be rep-delivered to eye care professionals, allowing consumers to try the product. Our team has developed a five-day sample pack, similar to the sample size for contacts, which, following the initial trial, can act like a bridge until the product is picked up at the pharmacy or delivered to the consumer's home. We'll continue to drive these three pillars: doctors to recommend us, consumers to request us by name, and a seamless journey to use as we progress towards our PDUFA date.

Before I conclude, we are looking forward to our upcoming commercial day on April 15, where we will have the opportunity to elaborate on our commercial strategy and pre-launch preparations, as well as bring forward additional key opinion leader and ECP perspectives as we approach the potential approval and launch of LNZ100. We feel this is an important event, which will give investors, analysts, and others a thoughtful overview of our plans and progress towards the potential approval and launch of LNZ100. I'd now like to hand the call over to Dan Chevallard, our CFO, to step through our financial results.

Dan Chevallard (CFO)

Thank you, Shawn. As both Abe and Shawn have highlighted, the fourth quarter in a recent period has been a critical time as we have now pivoted to a pre-commercial company. We ended 2024 in a position of financial strength with approximately $209.1 million in cash, cash equivalents, and marketable securities, which, as we have guided previously, is anticipated to fund the company's cash runway to post-launch positive operating cash flow. Turning now to our fourth quarter financial results, our operating expenses and resulting cash burn were generally consistent with prior quarters and in line with our operating plan.

Total operating expenses for Q4 2024 were approximately $15.2 million, compared to $25 million for the same period in 2023.

In general, this decrease was specifically driven by the fact that we were in the midst of our phase 3 CLARITY study in Q4 of last year, which makes these figures less relevant to compare. Perhaps more comparable, on a quarter-over-quarter and sequential basis, our total operating expenses increased by approximately 18% from $12.9 million in the third quarter. From a cash perspective, our Q4 2024 operating cash burn net of interest income was approximately $8.1 million, which was consistent with the $9 million in net cash burn last quarter.

Total sales, general, and administrative expenses increased to $9.4 million in Q4 2024, compared to $5.5 million for the same period in 2023, driven primarily by an increase in commercial headcount and other pre-commercial, pre-launch commercial planning activities.

Sequentially, SG&A increased quarter over quarter by approximately 44% from $6.5 million in the third quarter due to significant relative increases in sales and marketing as we continue to ramp our allocation of spend to support our consumer-driven brand planning and the addition of key sales force leadership. As we have discussed on previous calls, we expect our SG&A expenses, and more specifically our sales and marketing expenses, to continue to ramp from here as we approach our potential August 2025 approval for LNZ100.

Importantly, as a particular point of emphasis, we will continue to be measured in our spend on the general and administrative side of the organization. Our model will always be to staff appropriately and grow to support our commercial launch and organization at large, but remain a lean and highly efficient G&A team.

Turning now to research and development, total R&D expenses decreased to $5.9 million in Q4 2024, compared to $19.5 million for the same period last year. Sequentially, quarter over quarter, R&D expenses once again decreased by approximately 9% from $6.5 million last quarter. The majority of our R&D expenses between now and the time of potential approval will be dedicated to our manufacturing operations team as we build pre-approval commercial product and sample inventory to support our launch.

Finally, our net loss per share, both basic and diluted, was $0.46 per share in the fourth quarter of 2024 on a net loss of $12.7 million, compared to a net loss per share of $12.04 per share in the fourth quarter of 2023 on a net loss of $23.7 million.

Q4 2024 net loss per share was calculated on approximately $27.5 million weighted average common shares outstanding, compared to Q4 2023 when, as a then-private company with multiple classes of preferred and common stock outstanding, net loss per share was calculated on approximately 2 million weighted average common shares outstanding. As a final point, as of December 31, 2024, we had approximately 27.5 million shares of common stock outstanding. That concludes my comments on our Q4 financial results. With that, I'd like to turn the call back over to Eef for final remarks.

Eef Schimmelpennink (President and CEO)

Thanks, Dan. As you can see, the fourth quarter and recent period has been an extremely productive time. We are making significant strides in our pre-commercial preparations. As we are now less than five months from our PDUFA target action date, we believe we are well positioned to deliver a once-daily, safe, and rapidly acting treatment to the 128 million individuals living with presbyopia in the United States. I am very much looking forward to doing so. With that, I'd like to open up the call for questions.

