ReVision Optics built it – a corneal inlay capable of correcting presbyopia. The FDA approved it sooner than expected. Now the company needs to build it into a successful private-pay business.
Tom Salemi: Hey, Medtech Talk listeners, Tom Salemi here. Thanks for joining us on the Medtech Talk Podcast. It’s great to talk about success stories in medtech. And we’ve had a great one recently at ReVision Optics. The company received FDA approval for its Raindrop Inlay, which it was expected. It’s not a huge surprise. But the approval came actually a lot sooner than everybody, including the company, had anticipated, which doesn’t happen all the time. So it certainly speaks to progress and movement on the FDA front, which is great for all of medtech. So we talked with CEO John Kilcoyne about ReVision, about Raindrop, about the FDA, and how the company now will proceed to roll out commercial release of Raindrop, which will correct vision of people with presbyopia, like myself. So it’s an important story in a growing medtech field, and happy to bring it to you on the Medtech Talk Podcast.
TS: John Kilcoyne, welcome to the Podcast.
John Kilcoyne: Tom, it’s great to be here. Thanks for having me today.
TS: Very happy to have you. And you’re been a regular at OIS. I know we’ve got a number of your presentations up on OIS.net. And last one you gave at ASCRS you sort of included a field of dreams in there, which was a sort of a nice way of if you build this sort of product, the patients will come. And you did build it, and you got some big news last month. Can you first just tell us a bit about Raindrop and your news last month from the FDA?
JK: Sure. Just to those who may not be familiar with Raindrop, it’s a corneal inlay that’s placed under a femtosecond flap in the non-dominant eye. It’s about 30 microns in thickness and 2 millimeters in diameter. So essentially, you lift a Lasik-like flap, place the Raindrop down on the stromal bed, light constricted pupil, wait for 30 seconds or so for the Raindrop to take on the dimpled or mottled appearance, and then hydrate the hinge of the flap and put the flab back over. And when that flap comes back over the Raindrop, it creates a somewhat of a central elevation. And over the first 24 to 36 hours or so, you get an epithelial remodeling across the anterior curvature of the cornea. And that’s that epithelial remodeling which creates a prolate effect, is what drives the improvement in near and intermediate vision. So as we mentioned, we did have the good fortune of having an approval on June 29. It did come a little more quickly than we had anticipated. We were preparing for panel, we were going through all of the appropriate steps, budgeting, site selection of panel prep, locations, panel members, etc. And as we got closer into the date where we knew the agency was running up on their timeline. We got an increasing indication that we may in fact not end up going to panel, although the agency did not ever articulate that to us. But as the date drew near, we had a better appreciation of the fact that that may not occur, the panel may not occur. And then on the day of approval, we not only got approval, but we got the approval order.
TS: That’s outstanding.
JK: Yeah. It was quite a rush. The good news is it came a little bit faster and quicker than we anticipated. The challenge is it came a little faster and quicker than we anticipated. So we are moving as quickly as we can to put all of the final pieces of the puzzle in place with regard to UDI and labeling, etc., and making sure we conform with the agency’s request. And I have to say that through the whole process, the agency was on time, either on schedule or ahead of schedule. We had a great review process with Jeff Broches, who is our lead, who is our medical reviewer did an outstanding job. She was always there. We’d hit the ball to her and she’d hit it right back to us. We had a very good dialog with the agency all throughout the process. And obviously, Dr. Eyedleman, we appreciate her confidence and faith and moving us to an approval and approval order on June 29. But I have to give the FDA their due. They – great interaction with us, and we’re very appreciative for that.
TS: That’s always great to hear. And I don’t want you to speak for the FDA. I know you’re not an observer of the FDA, but how often does that happen, where you’re going in, you’re ready for another hurdle to climb, and then the FDA just says – or clear, and the FDA says, Well, you won, the race is over, you don’t have to jump any more hurdles? That’s really unusual, isn’t it?
JK: Yeah, well, no, I think we actually were the first to encounter this situation. I wouldn’t say we won, but the hurdle I would also share was quite high. It was a 3 year follow up, and the FDA held us, even though they gave us approval, they held us to a very high bar. So I think the data that we submitted was robust, I think both on the effectiveness and the safety, was robust. And so in addition to the dialog that ensued over – we submitted in September of ’15, so we had ongoing dialog for those 9 months or so. And I think as that process unfolded, the agency became increasingly comfortable with our data; the agency became increasingly comfortable with the fact that we were in command of our data, and that we were a willing participant to the give and take of the dialog and the relationship. So I think both parties became comfortable. The bar was quite high, but that’s fine. We did jump over that bar, and again, I appreciate the agency’s confidence and trust in moving us forward. So it is – I think we’re unique, although I’m very gratified to see that since that time we’ve had AMO got an approval, Shire got an approval. So I do – going up the hierarchy, I think Dr. Shurin also and Bill Mazel are trying very hard to be measured and appropriate with the advisory panel, or panel meeting and the advisory meetings. So yeah, I think it was a good effort all around, and I think the benefactors are going to be the patients and surgeon and op space.
