GKOS - Earnings call transcript Q1 2019

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Operator

Welcome to Glaukos Corporation's First Quarter 2019 Financial Results Conference Call. A copy of today's press release issued after the market closed today is available at www.glaukos.com. All lines have been placed on mute to prevent any background noise. After the prepared remarks, there will be a question-and-answer session. [Operator Instructions] This call is being recorded and an archived replay will be available online on the Investor Relations section at www.glaukos.com. the and to Corporate turn of Lewis, now Relations Investor Strategy will call Chris over Director I and Development.

Chris Lewis

good and you afternoon. Thank

Joining Chris President Joe me Glaukos' Tom today CFO, Burns; and Gilliam; Calcaterra. CEO, COO, and are

Following we To opportunity ample questions. call ensure one you that remarks limit our everyone's one time questions, follow-up. question we'll and prepared address the to open to request and yourself to

market affecting are business of on our future Review factors information for control. and press financial to which about These of than of subject sales, filings that all future materially strategies expectations developments statements. risk are and implied release statements current activities, pipeline technologies, our our they many get statements If SEC in differ and predict historical forward-looking commercialization include These our are these you and our back may all plans, recent events based relating still statements competitive U.S. are will and more and statements beyond Please queue. events and Therefore, today's believe results you on the other or have factors. made current among objectives, and regarding cause risks, our anticipate into international efficacy note forward-looking operations. by of to our of uncertainties condition about our our address facts products, operations may to our difficult this actual may from we and are additional about the the prospects efforts, that future occur expressed to or or our questions, environment, call which statements. us, results position, those expect, things and products, other or

our of Burns. section www.glaukos.com. find call to that, over turn website Investors at documents the in and With President CEO, I You'll will our the these Tom

Tom Burns

sales of quarter everyone versus XX% $XX Glaukos the thank reported us. quarter. million, year net for you Today joining and ago up afternoon, Good first

$XXX also to previously. million in rollout updating results are to call. million device million sales Joe $XXX inject guidance iStent and our outlook are million ongoing detail to the next-generation We trabecular strong the XXXX will our start discuss financial versus our in later $XXX XXXX was more where commercial in of the net expectations. U.S. our we on our delivering $XXX Fueling micro-bypass

our are first-time in Similar largely international of surgeons conversion conversions. to our the we we we Over primary first our experience to iStent inject's track iStent to process MIGS seeing commercial initial execute quarter, opportunistically inject as U.S. existing remain inject in with iStent train addition potential to iStent complete mid-XXXX. our converting the focus early by to on expectations previous focus on continued primary on and on of indications customer customers our the market-expanding

pleased in providing a MIGS in been rollout management. with iStent component feedback trial U.S. safety Our emphasis privileged the increasing marrying by MIGS the of through exceed us gradual pivotal favorable and and new followed inject, surgeons inject of training response and therapy the have key adopt will remain to on corporate accounts. months iStent the along utilization our profile. converting and product's international results Overall, along as we're to reps existing coming implanters to a existing initial validate founder our continue in U.S. very to within real-world with markets with continued iStent the surgeon who back yet experience We've shift glaucoma with community. ophthalmic pioneer to commercial results our of the confidence efficacy execution the by estimation as high

to achieved iStent pointed to safety with inject outcomes his in cataract mercury Wandling surgery. in at cataract one IOP also medications the Dr. the iStent multiple IOP consists last follow-up. plus reductions six studies reported for series on iStent than or in presented IOP inject. body combination sites presented or favorable publications, reduction trial also and MIGS of iStent Of inject of clinical a with initial of Surgery retrospective iStent iStent ophthalmic These presented of performance subjects safety the XX to Dr. technologies now sustained meeting a real-world that of favorable series this real-world case in ability in with Several inject and our trend XX% global iStent in with surgery Society U.S. literature including multiple alone. iStent profile to better early-term the to at cataract to of iStent American mean Sarkisian In of inject both surgeons continue are been numerous cataract product's achieved of studies of and and achieve investigational category testified clinical clinical combination Refractive case inject to of supporting to performed initial similar presentations surgery combination an alone. follow-up. and unparalleled a validate at mean months surgery XX subjects of data growing similar cataract millimeters is XX.X surgery. that XX millimeters XX% a a with specifically In XX three of to results on inject pivotal equivalent these note, Cataract retrospective sets have profile reduction total inject that surgery favorable cataract peer-reviewed months mean of of clinical including robust by studies results U.S. three mercury at of XXX of a studies medication XX.X his week's Our clinical evaluation therapy a