Operator (participant)

Thank you. If you would like to ask a question, please press star and the number one on your telephone keypad. Again, that is star and the number one on your telephone keypad. Our first question comes from the line of Yigal Nochomovits from Citigroup. The line's open.

Yigal Nochomovits (Director and Biotech Analyst)

Hi, guys. Thank you. I appreciate all the updates. First off, I think Shawn mentioned that the sales force is going to call on 15,000 ECPs. The digital campaign was targeting 30,000 or over 30,000. Could you just comment on how you're filtering that down to focus on the 15,000? What are the parameters there?

Shawn Olsson (Chief Commercial Officer)

Hi, Yigal. This is Shawn. Thanks for that question. It's a really good question. When you look across the landscape of eye care professionals, there's obviously a lot out there. When you look at the 40,000 optometrists and 20,000 ophthalmologists, when we think of targeting in terms of our sales force, we're looking at those that are high prescribers of Vuity. Therefore, we know that 15,000 ECPs represent roughly 85% or a little more than 85% of all the Vuity scripts. That's our focus for our sales force. We also know that there are other doctors. With presbyopia being so prevalent, driving early disease state awareness is helpful across a broader group of ECPs.

That is why you'll see our unbranded promotion is driving more broader awareness, while the field will focus truly on the earliest adopters of eye care professionals and those who represented over 85% of all the Vuity scripts.

Yigal Nochomovits (Director and Biotech Analyst)

Okay. Gotcha. On this I Am Selective Unbranded Awareness campaign, I'd be super interested to get a better understanding quantitatively of how you've ratcheted up the awareness. Do you have data on the % awareness before you started the campaign and how that's improved today in terms of knowledge of not only presbyopia, but your Phase 3 data specifically?

Shawn Olsson (Chief Commercial Officer)

Yeah. For the unbranded, we're really focused on the disease state awareness. We've just, in general, seen a lot of interest growth in the—a lot of growth of interest in the concept at all of our conventions and across the board on LinkedIn. You know what's great to see, actually, is the fact that we'll be at our convention and people come up. I don't know, can't tell you how many times we've come up to it. I've been seeing all of your ads on LinkedIn about your I Am Selective campaign. We're really pleased with how it's coming along. We'll continue to share more information at the upcoming commercial days.

Yigal Nochomovits (Director and Biotech Analyst)

Okay. And then just the last one on the timing of the launch. Obviously, the PDUFA is August 8. I mentioned that you're going to have product available in the channel, I believe, starting fourth quarter. Is the delta there a function of just needing more time to produce the sufficient commercial material or training the sales force, or are there other factors we should be aware of?

Eef Schimmelpennink (President and CEO)

Great question, regardless of Yigal. Thanks for allowing us to double-click on that a little bit. That's purely a factor of practicality. This, we believe, is going to be a very high-volume launch, as you can imagine. As I've shared in the prepared remarks, the manufacturing team has started production of the quantities that we believe will support a successful launch. That will all sit in bulk as we await final labeling discussions with the FDA and have a final approved label, insert, and carton. We will then obviously start printing that, which would happen after approval, package all those quantities, shift them to our 3PLs, and get them into the field.

That's purely the time that we guide there between PDUFA and a Q4 product in the market is, again, purely determined by those steps.

The sales force, importantly, will be trained up in general prior to PDUFA date, final training on final labeling, and then immediately hit the field. You can expect that immediately upon approval, the sales force will actually be out there promoting the product. They can get a couple of sales cycles in, which we like, prepare the doctors for what's to come, and then start delivering samples as soon as we have them available for the field.

Yigal Nochomovits (Director and Biotech Analyst)

All right. Thank you. Perfect.

Operator (participant)

Thank you. Our next question comes from the line of Marc Goodman from Leerink Partners. The line's open.

Madhu Yennawar (Equity Analyst)

Hi. This is Madhu on the line for Marc. Just a couple from us today. First, how long do you expect the significant sampling to go on for until most of those target ECPs have gotten experience with LNZ100? The second question is, what haven't you been asked about on the regulatory process or the launch that you would like people to be more focused on? Thanks.

