GKOS - NYSE

Welcome to Glaukos Corporation's Second Quarter 2023 Financial Results Conference Call. Copies of the company's press release and quarterly summary document both issued after the market closed today are available at www.glaukos.com. [Operator Instructions]. This call is being recorded, and an archived replay will be available online in the Investor Relations section at www.glaukos.com. I will now turn the call over to Chris Lewis, Vice President of Investor Relations and Corporate Affairs.

Thank you, and good afternoon. Joining me today are Glaukos Chairman and CEO, Tom Burns; President and COO, Joe Gilliam; and CFO, Alex Thurman. Similar to prior quarters, the company has posted a document on its Investor Relations website under the Financials and Filings Quarter Results section titled Quarterly Summary. This document is designed to be -- to provide the investment community with a summarized and easily accessible reference document that details the key effects associated with the quarter, the state of the company's business objectives and strategies and any forward statements or guidance we may make. This document is designed to be read by investors before the regularly scheduled quarterly conference call. As such, for this call, we will make brief prepared remarks and transition into a question-and-answer session. To ensure ample time and opportunity to address everyone's questions, we request that you limit yourself to one question and one follow-up. If you still have additional questions, you may get back into the queue. Please note that all statements other than statements of historical facts made on this call that address activities, events or developments we expect, believe, or anticipate will or may occur in the future are forward-looking statements. These include statements about our plans, objectives, strategies and prospects regarding, among other things, our sales, products, pipeline technologies and clinical trials, U.S. and international commercialization, market development efforts, efficacy of our current and future products, competitive market position, regulatory strategies and reimbursement for our products, financial condition and results of operations as well as the expected impact of general macroeconomic conditions including foreign currency fluctuations on our business and operations. These statements are based on current expectations about future events affecting us and are subject to risks, uncertainties and factors relating to our operations and business environment, all of which are difficult to predict and many of which are beyond our control. Therefore, they may cause our actual results to differ materially from those expressed or implied by forward-looking statements. Review today's press release and our recent SEC filings for more information about these risk factors. You'll find these documents in the Investors section of our website at www.glaukos.com. Finally, please note that during today's call, we will also discuss certain non-GAAP financial measures, including results on an adjusted basis. We believe these financial measures can facilitate a more complete analysis and greater transparency into Glaukos' ongoing results of operations, particularly when comparing underlying results from period to period. Please refer to the tables in our earnings press release available in the Investor Relations section of our website. For a reconciliation of these measures to the most directly comparable GAAP financial measure. With that, I will turn the call over to Glaukos Chairman and CEO, Tom Burns.