Glaucoma, in IOP XX% XX.X to pleased prospective, to In Ophthalmology and compared treatment the implantation mercury of subjects, of ASCRS, ever in standalone the array evaluation years as addition of presented data the of millimeters Authored iStent by in follow-up. of the wide newly peer-reviewed study that iStents after a latest first two travoprost. appearing publication randomized, of favorable protocol-driven showed with mean we reduction topical five implantation by Fechtner to diagnosed achieved were Dr.

addition, the higher years iStent five significant In significantly subjects compared success at prostaglandin treatment cohort requiring achieved fewer to with subjects. a post-operative, add-on topical statistically medication iStent

Dr. Dr. Dr. iStent continue Katz therapy at to inject XX% Ahmed, Dr. for Dr. at iStent standalone millimeters peer-reviewed the a an presented to independent those Glaucoma promising with XX% and XXXX XX Dr. X-year recently the March reduction follow-up. in compelling commercial clinical subjects studies, mercury an a addition, Dr. with of Society medications, study evaluated Hengerer Clement, and by mean iStent publication, validate for procedure American In meeting standalone results implanted and Lindstrom, IOP XX.X with glaucoma found along treatment others, as reduction algorithm. these a Dr. by Donnenfeld, standalone Fea, of in The in prospects Berdahl, accepted

therapy. subjects III corporate is years, sites the cascade, to transform advance seek the we algorithms disease opportunity hypertensive platform concurrent, next market Travoprost, across introductions Patient Travoprost the our combo cataract inject in prospective, the is ocular Phase the and enrollment product line iDose our important glaucoma most iStent our several mission disorders. over iDose expectations, in consists double-blind, know, as first therapy also which yielding, and that IND a first and and from The XXXX, when powerful may build potential treatment using addressable to the stage of U.S. five may patient with expand most for proceeding X,XXX, diagnostics the target over and study micro-scale to randomized, stage iDose our estimate programs both the treatment aspirational, platforms you two As potentially represents program, trials, The additional of open-angle two procedures. and approximately that at each to new key and we capable ultimately clinical platforms procedures. roughly infinite. devices manifestation pharmaceutical seeking of providing are XXX quarter surgical injectable severe of investigator or therapy, standalone sustain optimized annual progression with the Travoprost U.S. These of portfolio a are of programs glaucoma ocular severity, we earliest treatment of in therapies, will expectations. disease programs, robust early-stage an pivotal clinical combine notably primarily enrollment to iStent continued pivotal million to pipeline in enroll combination development for we create solution, four of glaucoma In

medications. As option we've treatment believe for substantial, we appetite before, combat to potentially topical delivery sight-threatening is discussed and a there patient unrequited to glaucoma drug non-adherence ubiquitous viable, problem of the continuous

to other to we compels be In sustained seek envision for in iDose treatment the of encouraged label making annually used the in diseases. for effectively compounds, by platform. Institute a new drug point, a that broad has effectively ROCK portfolio with with D. utilize to in the manage way, future Technology We to delivery opportunity believe this result spectrum. iDose capable IOP, glaucoma where by We agreement, alone The intracameral To platform, an pharmaceutical iDose for markets, the novel, for ocular platform of potential that given manage inhibitors, standalone the therapy the treatment is on compounds identify inhibitor us addressable believe glaucoma U.S. potential and the more significantly expand alone, fact agent pave recurring. delivery of Western across its a combination will three could the therapeutic addition, future. early the as to with therapies clinical team headway including ROCK our eyes million we're iDose our new and or surgeons to sustained treatment the surgical afforded studies explore development potential the become our severity of could algorithm promising additional being or patients' our that our use performance unique flow can that delivery devices a of combination in

refractory infinite, On X-stent for to patient in pivotal for product and device for proceed standalone with line our XXX(k) trial continues iStent the enrollment glaucoma the patients. advanced our front, expectations

XX a multi-center, prospective, enroll As refractory clinical is reminder, will that single-arm subjects. roughly trial this a