Eef Schimmelpennink (President and CEO)

Great. Thank you for those questions. From a sampling perspective, this product lends itself extremely well for sampling. If you look at the clinical data that we generated in our Phase 3 studies, you'll see that these are obviously naive patients. Endpoint is our three-day one. Within 30 minutes, which is the first time point that we've measured, you see that we have 71% of patients hitting three lines, 95% of patients hitting two lines of improvement. Because it lends itself so well for sampling, we feel that this is a unique tool that we have as a company that we will use widely.

We do not really look at this as something that we will only do initially to give doctors the experience, but truly something that allows patients or consumers a very easy test or sample point to see if it does the product work for them, which, again, looking at the clinical data, I think we can be highly confident that the answer should be yes. Then do they like to continue to use that? That is why we have got that sample pack of five out there that, to re-answer your question, will continue to pull through as the years pass by. Also because there are actually 4 million new presbyopes every year.

There is a large volume of new patients that we will continue to reach with those samples. That is on the sampling side. On the regulatory side, just reiterating a little bit what I have mentioned in the prepared remarks.

We're very pleased with how things are going with the FDA. We've had very engaged discussions with them, frankly, from like three years ago as we were talking through the setup of a clinical trial with them. Obviously, since we've submitted the NDA, as I've mentioned, those interactions continue to be very productive. The mid-cycle review was very benign, just like you like it. Importantly, we now have seen them starting the inspections of our clinical trials, showing that that progress continues to be made. All in, very pleased with how the FDA interactions are going and continue to be very confident that we're working nicely towards that August 8 PDUFA date.

Madhu Yennawar (Equity Analyst)

Thanks.

Operator (participant)

Thank you. Our next question comes from the line of Joe Catanzaro from Piper Sandler. The line's open.

Joseph Catanzaro (Biotech Equity Research Analyst)

Hey, perfect. Thanks, everybody. Thanks for the update. Thanks for taking the questions. Maybe two questions interrelated on the competitive landscape. Shawn, you made some brief comments on Vuity and pilocarpine and pilocarpine BID. There's been some recent Phase 3 data for a carbachol-based product. Wondering if you guys have any thoughts there on that product's profile and maybe how it compares and contrasts to LNZ100. Then maybe relatedly, on the other side of a potential approval, I'm wondering if there's any Phase 4 trials that you maybe have in mind that could reinforce that competitive profile, best in class that you might have with LNZ100. Thanks.

Shawn Olsson (Chief Commercial Officer)

Hi, Joe. This is Shawn. Thanks for the question. When we look at this area and opportunity for eye drops for presbyopia, we have said before we really see this as a category of one, and we continue to see this as a category of one. If you really want to drive the efficacy and the near vision improvement that the consumers desire, it requires two key things. It really requires a pupil size below 2 millimeters, which we achieved. When you look at our commercial data, it is very clear the capabilities of our product. What is really important is that you have the right miotic to do it, which is aceclidine, which is pupil selective. It is the only pupil-selective miotic.

When I look at this space, when I look at the competition, I really see this as a category of one, and we're really defined and set apart by our ability to achieve the performance with the sub-2 mm pupil. And aceclidine puts us in that place where we can be the only one with that opportunity.

Eef Schimmelpennink (President and CEO)

Maybe just adding to that, Joe, just building on what Shawn said, in our mind, successful product is a once-a-day, fast-acting, long-lasting eye drop. If you overlay that on the clinical data that's out there, we truly believe that our data is the only ones that show that. You've mentioned Carbachol, and just for everyone on the call, that used to be Visus, that product's now owned by Tenpoint. We've not seen that Phase 3 data. The press release highlighted that they met that clinical trial endpoint, but did not disclose or they chose not to show any of that data, which is therefore a little unsure what that means.

If you go by the Phase 2 data, which is available, again, we feel that that doesn't meet what the consumers are after. That just to answer your question on the Phase 3 data from Carbachol.

Joseph Catanzaro (Biotech Equity Research Analyst)

Thanks. That's helpful. Maybe on the follow-up on Phase 4 studies that you maybe could potentially perform if they're even necessary, again, to kind of sort of reinforce the competitive profile you have here.