TS: We literally cannot keep up with all the good news at OIS. We’re trying to put together a weekly newsletter, and we kept having to rip it up and rip it up because there was so much coming down through the pipe. It was an extraordinary month. So as a leader, you’re kind of positioning yourself or readying everybody for this last stage of FDA review. You get that review earlier than you like, which is a wonderful problem to have. What do you do next? Is there a pivot involved? Or is it more just kind of, well, we just skip this step; now let’s skip ahead a month and a half and pick up at that point? What was the challenge for you and for the company?
JK: Well, I think it’s not so much as a pivot as it is an accelerator. The panel goes to the floor, but in an appropriate way. We have some post approval details that we have to finalize with the agency, which are critical to us, you know, post market studies, having those reviewed and finalized. Labeling, just a final labeling; although it’s been approved, we need to check that box and get the agency comfortable with that, as well as the UDI, which is another project that we need to have in place. And again, we were anticipating that we would probably in panel in the fall and that the approval would come some time later in the year. And the approval order not until Q1 of 2017. So that was our planning process. Now we’re in a situation where we have an approval. So we’re trying to, in an appropriate and measured way, bring that timeline in as quickly as we can without obviously sacrificing on any of our quality metrics or, obviously, patient safety issues. So –
TS: Do you have a sales team sort of ready to go? Or does this accelerate that as well?
JK: No, that is in process as we speak as well. So we have recently hired Frank Shields, and we’re very excited to have Frank on the team. As we speak, he is trying to assemble a field sales force with outcome specialists as well. So we’re in the process and we’re moving that ball as fast as we can. So it is a pivot. One of the things, clearly, that we have talked about internally is that for the past 6 years – I mean the study began in 2010 – we have been pretty much a very internally focused organization. Everything was about the study, everything was about the development, everything was about the processes and development of the processes and internally. Now he pivots, to use your word, the pivot is going from an internally focused company to an externally focused company. We need to focus on the customer, which is our surgeon, and obviously, ultimately our patient. So that is a pivot. And it is a very different feel and flavor. I would share that the energy in the building post approval is palpable. You can feel it. Everybody has more of a bounce in their step and ready to take on the next challenge. It is very exciting. It is very exciting. This is a major market. As we know, presbyopia is referred to as the holy grail. We hope to be able to play our part in helping patients reduce or eliminate the need for reading glasses and provide them with a great outcome.
TS: I’ve shared on this Podcast before that I’m ready for the reading glasses, so I’m cheering you folks on and I’d love to find a way to –
JK: I’d love to say you’re unique, but you’re one of about 2 billion.
TS: Yeah, that’s good for you. You don’t want me to be unique.
TS: Tom’s not a very big market, I assure you. So did you have to accelerate the hiring of the sales team at all? That’s what I’m kind of wondering. Or are you just proceeding along the same schedule?
JK: No, I mean we’ve certainly accelerated. We’ve accelerated our timelines. And as I said earlier, we’re trying to pull in as much as we can as fast as we can. But you know, the clear items that we cannot change and must get done before we do anything is those follow up reports to the agency, which we will do, and make sure that they’re comfortable with us, and then taking the next step and moving forward to that first shipment.
TS: Hey, everybody, Tom here. Just want to remind you to go to the Medtechconference.com website. Once there, you can do many wonderful things, including follow up on some past Podcasts in case you missed them. But you also can sign up for the Medtech Talk Newsletter, so you’ll never miss anther one again. We’ll send the Podcast directly to you in your inbox, along with some of our original reporting and reporting from our conferences and other sites in medtech. So join us on the medtechconference.com website, and find out lots of great stuff about medtech. Now back to this conversation.
TS: So this is– I mean you’ve been in medtech for a long time. You were CEO at Solace, you were with Micrus, you’ve led sales efforts before. How different, though, is this? This is a private pay market, and it’s one that you in your recent OIS presentation, that you laid out pretty well. And you can go through the numbers today if you want to, or people can go on OIS.net and check it out themselves as to how large a market this is. But how do you prepare a company, device company and ophthalmology company for a private pay market like this one? Is it markedly different than other sales ventures, where you know what the reimbursement is, you know what docs are getting paid? What is that procedure like?
