Glaukos and Avedro Announce Definitive Acquisition Agreement

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Glaukos and Avedro Announce Definitive Acquisition Agreement

Adds Novel Bio-Activated Pharmaceuticals to Glaukos' New Corneal Health Franchise

Potential Revenue Synergies from Complementary Product Portfolios that Leverage Glaukos' Commercial Scale, Market-Building Experience and Shared

Reimbursement Expertise and Customer Relationships

Expanded Pharmaceutical and Device Research, Development and Clinical Capabilities that Enhance Ability to Provide Innovative Hybrid Ophthalmic Therapies to Patients

Acquisition Expected to Accelerate Glaukos' Revenue Growth Rate in 2020 and be Accretive to Operating Results and Cash Flows by 2021

Executives to Discuss Transaction on Glaukos' Second Quarter Financial Results Conference Call at 1:30 p.m. PDT Today, August 7, 2019

San Clemente, CA August 7, 2019 Glaukos Corporation (NYSE: GKOS), an ophthalmic medical technology and pharmaceutical company

focused on novel therapies for the treatment of glaucoma, corneal disorders and retinal diseases, and Avedro, Inc. (Nasdaq: AVDR), a leading hybrid ophthalmic pharmaceutical and medical

technology company focused on treating corneal disease and disorders, today announced that the companies have entered into a definitive merger agreement under which Glaukos will acquire Avedro in an

all-stock transaction. The transaction, which is subject to Avedro stockholder approval along with other customary closing conditions and regulatory approvals, has been approved by the board of

directors of both companies and is expected to be completed in the fourth quarter of 2019.

acquisition combines two complementary, hybrid ophthalmic pharmaceutical and device organizations and establishes the cornerstone for Glaukos' new corneal health franchise, providing

synergistic avenues for potential long-term growth in large, underserved markets. Glaukos plans to leverage its proven market-building expertise, global commercial scale and extensive clinical and

regulatory infrastructure to maximize Avedro's disruptive bio-activated pharmaceuticals and pipeline. The transaction also expands Glaukos' R&D capabilities and is expected to strengthen multiple

corneal health and vision correction development initiatives now underway across both organizations.

is an ideal fit for Glaukos' core strengths in creating and disrupting ophthalmic markets with novel therapies that address important unmet clinical needs of practitioners and

patients," said Thomas Burns, Glaukos president and chief executive officer. "Avedro has in place many of the same

attributes Glaukos used to pioneer MIGS, including proprietary paradigm-changing solutions, extensive clinical validation, broad reimbursement and first-to-market status. Our combined

organizations can possess the essential expertise, scale and reach to maximize these opportunities, drive further commercialization of Avedro's bio-activated pharmaceuticals and establish another

synergistic and durable Glaukos franchise to fuel potential near- and long-term growth and shareholder value."

platform uses its proprietary, bio-activated, single-use Photrexa drug formulations to strengthen corneal tissue and halt progression of keratoconus, a degenerative

corneal ectatic disease that affects approximately 1.1 million eyes in the United States. Typically diagnosed in a patient's teenage years, keratoconus is characterized by progressive thinning

and weakening of the cornea, resulting in vision loss. Approximately 90% of cases are bilateral and as many as 20% of patients ultimately require a corneal transplant. Conventional treatments address

symptoms but the Avedro platform is the first and only FDA-approved therapy that can stop disease progression. Avedro estimates the total U.S. opportunity for its keratoconus therapy to be

approximately $3 billion.

has also developed a pipeline of novel single application bio-activated topical ophthalmic pharmaceuticals for common refractive conditions, including presbyopia, low myopia and

post-cataract refractive error, which are estimated to have a combined U.S. addressable opportunity of approximately $23 billion.

