Ocular Therapeutix is a Promising Biotech Company with Exciting Opportunities in Front of it

Photo of author
Written By Keziah Monique Gayo

Ocular Therapeutix, Inc. is a biopharmaceutical company developing innovative eye treatment therapies. OCUL already offers a commercial product called Dextenza for post-surgical ocular inflammation and pain and ocular itching due to allergic conjunctivitis.

The drug is a market success with a net product revenue of $57.9 million in 2023. OCUL’s pipeline includes Axpaxli, an axitinib intravitreal implant in phase 3 trials for wet age-related macular degeneration (wet AMD) and phase 1/2 trials for diabetic retinopathy, which I consider its main value driver.

Axpaxli potentially unlocks a decabillion-dollar total addressable market (TAM) if successfully developed and commercialized.

Betting on Axpaxli: Business Overview

Credits: DepositPhotos

Ocular Therapeutix, founded in 2006 and based in Bedford, Massachusetts, develops novel therapies for eye conditions using its proprietary drug delivery platform, Elutyx. This technology utilizes bioresorbable hydrogel-based materials to provide sustained and targeted release of therapeutic drugs.

Other promising candidates in OCUL’s pipeline include OTX-DED for episodic dry eye disease and OTX-CSI for chronic dry eye disease, both progressing through clinical trials.

OCUL’s leading product, Dextenza, treats post-surgical ocular inflammation and pain, as well as ocular itching due to allergic conjunctivitis. As of 2023, around 400,000 eyes had been treated with Dextenza, generating a net product revenue of $57.9 million.

Axpaxli, an axitinib intravitreal implant, is in phase 3 clinical trials for wet AMD therapy, with the first subject screened in Q1 2024. Axpaxli is also being tested for diabetic retinopathy in phase 1/2 trials, with 9-month Helios phase 1 trial data expected in Q2 2024.

Axitinib, a tyrosine kinase inhibitor, targets vascular endothelial growth factor receptors (VEGFRs) related to new blood vessel formation. The intravitreal implant delivers the drug over an extended period, reducing the need for frequent injections, a significant advantage over current treatments.

Another drug candidate, Paxtrava (OTX-TIC), a travoprost intracameral implant, is in phase 2 trials for glaucoma and ocular hypertension. This implant delivers travoprost directly into the eye’s anterior chamber, providing continuous drug delivery to reduce intraocular pressure and prevent optic nerve damage.

OCUL’s OTX-DED, a dexamethasone intracanalicular insert, is undergoing phase 2 trials for episodic dry eye disease, expected to be completed by H1 2024.

Dexamethasone, an anti-inflammatory and immunosuppressive agent, reduces inflammation, swelling, and pain. The intracanalicular insert delivers the drug into the lacrimal canaliculi, potentially offering a promising treatment for dry eye disease.

Lastly, OTX-CSI, a cyclosporine intracanalicular insert indicated for dry eye disease, is also in phase 2 trials expected to be completed by H1 2024. Cyclosporine is an immunosuppressive drug used to reduce inflammation and increase tear production.

Global Expansion and Pipeline Progress

OCUL partners with AffaMed Therapeutics to develop and distribute Dextenza and Paxtrava in Greater China, South Korea, and Asian markets. On February 19, 2024, the Singapore Health Sciences Authority (HSA) accepted Dextenza for its New Drug Application (NDA). AffaMed also initiated a registrational trial in Mainland China to evaluate Dextenza versus placebo, with topline data expected in Q3 2024.

These milestones represent significant progress in expanding the reach of Dextenza in Asian markets and underscore the potential of the partnership with AffaMed.

Furthermore, Axpaxli is a key component of OCUL’s pipeline due to the SOL-1 and HELIOS trials. OCUL disclosed that the SOL-1 trial should finish enrollment by Q1 2025 and that the FDA is receptive to this trial, as evidenced by the Special Protocol Assessment designation. If successful, OCUL could submit the NDA for Axpaxli indicated for Wet AMD in 2026, tapping into a substantial market projected to generate $10.4 billion in 2024.

Valuation Analysis

OCUL trades at a market cap of $882.9 million, approaching a billion-dollar valuation, reflecting its consistently growing revenues. According to Seeking Alpha, the company is projected to generate $78.8 million in sales by 2025. This implies a forward price-to-sales (P/S) ratio of 11.2, higher than the sector’s median forward P/S multiple of 3.63.

However, OCUL’s premium is justified by its potential with Axpaxli, which has shown promising early clinical trial data and could revolutionize treatment for Wet AMD with a 92% reduction in treatment frequency.

Moreover, OCUL holds $482.9 million in cash against long-term debt of $66.5 million. With an estimated quarterly cash burn of $34.2 million, OCUL has a healthy 3.5-year cash runway. If Dextenza’s sales continue increasing, the cash runway might improve further, reducing the risk of dilution.