Okay. Thanks again, Chris. Good afternoon to all, and thank you all for joining us. Today, Glaukos reported record second quarter consolidated net sales of $80.4 million, up 11% versus the year ago quarter. These second quarter results reflected record sales and continued strong performance across our international glaucoma and Corneal Health franchises alongside the reemerging growth in our U.S. glaucoma franchise driven by the initial commercial launch of iStent infinite. I'd like to congratulate the dedication and performance of our teams around the globe who remain committed to their work and to advancing our key initiatives. Given our solid second quarter and our latest forward outlook, we are raising our 2023 net sales guidance range to $304 million to $308 million. Versus the $295 million to $300 million previously. From a commercial perspective, strong execution of key strategies within each of our core franchises drove our record quarter. Within our U.S. glaucoma franchise where we delivered sales of $39.6 million, which grew 4% year-over-year and 13% sequentially, we continue to advance iStent infinite ahead of establishing formal MAC coverage and payment. On that front, 5 of the 7 MACs have issued proposed LCD reconsiderations that if finalized would provide coverage for iStent infinite, consistent with FDA approval and based upon our coverage reconsideration requests. In total, all 7 MACs have taken preliminary steps to assess iStent infinite coverage through either proposed LCDs or temporary LCA updates. Further, we continue to support expanding broad access to interventional glaucoma tools for physicians and will closely monitor the various MAC policies and processes as they advance and are ultimately finalized in the future. We were also encouraged to see as part of the CMS 2024 proposed rule the CPT code used to cover iStent infinite and stand-alone procedures, 0671T has been lifted to APC 5492 from APC 5491. We are pleased with this initial proposal and believe, as we have stated in the past, that it more appropriately reflects the cost of infinite and similar stand-alone procedures. Separately, CMS also proposed to move the APC assignment for combined cataract plus trabecular bypass procedures 66989 and 66991 to a newly restructured APC 5493, which we also believe appropriately reflects the claims history as CMS stated in the proposed rule. If finalized, these changes will go into effect January 1, 2024. As mentioned earlier, our international glaucoma franchise delivered record sales of $22.3 million on a strong broad based year-over-year growth of 25% on a reported basis and 27% on a constant currency basis. As we continue to scale our international infrastructure, we are increasingly driving MIGS towards as a standard of care in each region and every major market in the world. While we focus on our near-term execution, we are also accelerating efforts to support one of our founding missions at Glaukos, which is to advance glaucoma care by driving intervention of therapies earlier in the treatment paradigm for glaucoma disease and, in turn, pioneering a new stand-alone market over time. We continue to lead and work closely with surgeons and thought leaders globally to organically drive this broader evolution in the standard of care, including through numerous events at the ASCRS annual meeting in May and more recently at the World Glaucoma Society Biannual Meeting in Rome in June. And finally, our Corneal Health franchise delivered record sales of $18.5 million on a 11% year-over-year growth, including Photrexa record sales of $15.9 million on year-over-year growth of 18% as key strategic initiatives implemented throughout the past year continue to take hold in support of this important business. Shifting gears to the development front. We continue to prudently invest in and successfully advance a robust pipeline of novel promising platform technologies that we believe have the ability to significantly expand our addressable markets and fundamentally transform our company over time. During the second quarter, we announced FDA acceptance of the previously submitted NDA for iDose TR, marking another important step in bringing this game-changing therapy one step closer to patients. We continue to be encouraged as we work closely with the FDA and their ongoing review process as we progress towards the agency's established PDUFA goal date of December 22, 2023. Alongside this, our teams continue to make nice progress with the preparation and planning of the iDose commercial launch targeted for early next year, including a robust set of peer-reviewed literature expected to be published over the remainder of this year and into 2024. Turning to the Corneal Health pipeline. During the second quarter, we completed enrollment in the second Phase III confirmatory trial for Epioxa, our next-generation corneal cross-linking therapy for the treatment of Keratoconus. This expeditious enrollment completion, which occurred in less than 6 months from trial commencement earlier this year, is a testament to the favorable risk-benefit profile of this next-generation therapy as well as our team's hard work in bringing this important rare disease therapy, one step closer to patients suffering from keratoconus which is a sight threatening corneal disease. We look forward to following these patients outcomes as we target NDA submission for Epioxa by the end of 2024. As you can see, we have a lot to be excited about when it comes to the significant potential value that we believe our pipeline programs may create. At the same time, as we discussed last quarter, we continue to prioritize the cadence of our investments as we strive to strike the right balance of risk-based investments and our capital position now and in the future. As evidence of that, our non-GAAP, SG&A and R&D operating expenses in the second quarter moderated to 6% year-over-year growth, reflecting some of the initial development adjustments we've made in our earlier-stage pipeline programs as we continue to prioritize our resources ahead of the anticipated iDose commercial launch early next year. So in conclusion, I'm very pleased with the record quarter and building momentum in our business as we continue to successfully advance our mission to truly transform vision by pioneering novel, dropless platforms that can meaningfully advance the standard of care and improve outcomes for patients suffering from sight threatening chronic eye diseases. So with that, I'll open the call for questions. Operator?

[Operator Instructions]. Our first question will come from the line of Tom Stephan with Stifel.

Great. First one, I'll start with iDose. I guess, big picture, in your guys' minds, what does the successful launch in 2024 look like? , you hear different numbers. I think $50 million has been cited as a year 1 number. But even if it's run rating more in the $30 million to $40 million range. Is that a decent starting point or benchmark as we try to refine our models for year 1 iDose now that we're getting much closer to hitting the market. But just any guardrails for how to think about 2024 iDose would be very helpful.