Eef Schimmelpennink (President and CEO)

Yeah. No, we're obviously focused on bringing this to the market. Phase 4 studies can be part of that. We know that there's ophthalmologists and other doctors out there that have interest in testing the product. We'll work with them as appropriate to do those Phase 4 studies. I will report on that as we are starting them.

Joseph Catanzaro (Biotech Equity Research Analyst)

Okay. Perfect. Thanks for taking my questions.

Operator (participant)

Thank you. Our next question comes from the line of Stacy Ku from TD Cowen. The line's open.

Stacy Ku (Biotechnology Research Analyst)

Great. Congrats on the progress, and thanks so much for taking our questions. We have three. The first question is around kind of your last year around the educational campaign. Maybe talk about your 15,000 target ECPs. Where are we in the campaign? What's the level of awareness of LENZ and LNZ100? Obviously, you're not able to promote specifically, but just help us understand level of awareness. In our Kowal Tech, all the optometrist consultants were familiar with the aceclidine, MOA, and pupil selectivity. They believe this confers low risk of retinal detachment. Curious your own progress. That's the first question.

The second question, Shawn, you made some comments around maybe finalizing the marketing messages around LNZ100's clinical profile. Just help us understand maybe early thoughts. How do you make sure consumers and patients have the right expectations for the product?

Is it up to 10 hours? How do you talk about the durability for a once-a-day product? That is question two. For our third question, can you discuss in a little more detail the background of the sales force hired so far? This is a unique launch that requires both therapeutic and consumer locks experience. Are they coming from recent launches? Are they able to navigate the current consumer profile? Any additional details would be appreciated.

Shawn Olsson (Chief Commercial Officer)

Cool. Thank you for the question, Stacy. I appreciate it. Again, this is Shawn. Looking at the educational campaign, we've been really pleased by this educational campaign. When we were looking at what we want to do to drive awareness of the important things to look for in the future of presbyopia eye drops, we really wanted to bring forward the eye care professionals as the voice of that campaign. That is how we came up with that concept of IAM. We allowed those doctors to really talk about what is it to them that's important and what makes them excited for the future of presbyopia solutions. In terms of reaching out to those 15,000 ECPs, we're making great progress.

As we shared, we've had over 2 million digital impressions with that campaign and targeting actually the over 30,000 ECPs of the broader group, which means these eye care professionals are seeing the campaigns multiple times over. That is driving a lot more awareness of LENZ itself and what's important, right, the pupil selectivity and the sub 2-millimeter pupil. I think although that's separate from the progress on awareness for LNZ100 and the efficacy of the drug, what we're really encouraged by was what we shared in our last earning calls. We did a market research initiative of over 420 eye care professionals.

By the way, those 420 eye care professionals sit within our 15,000 target group. Because when we designed that survey, we made sure that they had prescribed Vuity and prescribed Vuity multiple times and had an 80% split optometry versus ophthalmology.

That is a core signal of that group of our 15,000 targets. We are really excited to see that over 80% of them were already excited to prescribe LNZ100 if approved. We are really happy with that progress.

Eef Schimmelpennink (President and CEO)

Thanks, Shawn. Just adding to that, and Stacy, thanks for your initiation this week. We appreciate it and a lot of great insights that you did there. I think you mentioned actually in your question, in the survey work that you guys did, which was a lot, there was no shortage of awareness around LNZ100 or aceclidine. I think that's reflective of all the unbranded work that's been done over the last year, as well as, as we touched upon it, the work that our MSL team has started to do and is in full force out there now doing. Over 1,000 individual meetings.

These are one-on-one meetings that are 20, 30, 40 minutes with MSLs or with the MSLs having a medical discussion, really highlighting a product, the uniqueness of aceclidine, the fact that it's pupil-selective, ciliary-sparing, the importance of being below 2 millimeters, and obviously our clinical profile. You can imagine that we're targeting the top deciles, the first. That is going really well. I think all of that reflects in the fact that there is very high awareness of aceclidine already in the market that we'll continue to build out.

Stacy Ku (Biotechnology Research Analyst)

Okay, very helpfull.

