Eye Therapies Exhibit 2045, 1 of 23
`Slayback v. Eye Therapies - IPR2022-00142
`
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`Eye Therapies Exhibit 2045, 2 of 23
`Slayback v. Eye Therapies - IPR2022-00142
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`

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`Eye Therapies Exhibit 2045, 3 of 23
`Slayback v. Eye Therapies - IPR2022-00142
`
`

`

`Big Is Back
`
`Achieving top-10 New Product Pacesetter status
`takes a robust year, and always has. But products
`in 2019 had to work a little harder to achieve this
`status. In food and beverage this is especially
`poignant — No. 10 Pop-Tarts Bites generated more
`than $68 million in multi-outlet sales compared with
`the $50 million milestone of years past. In non-food,
`it is primarily the top four that show the fight to
`hold top spots. No. 4 Harry’s generated nearly $170
`million, compared with No. 4 from 2018’s ranking
`when Tide Pods Plus Downy brought in $82 million.
`
`Historically there had been a decline in the dollar
`threshold, until 2019, which reported a rebound.
`One outlet that played a considerable role in this
`movement was convenience stores, as they are
`home to niche innovations that capture broad
`appeal. The No. 1 c-store product Juul, for example,
`generated $2.4 billion in sales. Electronic smoking
`devices boomed as consumers often perceived
`them as healthier or less conspicuous than cigarettes
`and found the flavors and options alluring.
`
`$100M+
`10 products in multi-outlet
`channels achieved sales
`of $100M+, along with eight
`products in the convenience
`channel, marking the return
`of blockbuster New
`Product Pacesetters.
`
`The Squeeze Continues for Medium-sized Companies Caught
`Amid Innovation from Big and Small Companies
`
`% of Total Count
`
`% of Total Dollars
`
`23%
`
`46%
`
`38%
`
`37%
`
`29%
`
`35%
`
`38%
`
`44%
`
`12%
`
`15%
`
`14%
`
`34%
`
`28%
`
`37%
`
`23%
`
`30%
`
`35%
`
`31%
`
`30%
`
`23%
`
`31%
`
`28%
`
`26%
`
`26%
`
`19%
`
`20%
`
`19%
`
`24%
`
`14%
`
`12%
`
`13%
`
`10%
`
`26%
`
`26%
`
`41%
`
`34%
`
`4%
`
`11%
`
`8%
`
`8%
`
`7%
`
`16%
`
`19%
`
`19%
`
`49%
`
`30%
`
`27%
`
`22%
`
`62%
`
`60%
`
`52%
`
`49%
`
`86%
`
`43%
`
`46$
`
`52%
`
`2012
`
`2013
`
`2104
`
`2015
`
`2016
`
`2017
`
`2018
`
`2019
`
`2012
`
`2013
`
`2104
`
`2015
`
`2016
`
`2017
`
`2018
`
`2019
`
`Big Companies
`>$5.5B
`
`
`
`Medium Companies
`$1B – $5.5B
`
`
`
`Small Companies
`$100M – <$1B
`
`
`
`Extra-Small Companies
`<$100M
`
`
`
`Source: 2019 New Product Pacesetters
`
`NEW PRODUCT PACESETTERS: Innovation Before the “New Normal”
`
`IRIworldwide.com
`
`4
`
`SPECIAL REPORT
`
`Eye Therapies Exhibit 2045, 4 of 23
`Slayback v. Eye Therapies - IPR2022-00142
`
`

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`Eye Therapies Exhibit 2045, 5 of 23
`Slayback v. Eye Therapies - IPR2022-00142
`
`