Tom, it's Joe. I'll start, and Tom may want to add some color commentary at the end too. As we think about iDose, and obviously, I'm not going to comment on the specifics of the guardrails of any given number, how will we define success? I think we're going to define success in a couple of different ways. First, the more broad theme of continuing to drive the interventional glaucoma mindset and really the need and reason for intervening with these safe and minimally invasive technologies. But specific to the launch, you've been around the story long enough to know that our focus is on making sure that we deliver the right kind of training and the right kind of outcomes for surgeons out of the gate. So we're going to prioritize doing this the right way and doing it the right way, both from the surgeon's perspective as well as ultimately in achieving the optimal sort of reimbursement outcomes and everything else that go to drive long-term success over any particular quarter or target number for the year. Obviously, you know we're enthusiastic about what iDose means for our future, and we're going to make sure we put the right building blocks in place to achieve that success.

Got it. That's helpful. And then to pivot to infinite, maybe a 2-parter, but any trends you can speak of with Internet to date and maybe even into 3Q, just momentum with that product here in the U.S. Any color you can provide would be very helpful. And then in terms of the facility fee proposal, really encouraging to see I think, over a doubling of the ASC facility fee. Can you just talk about what that could mean in 2024 for the product? Maybe more specifically, do you think there's a good opportunity to take some price on that product?

Tom. So I think first, just in terms of the broader trends of iStent infinite, we continue to be really pleased with the momentum here, as we wind our way through the formal MAC and coverage process both within the Medicare side as well as the commercial payer side, to see the early utilization and adoption the way we've seen it is really particularly encouraging when you put it in the context of where we're at on the reimbursement side, which with -- as you know, 5 of the 7 MACs having proposed draft LCDs for coverage that's largely aligned with our formal coverage request and the product label and the other 2 having addressed via local coverage articles or LCAs. We're making our way through that process. But it's still early. And so the momentum we're seeing around iStent infinite and its utilization speaks a lot to the potential need for a product like this in the marketplace. Even though we're still working our way through the formalities of achieving proper coverage from the various MACs and commercial payers for that matter. I think as it relates to the facility fee in 2024, you heard Tom reference in the prepared remarks that we're obviously pleased to see the proposed rule as it relates to the facility fee for infinite and combo cataract for that matter. And you know, it's pretty consistent with what we've said historically, we would expect given on the data that we see. But sometimes it takes some time to work through the process. And so to be here with the proposed rule, we're obviously pleased in what that means for 2024. As you know, pricing, and it really gets [indiscernible] second question, pricing of product is -- it's multifactorial in terms of product attributes, your overall portfolio, competition and yes, reimbursement. And so what I can say is that I think the proposed changes, if they're finalized, will thankfully enable facilities to do these site-saving procedures to receive appropriate reimbursement that makes the procedure economically feasible for them. And I think patients end up benefiting at the end of that.

Your next question will come from the line of Ryan

And nice results here. I guess I want to ask first on guidance. If you look at kind of where the guidance is going based on results, and Joe, you know where I'm going with this question, it implies as kind of a step down on an absolute dollar basis in the back half of the year, relative to what is historically a strong seasonal fourth quarter. So -- any color here on kind of your thought process? And the second part of the question is just what impact from the proposed LCD and the other 2 MACs, have you seen in numbers in this quarter -- in the second quarter? And kind of what effect has that had kind of on physician behavior? And then I have a follow-up.

Sure, Ryan. -- obviously expected it in that context. I think -- well, let me start first. Obviously, it was a high-quality first half and the second quarter from an execution standpoint, it exceeded our expectations across the board. When you think about 2023, for us, it really remains all about building the strongest foundation possible ahead of what we think will be a pretty transformational period for our company going forward with infinite, iDose and Epioxa. So we had a good start in the first half, but we have a lot of work in front of us as we continue to lay that foundation. I think at the outset of the year, we were pretty clear we wanted to walk before we ran, as it related to guidance. And I think the update we're giving here today probably reflects of us starting to jog and use the same analogy. What have we tried to reflect and what's included in that. I'll try to give a little bit of color here. We've tried to reflect, obviously, the encouraging first half trends that you pointed to and what that can mean. We've also tried to factor in the fact that from -- as we look across the landscape and you all see this even more than we do, that health care procedure trends broadly feel pretty healthy and maybe even a bit elevated in the first half as some of the staffing constraints that have been an issue in 2022, started to ease a bit, and that enabled accounts to work through their backlog. So our guidance that we reported for today assumes more of a normalization of that reality in the second half. It also assumes that we've really not included any material benefit from the finalized LCDs in 2023, particularly as it relates to iStent infinite. And this ties a little bit into the second part of your question, which I'll get to in a second. But what we've really assumed is that we remain in a steady state -- we can talk about it more in the context of the LCD process, but there's no certainty in terms of exactly when those will be finalized. And once we know that, we can obviously better quantify the potential impact that has, especially to iStent infinite. We have to factor in the summer seasonality, which we would we do in globally in Q3 in particular. And that's been more pronounced in recent years coming out of COVID. And then the ongoing competitive dynamics, including from Alcon as well as some of the more invasive procedures. And that really ties into your -- the second part of your question. I think the LCDs as proposed I wouldn't say we've seen much of an impact at all from those in the context of what's happening here and now in the marketplace. They're proposed. They haven't changed any of the coverage rules for these products. And so until they do, I would expect that surgeons largely continue to operate as they have been on the basis of the reimbursement and the coverage that exists today.