Shawn Olsson (Chief Commercial Officer)

Moving on to your second question, we said that and shared that we're working on final messaging on our campaigns. We're very excited about where we're at in terms of our marketing materials. We'll break them into two groups. One is for our eye care professional side, and one is for our consumer side. When I speak to doctors and when we see what resonates with them and when we test what's important, I think one of the most important things they always bring up is, "This isn't Pilo, is it?" Right? When we think of our messaging to doctors, it's very important that we get across that this is not pilocarpine.

Really, when we think of promotion to doctors after approval, focus is going to be on MOA, which will lead heavily into the not pilocarpine.

Moves very quickly then into the efficacy and the safety profile. All that testing is continuing, and we're looking forward to sharing more at the upcoming commercial day. On the consumer side, you are exactly right. What we don't want to do is overpromise. What we saw from the previous launch with this space was promises were made that were not in line with the efficacy of the product, right? It was, "Hey, take one drop and it lasts all day," right? Or, "One drop a day." What we really want to highlight here is we want to provide real expectations.

One example, which you just mentioned, is how we're approaching it. Yes, in our data, we see a lot of patients still having a very strong response at 10 hours.

That being said, in the strategy not to overpromise, we want to focus on messaging of up to 10 hours. We also shared that we're leaning into that lifestyle brand. We spent a lot of time seeing with consumers to invoke what's the emotion they feel that presbyopia has on them. Again, we don't refer to it as presbyopia to them, but their blurry near vision. Eliciting that actual feeling and turning that into a campaign so when they see it, they want to click it, and they want to learn about the product, and they have a desire to be on the product. That's really where we're at in working on the messaging.

Stacy Ku (Biotechnology Research Analyst)

Okay. That's wonderful. Thanks. I'm looking forward to kind of the commercial day.

Eef Schimmelpennink (President and CEO)

Just wanted to touch on your last question there, Stacy, and we'll keep it brief. The background of the sales force. Shawn, you want to take that? You want me to?

Shawn Olsson (Chief Commercial Officer)

Yep. We have had a tremendous amount of interest in joining LENZ, which is exciting for us to see. We had a strong pool of candidates when we first brought on our regional directors in Q4. When we actually look at bringing on the district managers, which are now all 10 of them are on board, we are seeing that we are finding people that are working in good jobs in eye care and in pharma and are looking for the next better opportunity. The candidate pool has been very, very great. What we are seeing, our individuals are joining with decades of eye care experience as well as sales experience as well. Really great candidate pool.

Stacy Ku (Biotechnology Research Analyst)

Thank you.

Operator (participant)

Thank you. Our next question comes from the line of Jason Gerberry from Bank of America. The line's open.

Jason Gerberry (Biotechnology Equity Research Analyst)

Hey, guys. Good afternoon, good evening. Thanks for taking the question. On the sampling initiative and how you'll leverage the e-pharmacies, I'm wondering ultimately if the e-pharmacies will share with you kind of sample conversion to patients opting in to monthly supply. If that's a metric that you'll be kind of sharing with the street just to kind of give some sense of how that's progressing with utilization and adoption.

My second question just with early adopters, curious from a patient perspective, if you think that patients with other ocular comorbidities would be more or less likely to get treatment with a presbyopia drop therapy or if you think it's patients who probably have a low medication burden, just kind of curious how you're thinking about that dynamic.

At the commercial day, do you think you'll share any comps for launch ramp outside of the early Vuity adoption dynamic? Those are my questions. Thanks.

Shawn Olsson (Chief Commercial Officer)

Great. Thanks, Jason. This is Shawn again. Yeah, let me dive deeper a little bit into the sampling process and strategy in e-pharmacy because it's a great question. When we think of the samples, what will happen with the samples is those five-day sample packs, again, very similar to how contacts are provided as samples, they're really a bridge until the consumer gets started. Those sample packs will be delivered to the optometrist by the rep, so by the representative. The reps will show up at the optometrist. Let's, for example, say they leave 10 samples.

When they come back on their next visit, they'll take a look at the samples and make sure that they're well stocked and that they're appropriately being dispensed. The e-pharmacy is disconnected from the samples. That's a separate process.

When the patient receives their sample and they're checking out with their optometrist, the optometrist will ask, "Where would you like your script to be sent?" They'll have two options there. It can be sent to the e-pharmacy, or it can be sent to the retail pharmacy. Our preference is it's sent to the e-pharmacy, right? When it's sent to the e-pharmacy, what actually happens is the patient gets a text on their phone, and they actually click the text, pay for their product, and that ships to their home every single month.