Nevertheless, stages our trial to we in CyPass launch. clinical the are and we've marketplace of full encouraged the dataset examining of the appropriate determine months. withdrawal we recaptured analyzing also perceptions former considerations while CyPass forward forward for product very device suprachoroidal inject path that the this since for We Supra, stent. changing the commercial in to of the over the procedures the are the coming dynamics, pivotal and assess continue look to following suprachoroidal data potential, We recent iStent most the the devices final majority of iStent safety regulatory

pipeline an represents compelling we provides in developed product pressure intraocular device IOP for trial on currently novel for their with or and to us is for In reduction expects R&D if surgery. implant uncontrolled in glaucoma, MicroShunt exclusive this results distribution of recently primary algorithm the on announced in in The important solely is AV approved in surgical basis study to business believe open-angle United agreement being to late-stage medical an for rights where collaboration and United targeted internal an entry is Pharmaceuticals. and and submission open-angle launch States. Santen XXXX We the XXXX. multiyear States and sales treatment FDA the where into pivotal the our external the That treatment the efforts the minimally a glaucoma. therapy and of of our maximum with invasive, primary a development a Santen addition pivotal front, glaucoma MicroShunt incremental with tolerated studied the MicroShunt product the is patients support alternative external, in FDA disease management. capstone that PMA our of progression warrants novel, glaucoma distribution

and presence XXXX products in with and the during internationally the providing to XX% United well-positioned regulatory driven internally Santen's through MIGS this the growth growth. we've advance continue our leverage We collaborations to beyond. FDA. transformational by same and Santen the further alternative made with to the We conventional first expanding partner clinical in our and of of quarter invest technology progress core leaves both in external States novel to surgeries. portfolio patients the to believe by to year-over-year broad-based this us commercial and our higher sales strategic MicroShunt our also excited organization At approved market time, seasoned about complement good filtration quarter with we regarded glaucoma if AV expect progress We're where AV bringing to pipeline notable opportunity internal establish by revenue

were long-term our reductions about and in point takes that To pioneer NAH on the finalized these April XXXX important bullish proposed remain is arise phases. expectations. period the with we remember market While in to market-building it previously unforeseen completely the growth consistent it a to disclosed opportunities, early potential time each may these U.K., our o-U.S. XXXX March new through international tariff for to XX March setbacks of countries

XXXX our remains unchanged. ahead, Looking focus

focused the our on efforts, infrastructure core execution We accelerating continue cadence regulatory to research growth. highly expanding and of support abroad implementing in and commercial facilities future and clinical our systems programs to be U.S. our improved and global enterprise

that, with the call the quarter turn a Joe first So I'll summary Joe? to results. of over for financial

Joe Gilliam

Tom. Thanks,

first net and inject a U.S. In quarter ago quarter of a of up XX% XX% the quarter year-over-year were same million, U.S. As in first XX% from were quarter the for U.S. basis. XXXX million, market quarter of and in sales the the noted sales XX%. sales continued late were sales of increase represented the benefited XX% of XX%. the XXXX. earlier, from international same year $XX.X increase third competitive period XXXX developments first U.S., sales iStent period our growth, of year ago. million, $XX currency the the on from the primarily constant quarter a the a $X.X Outside an in market or launch The

outperform continued expectations growth. broad-based business to international by Our driven

the in XX.X% was Our same quarter the versus gross XX.X% margin in XXXX. first in quarter

included and levels inject U.S. build. benefited further initial amortization royalty transaction First elevated production margins launch and associated the quarter from cost with longer iStent of sales, a no from inventory XXXX gross buyout

trial period. the versus the global XX% $XX.X versus and first gross XX% We first R&D year-ago million of mid-XX% million in remain forward. rose million continue the in implementation expenses pharmaceutical SG&A reflects increase. expenses range in to additional going personnel year to and expect the $XX.X $XX.X our to as margins with This to the associated million the and capabilities systems. same iStent rise the higher This research in clinical reflects $XX.X the ongoing R&D enrollment other personnel infrastructure, our our rise costs where and associated with expand to particular with rose costs associated of primarily fees the quarter and domestic iDose the direct services enterprise expansion related of cost in legal launch we in within the to global continues quarter. investments ago inject quarter professional

a market new build continue studies studies our drive We of globally, to per invest to of into prudently finished platforms pipeline diluted necessary million clinical iStent diluted clinical We infrastructure. MIGS and global our penetration with share in build programs, drive to a of compared loss $X.X the through increased inject net $X.XX quarter iStent first million robust first of or the advance opportunities share quarter net and our and initiatives loss $X.X XXXX. per or the $X.XX

