Sydnexis, FDA, and an acute case of regulatory myopia
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Sydnexis, FDA, and an acute case of regulatory myopia
Shifting approval standards threaten a second FDA rejection for Sydnexis’s low-dose atropine treatment – and will chill further investment for myopia drugs.
RA Capital Management is an investor in Sydnexis. This article is for informational purposes only and does not constitute investment advice. Please see Disclosure for additional important information.
After returning from the October 30th FDA advisory committee meeting convened to discuss Sydnexis’s pediatric myopia treatment SYD-101, I’m still searching for the right way to describe the experience. Kafkaesque seems fitting, for those who have read The Trial, but Mugatu probably said it better in Zoolander: “I feel like I’m taking crazy pills!”
We’ve been investors in Sydnexis since 2017, and I sit on the board, although I am writing this to share my personal views, which do not necessarily reflect those of the company. We invested because we believe the company has a safe, effective, straightforward approach to addressing an enormous and growing problem that is hiding in plain sight. The story of how and why the FDA may come to a different conclusion – one at odds with other global regulators, not to mention thousands of practicing physicians – is worth understanding, because it’s a story about how the investment prospects for any therapeutic space can quickly change when regulatory certainty evaporates.
SYD-101 is an eyedrop containing 0.01% atropine. The drug was approved in Europe as Ryjunea in June 2025 but dinged by the FDA a few months later, despite the 800+ patient Phase 3 study supporting SYD-101’s NDA unequivocally demonstrating that the drug was working to slow the progression of myopia in kids.
That study, the largest ever in this indication, hit the key secondary endpoint of mean change in spherical equivalent (how much kids’ nearsightedness progressed over the three years of the trial compared to placebo) with a p‑value of 0.0002. It also hit the primary endpoint, a responder analysis of this same measure, comparing the percentage of patients who progressed by more than 0.75 diopters over those three years to the percentage who progressed on placebo, with a p‑value of 0.0226 (below the 0.025 threshold required by the statistical analysis plan). For context, glasses and contacts are generally updated when your prescription changes by half a diopter (D).
SYD-101 is also very safe, at 1⁄100th the concentration of already approved atropine eye drops, and the FDA agrees. So why did Sydnexis receive a complete response letter in 2025, and why does it now appear headed for another denial in the formal dispute resolution process following this advisory committee meeting? Two equivocal words: clinical meaningfulness. I’ll come back to them.
First, the enormous and growing problem of pediatric myopia
Myopia is an incredibly common eye disease, affecting ~40% of Americans, with onset and progression largely occurring during childhood. It’s so common that you may not have known it was even a disease (and it was only recently officially designated as such by the American Medical Association) and you may assume we’ve already cured it with glasses, contact lenses, or LASIK. But while nearsightedness, myopia’s most obvious symptom, can be corrected by glasses or contact lenses, these tools have no impact on its long-term effects.
Myopia leads to much higher rates of serious eye conditions such as myopic maculopathy, retinal detachment, glaucoma, and early cataract formation. Large population-based studies suggest that high myopes (>-6D) have substantially higher risks of these conditions than non- or low myopes (from around 7‑fold to 40+ fold) but the risk starts in low myopia and increases continuously. For example, each diopter of myopia is associated with a 67% increase in myopic maculopathy, regardless of the level of myopia. So slowing myopia progression by just 1D should lower a child’s lifetime risk of this severe retinal condition by 40%, as well as their risk of retinal detachment by approximately 23% and glaucoma by about 18%.
Multiple publications have referred to myopia as an epidemic or pandemic. Rates have been increasing steadily in the US and worldwide over the past several decades, apparently due to a decrease in time children spend outdoors (sunlight seems to slow myopia progression) and an increase in near work (i.e., screen time; which speeds up eye elongation). The WHO projects that >50% of the world population will be myopic by 2050. This has led many ophthalmic and optometric professional societies to publish recommendations about strategies for myopia control, including the use of low-dose atropine, which is approved in Europe, the UK, and many Asian countries, but not in the US.