That's the way that e-pharmacy is set up. Now from the e-pharmacy, we'll get data directly from the e-pharmacy on number of scripts and how often those are being ordered. The samples are separate from that. That's really delivered by the rep and separate from the e-pharmacy.

The great thing about the samples is since they're delivered at the optometrist location, they won't get caught up in any of your script data if you're monitoring script data for sales.

Eef Schimmelpennink (President and CEO)

Very concretely, Jason, to your question, there's no correlation to be seen or will be shared between samples and conversion to scripts. The second question was around the early adopters to the patients.

Shawn Olsson (Chief Commercial Officer)

When we think about the first patients going into the doctor, when we first get approval, our primary focus will be educating the doctors. Our earliest patients will be those that are already going into the practice. Actually, this works out well because if we think of comorbidities, one of the most important things that we see when we look at consumers that are interested in this product, a group that really stands out are those that are in contacts today and over 45. The great thing about those patients, they're already going into the doctor every year for their annual eye exam. We're already going to be seeing those patients at the doctor already before we even turn on DTC.

What we saw on our survey that we revealed last quarter, those doctors are seeing over 200 presbyopes every single month already, and they're in a place where they're excited to prescribe LNZ100.

Eef Schimmelpennink (President and CEO)

Last question I had was launch comps. At the commercial day, we're not going to be talking about launch and launch ramping. I think you and others have done a very good job at putting your models together. I think the consensus is what most people will look for and look at as we launch and in the quarters to follow. We'll stick with that for now.

Jason Gerberry (Biotechnology Equity Research Analyst)

Got it. Thanks, guys.

Operator (participant)

Thank you. Our next question comes from the line of Lachlan Hanbury-Brown from William Blair. The line's open.

Lachlan Hanbary-Brown (Biotechnology Equity Research Analyst)

Hey, guys. Thanks for taking the question. I've heard across the industry that it's been getting harder, at least in some places, for sales reps to actually get in and see a doctor. I'm wondering if you sort of have heard anything similar, particularly as it pertains to your targets. If so, what can you do, if anything, to get around those hurdles?

Shawn Olsson (Chief Commercial Officer)

Hi, Lachlan. This is Shawn. Thanks for the question. In this area of the industry, particularly around optometry, access to the eye care professional has not been seen as being increasingly challenging for us. We are not seeing that on our end. Definitely, when COVID came around, getting into the hospitals and the pharmacies became more difficult. For the optometrist, we really do not see that growing. I think what is really great about this product is with our samples, it is going to be another reason that they are going to want to see us because obviously, as they provide the product to the patients, they are going to want to see us again so they can restock their samples.

We see that as a great tool to make sure that door remains open for our sales force.

Lachlan Hanbary-Brown (Biotechnology Equity Research Analyst)

Good. Thanks. Maybe a follow-up. I've seen in some prior launches, especially in the more sort of discretionary or aesthetic kind of areas, concern around macroeconomic conditions affecting demand. Given there's been talk over the past month or so of potential recession, I was just wondering if you have any thoughts on how sort of economically sensitive demand might be because you sort of outlined you're going to be targeting higher-income customers anyway. I'd just be interested in sort of.

Eef Schimmelpennink (President and CEO)

Yeah. Great question, Lachlan. This is Eef. Two elements of that. One, if you'll look at aesthetics and you look at how revenue or volume has been impacted or frankly not impacted by recessions, you see that, take Botox for example, hardly any impact in the big recession of the late or mid-2000s, definitely not over the last couple of years. You don't see that actually, which is partly, and this is as we've been speaking about quite a bit, yes, there's 128 million presbyopes out there. We're talking about or projecting to get to a $3 billion-plus potential market, only about a 6% penetration. One of the cuts in there is actually income.

I think this is at least we're projecting this to go to a group of people for whom the discretionary spending is a little bit larger to begin with.

Again, we don't expect any impact on whatever the macro is going to do. Thanks.

Operator (participant)

Thank you. Our next question comes from the line of Gary Nachman from Raymond James. The line's open.