is extremely pleased with the potential to become part of Glaukos, a highly-respected ophthalmic organization with a successful track record forging new markets with disruptive

technologies like our keratoconus pharmaceutical therapies," said Reza Zadno, Avedro president and chief executive officer. "Glaukos already has deep customer relationships with the majority of our

target accounts, and a large, seasoned field organization that can unite with our team to accelerate awareness, adoption and utilization of our novel platform. In addition, Glaukos will bring its

extensive clinical and regulatory resources to bear to help advance our promising pipeline therapies. I believe this transaction can benefit customers, employees and patients, while creating value for

shareholders through ownership in a combined company with the expertise, scale and resources to drive meaningful future growth."

strategic and financial benefits of the transaction include:

Avedro fits perfectly with Glaukos' commercial

organization: Roughly 700 of Avedro target accounts are comprehensive ophthalmic practices where Glaukos maintains deep relationships. In

addition, the Avedro platform can benefit from a 5-fold increase in the size of its current 17-person U.S. field sales organization.

Avedro can accelerate Glaukos' growth

trajectory: Avedro generated 66% year-over-year revenue growth in the first half of 2019. Once combined, the addition of Avedro's fast-growing

product portfolio is expected to generate revenue growth acceleration for Glaukos beginning in 2020 and potential revenue synergies beginning in 2021.

Furthers Glaukos' hybrid

strategy: Avedro and Glaukos have similar and complementary hybrid pharmaceutical and device profiles that can combine to create a unique set of

R&D, clinical, regulatory and commercial capabilities with the potential to enhance organizational success.

Enhances organic pipeline initiatives and R&D

teams: The combined R&D and clinical organization can provide Glaukos with scale and a unique blend of integrated expertise across ophthalmic

pharmaceuticals, drug delivery, micro-scale engineering, and hardware and software development. In addition, an expanded pipeline can provide new opportunities to extend leadership positions in

high-growth ophthalmic markets.

Provides attractive financial benefits and potential shareholder value

creation: In addition to the potential for accelerated revenue growth, Glaukos anticipates achieving annualized cost savings in excess of

$15 million by 2021, primarily through reduced public company and

costs. As such, the company expects the transaction to be accretive to operating results and cash flow by 2021.

Transaction Terms and Approvals

Under the terms of the merger agreement, for each share of Avedro common stock they own, Avedro shareholders will receive an exchange ratio

equivalent of 0.365 shares of Glaukos stock.

on the parties' volume weighted average prices ("VWAPs") for the last 60 trading days prior to August 6, 2019, the transaction represents a 42% premium for Avedro

shareholders. Upon closing, Glaukos shareholders are expected to own approximately 85% of the combined company, with Avedro shareholders expected to own the remaining 15%.

transaction is subject to customary closing conditions and regulatory approvals, including approval of the merger by stockholders of Avedro. Certain shareholders of Avedro, including

OrbiMed, HealthQuest and LAV Agile, which collectively own approximately 41% of the outstanding shares of Avedro common stock, have entered into voting agreements to vote in favor of the transaction.

Perella Weinberg Partners LP is serving as financial advisor to Glaukos, and O'Melveny & Myers LLP is serving as its legal

advisor. Guggenheim Securities is serving as financial advisor to Avedro and Cooley LLP is serving as its legal advisor.

Conference Call, Webcast and Presentation

Glaukos will hold its regular quarterly earnings conference call and webcast for investors and analysts today at 1:30 p.m. PDT

(4:30 p.m. EDT) where its management will also discuss the transaction and the company's long-term growth strategy. The earnings conference call and webcast will be held jointly with Avedro, in

lieu of Avedro's previously scheduled call for Thursday, August 8. An investor presentation will be available for download. Links to the webcast and presentation are available on Glaukos'

website at http://investors.glaukos.com and on Avedro's website at http://investors.avedro.com. To participate in the conference call, please dial 833-231-8262 (U.S.) or 647-689-4107 (international)

and enter Conference ID 3119047. A replay of the webcast will be archived on Glaukos' and Avedro's websites following completion of the call.