Low-dose atropine in the US and the Sydnexis solution
In the US, high-dose (1%) atropine eye drops are approved for the treatment of amblyopia (lazy eye) but lower doses are not approved for any condition and there are no pharmacological treatments approved for the treatment of myopia progression. Nonetheless, due to a wealth of clinical data published over the past 15 years, low dose atropine has become a part of standard-of-care in the US, recommended by multiple professional societies.
But because it is not approved, optometrists and ophthalmologists must write prescriptions for compounded low-dose atropine, filled by various compounding pharmacies that dilute 1% atropine in facilities without FDA oversight. It is hard to get exact numbers on compounded prescriptions, but Sydnexis estimates around a million prescriptions for low-dose atropine are filled by compounding pharmacies in the US each year.
These compounded atropine products have been shown to vary in composition and potency from pharmacy-to-pharmacy and batch-to-batch, lack shelf stability at room temperature, and can vary widely in pH, all of which impact efficacy and tolerability. Sterility is another key concern, especially for an eye drop that is given to kids nightly for years, and contamination of other compounded and OTC ophthalmic products have led to outbreaks of serious eye infections. And besides variability in efficacy/tolerability and concerns about safety, atropine eye drops made by compounding pharmacies aren’t covered by insurance, leading many families to forgo treatment due to cost.
Sydnexis set out in 2014 to develop a low-dose atropine eye drop that is stable at room temperature (which is more difficult than it sounds and the basis for their IP) and very comfortable for kids’ eyes (near physiological pH). The company has since run a rigorous clinical program to gain FDA approval, in an attempt to give doctors and parents an alternative to atropine drops from compounding pharmacies.
It’s been a long road. In 2018 Sydnexis reached agreement with the FDA on the design of a Phase 3 trial to test two doses of SYD-101 against placebo and enrolled 847 kids aged 3 – 14, the largest study of pediatric myopia conducted to date, and followed them for four years (three years to the primary endpoint). Sydnexis enrolled its first patient in April 2019, had to pause during COVID, and finally read out positive topline data in June 2024. The company is still awaiting approval over two years later. It has been a labor of love for the company and its investors.
Clinical meaningfulness: Trying to get off these crazy pills
So here’s a drug that addresses an enormous and growing public health problem, was studied in the largest and most rigorous myopia clinical trial to date (the design of which was blessed by the FDA), and hit its primary endpoint and key secondary endpoint with no safety concerns. A genuine success story. But SYD-101 is still getting stonewalled by the FDA almost two years after its NDA submission!?
You may feel like you’re taking crazy pills, too. The FDA’s concerns come down to clinical meaningfulness. In other words, is SYD-101 slowing myopia progression enough to make a difference in kids’ health? This may seem like a challenging question for an endpoint (change in spherical equivalent, i.e., glasses prescription) that people don’t naturally think of as very important or impactful. But I think several key points make the case convincingly:
1) The FDA’s question of clinical meaningfulness is not whether slowing of myopia progression will prevent serious ocular conditions later in life; they have approved medical devices (MiSight, Stellest) on this basis recently. The question is whether the smaller magnitude of benefit that SYD-101 demonstrated is likely to do so; the literature strongly suggests it is. A recent review by Loughman, Bullimore & Flitcroft summarizes the evidence well. Risk of serious ocular conditions increases continuously, starting at low levels of myopia. So every diopter matters.
2) The Phase 3 primary endpoint, a responder analysis (i.e., how many patients progressed by 0.75D at year 3), was explicitly recommended by the FDA in order to capture clinical meaningfulness. Sydnexis would have preferred to use the key secondary endpoint, mean change in spherical equivalence, as primary (as the EMA allowed), because a continuous variable has much more statistical power than a responder analysis, which would have allowed for a smaller study. But the FDA recommended a responder analysis to ensure clinical meaningfulness of the primary endpoint and even suggested the 0.75D definition in the company’s first meeting in 2015! While this original FDA recommendation was 0.75D over five years of treatment, they expressed openness to a trial as short as two years, with eventual alignment at a later meeting on three years. Given the opportunity, the FDA never disagreed with 0.75D as the definition of responder for the primary endpoint.
3) The benefit is maintained across responder thresholds. If the FDA wants to move the goalposts and now only thinks that ‑1D is clinically meaningful, that analysis also favors SYD-101 (and actually by a slightly larger margin than ‑0.75D). The drug provides benefit across the full range of potential responder definitions.
