Sight Sciences, Inc. (SGHT) This fall 2021 Earnings Name Transcript

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Sight Sciences, Inc. ( SGHT -1.40% )
This fall 2021 Earnings Name
Mar 24, 2022, 4:30 p.m. ET

Contents:

• Ready Remarks
• Questions and Solutions
• Name Members

Ready Remarks:

Operator

Good day, girls and gents, and welcome to the Sight Sciences fourth quarter and full yr 2021 monetary outcomes convention name. [Operator instructions] As a reminder, this name is being recorded. I’d now prefer to introduce your host for right now’s convention, Philip Taylor. You might start.

Philip Taylor — Investor Relations

Thanks for collaborating in right now’s name. Presenting right now are Sight Sciences co-founder and chief government officer, Paul Badawi; chief monetary officer, Jesse Selnick; and chief industrial officer, Shawn O’Neil. Earlier right now, Sight Sciences launched monetary outcomes for the three months and 12 months ended December 31, 2021. A duplicate of the press launch is on the market on the corporate’s web site at buyers.sightsciences.com.

I want to remind everybody that feedback made by administration right now and solutions to questions will embrace forward-looking statements inside the that means of the federal securities legal guidelines. These embrace statements associated to Sight Sciences’ anticipated monetary efficiency and working outcomes, market alternative, the long run impression of COVID-19 on operations, enterprise technique, and plans for growing and advertising and marketing new merchandise. Ahead-looking statements are based mostly on estimates and assumptions as of right now and are neither guarantees nor ensures and are topic to dangers and uncertainties that will trigger precise outcomes to vary materially from these expressed or implied by these statements. An outline of among the dangers and uncertainties that might trigger precise outcomes to vary materially from these indicated by the forward-looking statements on this name will be discovered within the danger elements part of the annual report on Kind 10-Ok filed right now and different filings with the Securities and Trade Fee.

The corporate undertakes no obligation to publicly replace or revise any forward-looking statements besides as required by regulation. For extra info, please discuss with the forward-looking assertion notices and Danger Components within the current SEC filings. I’ll now flip the decision over to Paul.

Paul Badawi — Co-Founder and Chief Government Officer

Thanks, Journey, and thanks all for becoming a member of us right now. I am very excited to supply an replace on our enterprise and the progress now we have made delivering the ability of sight. I’ll contact on the accomplishments that made 2021 an enormous success and the way we’re positioning Sight Sciences for continued success going ahead, together with an introduction to among the thrilling new merchandise we’re growing. OMNI and TearCare are properly on their approach to changing into breakthrough merchandise, but now we have by no means stopped innovating.

We’re using our rigorous product improvement course of to develop a portfolio of recent merchandise that can allow us to serve a fair broader array of sufferers affected by glaucoma and dry eye illness. These packages which we anticipate will embrace managed product releases and launches this yr will assist us drive natural development for the following decade and past. However first, I might like to start out by reviewing our robust efficiency within the fourth quarter. Our whole income elevated to $14.7 million, representing development of 63% in comparison with the fourth quarter of 2020 and 12% development in comparison with the third quarter of 2021.

Regardless of headwinds from resurgent COVID disruptions and shifting reimbursement dynamics, we delivered significant sequential development within the fourth quarter, pushed by continued new buyer wins and better utilization in our surgical glaucoma section which grew 12% sequentially and 60% yr over yr to $13.9 million. As others throughout our trade have mentioned, we skilled an analogous slowdown in exercise in mid-December resulting from Omicron and the vacations that dampened what might have been an much more distinctive quarter. Basically, our core ideas place us to succeed and underpin the expansion of our enterprise. Our efforts are all the time centered on the wants of sufferers and defending and enhancing mankind’s most treasured sense sight.

We’ve got continued to propel our three strategic initiatives that we imagine will unlock the total potential of OMNI and TearCare and drive our development over the close to and medium time period. No. 1, our first initiative goals to extend the variety of surgeons utilizing OMNI. MIGS-trained surgeons who’re already performing mixture cataract procedures comprise our most fertile goal section.

The majority of our surgical glaucoma gross sales group consists of territory-based reps who promote OMNI to amenities and practice surgeons. We even have a strategic accounts group that focuses on promoting to and coaching surgeons to educating establishments and authorities hospitals. These groups have delivered distinctive outcomes changing surgeons to OMNI, and we’re modestly growing our investments in these teams in 2022. We imagine OMNI’S robust security profile, intuitive usability and demonstrated efficacy in lowering IOP and medicine utilization have helped us penetrate the mixture cataract section and acquire share regardless of intense competitors from legacy implant-based procedures.

Solely OMNI permits surgeons to deal with all three factors of resistance inside the standard outflow pathway utilizing a single system to carry out two sequential procedures in a single surgical setting. In accordance with Market Scope, there are over 5,600 surgeons performing MIGS procedures within the U.S. We have skilled roughly 1,500 of those surgeons. So we nonetheless have plenty of work to achieve our full potential.

Within the fourth quarter of 2021, over 750 amenities ordered OMNI surgical programs, with over one-third of those representing new OMNI amenities. We proceed to see elevated utilization as our facilities-based tenure will increase. Based mostly on the growing variety of ordering amenities and their utilization, we imagine we’re persevering with to take share together cataract procedures. Our reps sometimes practice surgeons together cataract circumstances as a result of they have already got cataract sufferers who even have main open-angle glaucoma on their working room schedules.

As soon as a surgeon is proficient with OMNI within the mixture cataract setting, they’re positioned to carry out stand-alone OMNI circumstances as properly. These surgeons have constructed their practices round a strong practitioner community for cataract sufferers. To increase their practices to incorporate interventions within the $5 billion U.S. stand-alone glaucoma section, our clients would require an analogous practitioner community for POAG sufferers.

