Second Sight Medical (NSDQ:EYES) said yesterday that it plans to accelerate development and commercialization of its Orion visual cortical prosthesis system and posted first quarter earnings that missed expectations on Wall Street.
Sylmar, Calif.-based Second Sight’s Orion is designed to connect the camera in a pair of eyeglasses with an implant that receives the camera signal and translates it to the visual cortex in the brain, bypassing the eye and the optic nerve entirely.
In its release yesterday, the company said that it believes the Orion system “holds the potential to provide useful artificial vision to individuals blind from many causes, including glaucoma, eye injury, diabetic retinopathy, optic nerve disease or injury and retinitis pigmentosa.”
“Given the positive results of our early feasibility study, we believe that Orion offers the most effective and quickest path forward to treat nearly all forms of blindness and address a significant unmet need. After an extensive strategic review, we view Orion as a more attractive platform for continued investment and technological improvement that will extend our leadership position in artificial vision. We remain encouraged by our discussions with the U.S. Food and Drug Administration regarding Orion’s regulatory path and are pleased by recent developments with the Centers for Medicare and Medicaid Services regarding reimbursement for products approved via the FDA’s Breakthrough Devices program. To support these initiatives, we intend to add more than 25 new positions this year, including top research and development talent as we pursue technological improvements of Orion. We are also taking steps to further align our organizational capabilities and focus resources primarily on advancing Orion as well as prepare for future sales volumes that we expect to be orders of magnitude greater than Argus II. Accordingly, we will suspend production of new Argus II systems in the near future as well as reduce ongoing commercial activities. We remain committed to supporting existing Argus II users including pursuing regulatory approvals for the Argus 2s next-generation externals. Our commitment to artificial vision is further evidenced by our continued investment in multiple research projects designed to enhance the user experience, such as the integration of object or facial recognition and thermal imaging, with our technology,” prez & CEO Will McGuire said in a press release.
“Orion provides a tremendous opportunity to further advance the field of artificial vision while also addressing the needs of millions of blind individuals globally. With encouraging early clinical results, we believe now is the right time for the company to transition to the Orion platform and focus on accelerating our development and clinical programs. Second Sight will continue providing support to existing Argus users worldwide while repositioning our resources to accelerate the market introduction of Orion,” board chair Gregg Williams said in a prepared statement.
In a separate release, Second Sight posted first quarter 2019 earnings that missed consensus expectations from analysts on Wall Street.
The company posted losses of $9.7 million, or 10¢ per share, on sales of $1.1 million for the three months ended March 31, seeing losses shrink 0.5% while sales grew 15.6% when compared to the same period during the previous year.
Adjusted to exclude one-time items, losses per share were 7¢, just behind the 6¢ consensus on Wall Street where analysts expected to see sales of $1.7 million, which the company also missed.
“Our decision to accelerate development of Orion is based on both the positive interim results of our Early Feasibility Study and on the significant market opportunity we see for this potentially transformative product. We believe it is the right time to reallocate resources toward this more attractive platform, which holds the potential to treat virtually all forms of blindness and extend our leadership position in artificial vision. We are also encouraged by our ongoing discussions with the U.S. Food and Drug Administration and the Center for Medicare and Medicaid Services’ proposed new rule regarding reimbursement for Breakthrough Devices, such as Orion. We believe that Orion provides an opportunity to address a much larger patient population and a significant unmet need in the United States and globally. Importantly, although we are suspending production of new Argus II systems, we will continue to support our existing users and plan to pursue regulatory approvals for our next-generation externals, Argus 2s,” McGuire said in prepared remarks.
Shares in Second Sight are down 2.3% so far today, at approximately 94¢ as of 11:03 a.m. EDT.
Last month, Second Sight released preliminary results from a small feasibility study of its Orion cortical implant, which is designed to give eyesight to the blind.
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