EyePoint's eye drug fails again; stock falls 85%, half of staff cut

EyePoint, based in Watertown, Massachusetts, makes eye drugs, and its shares trade on Nasdaq. Its lead product, DURAVYU, is a tiny insert placed in the eye that releases a drug for at least six months, so patients need fewer shots. The drug inside, vorolanib, is licensed from Equinox Sciences, an affiliate of Betta Pharmaceuticals.

The first target was wet age-related macular degeneration, a leading cause of blindness in people over fifty. EyePoint ran two identical late-stage trials, LUGANO and LUCIA, with more than 900 patients, each comparing DURAVYU with aflibercept, a standard eye injection. On August 17, 2026, LUGANO missed its main goal. Reuters reported the shares tumbled more than 70%, and analysts said approval looked harder without two successful trials. The company later said a reworked analysis passed once an uneven group of 9 of its 211 patients was left out.

The company has always lost money. It had $306.1 million at the end of 2025 and said that would last into the fourth quarter of 2027. By June 30, 2026, it had $180.5 million. In the first half of 2026 its revenue was $1.2 million, down 96% from a year earlier, and its net loss was $179.3 million.

Nasdaq requires a listed stock to keep a minimum bid of $1 a share. A stock that stays below $1 for 30 business days in a row gets a notice and 180 days to recover; if it does not, Nasdaq starts the delisting process.

On October 19, EyePoint said LUCIA also failed its main goal. Patients on DURAVYU gained 2.5 letters on an eye chart, while patients on the standard shot gained 6.1, a gap of 3.7 letters. The trial needed DURAVYU to stay within 4.5 letters with statistical confidence, and the likely range of results crossed that line. The numbers are preliminary.

The drug did win on its other goals. LUCIA patients needed 38% fewer injections, and 52% of their eyes needed no extra shot through week 56. Across both trials, DURAVYU patients got 40% fewer injections. The company called its safety record favorable, with serious eye problems under 1% in both groups.

The board acted on October 17, after it saw the results. It approved ending both wet macular degeneration trials early and cutting about 53% of the staff, mostly by the end of 2026 and fully by mid-2027. EyePoint expects about $9 million in charges, nearly all cash, and about $30 million a year in savings. It warns the cuts may grow.

What is left is diabetic macular edema, eye swelling caused by diabetes, which affects about 28 million people. Two trials, COMO and CAPRI, finished enrolling 551 patients in July 2026 and report in the fourth quarter of 2027. An earlier mid-stage trial in this disease met its goals. But the new trials use the same kind of test that just failed twice: DURAVYU must come close enough to the standard shot.

EyePoint says it had about $118 million in cash and short-term investments on September 30, down from $180.5 million in June. Its auditor has not reviewed that figure yet. At the October 19 close of $0.44, the 86.2 million shares it had in July were worth about $38 million, about a third of that cash.

The bull case: the drug cuts injections by about 40%, a real gain for patients who need regular eye shots, and no drug-related safety concerns showed up in more than 630 patients across six finished trials. The company is still studying the wet macular degeneration data and has not ruled out a next step there.

The bear case: the same test failed twice, and the remaining trials use it again. The company still lists an FDA warning letter about its Watertown factory as a risk. Law firms are looking into possible securities claims. And the stock now trades below $1.

How long the cash lasts. The old forecast, money into the fourth quarter of 2027, came before both failures and the cuts. No filing gives a new one or says whether EyePoint will raise money.

What happens in wet macular degeneration. EyePoint will run more analyses of LUCIA and of both trials together. No filing says when they finish or whether the company will still seek approval.

The September 30 cash figure is preliminary, and the filing gives no results for the quarter.

The FDA warning letter. No filing says when it will be closed or what the fix will cost.

Who goes. No filing says which jobs are cut or how many people stay on the diabetes trials.