No. 2, our second initiative focuses on educating these POAG practitioner networks to higher perceive when glaucoma sufferers could profit from stand-alone procedures carried out by OMNI-trained surgeons. We’re within the early phases of training the broader POAG group, together with main eye care professionals and sufferers concerning the chance and potential advantages of early intervention with OMNI. We imagine OMNI resulting from its indication to be used, security, excessive diploma of efficacy and excessive consistency of efficacy has the best product market match for stand-alone interventions.

Our medical trials have demonstrated that OMNI can safely and reliably cut back IOP and medicine burden. Major eye care professionals are the primary to diagnose and deal with POAG sufferers. At the moment, if a POAG affected person doesn’t require cataract surgical procedure, the remedy algorithm depends on growing use of topical eye drop remedy to sluggish the development of the illness, with the purpose of staving off standard surgical procedures for so long as potential. These extremely invasive surgical procedures are efficient at lowering IOP however carry a excessive danger of complication to unwanted effects and are sometimes solely tried by glaucoma specialists.

Our mission is to let the glaucoma group know that an earlier intervention carried out by a neighborhood OMNI-trained surgeon may very well be a greater different than prescribing a second or third eye drop. To this finish, we’re fielding a devoted group of glaucoma medical consultants that can ship our message to the tens of hundreds of office-based main care optometrists and ophthalmologists who deal with POAG sufferers with drugs. We’ve got strategically positioned our GCCs in territories which have a number of certified OMNI-trained surgeons with robust complete practices or established practitioner networks. Our market analysis signifies that 85% of glaucoma sufferers would seemingly select an intervention utilizing OMNI if it was really useful by their physician.

We expanded our GCC area group from a beta launch of 4 final yr to twenty within the first quarter of 2022. Finally, we imagine every of our conventional territories may benefit from a number of GCCs, constructing relationships within the broader glaucoma and supplier group. We’re supplementing these area efforts with our Do not Await Too Late academic marketing campaign that emphasizes the worth of early MIGS intervention and with affected person schooling and outreach supplies obtainable in docs’ workplaces and on-line. We imagine the industrial impression from our stand-alone market improvement efforts will likely be evident within the again half of this yr.

No. 3, our third key strategic initiative entails growing the marketplace for efficient dry eye remedy procedures. We achieved a significant milestone in December when TearCare obtained FDA clearance for an expanded label for the applying of localized warmth remedy in grownup sufferers with evaporative dry eye illness resulting from Meibomian gland dysfunction when used together with handbook expression of the Meibomian glands. MGD is the main reason for dry eye illness.

This clearance was supported by knowledge from our OLYMPIA RCT, which demonstrated clinically important enhancements in all indicators and signs of dry eye illness. This expanded label permits our industrial group to speak the advantages of TearCare extra utterly. Our reps have already reported elevated buyer receptivity within the area. Enhancing reimbursed affected person entry to TearCare is our final purpose.

Our SAHARA medical trial was developed with enter from eight payer medical administrators from eight completely different main insurance coverage corporations to supply the precise knowledge they might require to reimburse TearCare procedures. We count on to finish enrollment in SAHARA later this yr. As a reminder, SAHARA goals to reveal the prevalence of TearCare therapies in comparison with the market-leading prescription eye drop, Restasis at six months. We hope to have the ability to report again on this key superiority endpoint by the center of subsequent yr.

We’re very happy with the progress now we have made advancing these initiatives, which we imagine will create large worth. We’re additionally making investments in different areas that can contribute to our development within the coming years. Outdoors the U.S. now we have established a direct promoting effort within the U.Ok.

and have seen substantial traction in Germany. Each of those markets are progressing properly. We plan to increase our presence in Europe and different geographies. We spent plenty of time discussing adjustments to reimbursement over the previous 9 months, so I will be very transient in my remarks now.

In abstract, surgeon and ASC reimbursement for OMNI are each in higher positions relative to implantable procedures in 2022 than 2021. With our skilled and facility reimbursement ranges not too long ago revalued and totally stabilized beneath broad and reliable class one CPT coding, we look ahead to devoting extra time discussing elementary patient-focused drivers of our enterprise going ahead. We all know the investor in glaucoma communities even have questions concerning among the newer entrants to canal surgical procedure. Our not too long ago revealed March 2022 investor presentation features a comparability of the medical historical past of canaloplasty, trabeculotomy, or goniotomy and the newer, much less understood procedures enabled by a few of these instruments.

We proceed to make important investments in our expansive medical trial program, which incorporates 10 ongoing and deliberate trials. We simply introduced the primary affected person remedy in our Trident European research and can quickly start enrolling sufferers in our U.S. PRECISION IDE trial. These twin, 459-patient, 24-month head-to-head RCTs will evaluate three arms.

One, canaloplasty alone utilizing OMNI. Two, canaloplasty adopted by trabeculotomy utilizing OMNI. And three, the main trabecular bypass implant. Due to the label limitations of trabecular bypass stents within the U.S., PRECISION will research mixture cataract procedures whereas TRIDENT in Europe will look at stand-alone procedures.

As a reminder, OMNI’S present label requires canaloplasty adopted by trabeculotomy, the second arm of those research. We hope to make use of the outcomes of those research, if profitable, to increase the indication for OMNI to incorporate utilization for canaloplasty alone, which can present surgeons with one other beneficial, on-label surgical choice to titrate remedy for his or her sufferers with POAG. Not like current entrants into angle-based procedures, we sought and obtained FDA clearance for an IDE to review canaloplasty alone. We imagine that FDA clearance for an expanded canaloplasty-alone label can additional differentiate OMNI from the competitors.

