Good afternoon, everyone. Welcome to Jefferies Global Healthcare Conference. My name is Clara Dong, one of the Biotech Analysts here at Jefferies. It is my pleasure here to have Aldeyra CEO Dr. Todd Brady here with us today for this fireside chat. Welcome. Thank you, Clara. Before we dig into details of your pipeline, maybe it will be helpful for you to give us a quick overview of the company and what has kept you busy for the past 12 months. For sure. First of all, thanks for hosting. Thanks for all of you for listening in today. We are thrilled to be here. It has been a busy day with a lot of Investor Meetings. Special thanks to you and the team at Jefferies for having us. Of course. We are an immunology company. We've started in the front of the eye. I like to say that we're moving backwards into the back of the eye and then downwards into the rest of the body. There are a lot of diseases, it turns out, that are influenced by immunology, as we're learning, and cancer and autoimmune disease and metabolism and so forth. We are really pleased to be part of the broader system that involves eye and eye. We are really focused at this point on a drug called reproxalap. It's in development for dry eye disease and allergic conjunctivitis, which are two of the most common diseases that affect the front of the eye. In fact, most of us probably have some form of those conditions. They're very bothersome. There are really no good treatments that work acutely. Our focus in dry eye disease in particular is fast onset. In an allergy, there are a lot of folks that just do not respond to the over-the-counter treatments that are available today. Reproxalap aims to fill that need. As most people know, we have been involved in submitting new drug applications to the FDA for dry eye disease. We are, I hope, on the cusp of resubmitting an NDA. We received a complete response letter as we announced in April for dry eye disease. The FDA wants one more trial. Fortunately, we had a couple of backup trials waiting in the wings. The trial that was most similar to the trial we recently submitted was wildly statistically significant. Pending FDA discussion, we plan on resubmitting a new trial. Hopefully, a third time is a charm and the drug gets approved. Great. Since you already mentioned the reproxalap in dry eye disease, maybe for those who are less familiar with dry eye disease regulatory requirement, why don't you give us an overview of what's actually the FDA requirement for dry eye disease approval? Typically, it's symptoms and signs. So a little bit about dry eye disease. I mean, as I mentioned, all of us have some form of dry eye disease. And the prevalence of the disease is growing. We're all looking at computer screens and phones. Especially the younger generation these days, my kids seem to have a phone up front of their face most of their waking hours. What it's doing is drying out our eyeballs. We blink less when we're looking at screens. We have more pollution. We have more pollen thanks to climate change. All that is exacerbating the discomfort we feel that is generally characterized as dry eye disease. The FDA's stance on dry eye is it matters how patients feel, which makes sense. It matters how the eye is responding objectively. That is, if a physician or an optometrist or some other healthcare provider were looking at the eye, could they tell that it's getting better or worse objectively? We focused on redness. No one wants a red eye. I think having redness on your label is commercially advantageous. Red eyes matter to patients. That is our sign. Our symptom has typically been either dryness or discomfort. I think many patients feel the same way about those kinds of symptoms. They're just bad. They're persistently disturbing. We have gone to the FDA with symptom trials and sign trials. The FDA has appeared to have accepted two redness trials, which will be on the label if the drug is approved. They have accepted a symptom trial that was performed in a natural environment setting. That's a so-called field trial where you go home, you take the drug for a certain number of weeks, and patients report how they feel. The dry eye guidance, which is worth a read—it's only two or three pages from the FDA—specifies you can use Field Trials or Chamber Trials. Chamber Trials are like sitting on an airplane and having those vents blow in your face as you fly across the country and watch a movie. It's incredibly noxious. In fact, the first thing I do when I sit on planes is turn off the vent. If my neighbor's not there, I turn off their vent too because I don't want to desiccate my cornea. I'll say that the Chamber is really good at mimicking the flares that are sort of characteristic of dry eye disease. In fact, that may be the most important aspect of dry eye. Certain days are bad. You have bad days. The Chamber really is designed to mimic those bad days. Our redness endpoints were assessed in a Chamber. One of our Symptom Trials, we hope, will be