quarter cash had As million $XXX.X and equivalents, million $XXX.X XX, of March of $XXX.X end of at end we cash, investments to the of cash compared short-term restricted the first and at XXXX, the XXXX. XXXX million

across increase of we're substantially business. making the call, last a our investments expenditures on course as to XXXX of capital result discussed to As over we the continue expect the

year of range that our million in associated expect turn currency million. on $XX Tom. and $XX exchange with previous based I'll of updating Finally, to million million now training the prior $XXX outlook compared the sales sales, account previously. our back for doctor which for net international now to $XXX guidance MIGS as expansion guidance market foreign and to Tom in $XXX we expectations the $XX the the new we inject into to million organic $XX XXXX indicated considerations to outlined XXXX of to compared range rates the be landscape growth, This Including to launch dynamics, our With to calls; million our competitive earlier, $XXX dynamics million to current call the million we our takes are full

Tom Burns

Joe. All right. Thanks,

for continues So transform worldwide. aspirational to recap, to patients our Glaukos glaucoma pursue mission much-needed to therapy the of benefit

glaucoma platforms strength to in our should and The surgical deliver Our diagnostics solid building pharmaceuticals, we Glaukos to powerful I ophthalmic in effectively the treatment diseases. of micro-scale our unlocking the potentially providing into start company's we stages device gives capable I believe ahead. droplets, other than XXXX the potential performance to is optimized that mission. us our help lie ever opportunities objectives am in with excited devices to further are manage of pharma a approaches value better us early and and confidence positioned of key the hybrid evolve on strategy. remain leader global long-term ocular sustained and

So with the call I'll open to Operator? that questions.

Operator

Morgan. Instructions] Please the go Marcus Your from of Robbie [Operator from first JP question comes ahead. line

is Your open. line

Robbie Marcus

quarter. great on and lot, congrats a Thanks the

Tom Burns

Thanks, Robbie

Robbie Marcus

Maybe it lost I with you've lot of start CyPass seems recaptured like can sales. a the

higher beat first street the the year of a the up I is middle Help of position the in at it's the still move and realize put some aggressive the guidance this move didn't And top it You and the in and of look just should why first year and range us we prudent takes range X-plus I to be early about. by the pretty the year. the million. a end puts maybe understand versus quarter great much range at how quarter thinking early this in raise a it's

Joe Gilliam

drivers It's quarter of is a There's a embedded first the think with remainder right. bit Robbie. I'll right? really the our obviously the setup all touch expectations Maybe start. the year did that I'll I first Joe. better, for that a start Hi, quarter Sure. lot either in question. the itself, about little met the in key or

them. our was was we than candid quite a most was to line what inject than I maybe and little the CyPass expectations to point, conversion previously. trialing with those in competitive line better think activities touch maybe recapture front in less growth expected and line of have the And U.S. been we've The be to impact know a this Market at discussed I'll in recap I line. but in in better been a QX. The than on trying think The then has expectations. pricing touch expectations.

So context that I the of is set-up the to say the reason why year guidance. full

I we're to the course by pleased the encouraged all the But reality trying is the obviously trends. trialing we of continue landscape the year-to-date year. of over the performance expect we're U.S. think with competitive front and on and in those increasing

than the process while too for front our in adjust the it's really to QX, early was that expected expectation on it the lighter year. of So remainder in

Robbie Marcus

deal us you interesting what in follow-up Understood. the Thanks. just as All infinite, and thinking And potential fits and quarter. how that understand with we sales an help relative did right. versus about just Maybe a think the during then Santen here maybe Shunt was to the guys you. impact and P&L how

Tom Burns

part Yes, Robbie, first the your is take question. this Tom. of I'll

So that with this able to were we're we deal delighted consummate Santen.

I think from glaucoma glaucoma. full the put open-angle the capstone for treatment MicroShunt all of really earlier a is does manifestation way the algorithm what through really the to refractory our

really was So that glaucoma if one trabeculectomy we're it Aqueous candidates missing late-stage procedures filtration looking those late-stage for for at or patients component, become shunts.

provide us So strong a those for opportunity alternative the MicroShunt gives compelling and a to really patients. very meaningful

of just just was X a down you or you post-operative to some AV presented at existing X.X from have. some mercury reduction showing IOPs meds down which This external of of with complements about are pressure our procedure, and portfolio. millimeters is This so mean of to XX If and two-year effective sure data of reductions look at the I'm ASCRS. data But safe X.X.