4) The FDA criticized the lack of dose response in the trial but the trial was not powered for that comparison and the higher (0.03%) dose is supportive of atropine’s efficacy. Based on the literature, we expected 0.03% to have slightly better efficacy than 0.01%, and while it separated from placebo on multiple endpoints, it trended slightly worse than the 0.01% dose. It was highly nominally statistically significant (p=0.0018) on the key secondary endpoint of mean change in spherical equivalence, but missed on the responder primary endpoint. The FDA used this miss to question the validity of the 0.01% arm, but it actually meant that 0.01% had to clear a higher statistical bar (p<0.025 instead of 0.045). And hitting on the key secondary endpoint is supportive of atropine’s efficacy overall. If the FDA has wanted the high dose arm to be statistically significantly superior to placebo as a condition for approving the drug, it would have required that the statistical plan make that the primary endpoint with a p<0.05 threshold. But by agreeing to split the alpha evenly between the two arms, the FDA was acknowledging that either dose could prove its own efficacy. Indeed the low dose did and the high dose trended toward efficacy; the common sense conclusion is that the drug works and it jumped through the FDA’s required hoops. To then doubt its clinical meaningfulness and raise the bar after the fact is to create regulatory uncertainty that chills the willingness of any investors to fund R&D.
5) Stepping back, who is better positioned to decide whether a treatment benefit is clinically meaningful? FDA reviewers and their handpicked advisory committee, OR over 1,000 practicing ophthalmologists and optometrists (who signed a petition in support of SYD-101 approval), and the 16 prominent ophthalmologists and optometrists, including presidents and former presidents of professional societies, who took the time to speak in support of approval during the public portion of the committee meeting (link, starting 4:36:30)?
The medical community has spoken loudly and consistently in favor of having an FDA-approved, consistent, stable, low-dose atropine product approved for pediatric myopia. They have reviewed the data and find it clinically meaningful. Hundreds of doctors are already writing scripts for compounded low-dose atropine for hundreds of thousands of kids each year: they are all convinced the benefit is clinically meaningful. You would think this would lead the FDA to consider the experience of doctors who see patients every day, choose to prescribe low-dose atropine and want access to SYD-101. Besides, FDA approval doesn’t guarantee a drug’s uptake. Doctors would need to prescribe it, insurers would need to cover it, and parents and their kids would need to decide to use it. They will all evaluate clinical meaningfulness from their own perspective and determine SYD-101’s ultimate value.
Implications for innovation in pediatric myopia
When responding to the discussion questions at the end of the advisory committee meeting, some of the committee members wished they had more data. (Side note: it’s odd and unusual that there were only discussion questions, no voting questions, for a meeting centered on a formal dispute resolution.) One wished for 10 – 12 years of follow up. A couple suggested that another Phase 3 trial should be required. Listening to this, I leaned into an investor at another fund I was sitting next to. “There isn’t going to be another trial,” I said. He nodded in agreement. I didn’t just mean that Sydnexis isn’t going to run another trial. I meant nobody will. Who is going to invest in another four-year trial for pediatric myopia when the FDA still hasn’t defined what would be clinically meaningful?
Regulatory uncertainty chills investment and innovation. Sydnexis will face plenty of risk even if approved. SYD-101 would be the first FDA-approved drug for myopia progression. Will insurance cover it? Will doctors prescribe it? Will parents want their kids to use it? How much will it cost to launch and commercialize? These risks were worth underwriting, along with the clinical trial risk, when we thought the regulatory path was clear and that hitting the agreed-upon primary endpoint would result in approval. But an unquantifiable regulatory risk is impossible to underwrite.
The first drug approved for an indication is rarely the best. If SYD-101 is successful and demonstrates there’s a meaningful market for an FDA-approved prescription eye drop for myopia, it will attract competitors: scientists and entrepreneurs who believe they can beat SYD-101’s efficacy and investors who believe there will be a return if they do so. But they will all need to trust that the FDA will set a clear standard for approval and stick with it. If not, I fear this may be the last pharmacologic treatment for myopia up for FDA review.