`

`The Road from Specialty to Mass Market
`
`Niche brands have
`great appeal, and in
`many segments and
`markets they are stars.
`Sometimes a niche
`brand can maintain that
`unique, targeted appeal
`while transforming to a
`mass-market brand. Harry’s razors, for one, tells the
`tale of a once-direct-to-consumer product filling a
`unique need — high-end razor performance and
`feel at an affordable price. With the shift to retail,
`the brand racked up almost $170 million in sales and
`finds itself at major retail locations, including Target,
`Walmart and Kroger, albeit typically merchandised
`as a specialty section within the men’s personal-care
`real estate. These numbers are exclusive of any other
`channels, including e-commerce, perhaps propelling
`brand sales even more significantly when you look
`at its “all-in” numbers.
`
`By having powerful retail distribution — not in every
`store, but in the right stores — Harry’s got it right
`with the look and feel of niche marketing with
`mass-market exposure. Harry’s carries with it the
`mentality of direct-to-consumer products with sharp
`aesthetics and a strong back-story with blades made
`in a century-old European factory bought by two
`entrepreneurs with start-up passion and drive. The
`brand looks and feels exclusive, while it’s accessible
`to the masses and drumming up significant sales.
`
`Following the successful
`disruption of the razor market
`in the men’s space, Harry’s
`pushed into women’s razors
`with the brand Flamingo. The
`idea took hold as personal
`care makes strong connections
`with women, and in just a few years, the brand has
`extended into skincare with products beyond shaving
`to include waxing and skin lotions and treatments.
`Target stores feature Flamingo brand products.
`
`Similarly, Bubly grabs the
`No. 4 Food & Beverage
`position with $116.3
`million in multi-outlet
`sales. It also characterizes
`the feels-small, performs-
`big role in the crowded
`carbonated-soft-drink and carbonated-water market.
`Owned by PepsiCo, Bubly exemplifies a small brand
`with a big image from a big company, thanks to its
`attributes and attractive packaging, as well as its
`deep-pocket marketing and merchandising. It carries
`the aura of a small, niche brand, but the power of
`a big-brand player to help it find and connect with
`consumers who appreciate unique brands.
`
`$19M
`
`Median sales of a
`2019 Food & Beverage
`Pacesetter are $19M,
`up from $11M in 2018
`
`NEW PRODUCT PACESETTERS: Innovation Before the “New Normal”
`
`IRIworldwide.com
`
`6
`
`SPECIAL REPORT
`
`Eye Therapies Exhibit 2045, 6 of 23
`Slayback v. Eye Therapies - IPR2022-00142
`
`

`

`Big companies have made a big splash this year with
`24% of New Product Pacesetter products and half
`the Pacesetter dollars coming from big companies.
`However, a look at the total New Product Pacesetters
`list tells another interesting story.
`
`In recent years, trends indicate that 40-50% of New
`Product Pacesetters come from combined small and
`extra-small companies, defined by $1 billion in sales
`or less. Small companies bring innovation, they bring
`successful products, and they bring the flexibility to
`act fast. Often, they’re less hindered by stage-gate
`processes incumbent in larger businesses, and often
`there are private investors supporting the process
`and thus allowing for more risk, and thus more reward.
`
`In 2019, small companies represented 53% of
`New Product Pacesetters, taking on the challenge
`to achieve wide enough distribution to generate
`impressive sales. The “Shark Tank” effect is at
`play here, with small, driven, inspired companies
`breaking through with grit and determination to
`get products noticed and distributed both in the
`marketplace and with the Sharks on the TV program.
`There’s a distinct mentality here, and the product
`must effectively tap and deliver on a niche need
`that is broadly recognized. Particular ingredients,
`including non-animal protein sources, or value-added
`benefits such as proteins and vitamins, or functions
`such as convenience in personal care, can generate
`excitement and connect with a broad, yet targeted
`swath of consumers. Playing on niche innovation can
`translate to large dollars when an attribute is unique
`yet still offers generally sought-after benefits.
`
`Products experiencing the
`Shark Tank effect are solid,
`but unique, and once they
`get an endorsement from
`the show and the Sharks,
`they gain the distribution
`needed for true traction and organic growth.
`Often these product successes encompass a twist on
`something established. Kodiak Cakes Power Waffles
`infuse excitement in a long-established category
`with a boost of the sought-after attribute of protein.
`Protein-seeking emerges as a trend given that 38 of
`the top 100 and three of top 10 food and beverage
`Pacesetters offer protein benefits.
`
`Chickpea-based Banza
`noodles also focus on the
`lack of carbs and benefit
`of protein. In four* years,
`Banza has become Whole
`Foods’ best-selling pasta
`and Target's second-
`best-selling pasta. Banza
`exemplifies a product
`creating a groundswell at specialty markets,
`expanding its reach and gaining positioning into
`mass markets, achieving the distribution level to earn
`Pacesetter status. Products such as these illustrate
`how a few years of success in specialty markets can
`be the spark needed to sway bigger retailer adoption,
`and spur distribution needed for winning positions.
`
`Dude Wipes is a
`product banking
`on the success of
`the wipe format in
`baby, household and
`auto by specifically
`delivering a personal care product for men, and
`especially adolescent boys. Making its first Shark
`Tank appearance — and deal with Shark Mark Cuban
`— in 2015, distribution expanded regionally in Target
`stores. Then, after a second Shark Tank appearance,
`the brand’s distribution spanned the country, putting
`it in a position to earn Pacesetter status.
`
`Consumer groups vary, and the market is complex,
`but products that win with consumers tap into an
`intentional look, feel, performance, experience or
`any and all combination of those features. While
`big-budget brands often have an edge, consumers
`typically don’t care if a company is big or small; the
`brand story and image — and how it fits into their
`own lives — matters more.
`
`
`
`
`Three 2019 New
`Product Pacesetters
`boast the “Shark
`Tank” effect, gaining the
`support needed to thrive
`in a broad marketplace.
`
`*Please refer to the New Product Pacesetter criteria on page 22.
`
`NEW PRODUCT PACESETTERS: Innovation Before the “New Normal”
`
`IRIworldwide.com
`
`7
`
`SPECIAL REPORT
`
`Eye Therapies Exhibit 2045, 7 of 23
`Slayback v. Eye Therapies - IPR2022-00142
`
`