Because the market chief in canal surgical procedure, we’re executing our canaloplasty alone IDE the proper means from the beginning by demonstrating if profitable, medical efficacy and security, securing our desired label from the FDA and placing our sufferers’ wants first. We imagine that is the one approach to construct the canaloplasty class for significant, long-term worth and unshakable management. As a result of their massive research populations and 2-year endpoints, remaining knowledge for TRIDENT and PRECISION will likely be obtainable in three years. Within the meantime, we’re making ready quite a few different articles for publication, together with one based mostly on the outcomes of our multicenter TRAY research that examines the protection and efficacy of stand-alone OMNI procedures in POAGs with uncontrolled IOP and a earlier historical past of mixture cataract surgical procedure with trabecular bypass implants.

TRAY will look at the potential advantages of OMNI interventions within the over 1 million now pseudophakic trabecular micro bypass stent eyes that will require additional remedy, in addition to the overall stand-alone inhabitants. Our publication plan in peer-reviewed journals consists of quite a few articles based mostly on knowledge from our medical trials. Earlier this week, Medical Ophthalmology revealed an article that reported 12-month outcomes for OMNI canaloplasty adopted by trabeculotomy, together with cataract surgical procedure in a inhabitants of grownup Hispanic sufferers with gentle to reasonable open-angle glaucoma. The article reported a discount in unmedicated imply IOP of 35% and a 93% discount in common drugs.

Adversarial occasions have been gentle, self-limiting and typical of MIGS mixed with cataract surgical procedure. We’re very happy with these excellent outcomes. In parallel with our medical efforts, now we have additionally made a push to increase our presence at key trade conferences such because the American Glaucoma Society assembly earlier this month and the upcoming ASCRS assembly on the finish of April. We plan to increase our presence at ophthalmologist and optometrist conferences to assist educate the attention care group about the advantages of our merchandise and our firm’s mission.

Our need to enhance the lives of all sufferers with glaucoma and dry eye illness drives our innovation. We’re growing a broad portfolio in each classes, and our purpose is to supply market-leading remedy choices alongside each step of a affected person’s journey residing with these incurable, life-long ailments. To take action, we will likely be increasing past units into pharma, drug system mixtures and sustained launch prescribed drugs. We acknowledge that remedy will be an efficient first-line glaucoma remedy, if administered correctly.

We imagine that sustained supply of hypotensive drugs is a really promising space to innovate and have filed IP on a product that we imagine might have a superior product market match by way of ease of utility, efficacy and security in comparison with present and introduced competing merchandise. Our early leads to animal testing have been promising, and we’re very excited to proceed growing this product and we’ll share extra in the end. Because the affected person advances past drugs and requires microinvasive glaucoma surgical procedure the place now we have OMNI right now, we’re happy to announce our plans to introduce two new MIGS merchandise within the coming yr after which now we have two extra in earlier phases of improvement. In the end, we’d have 4 surgical units that might signify 5 distinct procedures, representing the broadest and most compelling product portfolio within the MIGS class.

First, now we have continued to innovate our flagship OMNI product and plan to launch the third era of the OMNI system that can function quite a few design enhancements. We count on a managed launch within the second half of this yr and a full launch in 2023. We’ll proceed to enhance and replace OMNI regularly to make sure its continued management place in microinvasive canal surgical procedure. If our IDE is profitable, we imagine the medical knowledge would function a robust foundation for us to hunt FDA clearance of an expanded indication overlaying canaloplasty alone.

Second, whereas we imagine OMNI’S skill to circumferentially deal with all three factors of resistance and the traditional outflow pathway can’t be surpassed and the market is more and more recognizing canaloplasty because the foundational process of MIGS, we do acknowledge that there’s curiosity out there for varied varieties of procedures. To that finish, we will likely be introducing a devoted and differentiated ab interno trabeculotomy, or goniotomy system within the second half of the yr. Third, transferring past our third-generation OMNI system and the goniotomy system that we intend to launch this yr, we additionally resumed improvement of our implantable canalicular scaffold. The final word purpose of this improvement program is to enhance the long-term efficacy of canalicular implants and scaffolds by including new improvements for which now we have already filed IP.

Fourth and final however not least, we’re additionally growing an implantable answer for superior refractory glaucoma. We imagine this product could be acceptable for sufferers whose standard outflow pathway choices have been exhausted. In abstract, we imagine the circumferential canal surgical procedure is rapidly changing into the foundational process in MIGS, each on a stand-alone foundation and together with different MIGS procedures. We’re the primary mover in microinvasive canal surgical procedure and intend to maintain the lead with our third-generation OMNI launch later this yr.

We’re additionally within the technique of growing an unbelievable portfolio of merchandise round OMNI that might supply our surgeons a whole armamentarium and a full growth of the client firm relationship with Sight Sciences. We’re additionally innovating in dry eye. As with OMNI, we’ll proceed to replace and enhance our flagship TearCare system. We’ve got a next-generation TearCare system in improvement that can embrace a number of new options akin to an improved tablet-based consumer interface and additional enhancements to our SmartLids.

We plan to introduce this product in 2023. Long term, we’re additionally engaged on a number of merchandise that can assist sufferers affected by MGD to keep up wholesome Meibomian Gland between workplace based mostly TearCare therapies. These embrace OTC eye drops, a prescription ointment utilized to the eyelids for MGD and an at-home shopper model of TearCare. We imagine this dry eye portfolio will supply physicians and the 14 million sufferers recognized with MGD a complete vary of options to fight dry eye.

We plan to schedule an investor day or analyst day or each, to debate these pipeline merchandise in better element later this yr. I’ll now flip the decision over to Jesse to debate our fourth quarter monetary outcomes and our outlook for 2022.