assessed in a Chamber as well. I think that matters commercially because Chambers are measured in minutes. They're not measured in weeks. They're measured in days. They're not measured in months. They're measured in minutes. The ability to show improvement in dry eye in minutes, I think, is what's lacking in today's marketplace. We have many drugs approved for dry eye disease now, at least a handful. All of them, their efficacy is measured in weeks, which is the last thing any of us want. When we go to a doctor and our eye hurts, we don't want to feel better in weeks. We want to feel better now. In minutes, that's probably the closest thing we can get to now. So therein lies our regulatory approval process, which is a combination of signs and symptoms. God, is that super helpful? I know there has been a lot of focus recently on the regulatory development of reproxalap in dry eye disease. I know you touched on this a little bit earlier as well. You are planning to resubmit for the regulatory approval. Maybe could you elaborate a little bit more on what is the plan for resubmission, what is the timeline, and how are you planning to leverage the latest data from one of your phase three, which met the primary endpoint of ocular discomfort, to support the potential approval? Right. Maybe just to back up on our history in submitting NDAs in dry eye disease, the first submission was in 2022. The FDA came back and they said, well, one of your symptom trials failed a co-primary endpoint. In regulatory medicine, there is this concept of co-primary, which means you have two endpoints. For the trial to be valid, both endpoints need to be successful. Our symptom endpoint hit in that trial. Our sign endpoint, which was something called staining at the time, did not hit. That is why the FDA said in 2023, we want another Symptom Trial. At the end of last year, we submitted another trial. We had actually started three trials to remedy the one trial requirement from the FDA. Two of those trials were Chamber Trials, as I have described. One of those trials was a Field Trial. The first Chamber Trial readout was successful. We resubmitted that at the end of last year. The FDA came back, as we announced in April, and said, we want another trial because there was a baseline imbalance across treatment arms. What that means is the patients that were randomized to reproxalap were different by a certain amount in terms of their discomfort at baseline than the patients that were randomized to vehicle. It is not ideal. Even I would admit that is not ideal. You want your patient arms before treatment to be relatively balanced in terms of the endpoint that you are assessing. The good news is we had a backup Chamber Trial. That trial, as you mentioned, was successful. There was no baseline imbalance. We announced those data at the beginning of May. Again, pending successful FDA communication, which I'm sure you're going to ask me about, we look forward to resubmitting that Chamber Trial. Just to maybe follow up on the point you just mentioned, have you had any interactions with the FDA following the latest regulatory update? Clara, the good news is that is the 15th time I've heard that question today. I've had a little bit of rehearsal. We typically don't update, like many companies, on interim FDA communications. As you know, you meet with the FDA. Usually, you get minutes and you wait for the minutes and so forth. I'll say this. When we announced the data at the beginning of May, we also disclosed that we had requested a type A meeting to discuss the complete response letter. The FDA has 30 days to provide some sort of feedback in a Type A Setting. That was on May 5th. Today, it is June 5th. A reasonable assumption is that we've received some sort of advice from the FDA by now. I tell folks that there's two options going forward. One option is you hear from us that we've submitted an NDA. That means that we've had communications with the FDA. Those communications were reasonably positive. We believe that we have a data package sufficient to be accepted by the FDA for review. Obviously, that's a good thing. Another option is you hear from us about a Type A meeting. We've received minutes and the FDA wants X, Y, or Z. And then that's when you'd hear about it. I think the timing for the latter would be end of this month because that would be 30 days after our 30-day meeting, which should happen around now. Obviously, that meeting is not today because here I am talking to you about Aldeyra Therapeutics. You know, I think that the trial that the FDA would review in a resubmission is essentially the same trial that we submitted at the end of last year. It's not like calculus. I don't think the FDA needs to reinvent models and ways of thinking about Chamber Trials and so forth to decide whether or not this package will be acceptable for review. I also think, though, that the FDA is being quite careful with Chamber Trial Data. There is no drug on the market today