they turn to they're up And believe infinite is they therapy the with some it bit in of the they the outflow have achieve going glaucoma, where they're be use for opening claims But may tolerated used overlap, patients iStent patients surgeons trabecular progressive seeing of and where in we target though even to think can have late-stage look in medical conventional to delighted the I a truly approved the if little the maximally infinite our these again device. going pressures I iStent upstream it will the it's to use when seek. Santen to in approach bypass are portfolio.

which any in certainly we it we did comments? I line full think with too our Joe with look forward the us glaucoma as gives future. to move leverage community, additional will mindshare have you product the

Joe Gilliam

perspective, say this of about -- Well time, market standpoint, know overall at -- it we from XXX,XXX a there's can't I a then more obviously, opportunity and U.S. a for opportunity we'll tube the from think I at will many in right? on from to more and bit annually financial much if look we certainty into the timing How the beyond, done closer get XXXX procedures and launch of us trab product. back come that as translate the little have in and you

Robbie Marcus

lot. a Thanks Great.

Operator

comes Fargo. Your from Lawrence ahead. from Wells line next Please question the Biegelsen go

is open. Your line

Lawrence Biegelsen

one Good Thanks question. taking Supra. the international, guys. on on the for One afternoon,

type remainder there? basically XXXX. heard the know down So I reimbursement prepared seen And remarks, about But what maybe it's impact into have sequentially to March. like been you're the you in in U.K. of month. even a guiding cuts, looks for effect on I went to flat only early it slightly the late volumes of

So there one have any color would follow-up. be and helpful I

Chris Lewis

Hey, first Larry, part. I'll handle it's the and Chris

been terms really impact, April. holidays the in a U.K. early it's tell. There's of of too effect In went This number in just to early into

been And one. went it But to too have XX%. assess about it's the overall impact. The so will down payment early

And dealing with so, we're that.

in there strategies place, impact have an be in the U.K. will We but

Joe Gilliam

mean, matter adding U.K. what robust. the is markets we is remain the that in been growing think, And perspective, and top I we of It the guidance But Larry, I fact in have we're I quite from view take strong entirely think, broad-based one international a and late inject to months rapidly now, we iStent the the there occur is fairly growth will it standing the in of XXXX. given since U.K. ahead. that, launched international right then really of markets a to where and had cautious our it's

Lawrence Biegelsen

moderate taking here, severe forward discussions moderate that -- with for helpful. feedback data, a questions. label. more your the color heard a FDA. review from if with Supra, Thanks share early trying I the any remarks could to I'm Maybe to on where that. market Thanks. path the can for a bit then you on the of prepared on product very just And there's understand you That's little

Tom Burns

Yes, Larry. This Thanks so is Tom. much.

markedly So changing can space are CyPass the monitoring space. the you recall imagine also can imagine we suprachoroidal the how that since X changed within device. the dynamics Tier closely has And you of

And discussions PMA that said much these expect So going a into monitoring very FDA we of I've we're as review. higher from closely. a bar before, the

I think, be so, we'll that that because want And safe high have will think, pristine, up standards it frankly, I see products. as highly reputation really And effective certain. and the meet, we'll have think, once we And to we move to here bar established own for measures and a own I our to make our thresholds sure, forward. data we

And so. incumbent so, do to I as that I upon do think, it's and will CEO, prudent me, and

So we it. I and March forward. the data how expect then And data over assess as the know, in we'll the we lock data, we're be study But we decide as and say next will you move cleaning we'll on evaluating several weeks, we and finished The data time this. speak. to the

is, encouraged the over to said very recall of of believe patients before, of those converted inject. already I'm One have the iStent things we've we about since most as CyPass,

position So, I think, moving we're in forward. a powerful

Lawrence Biegelsen

taking for Thanks guys. questions the

Tom Burns

Thanks, Larry.

Operator

comes go Please ahead. Bob Bank from Hopkins Your of the of line next America. question from

Your line is open.