Jesse Selnick — Chief Monetary Officer

Thanks, Paul. I will begin with a dialogue of the fourth quarter outcomes after which I will transfer on to our 2022 steerage, together with an replace on our year-to-date efficiency, traits within the working surroundings and our outlook. Our whole income for the three-month interval ended December 31, 2021, was $14.7 million, a 63% enhance from $9 million in the identical interval of 2020 and a 12% sequential enhance from $13.1 million within the third quarter of 2020. Our mixed gross margin for the fourth quarter was 87% in comparison with 74% within the corresponding prior yr interval and 84% within the third quarter of 2021.

Our surgical glaucoma section revenues for the fourth quarter have been $13.9 million, up 60% from $8.7 million within the fourth quarter of 2020 and a sequential enhance of 12% from $12.4 million within the third quarter of 2021. Underlying elementary enterprise traits, together with utilization and ordering amenities have been very encouraging till the second half of December as we skilled enterprise disruption just like our friends as a result of surge within the Omicron variant. Sequentially within the quarter, our variety of strange accounts grew by roughly 5%. The rest of our sequential development got here from a rise in utilization from ordering accounts, which we achieved regardless of 3% fewer OR days within the fourth quarter versus the third quarter.

So we did a really good job each including to our consumer base and leveraging our present consumer base to increase utilization. By way of the primary half of December, we generated extraordinarily robust gross sales, and we have been really on tempo to develop sequentially by between 17% and 19% for the quarter, inclusive of the historic slowdown of bookings across the vacation season, which, in our expertise, the primary half of December generates roughly 60% of the entire month’s bookings. Over the second half of the month, nevertheless, we skilled a big slowdown, pushed by the coinciding enhance in Omicron circumstances, which for the primary time for the reason that second quarter of 2020, resulted in important facility closures and restrictions on elective procedures that impacted our industrial alternative versus patient-driven deferrals that we noticed earlier in 2021. Gross sales for the primary half of December 2021 accounted for 75% of the full month gross sales versus the rule of thumb I simply talked about of roughly 60% of gross sales sometimes occurring within the first half of December.

Common each day gross sales have been over 40% decrease within the second half of December than they have been within the first half of the month. Gross margin in surgical glaucoma was 89% within the fourth quarter in comparison with 76% within the prior yr interval and 87% within the third quarter. I want to salute our operations group for bettering our working effectivity, even exceeding our bold inner objectives whereas sustaining uninterrupted provide of completed items within the face of provide chain challenges all through the worldwide economic system. Our dry eye section income for the fourth quarter have been $0.8 million, up 179% from $0.3 million within the fourth quarter of 2020 and a sequential enhance of 16% from $0.7 million within the third quarter of 2021.

This year-over-year comparability is the primary true apples-to-apples comparability we had in 2021 since we applied particular account focusing on pointers and pursued a premium pricing technique versus different procedure-based MGD-oriented options within the fourth quarter of 2020. For the yr, we added roughly 240 accounts, and we ended December with over 550 amenities with the TearCare system. We’re happy with the good receptivity and outcomes from our small, centered gross sales effort in dry eye. Gross margin in dry eye was 52% within the quarter versus unfavourable 1% within the fourth quarter of 2020 and 33% within the third quarter of 2021.

As we have mentioned beforehand, dry eye gross margins will likely be noisy till we scale the enterprise, and our gross sales combine matures to a better proportion of higher-margin SmartLids. Subsequently, issues like gross sales combine between new clients and reorders can impression gross margins in any interval, even with enchancment in contribution margins for every particular person element. Working bills for the fourth quarter of 2021 have been $27.5 million, an 82% enhance from $15 million within the fourth quarter of 2020 and a ten% enhance from $25.1 million within the third quarter of 2021. Working bills embrace noncash stock-based compensation of $2 million in comparison with $1.9 million within the third quarter of 2021 and roughly $200,000 within the prior yr interval.

SG&A bills for the quarter have been $23.1 million in comparison with $12.2 million within the fourth quarter of 2020 and $20.8 million within the third quarter of 2021. The rise in SG&A was primarily resulting from our continued funding in and the scaling of operations and company headcount to assist our development. At 12/31/21, we had 212 full-time workers versus 197 as of September 30, 2021, and 140 at year-end 2020. As a part of our 2022 plan, we have continued to establish alternatives to enhance our group in areas to additional speed up our development, improve our skill to develop the stand-alone MIGS and MGD markets, and to guard our strengthening aggressive place in each segments of our enterprise.

I’ll give some extra specifics about these funding areas once I focus on our 2022 outlook. R&D bills for the quarter have been $4.4 million in comparison with $2.9 million within the fourth quarter of 2020 and $4.3 million within the third quarter of 2021. The vast majority of the rise of R&D expense from ’20 to ’21 was attributable to 3 elements. One, a rise in personnel bills as we construct out our medical and regulatory and R&D departments.

Two, larger contract manufacturing lab provides and prototype improvement bills. And three, elevated medical trial exercise. All three areas detailed by Paul in his feedback. We count on our R&D expense to proceed to modestly enhance over the close to time period as we execute our medical highway map and develop the pipeline that Paul previewed.

However in a way just like how we developed OMNI and TearCare, our R&D course of is environment friendly vis a vis what you’d assume it will take to develop groundbreaking merchandise, which is the final word core competency of our firm. Because of the aforementioned drivers, our loss from operations for the three months ended December 31, 2021 was $14.7 million in comparison with a lack of $8.4 million for a similar interval in 2020 and a lack of $14 million within the third quarter of 2021. We had a internet lack of $15.9 million or $0.34 per share within the fourth quarter of 2021 based mostly on a weighted common post-IPO share rely of 47.4 million shares. This compares to a internet lack of $9.2 million or $0.97 per share for the fourth quarter of 2020 based mostly on a weighted common pre-IPO share rely of 9.4 million shares.