in dry eye that has Chamber Trial Data. We would be the first. As I like to say, this is the price of innovation. Sometimes it takes a little longer to get something across the goal line when it's new. The regulatory agencies are unfamiliar with assessing those kinds of results. I often get asked, why aren't there other drugs with Chamber Data? My general response is probably because there aren't other drugs that work so fast. To work in 90 minutes or 100 minutes, even in a flare situation, requires rapid onset of activity, both in terms of symptoms and signs. I think that's where reproxalap really shines relative to the rest of the drugs out there in the marketplace. While it may have taken a little longer and fingers crossed, the end result is a good one. I'm thrilled to be part of this process because, as I mentioned at the beginning of this chat, what the market really needs is something that works fast. Fantastic. Also, you have an option agreement with AbbVie. Can you just remind us about the terms of this agreement and whether anything has changed on this front with the recent regulatory update and whether you have any recent interaction with AbbVie regarding the future direction of repro's development? Right. I've also been asked that question 15 times today. You know, first of all, I'd just like to say AbbVie has been a fantastic partner. They have an option on reproxalap for all indications. This is the company that invented dry eye disease with RESTASIS. Some of you remember way back when they were Allergan. Clearly, their knowledge and experience in the space shows. They are, by the terms of the option agreement, intimately involved with us. They have rights to attend meetings with the FDA. They have rights to review anything we send the FDA or the FDA sends us. By and large, it's been an absolute pleasure to work with them. The terms of the agreement are they have 10 days after approval. I just want to say those are 10 business days after approval to decide whether to exercise the option on reproxalap. The option is a co-development, co-commercialization option. What that means is that we have a 60/40 split of the P&L. So Aldeyra is responsible for 40% of the costs and 40% of the profits of the P&L ultimately when the drug turns profitable. To exercise said option, it is $100 million less what AbbVie has already paid us for option fees, which is $6 million. That makes $94 million upfront. If the drug is approved, it is another $100 million. There are two other $100 million milestones that occur after approval or potentially could occur after approval. The rest is all about splitting the P&L, as I described. I think from Aldeyra's standpoint, it is a fantastic deal. We are also capped in terms of expenses and so forth. Over time, I think it makes great financial sense for Aldeyra. Nothing has changed, Clara, that I'm aware of. AbbVie, again, per the terms of the option agreement, remains intimately involved with the program. As far as I know, eye care remains an important part of AbbVie. Fantastic. I understand it might be too early to discuss, but let's say third time is a charm. Do you have any preliminary thoughts on what could be a winning situation for the label in the future? How does it make repro differentiated from approved products in the dry eye disease? Yeah, I think I often get asked about the label. I think we sort of know what the label's going to look like in a sense, right? These days, every drug in dry eye is approved for the signs and symptoms of dry eye disease. We had an approval last month. Another drug was approved. There's another way to get approved, not symptoms and signs, but something called Schirmer Test. Schirmer Test is stick a piece of paper in your eye and measure the amount of tear that wicks out into that paper. That's a measure of the volume of fluid in your eye, your tears, if you will. The way to get approved there is to compare the number of patients in your active arm that have 10 millimeters or more that wick out onto that piece of paper versus your control arm that have 10 millimeters. Those are called Schirmer Test 10 millimeter responders. That gives you a symptom and sign labels. Most drugs in the dry eye space are approved that way, remarkably. I like to tell people we're really good at making people cry. As a medical community, we're now experts in making people cry. We have a nasal spray that makes you cry. We have eye drops that make you cry. I'm not sure we need more drugs that make you cry at this point. I think the other thing about all this is on your label, to your question, you probably want to have some symptom improvement. As I talked about earlier, if you're going to have a sign, you probably want to have redness. Patients care about how their eye looks, i.e., not red, and how their eye feels, i.e., discomfort. That is really what we're going to have on the label. I think the other key factor that I've mentioned a few times already is onset. You want a label