Okay. Very thorough on that. I want to squeeze in one more. Just, Tom, you talked about moderating spending, and I thought that was an interesting comment given kind of we're about to prepare for what is arguably one of the biggest products in the company's history and a launch around that. And so I think the earlier question kind of talked about what is a successful launch. But maybe on the other side of the P&L, I mean what is moderating spending mean in terms of how you go to market and sell iDose from a commercial standpoint?

Yes. Great question. Happy to answer it, Ryan. So when I talk about moderating, we're talking about an extensive array of organic development programs that we've been really blessed to have in the organization as we're carrying these forward. And so that obligates me and compels me to prioritize and use our capital in the best way to establish benefit to risk and optimal return on investment for shareholders. And so that's what we're doing. So I wouldn't be -- draw the wrong conclusions. I would tell you that we have tremendous capital that we'll employ towards the significantly successful of our target launch of iDose. That is a question of timing. I expect some of that to occur later this year and on into 2024. And so we understand the order of magnitude that this launch could mean for the company. And so I can assure you that we'll make the necessary capital -- put the necessary capital behind this launch to make it a success.

Your next question comes from the line of Larry Biegelsen with Wells Fargo.

This is Charles on for Larry. First congrats on the nice quarter. First question, a quick follow-up on guidance. I wonder if you could give a little thoughts on quarterly cadence of sales through the back half of 2023. I know you mentioned -- you mentioned a little summer seasonality. So I don't know if that's implying that Q3 a little lower in Q4 is a bit of a step-up, but maybe some thoughts on that. And then I have a quick follow-up on iDose.

Yes, Charles, I think that's -- you hit it with really the way you asked the question. If you look -- implied guidance is the second half looks somewhat like the first half. And that the -- I think the summer seasonality dynamic that we've seen in recent years plays itself out here in the third quarter. The last month of the quarter tends to drive a lot as people return back to doing procedures in a fulsome way on a global basis. So we'll see how that plays out. But at this point, yes, I would expect that Q3 sees a bit of a downtick from that summer seasonality, and then that recovers in Q4.

Great. And then -- and then a follow-up on iDose. So do you still expect no restrictions on the repeat procedures upon approval? And then also, you said you plan to work towards reimbursement for iDose in the office setting. How might -- how long do you think that could take after launch? And do you think that's a big catalyst for adoption?

Yes, Charles, I'll be happy to take those. So your first question was on whether or not we expect to be restricted at all in exchange. And so we've answered this before and continue to express confidence that, that won't be an imposition for us. And if you recall, our exchange study that we did by reconsenting patients in the Phase IIb study, we had 33 patients that we were following over 5 years and we saw no real substantive differences between treatment and control. And so we feel confident that we will not have a restriction going into that study. Now with regards to how we will go to launch, again, it's important that we take this in a twofold way. One, I want to provide site of surface offerings or surgeons to be able to do the iDose both in the office and certainly in the ASC. Recall that as we get to launch, we will be approaching MACs to establish an appropriate professional fee. They'll be an assignment to an APC. That will then be -- typically, we'll see that over the first half of the year. On the drug payment side, you'll recall, we'll have a miscellaneous J-code at launch. And we'll file for a HCPCS code which in my experience and others, typically takes 2 quarters to be able to get a former J-code. That J code will apply to both ASCs and to in offices. And so when we talk about in-office use, which we believe will become an important part of the use of iDose over time. What we'll need to do is to establish non-facility payment. And that's done by approaching the MACs individually. We will need to get society -- specialty society support and KOLs. And what we'll do is we'll develop a practice expense work up which will be the basis for which these MACs will be able to consider, what the professional fee will be for non-facility payment in office. And as you recall, typically, that professional fee payment is higher in the non-facility because there is no -- in the non-facility because there is no facility payment. So the professional fee, we expect will exceed the professional fee on the ASC side. This is something that happens fairly. It happens case-by-case as we go forward with the MACs. So it will be something that will occur over time. But as I've said now, probably since we've had our IPO, this will be an important component longer term. To give the physicians the ability to use in office as a site of service for what we believe will be a game-changing technology.

