It has been predicted that the COVID-19 pandemic would cause business disruption. Now, it has claimed a casualty with Second Sight Medical Products Inc., of Sylmar, Calif., which has been forced to wind down operations, citing the pandemic and the impact it will have on the company’s ability to secure financing. Second Sight, which makes the Argus II retinal prosthesis system, said that effective March 31, 84 of its 108 employees will be laid off.
The company expects to bring on an adviser experienced in winding down operations to guide the board on next steps. However, additional layoffs are anticipated in the future based on the company’s level of operations.
When asked whether it was looking for buyers for its Argus II/Orion assets and if it could predict how long the wind down would take, the company referred BioWorld to its statement and 8-K filing.
With the wind down announcement came news that the company had named Matthew Pfeffer, chairman of the audit committee of the board, as acting CEO, effective immediately. News of the company’s winding down comes roughly three weeks after it reported that Will McGuire, president and CEO, was leaving, effective March 27. He was slated to remain as a director on Second Sight’s board.
McGuire left to join Carlsbad, Calif.-based Ra Medical Systems Inc. as CEO and a member of the company’s board, effective March 30, citing the desire to be closer to his family.
With McGuire’s departure, Gregg Williams, the board chair, was tapped as acting CEO. However, now the company has decided to go with Pfeffer through this process.
Before the decision to wind down, the company had high hopes for its Orion visual cortical prosthesis system. The company saw the potential for the product to provide useful artificial vision to individuals blind from many causes, such as glaucoma, eye injury, diabetic retinopathy, optic nerve disease or injury and retinitis pigmentosa.
Indeed, during the company’s March 19 fourth-quarter earnings call, COO Pat Ryan provided an update on the company’s Orion early feasibility study. Specifically, it had wrapped up the 12-month testing for the sixth and final subject in February. Ryan detailed some results, noting that on square localization, 83% of individuals scored significantly better with the device on than off. All individuals scored significantly better with the device on than off on direction of motion.
“From a safety perspective, as previously shared, there was one serious adverse event in seven nonserious adverse events over the same time period. These results are extremely encouraging, and we believe sufficient to support moving forward with a pivotal study in the U.S.,” Ryan said.
The company had reached an agreement with the U.S. FDA on the primary efficacy endpoint for the pivotal trial, which will be FLORA [Functional Low Vision Observer Rated Assessment] 20. As of that date, three of 15 subjects have begun participation in the FLORA 20 validation. “However, due to COVID-19 social distancing protocols, we have suspended validation efforts until further notice,” he said at the time.
Kyle Bauser from Dougherty & Co. asked whether COVID-19 had had an impact on the IDE application, given that it was now slated for the first half of next year. Ryan said no, adding that the company was being conservative in light of ongoing discussions with the FDA.
For its part, a big competitor of Second Sight, Paris-based Pixium Vision SA, reported March 31 positive follow-up data from a feasibility trial of the Prima system in patients with dry age-related macular degeneration (AMD). Specifically, the Prima system sustainably elicited light perception in all four dry AMD patients with favorable safety profile. The company said the results build on the previously reported positive 12-month clinical data. The Prima system is intended to partially replace the normal physiological function of the eye’s photoreceptor cells by electrically stimulating the nerve cells of the inner retina. Those then transmit the visual information to the brain via the optic nerve.
But COVID-19 is having an impact on this company as well. Pixium reported March 23 that it had decided to postpone continuing its feasibility studies in France and the U.S., aside from ongoing safety monitoring. It added that the initiation of the PRIMAvera pivotal study with the Prima system in dry AMD may be delayed.