Glaukos and Avedro Second Quarter 2019 Earnings Results

In separate news releases issued today, Glaukos and Avedro each announced financial results for the second quarter ended June 30, 2019.

Glaukos and Avedro management will

address questions regarding quarterly financial performance as part of the joint conference call and webcast referenced above. Avedro's quarterly conference call, previously scheduled for tomorrow,

Thursday, August 8, has been cancelled.

Glaukos (www.glaukos.com) is an ophthalmic medical technology and pharmaceutical company focused on novel therapies for the treatment of

glaucoma, corneal disorders and retinal diseases. The company pioneered Micro-Invasive Glaucoma Surgery, or MIGS, to revolutionize the traditional glaucoma treatment and management paradigm. Glaukos

launched the iStent , its first MIGS device, in the United States in July 2012 and launched its next-generation iStent inject device in the United

States in September 2018. Glaukos is leveraging its platform technology to build a comprehensive and

proprietary portfolio of micro-scale surgical and pharmaceutical therapies in glaucoma, corneal health and retinal disease.

Avedro is a leading hybrid ophthalmic pharmaceutical and medical technology company focused on treating corneal disease and disorders and

improving vision to reduce dependency on eyeglasses or contact lens. Avedro's proprietary bio-activated pharmaceuticals strengthen, stabilize, and reshape the cornea to treat corneal ectatic disorders

and correct refractive conditions. Avedro's suite of single-use drug formulations are applied to the cornea and bio-activated to induce a reaction called corneal collagen cross-linking.

Use of Forward-Looking Statements

This communication contains "forward-looking statements" within the meaning of federal securities laws. Forward-looking statements may contain

words such as "believes", "anticipates", "estimates", "expects", "intends", "aims", "potential", "will", "would", "could", "considered", "likely" and words and terms of similar substance used in

connection with any discussion of future plans, actions or events identify forward-looking statements. All statements, other than historical facts, including statements regarding the expected timing

of the closing of the proposed transaction and the expected benefits of the proposed transaction, are forward-looking statements. These statements are based on management's current expectations,

assumptions, estimates and beliefs. While Glaukos and Avedro believe these expectations, assumptions, estimates and beliefs are reasonable, such forward-looking statements are only predictions, and

are subject to a number of risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements.

following factors, among others, could cause actual results to differ materially from those described in the forward-looking statements: (i) failure of Avedro to obtain

stockholder approval as required for the proposed transaction; (ii) failure to obtain governmental and regulatory approvals required for the closing of the proposed transaction;

(iii) failure to satisfy the conditions to the closing of the proposed transaction; (iv) unexpected costs, liabilities or delays in connection with or with respect to the proposed

transaction; (v) the effect of the announcement of the proposed transaction on the ability of Avedro or Glaukos to retain and hire key personnel and maintain business relationships with

customers, suppliers and others with whom Avedro or Glaukos does business, or on Avedro's or Glaukos' operating results, market price of common stock, and business generally; (vi) potential

legal proceedings relating to the proposed transaction and the outcome of any such legal proceeding; (vii) the inherent risks, costs and uncertainties associated with integrating the businesses

successfully and risks of not achieving all or any of the anticipated benefits of the proposed transaction, or the risk that the anticipated benefits of the proposed transaction may not be fully

realized or take longer to realize than expected; (viii) competitive pressures in the markets in which Avedro and Glaukos operate; (ix) the occurrence of any event, change or other

circumstances that could give rise to the termination of the merger agreement; and (x) other risks to the consummation of the proposed transaction, including the risk that the proposed

transaction will not be consummated within the expected time period or at all. Additional factors that may affect the future results of Avedro and Glaukos are set forth in their respective filings

with the SEC, including each of Avedro's and Glaukos' most recently filed Annual Report on Form 10-K, subsequent Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and

other filings with the SEC, which are available on the SEC's website at www.sec.gov. The risks and uncertainties described above and in Avedro's most recent Quarterly Report on Form 10-Q and