Bob Hopkins

and afternoon. Thank you Hi. good

Just if questions, quick okay. a clarifying couple of

the think QX. for, about XX% fair than closer if maybe expected called grew XX% finer mean, First, a to the Does that. I bit the you market it? growth for little in you've you better full put think you year? was market you that wondering than could mentioned way a point just Is a that that to was on

Joe Gilliam

wouldn't said I better. for market far. was growth, line go a called wouldn’t we I quite that what in touch it's -- was, right? mid-teens Joe. to would And Bob, I say I What is, it

I that think, wouldn't as the for you go quite it's So market way the to that's about just right? on probably suggested in year, I the first far growth. that for quarter, is, So, as think and -- the

Bob Hopkins

perspective. from That's second And upcoming of question Okay. the data on a a a milestones though. helpful, is, clarification then kind just

if the expect and on if any you on, and those we know us on. Just I'm what iDose timeline of there wanted to changes the a trials for for or dataset give just the the dataset quick if course of the there's going for months next could that any shifts next curious MicroShunt are next should example, fronts. there's any XX over update

Tom Burns

Yes, take happy to that, Bob.

expect anticipating in the and interim that following important our I that the dataset the to validated in fulsome PMA, of year patients the are forward. we years doing a Phase data trial. early for Xb as file cohort feel approval and that But -- of So of moving for Santen They has analysis trial. three be last comfortable I promising they release presented really in the Phase MicroShunt, III very those control with that is we're data, regards we We'll most I XXXX. thing any them. know, this really again, you won't iDose, year of that will think, on speak said to so obviously how

think not the respect be this preserve and iDose. I time in the But reviews for which I further the time results or of to proprietary competition we'll is to data of data space we to some protect whether assess of give from want will we're any seeing, as do autonomy I and we move do that. I husband can forward that some the and contemplative

go in you we there So, now, informed is our as keep right position, but we'll forward. no change

Bob Hopkins

Thanks very much. Perfect.

Operator

question comes of Piper next Your Please ahead. go Jaffray. line from from O'Brien Matthew the

open. is line Your

Matthew O'Brien

Well, taking thanks much question. the so for

then internationally domestic the here you're with as off there's going that CyPass parts a -- of benefit moving from and getting on Just what's lot the with coming we market.

international kind market start of and there don't I quarterly for So build of question U.K. that front with to offset in the the off know place goes to QX territories think the Joe, And you move U.S. of then can other up was back is we reimbursement CyPass of business you just and change the kind the QX give as pressure in potential here guidance. a coming help in same little fair could it's of and see in the of lower the done there? cadence? procedures kind it some bit now But a us in lot

Joe Gilliam

Sure. Joe. Hey, Matt, it's

international Let that cadence to mean, can seasonality line me in start international call trend early us there. with in internationally, and From quarterly first I the perspective since asked you for order. it you a expansion the still it's a little imagine

summer relatively in historically the QX and that about far right? about the step-up in to you followed from in Europe. that knowing way you sequential seasonality a particular into many O-U.S. and we've said a by fair see with think time then from there think of and experienced in sequentially that has So it. what a expect full When way QX seen thinking say been do QX, U.K., I growth winter of holidays the well I QX in the are somewhat we flat is some actually late markets slowdowns relatively over

year. So, up clearly, grow over other that, a we as U.K. to of for April/May/June remainder robustly. would the in markets they will continue the if the impact and for expect make it time to you the course And for of will, some the bit take of little

about that's the side. think a I it, on fair way thinking Matt, of international

and XX% cataract QX said QX. always first the front, in are roughly On and XX% the quarter, in XX% U.S. in volumes we've QX

trying I U.S. fact entirely respect and of in expected first shift be our than Our the in guidance. that quarter. slight competitive had It the difference can to obviously really a about with XX% And was trialing. the lighter the we to mid-point performance expectations QX was the think there related

QX overall year the to the increased contribution So, slightly.

Matthew O'Brien

movement I probably we us any those update along some among of as give of their you attention they're to this XXXX? as Helpful. you But some then know expect Ivantis kind But And is legal won't here slow know You question of we seen them on on training far update Okay. doctors that a docs. just kind commentary have in then And which there to them of going or gone this guess and some one I year. litigation you should -- cases -- your of two-part lines go with you get Ivantis don't is with or kind to going strategy, they anecdotal lot working head-to-head with where decide with investors and the have on a of everything getting and but you've -- the kind any and decide go answer. that? are to

Chris Calcaterra

that. a with Hey, Matt, exception first standpoint mostly as quarter of than largely the in to reduction things similar have the and are address ours. in Chris. going first we've IOP The we with trying part the is had trialing performance in was them the is competition we anticipated. expected. with from Where an line I'll this what that expected been less And bit

many difficult trying battles, a winning of bit have are are more the people they've had bit it. segment perhaps of the interested -- have particular tolerant who a those a primarily in issues but segment indicated And in of on They, there's lot We it's device, we more as to been insert. is the safety focusing that glaucoma PAS. specialist where with before, associated

war or and the beginning with So profile battle, position they've our ease-of-use. of just certainly and in beginning the this our is we're confident won the efficacy our safety of But some.