Your next question comes from the line of George Sellers with Stephens.

Congrats on a great quarter. Sticking with iDose. You've obviously had some success with iStent infinite adoption despite working through some of the reimbursement processes with the MACs. But I'm just curious, as it relates to iDose, is there anything we can kind of take from that commercialization of iStent infinite and apply to the expected commercialization of iDose? And I know we're still waiting on approval and it's a little bit more complicated than infinite in a lot of ways. But what could demand for iDose look like prior to reimbursement fully coming together? And how do you expect that to sort of progress.

Yes. I mean I think it's hard to draw a direct line between the experience with one product versus the next, given they have different labels and different indications and different patient populations that they're targeting. I think the thing that you can't take from infinite is our commitment to doing it the right way, to being methodical in the way we launch these products and the way that we train our surgeons and the way that we make our way through the reimbursement process. Over a couple of decades, we've earned a lot of experience in going through this process of launching new products into white spaces. And I think iDose, in some respects will be another example of that as we go forward. I think we -- there's enough variables in play there that we'll address what we expect for 2024, for example, when we get to our guidance for that year versus getting ahead of that now at this point.

Okay. That makes sense. Maybe switching gears a little bit. You also recently announced an agreement with Radius XR. And I'm just curious if you could give some additional details on that deal. Any incremental costs you're expecting this year associated with that? And then also maybe what's assumed from that in the current guidance?

Yes. So I'll start in reverse order. I think from an expense standpoint, it's pretty immaterial. I wouldn't call anything out -- and from a guidance perspective, yes, it's factored in there. I wouldn't call that as a particular material driver of the guidance at this stage. But what really is behind Radius and why we're doing it is we've talked about some time about our role in pioneering these markets and growing the market. And part of that is trying to make sure that we're helping to democratize testing and screening in a way that identifies these patients and helps them wherever they're first presenting themselves from a site of service standpoint. Whether it be an optometrist, whether it be retail optometrist like a Walmart optical or ultimately, obviously, in the MD setting. That they're getting access to technology that can efficiently and easily test them for these sight threatening diseases and hopefully identifying them more early and getting them the kind of care that they need and deserve sooner or rather than later. Today, as it stands, as you know, in many of these optometry centers, in particular, alongside of even some most, they're limited in terms of the diagnostic capabilities or when and where they actually deploy the diagnostic technology they have, to really test these patients. And so our hope is that by putting some incremental muscle behind the technology that we think is truly best-in-class and Radius that we can help democratize and really drive that screening and diagnostic side of the equation.

Your next question comes from the line of Joanne Wuensch with Citi.

I'm curious about two things. One is, at what stage are you comfortable sharing with us what the ASP is for iDose because we've heard a number of different numbers tossed around. And then the second question I have is your OUS mix is really strong. And I'm curious whether or not there is pent-up demand or a new region you opened up, any stocking? And would you be surprised if this didn't continue for the remainder of the year?

Thanks, Joanne. I'll take the first part of the question. So with regards to iDose pricing, we are still contemplating what that price will be. And -- and as I've said all along, we are being highly contemplative. We're looking at Markov transition probability analysis, burden of illness analysis. I'm factoring in what derisk the charge over $2,000 in a J code for 4 months of therapy. And I'm also looking at surgical pharmaceuticals, both on the anterior segment side and on the retinal side, which I think will guide me in the basis for what I think will be a fair and compelling price. I would expect you not to hear that price until we are FDA approved. And so we'll be contemplating that. We'll take our time. We'll make sure we get it right and then some short time after FDA approval, you will hear and we'll disclose the pricing for iDose.