Investment Caveats: Risk Analysis

The investment thesis for OCUL rests on the successful development and commercialization of Axpaxli. The FDA approval process is complex, and any setbacks could significantly impact the stock’s valuation. Additionally, Axpaxli’s market success depends on factors beyond its intrinsic properties, such as OCUL’s marketing strategies and healthcare provider engagement.

These risks are inherent but manageable given Axpaxli’s potential.

Outlook for OCUL

Credits: DepositPhotos

OCUL is transitioning from a clinical to a commercial stage, with Dextenza as its main revenue source. However, Axpaxli represents the company’s primary value driver. If Axpaxli receives FDA approval for Wet AMD, it could become a best-in-class drug in a multi-billion-dollar market.

Early trial results are promising, and the company’s financial position is strong, with negligible dilution risk. Therefore, OCUL is a compelling investment prospect at these current levels for investors betting on Axpaxli’s success.


You should read and understand this disclaimer in its entirety before joining or viewing the website or email/blog list of SmallCapStocks.com (the “Publisher”). The information (collectively the “Advertisement”) disseminated by email, text or other method by the Publisher including this publication is a paid commercial advertisement and should not be relied upon for making an investment decision or any other purpose. The Publisher is engaged in the business of marketing and advertising the securities of publicly traded companies in exchange for compensation. The track record, gains, upside, and/or losses mentioned in the Advertisement, if any, should not be considered as true or accurate or be the basis for an investment. The Publisher does not verify the accuracy or completeness of any information included in the Advertisement. While the Publisher does not charge for the SMS service, standard carrier message and data rates may apply. To unsubscribe from receiving promotional text messages to your phone sent via an autodialer, using your phone reply to the sender’s phone number with the word STOP or HELP for help.

The Advertisement is not a solicitation or recommendation to buy securities of the advertised company. An offer to buy or sell securities can be made only by a disclosure document that complies with applicable securities laws and only in the states or other jurisdictions in which the security is eligible for sale. The Advertisement is not a disclosure document. The Advertisement is only a favorable snapshot of unverified information about the advertised company. An investor considering purchasing the securities, should always do so only with the assistance of his legal, tax and investment advisors. Investors should review with his or her investment advisor, tax advisor or attorney, if and to the extent available, any information concerning a potential investment at the web sites of the U.S. Securities and Exchange Commission (the "SEC") at www.sec.gov; the Financial Industry Regulatory Authority (the "FINRA") at www.FINRA.org, and relevant State Securities Administrator website and the OTC Markets website at www.otcmarkets.com. The Publisher cautions investors to read the SEC advisory to investors concerning Internet Stock Fraud at www.sec.gov/consumer/cyberfr.htm, as well as related information published by the FINRA on how to invest carefully. Investors are responsible for verifying all information in the Advertisement. As an advertiser, we do not verify any information we publish. The Advertisement should not be considered true or complete.

The Publisher does not offer investment advice or analysis, and the Publisher further urges you to consult your own independent tax, business, financial and investment advisors concerning any investment you make in securities particularly those quoted on the OTC Markets. Investing in securities is highly speculative and carries an extremely high degree of risk. You could lose your entire investment if you invest in any company mentioned in the Advertisement. You acknowledge that we are not an investment advisory service, a broker-dealer or an investment adviser and we are not qualified to act as such. You acknowledge that you will consult with your own independent, tax, financial and/or legal advisers regarding any decisions as to any company mentioned here. We have not determined if the Advertisement is accurate, correct or truthful. The Advertisement is compiled from publicly available information, which include, but are not limited to, no cost online research, magazines, newspapers, reports filed with the SEC or information furnished by way of press releases. Because all information relied upon by us in preparing an advertisement about an issuer comes from a public source, it is not reliable, and you should not assume it is accurate or complete.

By your subscription to our profiles, the viewing of this profile and/or use of our website, you have agreed and acknowledged the terms of our full disclaimer and privacy policy which can be viewed at the following link: www.SmallCapStocks.com/Disclaimer and www.SmallCapStocks.com/Privacy-Policy

By accepting the Advertisement, you agree and acknowledge that any hyperlinks to the website of (1) a client company, (2) the party issuing or preparing the information for the company, or (3) other information contained in the Advertisement is provided only for your reference and convenience. The advertiser is not responsible for the accuracy or reliability of these external sites, nor is it responsible for the content, opinions, products or other materials on external sites or information sources. If you use, act upon or make decisions in reliance on information contained in any disseminated report/release or any hyperlink, you do so at your own risk and agree to hold us, our officers, directors, shareholders, affiliates and agents harmless. You acknowledge that you are not relying on the Publisher, and we are not liable for, any actions taken by you based on any information contained in any disseminated email or hyperlink.