JK: I think fundamentally at one level there really isn’t any difference. Because at the end of the day, regardless of whether it’s a for pay or not for pay, the bottom line is kind of has to work. And so you have to deliver clinical outcomes. You have to be able to provide value to our surgeons and our patients. So whether it’s charged a dollar and it gets reimbursed, or $5000 and it doesn’t get reimbursed, that part of it is exactly the same. We need to focus on delivering great outcomes. And if we do, we’ll be successful, whether it’s for pay, reimbursement, not reimbursement. If we deliver great outcomes, we will be successful. So now moving to the next step, I mentioned to you that it’s 2 billion people in the world. But let’s kind of bring that back a little bit to reality and let’s look at the US’s, which will be our target over the next, certainly 12 to 24 months. Our focus will be in large part on the US and the roll out of Raindrop to the US surgeons. If you look from the top line, there’s 328 million people in the United States. We then take that number and say, OK, what is in our approved indication? So our approved indication is minus a half to plus one. So of that 328, how many are in that population and are in our age group? That’s 28 million. If you take that one step further and kind of put it through another filter and say, OK, this is an elective procedure, to your point about it being a non-reimbursed procedure. This is an elected, not reimbursed. If we put a household income qualifier on it, we’ll say $75,000, what does it look like then? So again, through that second filter, you go from 28 down to 13 million. So it’s easy to say 2 billion. That’s a great slide for everybody. But the reality of our market with our indication and our age group and if you put a household income qualifier on it is about 13 million people. That’s still a really big market. It is evergreen. It repopulates, replenishes ever year. So it’s a holy grail. It is a very large market. And the challenge is making sure that you stay focused to your plan, make sure you have the technology and identify it for a specific population that we want to make sure that we put this in patients in the right indications, within our approved indication. And those patients that we have seen historically, be it through the IDE trial or some of our – we have a small bit of experience outside the US, but clearly the provided – that experience has provided great learnings for us – as to which patients are going to do the best. Great ocular surface, low MGD, the tear film development, people who typically are compliant to their meds. And there’s certainly a recipe, if you will, of which patients would likely be better, and we want to make sure we focus on those patients, and impart that information to our surgeons. I mean what we do want to be is in this launch, again, whether you’re in cardiology, neurosurgery or in ophthalmology, no surgeon likes surprises. So we will be as transparent as we can with our surgeons to make sure that they understand where we believe, based on our experience, be it an IDE or commercial setting, where this product will work and perform the best for them and their patients. And I think Luis Vargas on the medical affairs side, who works for us, Sarah, Canon who’s our director of marketing, and then obviously Frank, that group will be heading up the commercial effort, and they will be, I think, very open and transparent in the way they present raindrop to the marketplace.
TS: How does the approval of other lenses sort of affect ReVision? Is it better to have other presbyopia targeted devices out there because it sort of builds a critical mass of offerings that you can sort of be part of, and you don’t have to explain the whole story? Or would it be better to have this field to yourself?
JK: No, I think your first point is correct. I mean the fact that KAMRA has been in the marketplace I think is helpful. I think they help us, we help them. Presbia will be on line at some point in the future. I think the more opportunities that surgeons have, the more opportunities the patients have or selection will benefit us all. I mean as I just articulated, there’s 13 million people that replenish every single year. The market is extremely large and can certainly tolerate 3 players. In addition to there are other methods of presbyopic correction as well, and one of the things I’ve really come to appreciate over the 5 years I’ve been in this marketplace is not all presbyopes are created equal. And no one presbyopic solution is going to be perfect for all patients. So I think what we’ll see in this marketplace is a, over the next years is there is a continuing maturation and improvement in the technology that will allow surgeons and their patients to better select the presbyopic correction for that particular patient. One of the other things you had reference, my OIS presentation, that really jumped out at me from some of the work we did with a strategic partner. We surveyed just under 1000 patients, potential patients, I should say. And what I heard continually from the marketplace is that presbyopes don’t go see the ophthalmologist. They just don’t go see them. What I shared with the group at the last OIS meeting was that that is totally counter to what we heard from these almost 1000 potential patients. Because when they were asked, when they were told about Raindrop, and they were told about the advantages and some of the disadvantages, the drawbacks, so there was a balanced discussion as to what Raindrop was, who would you seek out for information and treatment with this product? 71% of the patient said they would see an ophthalmologist. 71% said they would go to the ophthalmologist. So my belief is that patients don’t go to the ophthalmologist for their presbyopic correction because the ophthalmologist really hasn’t had tools to offer to the presbyopic patient. Well, Bob Dylan, these times are a-changing. We do now have products that ophthalmologists, surgical products that will benefit presbyopes that they can market. And it goes back to your other point. So the fact that KAMRA is in that market, that we’re in this market, presbyopia in the market in the future, and other technologies I think will benefit everybody to raise the awareness that there are surgical solutions that bring these patients back to the ophthalmologist, which leads to more refractive procedures, which leads to more dry eye management, which leads to more cataract identification at earlier or later stage. So it really is a driving force to accelerate, I think, patients who would not have typically seen an ophthalmologist, not just for their presbyopia, but for all others of their conditions as well. So I think it’s a great opportunity.