And on the international side, it really was another standout record quarter, 27% constant currency growth year-over-year [indiscernible] I think, sequentially. It was broad based, [indiscernible], across all of our regions and really, I think, reflects that strong execution by our teams globally. If you think about it, we're really pioneering a change in standard of care in each of these markets, just like we've been doing in the U.S. for some time. And all of the various markets that we're in today are in a little bit different stage of that. And -- and all the things that you know we've done here to build the MIGS marketplace exist today in terms of the broader support, both from the community, the surgical treatment algorithms, the reimbursement dynamics in each of these -- all these markets are in a little different place. And so we're still making our way through really building and in virtually all of the markets we're in, we're still very much in the growth phase of that business. We didn't add any new regions or any unique drivers here. I think probably at the beginning of 2022 from a growth standpoint, there was still a little bit of lag effect, a couple of the regions still felt a little touch of COVID. They probably had those numbers a little depressed on a year-over-year growth standpoint. But all in all, we couldn't be more pleased with the execution of the team. I do expect that similar to what we talked about in terms of macro guidance, you'll probably see a little bit more normalization. I think the same dynamics that have been playing true here in the U.S. from a staffing levels and getting back to business as normal and clearing some of the backlog, inherent our guidance is that we'll see a little bit of normalization there in the second half, not just in the U.S. but globally. So we would expect that business from a growth perspective would come in a bit in the second half relative to what we've experienced thus far in the first.

Your next question will come from the line of Matt O'Brien with Piper Sandler.

This is Phil on for Matt. Thanks for squeezing us in at the end and congrats on another great quarter. Just for starters been I don't want to belabor the point here, but laying the groundwork for an early 2024 launch of iDose, how are those conversations with docs going as far as using the currently available miscellaneous J code? And what I'm really trying to get at is, that requires that process. So are docs aware of how that process works and what might early utilization look like there?

Sure, Phil. I think a couple of things first. You can imagine that given iDose has not yet received approval, there really aren't conversations specific to iDose, as it relates to reimbursement and how the dynamics with miscellaneous codes and all those various things go specific to the product. The vast majority of our customers have been through this before in some capacity. Some are better at that process than others. All I can tell you is that we're very prepared for that part of the launch and educating our customers as we go through that, getting them comfortable with how that will work. Ultimately, as you can expect, many of them will want to see it and see themselves do it successfully. So I -- we do expect that they themselves will walk a bit before they run as I like to say. But it's something we're prepared to take care of and educate at launch on a customer-by-customer basis. But getting ahead of it in their knowledge today is more based upon their broader experience in the industry than it is specific to iDose.

That's helpful. And then just one follow-up on R&D. I noticed -- and I know you called out some initial development adjustments in some earlier-stage pipeline programs. And I don't think I heard anything specifically called out there. I just wanted to check if there was any impact to iDose TREX.

Phil, this is Alex. I'll just kind of comment on that. And it goes kind of what Tom was earlier speaking about, which is we have sat down as we looked at our capital position, we looked at our pipeline, we looked at iDose launch and what we needed to invest in for that activity. And so we've started to make decisions around allocating those resources appropriately, in order to really fulsomely prepare for and invest in the iDose launch that's coming up. I don't think we've gotten much more granular than that.

Yes. I don't think we've said anything specific to any individual programs. But you can imagine that the iDose franchise remains a top priority for us, not just the first generation, but I heard you reference TREX and sort of the extended release portion of that, and we continue to move forward full steam ahead on that front.

Your next question comes from the line of David Saxon with Needham.

This is Joseph on for David. Maybe one on iStent. In terms of adoption for iStent infinite, are you seeing a traction from new docs to Glaukos? Or is the adoption primarily centered around current iStent inject users?

Yes, Joseph, I think you're always going to see a little bit of that, but you got to put it in the context of the stage of where we're at. I think at this stage, the majority, if not the vast majority of that adoption, utilization, expansion, the stand-alone utilization, et cetera, is happening within customers that have been Glaukos customers for some time. That tends to be how you launch these things anyway, and I think it's true with iStent infinite. Now as we continue to move forward and establish reimbursement coverage, we certainly hope that it will expand more, particularly in the glaucoma community where this product should be well received. And for folks who made today, they spend their time a little bit more in the late-stage procedures -- tubes and trabs and other devices that work at that stage, you hope that, obviously, they'll start to adopt iStent infinite as the coverage really picks up on the reimbursement side and they're able to run free.