We ended the quarter with $260.7 million of money and equivalents and $32.7 million of long-term debt, together with $2.3 million of debt low cost, so $35 million of principal quantity. We’re in a lovely [Inaudible] to execute upon our base plan and to opportunistically contemplate levers to speed up the enterprise. Turning to our outlook for 2022. We count on our full yr income to be within the vary of $67 million to $75 million, representing development of roughly 45% over 2021 on the midpoint of this steerage.

This steerage for continued market-leading income development displays our stage of confidence within the trajectory of each of our present merchandise. One of the engaging attributes of OMNI’s enterprise mannequin is that the growth of its use case throughout illness severities and into stand-alone procedures generates a compelling supply of natural development by itself even with out new buyer acquisition. Once we evaluate the fourth quarter of 2021 to the identical interval in 2020, our ordering facility base grew by over 45%. At its easiest, the rest of our 60% of year-over-year income development was pushed by use case growth.

So “same-store gross sales”, for lack of a greater time period, has a strong development profile by itself. Coupling that with the truth that we added 98 new ordering amenities within the fourth quarter of 2021 versus solely 72 in the identical interval in 2020, implies that the expansion engine of shoppers starting their trial section with our firm is best primed going into 2022 than it was in throughout 2021. All that being mentioned, our steerage offset elements and the impression of slower exercise as a result of Omicron variant that started in December and carried into the New 12 months. The variant impacted us in two methods.

The plain impression is that it diminished our process volumes within the first a part of the primary quarter. The disruption to working room schedules has additionally lengthened the time it takes to get surgeons by way of our product adoption cycle. Our in-depth surgeon coaching mannequin entails reps proctoring in new surgeons’ first 10 circumstances. Process cancellations or postponements can have cascading knock-on results that delay getting surgeons up the educational curve in a well timed method and transferring from the trial section to a longtime larger quantity accounts.

Sometimes, our reps spend three OR days with a surgeon to trial and practice. However the common time to get on the calendar for trial day two and trial day three is prolonged by 30 days. Over the course of a yr, nevertheless, this delay, the 30-day delay for day two and day three might have a better than $2 million impression on our annual revenues. So Omicron restricted bodily entry to buyer amenities for our reps and hindered their skill to maneuver clients to the adoption cycle, and that is mirrored in our steerage.

Our steerage additionally takes under consideration the introduction of a number of new entrants into the MIGS market. Whereas we strongly imagine that OMNI’s mixture of security and efficacy continues to be unmatched by legacy or new aggressive merchandise, the fact is, as can also be witnessed amongst buyers and analysis analysts, these new entrants have created noise and, frankly, a little bit of confusion by way of what they do. How they are going to be reimbursed, and many others., that can take a couple of months grow to be extra clear to the market. Within the interim, we witnessed current delays in our skill to maneuver clients alongside the adoption curve and delaying the growth of utilization resulting from sure surgeons trialing these different merchandise.

Trial phenomenon is just like the COVID-related surgical schedule disruptions that I discussed earlier by way of a onetime delay and transferring alongside the curve versus one thing that we expect has any everlasting impression on our development trajectory. A part of what you see mirrored in our income steerage is a spread in our estimates for the way lengthy it should take for the market to revert to the extra normalized, and in some ways from our perspective, a better-informed industrial surroundings that was in place by way of 2021. On a quarter-by-quarter foundation, we count on our income breakout in 2022 will likely be fairly just like 2021. The primary quarter for each years displays typical trade seasonality, and in each years, COVID-related impacts to January outcomes.

And just like final yr, we count on revenues to be modestly sequentially decline from This fall 2021. That being mentioned, we totally count on the final three quarters of every yr to exhibit a real overview of the underlying natural development traits in our enterprise. We imagine that 45% high line development in 2022 at our steerage midpoint, together with the continued improvement of what are our true long-term development alternatives, which is the stand-alone MIGS market and process based mostly MGD with widespread affected person entry, retains us within the very high tier of med tech corporations. I might now like to supply some shade on our anticipated funding ranges in 2022.

There are three main sources of incremental funding that we have made heading into the yr. The primary space is in R&D. The place we have constructed out our R&D group and are making project-level investments to assist the pipeline that Paul previewed. Given the a number of packages we’re pursuing, we estimate the in-year incremental funding from R&D will likely be within the mid-teens of tens of millions for 2022.

We’ve got extraordinary conviction within the potential ROI of this incremental funding to say the least. Secondly, now we have scaled up our funding in glaucoma medical consultants, whose main goal is to teach the broader POAG group about the advantages of stand-alone MIGS intervention with OMNI in order to drive acceptable stand-alone circumstances to OMNI-trained surgeons. As Paul talked about, we have expanded our group of 20 GCCs within the area plus related administration infrastructure, up from a beta group of 4 who delivered encouraging outcomes final yr in choose main markets. This can be a essential funding in enhancing consciousness, which we imagine will speed up stand-alone market improvement and surgeon adoption.

The ultimate space is in market improvement assist assets for each the stand-alone market alternative and our market access-driven execution technique for MGD. This consists of will increase in our medical spend by way of each headcount and trial prices for key trials akin to SAHARA, PRECISION and TRIDENT as we have mentioned and the build-out of a world-class market entry group to teach the sector, payers, and our buyer base on the reimbursement panorama, in addition to advertising and marketing assets extra explicitly align the market schooling and improvement, as evidenced by our not too long ago launched Do not Await Too Late stand-alone MIGS marketing campaign. All in all, we anticipate these incremental investments, partially offset by larger gross earnings from our rising revenues will lead to about $10 million to $15 million of annualized money burn enhance over and above the degrees we have been working at publish IPO. Given we ended the yr with a $260 million money steadiness and a modest quantity of debt and a quickly rising income base, we really feel very properly capitalized to execute our development plan and to fund this, frankly, digestible stage of incremental investments.