Dennis Reznick (Equity Research Associate)

Hey, guys. Good afternoon. This is Dennis Reznick on for Gary Nachman. Congrats on the progress this quarter, and thanks for taking the questions. Previously, you've segmented the consumer market in a specific way where you've talked about the patients that could be early first adopters being those who are lens wearers, refractive surgery, or those that go to med spas. Of those three, could you talk about which segment you think will be the easiest to activate and reach, and which one will require more work? Any quick updates on how we should think about the commercialization plans for LNZ100 in the EU? Thanks so much.

Shawn Olsson (Chief Commercial Officer)

Great. Thanks for the questions, Shawn, again. When you think about the early adopters, we see all three of them as very great and accessible targets from a promotional standpoint. In terms of access, when we think of the early days of launch before we turn on DTC, I think when we think of those people in contact lenses, the great news is they're already in the optometrist. The good news is we can get them early in terms of the doctor can be our conduit to start speaking to that subset. When you think of those that have had refractive surgery in the past or those that get a med spa, again, we see both of these are groups that we can target digitally.

When we look at our media buy companies that we've partnered with and our ad agencies, in terms of if we're focusing on our med spa clients, we can look at their search histories and geolocations to really target them with the right digital ads. They are extremely motivated, and they test very high. They actually test the highest in our analysis of interest for an eye drop solution. For those that have had refractive surgery in the past, again, from here, we can target them as well as we can as we reach out to ophthalmologists. These are people that they've met in the past and have worked on before. It is another avenue to get access to that population. We really see all three groups as very accessible.

Eef Schimmelpennink (President and CEO)

Thanks, Shawn. Your second question was about Europe. I'll take that a little bit broader and in general talk about the XUS strategy. It is clear or should be clear to all of you that we are obviously focused on commercializing the product in the US ourselves. XUS territories will all be up licensing to the right commercial partner there. We do see that there is a significant XUS opportunity, and that is reflected in the amount of inbounds that we get from very interested parties wanting to understand what it would take to get a license to this product. We do want to make sure, obviously, that we drive the appropriate value for that.

That is how we are timing those discussions. The one exception there being China. We have licensed China early because they had to do their own clinical trial.

I've seen the results a couple of months ago, which were carbon copy of what we've seen in the U.S., which again was highly validating. They're about, let's call it, 12-18 months or so behind us from a filing and launch perspective. We'll keep everyone updated as we progress any other XUS discussions.

Dennis Reznick (Equity Research Associate)

Great. Thanks for the additional color, and congrats on the progress.

Operator (participant)

Thank you. Now our next question comes from the line of Matthew Caufield from H.C. Wainwright. The line's open.

Matthew Caufield (VP and Biotechnology Equity Research)

Great. Hi, guys. Thanks for the updates. You kind of touched on this, but from the commercial standpoint, do you foresee any tangible prescription resistance based on former Vuity experiences or disappointment from that separate pilocarpine profile? Thanks a lot.

Shawn Olsson (Chief Commercial Officer)

Hi, Matt. This is Shawn. Good question. When we look at this market, what we really focused on, particularly in our last market research study, was the excitement and interest for LNZ100. When we look at those 15,000 ECP targets, we did the survey on a subset of them, right? Those 420-plus eye care professionals, again, 80% optometry, 20% ophthalmology. When we asked them about the willingness to prescribe LNZ100, what we saw was over 80% of them were already likely to prescribe. A few sat on the fence, and it was only about 2% or 4% that were unlikely to prescribe. The fact that we're not pilocarpine-based is really the key factor there.

They're excited and ready for a solution for their patients. Their patients are still frustrated by the fact that they don't have a good solution.

The reason to believe for them and why they're so excited and open is the fact that we're not pilocarpine and that we're aceclidine-based. When we did our market research on why Vuity failed, the number one reason that came out was for most people, it didn't work. For the second one, when it did work, it didn't work long enough. We're really breaking the mold in what we're offering here. The excitement that we're seeing in our market research doesn't have that hangover effect.

Matthew Caufield (VP and Biotechnology Equity Research)

Got it. Very helpful. Thank you, guys.

Operator (participant)

That concludes our question-and-answer session. As I am showing no further questions, thank you for your participation, and we will now conclude today's conference call. You may now disconnect.