that shows activity in minutes, if possible. In a Chamber, you can demonstrate activity in minutes. The most recent drug approved is yet another Schirmer Test drug. It shows activity in two weeks. There aren't many of us here today that want to wait two weeks to feel better. We'd rather wait two minutes. I'm just not sure where the rest of the field is going. Reproxalap really is a novel addition with regard to unmet medical need. I see. Can you also remind us about the size of the dry eye disease market? In terms of the prevalence and in terms of the unmet need? Where do you see exactly the unmet need is? What's your kind of strategy to achieve it? There are about 40 million people in the U.S. that have dry eye disease. Remarkably, the vast majority are not treated. The reason for that is that I think there are many people that have mild forms of the condition that can take artificial tears, which is what I always recommend to folks. A pro tip is to put your artificial tears in the refrigerator. The cold tears make you feel better sometimes. For about 5 million patients or so, that does not work. It is just not sufficient to use artificial tears, whether they are refrigerated or not. You have to go see your optometrist or your ophthalmologist. About 60% of the time, dry eye scripts are written by optometrists, which are taking over, I think, medical care for the front of the eye. I am actually thrilled about that. I see an optometrist. Ophthalmologists are great, but they mostly make money by doing surgery. I guess one day I'll have my cataracts taken out by an ophthalmologist. In the meantime, I see an optometrist. The patients that are severe enough in terms of dry eye to go see their optometrist or ophthalmologist are generally treated with one of the drugs that are available today in addition to artificial tears. Sometimes patients will be put on a steroid. You can only use steroids for about two weeks unless you want glaucoma or more cataracts. Steroids can be toxic with long-term use. After that, maybe you're on RESTASIS. RESTASIS, as I mentioned, the first drug that Allergan developed in dry eye disease, is now generic. There are other drugs out there that could be used to treat dry eye. As I've said before, there's no drug for chronic use that has redness on the label or discomfort on the label. There's no drug that works in minutes or has data on the label that suggests that the drug might work in minutes. Great. Also, reproxalap is being studied in allergic conjunctivitis. Can you remind us what's the current status and your plan for this? I tell you, allergic conjunctivitis is really underappreciated. Thank you for asking that question. One of the things I like to do at 5:00 A.M. in the mornings in the summer is ride my bicycle. I ride with a group. That's great until I realize how much pollen I'm getting in my eyes. Sometimes I wear sunglasses, but it's not that light at 5:00 A.M., so I end up getting pollen in my eyes. That's bad for two reasons. One is I have a little bit of allergy, and that makes your eye itch. It makes your eye red. The second reason is it's irritating, and it exacerbates pollen, exacerbates dry eye disease. Itchiness is part of dry eye disease, not only because of pollen, but dry tissue itches. If you ever noticed something in your skin and you have a little dry patch, it's sort of itchy. Same thing happens on the front of your eye. Allergic conjunctivitis is a massive market. It's actually about a third of the world has some form of ocular allergy. Generally, you can treat that with topical antihistamines. You go to CVS, you go to Walgreens, you can treat yourself with an antihistamine that's applied in terms of an eye drop. About a third of patients, though, don't respond adequately to ocular topical antihistamines. There again, we really lack something that works more or less immediately. I remember I was driving on the wrong side of the road in Ireland once, and somehow pollen got in my eye. It is incapacitating. I don't know if you've ever felt that, but I had to pull over again on the wrong side of the road and adjust because my eye was so red and puffy. Man, it's a terrible situation. If you use an antihistamine in that scenario, you're not going to feel better immediately. Again, just like in dry eye, we've run two phase three trials in ocular allergy in a Chamber. This is, I guess we're good at torturing people now that I think about it. This is instead of a small room with hot dry air like you're sitting on an airplane, it's sort of like the airplane thing, except in the air vents are pollen. You spray pollen in people's eyes, and they get red and itchy. You can measure both of those things in a matter of minutes. Similar to dry eye, I think we have clinical data that suggests that in ocular allergy, reproxalap works quickly, both in terms of symptom—there, it's itchiness, not discomfort—but also signs in terms of redness. Fantastic. I'll pivot the topic a little bit to the rest of