As a reminder, with blended gross margins within the mid-80s, OMNI gross margins approaching 9% and a extremely productive hunter gross sales drive, our direct revenue or money movement contribution from our gross sales could be very wholesome. And far of this funding is really discretionary that we imagine that it’s going to generate compelling ROIS and allow us to keep up sturdy development charges for a very long time. So with that, this concludes the ready feedback that now we have for the decision. Paul and I’ll now be joined by Shawn O’Neil, our chief industrial officer, to reply and take some questions.

So operator, please open up the decision for questions.

Questions & Solutions:

Operator

[Operator instructions] And our first query comes from the road of Joanne Wuensch with Citibank. Your line is open. Please go forward.

Joanne Wuensch — Citi — Analyst

Hello. Are you able to hear me OK?

Jesse Selnick — Chief Monetary Officer

Sure, we will. Hey, Joanne.

Joanne Wuensch — Citi — Analyst

Hello. How are you doing? I simply need to be certain that I caught a few the numbers that you just have been speaking about. I obtained the variety of lively accounts, 750 within the quarter for MIGS. I obtained that there are roughly 550 amenities doing dry eye.

However I am searching for a few different items of data, notably, and I apologize if I missed this, of these 750 lively accounts, are you able to again us into both the variety of physicians and/or the proportion of procedures which can be stand-alone versus concomitant?

Jesse Selnick — Chief Monetary Officer

So I will take the primary. We won’t monitor — we monitor skilled surgeons, Joanne, however we won’t monitor using surgeons, proper? So we have skilled — we ended — we’re at present round 1,500 skilled surgeons. And there is really not too long ago some analysis that got here out that estimated the full variety of MIGS-trained surgeons to be 5,000. So nonetheless plenty of runway there.

After which, there’s — we form of estimate about 1.3 to 1.5 surgeons per — using surgeons per facility at this cut-off date, however that is simply an estimate. After which, Paul, stand-alone mixture?

Paul Badawi — Co-Founder and Chief Government Officer

Sure. It is laborious for us to trace with any specificity proper now, stand-alone penetration. We clearly have a variety of investments we talked about that we’re making. A part of these — in parallel with these investments the place we proceed to discover methods to trace our progress each internally for ourselves and likewise to report publicly to you all, Joanne, particularly across the GCCs, the group of 20 that we have employed.

They’re totally skilled now. We employed them on this quarter, and we have been coaching them over the previous a number of months. We would count on for his or her contributions to start out exhibiting up meaningfully later this yr, and Shawn can discuss that. And Shawn, the metrics we’ll use to trace the progress there?

Shawn O’Neil

Sure, Joanne, as we have talked about earlier than, the CPT codes don’t differentiate between a mixture cataract or a stand-alone case. So we’re nonetheless taking a look at that knowledge at a excessive stage to attempt to acquire insights, however it’s not apparent. One factor that we’re doing with our GCC group is that they do have a finite goal record that they’re going to be specializing in. And clearly, we all know what the baseline gross sales and exercise are in these amenities, and we’ll be capable of monitor that over time and establish incremental development, which is clearly one of many KPIs that we will be centered on.

So we imagine we’ll be capable of take a number of of those knowledge units after which be capable of crystallize them into a greater reply.

Joanne Wuensch — Citi — Analyst

OK. I will depart it there. Thanks.

Paul Badawi — Co-Founder and Chief Government Officer

Thanks, Joanne.

Operator

And our subsequent query comes from the road of Cecilia Furlong with Morgan Stanley. Your line is open. Please go forward.

Cecilia Furlong — Morgan Stanley — Analyst

Nice. Good afternoon and thanks for taking my query. I wished to ask on ’22 steerage, one, the way you’re enthusiastic about continued growth in your established accounts into stand-alone, how that contributes to your outlook, in addition to your expectation for brand spanking new heart provides all year long?

Jesse Selnick — Chief Monetary Officer

So gave you in my feedback, in all probability it was a mouthful, Cecilia. However we added 98 new amenities, brand-new amenities, first-time orders within the fourth quarter. That form of tempo is a tempo that I believe we count on to proceed at a baseline minimal, proper? So that ought to offer you some shade on that. And as Shawn alluded to and Paul, like the best way we construct our mannequin is we have a look at utilization general, Stand-alone is clearly a extremely necessary driver.

And sure, I imply, all the pieces, all of our traits level very positively towards that. We decompartmentalize our development by way of buyer acquisition development and use case development. And we really feel — truthfully, we really feel like with these investments that we’re making and the rising market presence, that that type of pure natural development in use case goes to see tailwind really as we proceed to progress by way of the yr and see the outcomes of the GCCs and plenty of the actually centered advertising and marketing that we’re doing across the alternative.

Cecilia Furlong — Morgan Stanley — Analyst

Nice. Thanks. And if I might observe up as properly, simply on R&D, each close to time period, however extra in order you assume over the following a number of years with the pipeline updates you supplied right now, the way you’re enthusiastic about simply the extent of R&D funding incremental to what we have been beforehand considering with the aforementioned product portfolio and medical trials that you just had beforehand deliberate?

Jesse Selnick — Chief Monetary Officer

Sure. So low double-digit tens of millions by way of pipeline funding, that is each headcount and challenge funding this yr. So it is honest to take a look at how we have been trending in that space and add that to it as a very good proxy for that line merchandise. The fact is our improvement course of itself could be very environment friendly and sensible, form of just like — we have been very capital environment friendly in getting OMNI into market.