Fair enough. Makes sense. Maybe a bigger picture question. With the products you have approved today, what would you kind of say your long-term growth profile is? What do you think the glaucoma business can grow longer term? You talked about Corneal Health growing 8% to 12%. Is that still kind of your thinking or -- as reimbursement starts to get more specific, could there be upside to that?

Well, I think there's a couple of different parts that within your question, specifically to the Corneal Health business, I think we continue to think about that at the moment, a high single-digit type growth franchise. We're encouraged by what we've seen so far in the first half. We'll need to see a little bit more from that business before we upgrade that, if you will, in terms of our growth expectations. But I think more importantly, the macro question that you're asking to me, it's hard at our stage to put a number out there and say we think we can grow at. The reality is that we've been operating in both sides of our business, U.S. glaucoma and Corneal Health and for that matter, international glaucoma, inside of still relatively small markets versus what we're about to start embarking on. When you think about the size of the combo cataract opportunity, relative to what we can potentially achieve as we drive the interventional glaucoma change in standard of care, if you will, and the sheer number of patients who can benefit from that mindset relative to the combo cataract setting, I think we're very -- it's why we're very excited about what this next chapter means for Glaukos and where we're going to go. And I think in a similar fashion, Epioxa represents that same type of transformational moment, if you will, for us on the cornea side as we get closer and closer to hopefully that approval and launch. So we have a lot of reason for optimism about what that long-term growth trajectory looks like. We're swimming in a much larger and deeper ocean as we move forward here. And I think that's going to hopefully benefit us and you all shareholders.

Your next question will come from the line of Steve Lichtman with Oppenheimer.

This is Ron on for Steve. Congrats on the quarter. Just wanted to ask you guys, in your earnings desk, you mentioned potential normalization of procedure volumes in the second half of the year. Following what may have been worked on over the backlog in the first half. So can you guys talk about -- a little bit about what you're hearing from the field on that front? And where do you think we are in terms of the backlog?

Yes, Ron, I think in some ways, it's what we're not hearing from the field. And so if you think about it last year, and we called this out on several of our calls, what we were hearing from doctors in the field was a fair amount of feedback around staffing levels and constraints and the turnover and the inability to hold and retain a fulsome staff that enabled, for example, doctors who have 2 OR base to work in both simultaneously. You were pretty consistently hearing that theme. And I think as we turn the corner into this year and certainly as we've made it along, we've heard less and less of that, if at all, quite frankly, I'm sure it obviously still exists in pockets, but it's less pronounced. And I think the broader point around procedure trends and the backlog is almost more of a macro one. When we look across the landscape, and obviously, you cover a lot of different industries and companies, and we saw this in the first quarter, you see it again in the second. It feels like, in general, procedure volumes have been pretty robust. And I think that, why I can't point any specific number or item in ophthalmology or within MIGS procedures, in general, it feels like folks have been back to work. And they've been working their way through. And net-net, they're making their way through whatever backlog tends to exist. It's impossible to know exactly when that will normalize, but we felt like it made more sense to make the assumption that whatever elevation existed in the first half that it may not continue in the second half. And if it does, obviously, that will accrue to all of our benefits.

That's great. And just one small follow-up on iDose. Do you guys think there's any chance that a panel will be called for this? Or is it already too late for that to happen?

Ron, I'm happy to take that question. So this is -- it's been asked a few times before, but happy to address it again. We currently do not believe that there'll be an advisory panel that will be requested. And so -- right now that we're moving towards our PDUFA date, everything is on track, going very well. We just finished a pre-approval inspection which we believe went very, very well, and we'll expect to file a written confirmation of that in the next few weeks. And as well, the FDA is needing CDER, CDRH for a mid-cycle review, and we'll expect to receive some interim questions, which will hopefully put us in a really advantageous position going into the PDUFA date. And so the short answer to your question is, no. We don't expect that there'll be an advisory panel.

Your next question comes from the line of Allen Gong with JPMorgan.

I think a lot of the questions have been asked already. So I'll just keep it to one. But when I think about iDose, I fully understand that it's kind of hard to predict the success. But when I think about the competitive landscape, the fact that there is a somewhat comparable product. The profiles are clearly very different but somewhat comparable product on the market already. How should we really think about maybe iDose benefiting from that as a secondary player, whether or not we might see competitive dynamics from that early or if it is more just about expanding the market opportunity and kind of establishing iDose as a differentiated solution.