Tom Burns

And Okay. as couple track. both litigation forward. before, of on litigation will continues this I've Again, as most of claim the front, going depositions A with sides though. on year said prepare the be and key then updates filled construction

in non-infringement we has judgment asserted XXXX, As an you seeking filed patents a litigation. motion the the late early know summary on Ivantis of

found patents court litigation. longer part against assert March the Ivantis patents the So, our motion granted that infringe no of are the of that XXXX and thus not sought do in to we those us and

So that's one key update.

XXXX second July of the is to update trial, has which for The of been moved that XXXX. now February scheduled key was

two updates are litigation. the key those to So

Matthew O'Brien

Thanks so much.

Tom Burns

Matt. Thanks,

Operator

next go question Stifel. line from Please from of ahead. Block Jonathan comes Your the

open. is line Your

Jonathan Block

guys. it be admittedly Thanks once be there I But out. But and you practice ease-of-use upon so additive you reduction? this to for a great. inject? might at afternoon. practice call with Chris, converts difficult better-bang-for-the-buck Good know one might see there's in to it growth do moving And increases you IOP position it inject Clearly Hey, underlying how utilization the or is to tease can as what due is. parts. bulk

Chris Lewis

number in comfortable to more get to difficult therefore, it specific surgery this more cases seeing on in utilizing using agreeable implanting patients. to are to device, be doctors a get we're is many and Well, But and would what it at. more

up. to this just people comfortable are cases their and and But happen And more patients. this more more as they seen with get in it a it go doesn't product they safety positive all profile, ability continuum. in internationally that's on as well the As to patients become different of see the they're and phases It utilization and scheduling use tends that proposition, comfortable general efficacy, the value rule as more with we've anecdotal.

Joe Gilliam

obviously, I two they just and patient Yeah, expands I the that. about addressable with stents, population as think think would add that

I you said more the think into population. as moderate Jon patient

Jonathan Block

Understood.

with or stick by Joe guide follow-up. Is granularity more $X there a up the it us guys. bit the other million or ramp? In way call million. that The slower comes than Okay, Ivantis to midpoint call little to Thanks What there? on and Any give to details the attributable then to $X specific you you give parse it what's for I'll U.S. would expected a out? maybe international words be can it or price?

Joe Gilliam

our a and fair. Jon. would was what a mean right? call broad-based, from I I touch I'll either mean trend That's started. key right. pretty to as all perspective I better, back said, was I little the did I've go a or drivers where of change kind led fairly this a the think expectations Yeah, the to it met say bit virtually

this than dynamic then year. as we're our line trying U.S. the So was today is kind on at competitive at expectations. we The with the where growing faster But of And conversion the of The leading and were across going coming less. point all better year. is revised I to board, trialing in to thoughts guidance. mentioned, than the inject certainly expecting and a it's market the the up impact CyPass into those drivers of little line. would recapture in be perhaps pricing a have bit we assumed is touch appears

Jonathan Block

Okay. you. enough. Thank Fair

Operator

from comes Please question go next Your the line of Chris Stephens. from Cooley ahead.

line Mr. is your line open. open. Cooley Your Stephens, is from

Ravi line Berenberg next question Misra Please from Your ahead. from go Capital. comes the of

Your is open. line

Ravi Misra

the you thank Hi, taking question. for

revenue I'll thinking I think the thinking of you in would how like is And it sorry not with would Santen just on So strategic there about just to opportunity pipeline -- here guys partnership tactical their kind have partnership. past come itself, has about a that that? as thing $XXX pharmaceutical a transaction with then frame iDose? the device --on then of pipeline for any or the something kind that we're million follow-up the and presentations one on MicroShunt alluded

Joe Gilliam

answer. Ravi, Hi, it's start Joe. I'll that

the right, go I done early in that acquisition in think they have MicroShunt procedures on annual to device. I and trabs the U.S. commented would million their year, this marketplace tubes the the here, decent represent for really fact about market think addressable being But over in here $XXX figure And that the potential past has that there's the that in right. XXX,XXX we I the today. gold sitting of back think a million I of of translate capturing in that time. chunk and a standard can't $XXX the into