I am happy with that truth. And I believe we’re engaged on these tasks with an actual comparable mentality. So I believe there’s plenty of alternative for a really cheap quantity of spend there.

Cecilia Furlong — Morgan Stanley — Analyst

Thanks for taking the questions.

Jesse Selnick — Chief Monetary Officer

Thanks, Cecilia. 

Operator

Our subsequent query comes from the road of Andrew Brackmann with William Blair. Your line is open. Please go forward.

Andrew Brackmann — William Blair — Analyst

Yeah. Hey, guys. Perhaps simply begin there on the aggressive entrance and trialing you anticipated. Jesse, I did not hear type of a particular quantity that you just’re type of anticipating in your steerage for the yr.

So possibly only a housekeeping round that in case you have a particular quantity. However I assume then greater image, I assume out of your perspective, how do you see all of those types of newer non-implantable units or instruments type of impacting the market broadly. Something that you may type of share from a surgeon type of perspective that you just’re listening to given these bulletins during the last 10, 12 months.  Thanks.

Jesse Selnick — Chief Monetary Officer

Yeah. I will go to the precise query, after which I will let Paul and Shawn take the larger image query. And on the precise, Andrew, prefer it’s a consider how we have a look at our mannequin, proper? Like I do assume that what it does is it creates an adoption lag. What we’ve not seen is we’ve not seen share loss due to it.

However what we have seen is it is more durable — there are circumstances the place it is more durable to get on the calendar to maneuver folks alongside the trialing curve. So if you have a look at our vary, that displays a spread of enthusiastic about what our trial interval could be. And as you form of know from our mannequin, that is only a actually key driver given how excessive development it’s by way of after we get folks to maneuver alongside to that type of regular ordering cadence. And so, I wished to form of flag what the impression of that’s in our mannequin simply as type of an order of magnitude, however it would not — it is not like there is a bridge that claims aggressive merchandise and aggressive trialing has had x {dollars} of impression on us.

Paul Badawi — Co-Founder and Chief Government Officer

Sure. I will add a few feedback. I do know Shawn has different feedback so as to add as properly. However we’re seeing it, initially, these new entrants primarily together with cataract surgical procedure and primarily being bundled or utilized in mixture with stents.

I imagine that is all we’re seeing to this point. And so, for us, in response to that, as we all the time do, we spotlight the advantages of OMNI, proper? And that is often sufficient. The great outflow process that addresses uniquely all three factors of resistance; the usability and procedural predictability based mostly on many, a few years of design iterations; a best-in-class indication to be used based mostly on extremely compelling medical knowledge in all grownup sufferers with POAG, so assume combo cataract stand-alone, gentle, reasonable, superior. So all in all, for us, as we have a look at this stuff, we expect it is laborious to compete with what we provide, and our industrial group does a extremely, actually wonderful job of growing unshakable relationships with our clients.

They’re all the time doing the proper issues, highlighting the proper issues, the medical worth of OMNI all the time at the beginning and, frankly, the shortage of medical proof with a few of these new entrants. Shawn, I do not know in the event you’ve obtained anything so as to add.

Shawn O’Neil

From a industrial standpoint, clearly, specializing in our execution from a gross sales, advertising and marketing and coaching standpoint, we’re positively persevering with to deal with the worth of OMNI. I believe the factor that is necessary within the trial setting, per your query is these being new merchandise, they don’t have medical knowledge, nor have they got a monitor report of a reimbursement pathway. So we proceed to deal with the worth of OMNI, the flexibility to decrease IOP in grownup sufferers with main open-angle glaucoma. Additionally the extra good thing about the remedy potential remedy discount, all inside that steady, clear reimbursement pathway with 66174.

So our group is targeted on mitigating any of that trial exercise after which rapidly pivoting again over to demand creation for OMNI and finally holding the affected person on the heart of the dialog and offering the best choice for the affected person.

Andrew Brackmann — William Blair — Analyst

That is nice. Thanks all for that. After which, possibly simply type of pivoting right here to the pipeline. Clearly, plenty of new issues type of being unveiled right here right now and positively warrant an investor day later this yr, so enthusiastic about that.

However, I assume, possibly out of your perspective, type of on these non-implantable newer units, these appear to be those which can be in all probability closest to market. How ought to we be enthusiastic about type of the differentiation of these units versus the type of aforementioned newer entrants within the canal-based type of surgical procedure that we have been speaking about right here. Thanks, guys.

Jesse Selnick — Chief Monetary Officer

Andrew, sorry, are you referring to our pipeline versus among the new entrants, or one thing else? I did not observe that precisely.

Andrew Brackmann — William Blair — Analyst

Sure. So your pipeline precisely. So the brand new goniotomy system after which additionally the second-generation or third-generation OMNI system, how are these anticipated to type of compete with these newer pipeline merchandise from rivals? Thanks.

Paul Badawi — Co-Founder and Chief Government Officer

Sure. Sure. Properly, I will say that. We do not enter any class with out a complete lot of thought.

We do not enter any class with out the expectation to be best-in-class. That’s the expectation that is from earlier than we even file a patent. These are the issues going by way of our minds. So we’re not disclosing particulars, Andrew, on this name, of that product or among the different merchandise intimately.

We did need to preview it with you and everyone as a result of we have been enthusiastic about this stuff for a number of years. A few of them, we filed IP on them. We are actually starting to put money into them. We have not too long ago employed a really gifted head of pipeline technique and improvement.