TS: Is this a direct to consumer sort of effort, then, by you? Or do you work with optometrists? I have an appointment with my optometrist in a month to sort of review my prescription and my situation. Are they going to be referring patients to ophthalmologists to talk about these new products that can help them?
JK: That’s a great question. I think for me personally; this is the closest I’ve ever come to direct to consumer. But our customer still is the surgeon, the ophthalmologist. We will certainly be educating and updating and informing optometrists with regard to direct to consumer. A national campaign is something we would consider at a potentially later date. But when you go to that level and create that demand in the marketplace, you need to make sure that that demand can be satisfied. And at the early stages, we’re going to have tens and hundreds of doctors over the course of the next 12 months or so doing the procedure. If you go to a national campaign, direct to consumer, you have to have – because if you don’t, they’re going to be frustrated when they go seek out the technology and they’ll go away. So we’ll build that momentum over the next years.
TS: That’s a great point. And you want to make sure it’s done right, too. You don’t want the first impression to be a bad one. So what is next? Just talking about the consumers, what was – you talked about the online survey of just under 1000 people. I think it was 800-something people. What other data have you accumulated to sort of help your sales team prepare to make the pitch to the surgeons? What other data do you think is relevant to those surgeons?
JK: I mean clearly; you start with what your indication is. So that’s where we start. And this will be our approved indication. And clearly, the directive of the field sales force is that we are staying on label, and that is also our message to our surgeons as well. Because we know when – that minus a half to plus one, we know a lot about that patient. And we can really help you get great outcomes. So patient selection, types of patients, as I mentioned before, ocular surface health, some of the things that you want to look for there. Then you get to the next level down is surgeon training. We will have online training, we’ll have didactic, we’ll have wet lab, we’ll have proctors. So there’s a process, a very logical and stepwise process that we’re going to take these surgeons through. And overall, our procedure is quite straightforward. It is relatively simple. You cut a flap, you lift the flap, you put the Raindrop down on the light-constricted pupil, you wait for it to dry, you rehydrate the hinge, then you put the flap back. For a surgeon who has done 20 to 25,000 Lasik procedures and flap lifts over the past x number of years, they look at you and say, “I don’t need the assistance.” And the surgical technique, you know, you’ll offer some pearls on the surgical technique for sure because it is a little bit different. But it’s also that perioperative environment that we need to make sure that these surgeons understand this is a different patient population. This is from a counseling standpoint; these are the things you want to bring forward. From a patient follow up standpoint, these are the things you want to emphasize. And then we are also working on some value added technology that we’ll be able to layer on top of the surgeon patient experience, which is still – we have not presented yet publicly, but we’re looking to do things a little bit different in a positive way, where we can hopefully enhance the surgeon patient experience and improve the outcomes on a long term basis. So we have high satisfaction rates, both at the surgeon and at the patient level.
TS: Terrific. And just final question. How are you capitalized? Do you have the money you need to take this next step? Or do you have to be raising some money soon?
JK: We certainly do have – we are well capitalized at this point, although as you can imagine, the US launch is an expensive endeavor. So we will be raising additional capital to support the US launch. I have a great group of investors around the table, and I’m very excited to have them be very committed to seeing ReVision Optics through and supporting us along our way. But yes, we’ll raise some moneys and look forward to doing that because I do think we have a technology and a product that will be rewarded in the marketplace. And I do believe our investors are agreement with that.
TS: Terrific. Congratulations again. Like I said, it came as a pleasant surprise. I read the news about your approval, and then I looked at our coverage from ASCRS, and thought, well, we had the timeline a lot farther down the road than that. So I didn’t think I’d ever see anything come in that early. So that was great news for you and a great –
JK: Yeah, it’s a high grade problem, but we’ll take it.
TS: Absolutely. All right, John, well, thanks for the time today, and look forward to seeing you at a future OIS.
TS: Hey, John Kilcoyne, thanks for sharing ReVision’s story. Great news from the FDA, glad it came quicker than anyone had anticipated. And look forward to watching the roll out of the Raindrop. And who knows, maybe I’ll be a customer someday soon. Thank you, Podcast listeners, Medtech Talk Podcast listeners, for joining us. A few things: If you wouldn’t mind taking a few seconds to rate us on iTunes, just give us a few clicks of a button, let us know how we’re doing. If you’ve got an extra couple of seconds, feel free to write a review. And we’d love to hear your thoughts and read your thoughts on iTunes. It helps us a lot if you do that. Finally, if you want to reach me directly, I’m at firstname.lastname@example.org. That’s the word health followed by the letters EGY.com. Let me know who I should be talking to in medtech, who you want to hear from. And I’ll track them down and get them on the Podcast. I’m also at Twitter at @medtechtom. And look forward to hearing from you and bringing you another tale of innovation in next week’s Podcast. Thanks for joining us.