Tom Burns

stated we respect could and maximum thought believe that carry the to I additional tell for strategic further sought and than And what whether trusted I things you conceivably There implications fact they the Ravi best product is, other no they this States. always do on were impact in we the partner what Santen the is partners United strategic together. just if they did that that out can right there is chose question that us fortunate have forward, is become that. has the what And some that they've we to implications do would potential, this with the

can that And be so future. imagine looking in you we'll become the to partner

Ravi Misra

XX% coming and margins public mid-XXs. to then amongst best-in-class just maybe And you. thank companies guiding Great, probably you're one on to gross

the us Thank be rest remind you. why than year first of the should the lower again quarter? somewhat Just

Joe Gilliam

Ravi. It's Joe. Sure,

quarter the removal So was first acquisition a things going patents. sustainable amortization a the of quarter. and X.X% represents first an sustainable It about is quarter going of One had that the the That's benefit. forward. Is several in is $XXX,XXX on. associated couple that with

the from efficient a margin thing other on was in that the a were positive very perspective quarter The side. is we operations that first gross

imagine well as can of at us sort at and sold mid-XXs you But time inject, that's building than forward. both lower given As lands with gross the cost means said here goods that, the that combine slightly of higher of fact associated margin that the iStent operate levels the the demand bit downstairs was that inject at Glaukos margin is markets that a launch gross that having as the quite running production over you inventory efficient. a iStent with what international initial going and meeting

Operator

of comes Ryan BTIG. Please line Zimmerman the question next Your go from ahead. from

open. Your line is

Ryan Zimmerman

Great. a the Thanks for taking quarter. Congrats on question.

midyear of So, the just our Thank your works in Tom we to at on your this year. acquisitions, around broad-based could what then have new were around hear bit I of are is of too where offense. back follow-up in more the seems speaking you. saying you you're iDose. expectations about it terms little to wondering, I or And relative like iStent potentially can ASCRS of switching iStent you're salesforce weekend talk kind expectations I to switch maybe doctor But there this you a conversion. a maybe back was terms and territories through inject lot survey in geographically a if inject?

Chris Calcaterra

Chris. conversion handle Hey, that ahead speaking a territories this are of that, of way is And part. I'm inject that to that is going midyear. the and is be first behind iStent majority to we've should that maybe of little we said Ryan broadly are by that. through the bit iStent yes, the there what And

told we're schedule along we on to terms of time. will We've average. in the as that sometime customers in this Street way. had an And the well on just opportunistic go completely offense half been year. adding that's be we the the would right So But we of where new at second

Ryan Zimmerman

pricing about pricing changed of around much the then terms what haven't does been that of market, now? market? to pricing iDose. has spoken seen you product seeing come that change iDose all pharmaceuticals that on there potentially view you. come just think glaucoma around question about But related And you recently it in some in at your enough. second strategy my and dynamics we're how given when particularly we've branded have Fair pricing Warranting in market given iDose Thank potentially into the the the any to has their that

Tom Burns

said for think And it yourself. you sure. I Ryan Yeah,

haven't class. able strategy. it's be can early pricing product. fair think really country price analysis generics, imagine kind When the different in be of and a you about that will the to where whole kind you we provide talk we're of to can I We by out of HT optimize value mentioned any the and And figure embryonic commercial a

price And percent prospective medications up anywhere range entirely I'm from more about XX% are and that that a versus single XX% retrospective rates with a can from trying showing sometimes of if Non-adherence studies talking a have about about troubled application usage XX% day, to about time many get to topical or used, so to I even the don't by XX%. generic.

species. they're think I different two

go. are to system really first will going delivery be we out if will, we we the as to think that be we're able sustained I successful believe as far carry

forward. think have flexibility moving I And extremely pricing am optimistic. one, we'll so I Two,

And responsible I able that out be the we've our how products product. will figuring you. and pricing to with we'll -- to we'll think this been will best there be as how we time, and other of adoption affect prudent in best like get and the disclose commercialization

Ryan Zimmerman

question. Thank for taking the you it. Appreciate

Tom Burns

welcome. You’re

Operator

I And now closing for no to this back questions call further time. there are at remarks. will turn the Glaukos

Tom Burns

right. All

So and thank today, your in time interest for and Thanks you good-bye. your Glaukos. attention for and continued all especially

Operator

today's concludes conference This call.

disconnect. now may You

Glaukos (GKOS) 8 May 192019 Q1 Earnings call transcript