the pipeline. Maybe let's talk about the retinitis pigmentosa program. You recently actually presented some clinical development of this program at a conference last year. Could you maybe elaborate a little bit about what's the latest development of this program and maybe share some physician feedback on the presentation as well? For sure. Some years ago, we bought a company called Helio that had developed the world's first intraocular injection that contains methotrexate. Methotrexate's an old anti-neoplastic, anti-cancer, anti-fibrotic, anti-inflammatory compound. It's been around since the 1950s. It's used off-label mostly to treat a disease called ocular lymphoma. That's a fatal cancer. It's a condition for which we had submitted an NDA previously based entirely on the literature. The FDA decided they wanted a trial to prove the drug is active in addition to the literature. That's something I think we'll be talking about in the future, Clara, just to give you the heads up there. You might be hearing about that shortly. Retinitis pigmentosa, though, is something for which intra-ocular methotrexate is not used. There was an investigator at Pittsburgh and then Case Western who came up with this notion that methotrexate may be active in retinitis pigmentosa. That is an inflammatory orphan disease of the retina. It results in blindness. There is no approved therapy except for a very small set of patients. At least in animal models, methotrexate worked quite well in treating the condition. We ran an open label trial a couple of years ago. At least over three months of therapy, patients seem to improve in a manner that you would not expect if you had just followed retinitis pigmentosa patients. Usually, they get worse, not better. One of the things we are planning on doing is starting a 12-month trial. We will randomize patients. We will treat them with methotrexate, or there might be a sham injection and so forth. That's another potential program that I think adds to our catalysts, probably reading out next year. Great. For ADX-248, could you give us a brief overview of the program and what's the latest status there? Let me talk a little bit about RASP. I could go on forever, although I think we have three minutes and 15 seconds. RASP are small molecules. Reproxalap is our lead RASP inhibitor that I know of. It is one of the few drugs that does not target a protein. Think about every drug you have ever taken or invested in or thought about. They all affect proteins, right? They are enzyme inhibitors. They are receptor agonists or antagonists. They are proteins. They are gene therapies that make proteins. They are antibodies against protein. This is different. RASP are small molecules, and they affect a variety of proteins. By trapping RASP, you are really downregulating a whole system of proteins. ADX-248 is the oral version of reproxalap. It is different chemically, but same sort of warhead in terms of the way it works, and the mechanism is the same. We've thought about atopic dermatitis as a potential indication for that drug. We're in the midst of phase I clinical testing now for inflammatory disease with this oral molecule. Atopic dermatitis is interesting because there really is no good oral option in atopic dermatitis. We're great at injecting things, and those injectables are very effective. The problem with atopic dermatitis and eczema is a lot of kids get that disease. I don't know any kids that like injections. We're all waiting for an oral option in this condition. That's something that we plan to pursue, assuming phase I results are positive for ADX-248. Great. I know we have a minute and a half left. We just want to quickly touch on alcoholic hepatitis and what's the latest status? Right. We've been working on alcoholic hepatitis for a while. It's been somewhat challenging finding patients that are interested in enrolling in clinical trials. I think something you'll hear about in the near future is an update on that program. Hepatitis itself is interesting. Alcohol is metabolized to a RASP called acetaldehyde. We do not get cancer in red faces after we drink because of ethanol. We get it because of acetaldehyde, which is a metabolite of ethanol. Obviously, that acetaldehyde metabolite is trapped by ADX-248 and ADX-629 and other RASP inhibitors that we've developed. I look forward to updating on that in the future. Great. Lastly, what are the key milestones for the company that investors should be looking for? Based on the 15 questions I've gotten today, they are, when are you submitting your NDA? How did the meeting go at the FDA? When is your PDUFA date going to be? I would say it's pending positive discussions with the FDA. It would be NDA submission. It would be NDA acceptance and NDA approval for this year. I think that's 95% of what investors want to hear about at this moment. Okay, great. Thanks for the very insightful discussion. We'll wrap up our session here. Thanks, everyone, for joining. Thanks again, Clara.