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`Eye Therapies Exhibit 2045, 8 of 23
`Slayback v. Eye Therapies - IPR2022-00142
`
`

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`Eye Therapies Exhibit 2045, 9 of 23
`Slayback v. Eye Therapies - IPR2022-00142
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`Eye Therapies Exhibit 2045, 10 of 23
`Slayback v. Eye Therapies - IPR2022-00142
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`Eye Therapies Exhibit 2045, 11 of 23
`Slayback v. Eye Therapies - IPR2022-00142
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`

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`Eye Therapies Exhibit 2045, 12 of 23
`Slayback v. Eye Therapies - IPR2022-00142
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`

`

`Schmidt’s
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`The mass distribution bolstered Schmidt’s to
`reach more than $26 million in sales and a
`position on the New Product Pacesetters rankings.
`The evolution of the Schmidt’s brand has taken its
`reputation as a high-performing, natural deodorant
`product and embraced it across more categories
`— the company pivoted to expand into homecare
`with natural cleaning products, as well as personal
`care products, including toothpaste for kids. The
`brand carries a great story, which many consumers
`today value. It feels like a purchase that is good
`for one’s family — a healthy choice, which today
`carries a lot of weight, especially for young families
`with income levels that allow for taking risks and
`exploring products and various price points.
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`Schmidt’s brand
`deodorant was born
`in a Portland, Oregon,
`kitchen only a decade
`ago, touting its natural
`composition and
`effectiveness. Just five
`years later, the company grew and expanded
`into retail channels, and then just a few years
`after that came the boom that shot Schmidt’s to
`the big leagues. In 2018 Unilever acquired the
`brand, which by then had grown to feature natural
`beauty and personal care products and expanded
`distribution. The brand delivered Unilever an
`opportunity to reach a new, natural-focused
`audience, and make a niche, natural product
`available to a mass-market audience.
`
`Strategy Success Stories
`
`Enfamil NeuroPro
`No. 2 on the Food & Beverage
`Pacesetter rankings, Enfamil
`NeuroPro formula generated
`more than $230 million in
`multi-outlet sales. This special
`formula that imitates mother’s
`milk takes the baby formula
`category to a new place scientifically. The product
`features MFGM (Milk Fat Globule Membrane),
`which is found in breast milk and supports cognitive
`development in brain structure and function. Enfamil
`NeuroPro taps into a huge market of parents who
`value the nutritional support of breast milk but, for
`any number of reasons, choose formula.
`
`The success of Enfamil NeuroPro can be attributed
`to a few key factors, including parents’ willingness
`to buy the best for their children and the busy
`life new moms lead that may inhibit breast
`feeding even when they desire the benefits. But
`most notably, this is a revolutionary step in the
`nutritional composition of baby formula — the
`first major scientific enhancement since DHA
`fortification became FDA approved more than
`two decades ago.
`
`Leveraging its reputation as a high-performing natural
`deodorant brand, Schmidt's has expanded into other
`personal care and even homecare categories — all while
`still focused on natural wellness.
`
`NEW PRODUCT PACESETTERS: Innovation Before the “New Normal”
`
`IRIworldwide.com
`
`13
`
`SPECIAL REPORT
`
`Eye Therapies Exhibit 2045, 13 of 23
`Slayback v. Eye Therapies - IPR2022-00142
`
`