Well, I'm happy to take the first part of this, Joe answer as you will. But Alan, I would just tell you that I really don't see DURYSTA as something that I would take a lot of comparability towards. I mean you've got a product that is bioerodible, that is lasting a period of 4 months, relatively short period of time, has shown a relatively high rate of endothelial cell loss, which restricts its use to a onetime use and throws off relatively high rates of hyperemia as well, due to its [indiscernible] and dosing profile of release versus a product such as what we have, which is showing basically a safety profile where we have no endothelium or limited to minimal endothelial cell loss that we see and a 3% rate of hyperemia and a product that you've seen in the Phase IIb clinical trial that in 70% of patients is controlling glaucoma in 3 years. And so I don't see a lot of comparability between the 2 products. I don't take a lot of, use DURYSTA as a predicate. I think where DURYSTA serves our interest is the fact that they did establish a J-Code at $2,100 for 4 months of therapy, I think that will serve us well going into the pricing for this product. I will tell you this, given some of the limitations of DURYSTA , I might draw some high optimism that even with these limitations in place, there has been a relatively strong appetite, at least for the concept of intracameral drug delivery. Joe?

Yes. I'd just add, I think the 2 things that benefit us in the iDose launch, one, specific DURYSTA one not. I think anything today that's helping drive that interventional glaucoma mindset is a positive. As we continue to think about driving that change in standard of care, the fact that DURYSTA and Allergan and their reps have been out talking about that alongside all of the efforts that we're in muscle that we're putting behind that, as you know. I think that continues to hopefully turn the broader industry towards what we think is the optimal course of care for these patients. And the second thing is, obviously, it's less about any competitor. I think it's more about just the state of the industry -- you think back to when Glaukos first launched MIGS and with iStent, there were a lot of basic blocking and tackling even in the combo cataract setting that the company had to go through around reeducating and teaching surgeons -- surgical techniques that a lot of them hadn't done since the residency. And so as we go into any of these things, whether it's iStent infinite or iDose, the good new news is that now surgeons understand much more fulsomely the angle based surgery and the various technical aspects. And so it's much more about the features and benefits, the safety profile, as Tom has talked about the individual product and what that use case is for the appropriate patients that are on label. So I think that we enter into it with a far more educated marketplace in terms of interventional - and we're going to obviously do our part to drive that forward even faster.

And our final question will come from the line of Anthony Petrone with Mizuho.

Congrats on a good quarter here. Maybe 2 quick ones. One is on the core mix space. I'm just wondering if you have any views on how it could shape up into next year if non-implantable MIGS procedures are -- become a non-covered procedure across certain MAC territories next year. So how do you see the core space evolving if that scenario plays out? And then the second one real quick would just be on the iDose label. Is there anything of note just on the latest views from Glaukos and how you're thinking about duration of the implant what can be included in the label for duration on iDose?

Okay. I'll start and then Tom can jump in the second part around iDose. I think -- as it relates to the proposed LCDs and outcomes, we're prepared for any scenario there that emerges and I'm not sure I would hazard a guess at this stage nor attempt to quantify it because there are so many different factors that could play out, as these things are finalized hopefully in the coming months, if not quarters. Our focus is on building a healthy and growing market that benefits patients. And we think supporting surgeons making clinical decisions and not payers is optimal in that regard. And so really, at the end of the day, if you take a long-term view, I think we would all agree that getting interventional glaucoma, iStent infinite and iDose, right, is probably far more material to our future than those near-term dynamics. And while I understand and appreciate the question, I think, that's where our focus is at.

I'm happy to address the second part of your question. So with regards to the label, again, we are under a 505(b)(2) regulatory path and so the likely label that in our expectation would be that I would say something effect for the reduction of intraocular pressure in ocular hypertension and open-angle glaucoma patients. So a significantly wide open label, which will be based really on the 3-month non-inferiority primary efficacy endpoint that we established in the pivotal trial. We do not expect the label to specify our extended duration. For that, I think we've been proficient in extending the Phase IIb study after 3 years. That will become the important component, that 3-year -- 3 cohort study we did with the Phase IIb will allow us to approach payers to be able to substantiate the need both for coverage and payment.

I'll now turn the call back over to the company for any closing remarks.

Okay. Thanks to everybody for all your time and attention today. We thank you for your continued interest and support in Glaukos. Thanks, and goodbye.