WATERTOWN, MA — EyePoint Pharmaceuticals Inc. is planning workforce reductions in response to the coronavirus pandemic.
The company (NASDAQ: EYPT) said it expects $7 million in annual savings from the reductions and $10 million in one-time savings from other planned expenditure cancellations and deferrals. It did not say how many employees would lose their jobs.
EyePoint has two commercial products: Dexycu, the first approved intraocular product for the treatment of postoperative inflammation, and Yutiq, a three-year treatment of chronic non-infectious uveitis affecting the posterior segment of the eye.
The company said in a press release that it’s experienced “a significant decline in product demand associated with shut-downs of customer facilities and postponements of elective surgical procedures in response to COVID-19.”
“COVID-19 driven closures have significantly impacted our customer base and this commercial reorganization is necessary to focus the Company’s resources on continuing to serve patients who are still being treated with YUTIQ and DEXYCU,” said Nancy Lurker, president and CEO of the firm. “We have prioritized our overall spending to focus on a more targeted commercial footprint, conserve cash and to continue advancing EYP-1901, a six-month potential treatment for wet age-related macular degeneration, toward clinical development.
“Our patients, employees, shareholders and the ocular disease community remain our top priorities as we navigate through the COVID-19 pandemic. We want to recognize and thank those affected by this reorganization for their dedication to EyePoint and our patients, and we will work to make their transitions to other opportunities as smooth as possible.”
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Other details from the release:
Dedicated to Delivering Our Innovative Ocular Disease Treatments to Patients
EyePoint is committed to providing uninterrupted access to our products during the COVID-19 pandemic for those patients who are in essential need of treatment. Our supply chains for YUTIQ and DEXYCU are robust and have not been interrupted during the pandemic. The Company has ample supply of API and other raw materials for YUTIQ and DEXYCU, and EyePoint continues to produce finished product for commercial sale. Our commercial team is providing ongoing support services for patients and physician offices on an as-needed basis, while respecting the need to maintain social distancing.
Focusing of Commercial Operations in Response to COVID-19 Impact on Commercial Markets
The Company will downsize its current workforce, with reductions coming primarily from the external DEXYCU sales force and supporting commercial operations as cataract surgery is considered a non-essential procedure due to the pandemic. The Company plans to allocate its remaining DEXYCU commercial resources to high-volume ambulatory surgery centers (ASCs) in key U.S. regions, subject to the availability of such ASCs to perform elective cataract surgery upon the lifting of restrictions associated with the COVID-19 pandemic. The Company will continue to invest in its YUTIQ commercial operations, as treatments for patients suffering from non-infectious uveitis affecting the posterior segment of the eye continue to be deemed essential during the COVID-19 pandemic, given that irreversible blindness is a potential consequence of delaying treatment.
The reorganization is Based on these actions, coupled with cash conservation activities, the Company is able to reconfirm its expected cash runway into 2021 under current assumptions for the duration of the COVID-19-related closures across the U.S.
The Company estimates that it will record approximately $0.6 million for severance and other costs related to the workforce reduction in the second quarter of 2020. Further details on the financial implications of the corporate restructuring will be included in the Company’s 10-Q for the first quarter of 2020 and other filings to be made with the Securities and Exchange Commission.
Business Continuity Plan to Protect Employees and Advance Development Pipeline
In early March 2020, the Company mandated a work from home policy for all employees who are not deemed essential to our manufacturing operations and suspended all non-essential travel. The Company has maintained a rotating, limited schedule to ensure continued production of YUTIQ and DEXYCU with heightened safety precautions for our employees.
Research and development initiatives remain on schedule. In March, the Company initiated a good laboratory practice (GLP) toxicology study for EYP-1901, a six-month sustained release anti-VEGF potential treatment for wet age-related macular degeneration. We expect to file an investigational new drug (IND) application for this program in the fourth quarter of 2020 with a Phase 1 clinical trial to commence shortly thereafter.
The Company continues to assess its policies, business continuity plans and employee support needs during the COVID-19 pandemic.
