
Sight Sciences Announces Strategic Cost Measures as it Awaits Final LCDs on MIGS Technology
Sight Sciences, Inc., a leading healthcare company, has announced a targeted cost reduction plan aimed at streamlining its operations, improving efficiency, and enhancing its financial stability. The plan, which begins immediately, will help the company better align its operating structure for long-term profitability and extend its financial runway. The company has no pressing capital needs, it has a cash balance of $155 million at the end of the June quarter and burned $30M in cash in the first half of the fiscal year. However, it is taking prudent steps given current financial conditions to manage resources.
In the second quarter of 2023, five of the seven Medicare Administrative Contractors issued local coverage determinations that could lead to a loss in Medicare reimbursement for the company’s OMNI system for minimally invasive glaucoma surgery (MIGS), and an unknown follow on impact from commercial insurance. The proposed LCDs identify the company’s non-implantable MIGS procedures as investigational. The procedure is currently reimbursed using CPT code 66174 (Transluminal dilation of the aqueous outflow canal (eg, canaloplasty); without retention of device or stent) and is reimbursed at $1,969 in the ambulatory surgery center setting and $3,996 in the outpatient setting. Surgical glaucoma revenue makes up the lions share of current total revenue.
The company was highly active in a recent at recent public open comment meetings hosted by five Medicare Administrative Contractors (MACs). On its earnings call it noted various medical societies, physicians, and patients came together to express strong support for continued access to OMNI technology. The presentations during these meetings emphasized the significant role played by canaloplasty and trabeculotomy in treating glaucoma. Additional clinical data was presented to the MACs, data that had not been considered in the draft Local Coverage Determinations (LCDs). Key data shared included results from the two-year extension of the ROMEO Study, a multicenter study. This study demonstrated that OMNI technology effectively reduced intraocular pressure (IOP) and reduced the need for glaucoma medication use in patients with mild-to-moderate POAG. Importantly, these benefits were observed both at the initial 12-month assessment and extended out to 24 months. This extended data reinforces the long-term durability and effectiveness of the OMNI technology.
Additionally, 12-month results from the GEMINI trial, a prospective multicenter study of OMNI in combination with cataract surgery, were presented. In this trial, OMNI was shown to significantly reduce IOP and medication usage compared to a historical cataract control group. GEMINI’s success criteria aimed to surpass the IOP reduction achieved by cataract surgery alone, as observed in previous studies. The prospective study successfully met its efficacy endpoint with a statistically significant reduction in IOP at 12 months when compared to the historical control group.
However, given the uncertainty around the MACs final decisions and current capital environment, the company announced that it will reduce its global workforce by 25 employees, or approximately 10% of its total headcount. The company stated it will also implement measures to control marketing costs, particularly in its Dry Eye business segment, and limit general administrative expenses. The goal is to streamline the organization and better allocate resources to support its strategic objectives. The company will also not fill some open positions. In light of these changes, Sight Sciences anticipates incurring a cash restructuring charge of approximately $1.3 million in the fourth quarter of 2023. This charge primarily includes one-time costs related to employee severance and benefits contributions. The company expects the workforce reductions alone to yield savings of about $7.9 million on an annualized basis
Despite the changes, Sight Sciences stated that it remains comfortable with its recently revised revenue guidance for the year ending December 31, 2023, with a projected revenue range of $80.0 million to $82.0 million.