And so, we wished to preview with you. We will likely be talking intimately later this yr both at an analyst day or investor day or each about these particulars that you just’re asking about, however simply count on no matter we will disclose will likely be compelling. We have finished it twice with OMNI and TearCare. We’ve got a historical past of inner — internally growing breakthrough merchandise, the pipeline that we’re speaking about right here has all been internally developed.

Clearly, sooner or later, we’ll look externally. However for now, what we’re speaking about is inner improvement. We’ll share particulars, Andrew, on it in the end.

Andrew Brackmann — William Blair — Analyst

OK. Thanks, guys, and thanks for the colour right now.

Paul Badawi — Co-Founder and Chief Government Officer

Positive. Thanks.

Operator

And our subsequent query comes from the road of Matt O’Brien with Piper Sandler. Your line is open. Please go forward.

Drew Stafford — Piper Sandler — Analyst

Hello, guys. Good afternoon. That is Drew on for Matt. And thanks for taking the questions.

Paul Badawi — Co-Founder and Chief Government Officer

Hey, Drew.

Drew Stafford — Piper Sandler — Analyst

I do exactly need to observe up slightly bit on the feedback on the industrial delays associated to the rivals. I assume, simply to be clear, I imply, what’s informing your view that offer you confidence that these delays are momentary? After which I assume, two, have you ever made any tweaks in any respect to the industrial technique till you may have the canaloplasty label or on label for OMNI? Or is it nearly whether or not on this interval till issues get again to regular?

Shawn O’Neil

So from a industrial — sorry, go forward, Jesse.

Jesse Selnick — Chief Monetary Officer

Go forward, Shawn.

Shawn O’Neil

So from a industrial technique standpoint, we contemplate — we proceed to face behind the worth of OMNI addressing all three factors of resistance as a key differentiator, addressing the traditional offload pathway in that method. So what we’re doing is de facto being centered on persevering with to drive demand and focusing our technique, particularly with our investments in GCCs, to increase, use our SSRs to mitigate trial and proceed to create demand and practice new surgeons, after which make the most of our funding in GCCs to increase use case by educating the broader medical ECP group on ensuring that sufferers are conscious that there’s one other different for his or her earlier surgical intervention for his or her mild-to-moderate glaucoma wants. So from that standpoint, we’re being constant and proceed to drive worth with that technique.

Paul Badawi — Co-Founder and Chief Government Officer

Yeah. And as for the canaloplasty alone indication and the research, the TRIDENT, PRECISION trials, let’s have a look at what the medical knowledge seems like. We’re enthusiastic about them. And we expect that it — as you’ll be able to inform from the at the very least the high-level description of the portfolio that we’re constructing out right here, we need to supply the broadest, deepest, most wealthy portfolio of options for each physician.

And completely different docs have completely different preferences. Some could desire to do canaloplasty alone. Some could desire to do canaloplasty with trabeculotomy. Some could desire to do both of these procedures together with an implant.

We have seen all the pieces out there. And now we have a really, excellent R&D group and manufacturing and operations group right here. I can let you know that the Menlo Park workplace is buzzing with pipeline improvement proper now, a ton of fine power right here. And we would like and may or capitalize to convey this portfolio to market, once more, addressing all of those completely different use circumstances.

Jesse Selnick — Chief Monetary Officer

And also you requested a query about why we’re assured. We’re utilizing our eyes and ears to be assured. It was very noisy to attempt to assess January given the variants. However now we have a extremely excessive contact gross sales mannequin.

We get nice area intelligence about what’s on the market, and I believe we fairly have conviction that by way of what we’re seeing and seeing order patterns by way of three quarters, March as properly that form of that characterization is correct.

Drew Stafford — Piper Sandler — Analyst

OK. That is very useful. Thanks for that. After which, I perceive your feedback on the way it’s tough to bifurcate the steerage because the stand-alone and combo cataract.

However I assume to possibly simply ask it merely, does stand-alone must publish comparable development final yr? Does it must speed up from a few of these investments you are making? What’s wanted to get to the midpoint of the steerage vary?

Shawn O’Neil

We do imagine — I imply, we’re assured that it’s going to speed up. It has been a part of our aims as we introduced OMNI out with us, particularly after we obtained its broadest label, and we’re assured that as we execute appropriately, that’s what will happen.

Jesse Selnick — Chief Monetary Officer

Sure. I imply, Shawn’s reply is the proper one. We’re assured that is what we’re making that funding however there’s not a — there’s plenty of — one of many nice issues about this product is there’s plenty of completely different drivers of development, and it is nonetheless at even with a $14 million-ish fourth quarter, there’s a lot room to develop by way of just like the low quantity of market penetration in stand-alone and mixture cataract. And so, there is a ton of conviction and a ton of funding in perception.

However OMNI’s skill type of assist to attain this steerage, there’s a number of methods to get there.

Drew Stafford — Piper Sandler — Analyst

OK. Thanks.

Operator

Thanks. And I am exhibiting no additional questions right now. And I want to flip the convention again over to Paul Badawi for any additional remarks.

Paul Badawi — Co-Founder and Chief Government Officer

I simply need to thank everybody for his or her time and questions and a focus and curiosity in Sight Sciences and thank our group for a stellar yr in 2021, and what’s trying like a extremely wonderful yr forward with all the pieces that we mentioned right now. So thanks all.

Operator

[Operator signoff]

Length: 57 minutes

Name contributors:

Philip Taylor — Investor Relations

Paul Badawi — Co-Founder and Chief Government Officer

Jesse Selnick — Chief Monetary Officer

Joanne Wuensch — Citi — Analyst

Shawn O’Neil

Cecilia Furlong — Morgan Stanley — Analyst

Andrew Brackmann — William Blair — Analyst

Drew Stafford — Piper Sandler — Analyst

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