`

`Consumers Gravitate to Natural, Healthy
`
`New Product Pacesetter performance in 2019
`represented consumer behavior in a pre-COVID-19
`world. The next New Product Pacesetters chapter
`will be one where the retail marketplace and
`consumer groups will have evolved and behaviors
`undoubtedly will be different. How different is the
`big question.
`
`Both Enfamil NeuroPro and Schmidt’s reflect a
`relevant and likely lasting trend shown across New
`Product Pacesetters both in food and beverage
`and in non-food categories: natural/pure/non-
`GMO ingredients matter to consumers today.
`Three of the top 10 and 25 of the top 100 Food &
`Beverage Pacesetters offer non-GMO benefits, with
`
`products including SlimFast
`Keto offering low-carb,
`ketogenic nutrition; PERDUE
`SIMPLY SMART Organics,
`featuring organic meats and
`non-GMO ingredients; and
`Arnold, Brownberry and
`Oroweat Sandwich Thins, relaunched with premium
`ingredients and a dose of fiber in a low-calorie
`bread product.
`
`Two of the top 10 and 25 of the top 100 in non-
`food tout natural/simple ingredients, with products
`including Johnson's CottonTouch bath products,
`made with real cotton, pH balance for a newborn
`
`and no parabens, phthalates
`or sulfates; Downy Nature
`Blends, a plant-based fabric
`conditioner made with a touch
`of coconut oil, and without
`dyes or parabens; Blue Buffalo
`pet food made with high-quality ingredients; and
`Pampers Pure Collection of diapers and wipes,
`made with premium cotton and other plant-based
`ingredients.
`
`Products considered healthier for bodies and for
`the environment continue to capture consumer
`interest, even if they carry higher price points
`thanks to the perceived or actual value. Homecare
`products could potentially tell an interesting
`tale in the post-COVID-19 world given people’s
`new diligence for killing germs and protecting
`themselves and their families. Will consumers
`continue to value natural and pure in this space?
`Overall, people’s health and wellness efforts won’t
`waver — and may boom — in order to stay healthy
`and build immunity, so watching consumer trends
`in this space is imperative.
`
`NEW PRODUCT PACESETTERS: Innovation Before the “New Normal”
`
`IRIworldwide.com
`
`14
`
`SPECIAL REPORT
`
`Eye Therapies Exhibit 2045, 14 of 23
`Slayback v. Eye Therapies - IPR2022-00142
`
`

`

`This year’s New Products
`Rising Stars will continue
`to tell a meaningful story,
`but the plot arc is still to be
`determined. In Non-Food
`Rising Stars, a number of
`products tout natural and
`simple ingredients, mirroring
`trends in Pacesetters. For example, Rising Star
`Greenies pet dental treats echo similar messaging
`and the growth pattern set by 2018’s pet Pacesetter
`Nature's Recipe and this year’s Blue Buffalo.
`Personal care deodorant brand Native took the
`leap from online to multi-outlet sales in 2019,
`much like this year’s Schmidt’s, indicating a strong
`predilection for landing on the Pacesetters list next
`year as people embrace natural products.
`
`In Food & Beverage Rising Stars, three energy
`drinks lead the way and join two ice creams. The
`presence of ice cream shows people still indulge
`and treat themselves, even though a large portion
`of the population remains focused on health and
`wellness. And energy drinks show that people still
`fight to cram everything into a day and are looking
`for a boost. Though the parallels of Rising Stars
`in food and beverage are not as present in this
`year’s top winners, Bang Energy did just that and
`made a huge bang. Other indulgent products
`such as Pop-Tarts Bites and Enlightened Ice Cream
`grabbed 2019 Rising Stars spots and could pave
`the way to Pacesetter status.
`
`Dollar sales trends in Rising Stars and Pacesetters
`often lead the story, but indicators show that 2019
`could be an aberration in year-one revenue and
`that good innovation launches are not just tied to
`dollars. Innovation meets consumer-demonstrated
`needs and large dollars are not always needed
`to satiate an unmet need. While Pacesetters saw
`record numbers of $100 million-plus launches,
`Rising Stars still signal success for launches
`large and small. We expect a decline in year-
`one revenue, and that was before the advent of
`COVID-19, another potential hurdle or opportunity
`for manufacturers.
`
`Historically Rising Stars make the leap to Pacesetter
`status, but in our new normal, will they continue to
`be important to manufacturers fighting to keep the
`supply chain full with the types of products people
`know they want and need?
`
`Or will Rising Stars get the win as people find ways
`to treat and indulge in otherwise very trying times.
`Already ice creams and frozen novelties are a
`trend noted in this year’s New Product Pacesetters,
`especially kids’ and less calorie versions, which
`may reflect an interest in indulgence in moderation.
`There are eight ice cream and novelty products in
`the top 100 Food & Beverage Pacesetters.
`
`We forecast that product-launch timetables will
`play a more significant role in the coming years
`because of long-term effects from changed
`COVID-19 behaviors. This year, more than half
`of non-food Pacesetters and about one-third of
`food and beverage Pacesetters achieved 30%
`distribution or more in the first quarter of the
`calendar year. This timing holds year after year,
`represented across products earning Pacesetter
`status. Thus, it’s likely that the lion’s share of
`innovation for this year is already on the market,
`facing a never-anticipated COVID-19 environment.
`
`Rising Stars of next year launched this year
`amid the COVID-19 chaos and, given historical
`trends, launched in first quarter. Manufacturers
`and brand owners need to closely monitor the
`ability to source ingredients and production and
`distribution in a taxing supply chain. They will likely
`face headwind in new product development and
`consumer adoption.
`
`More than half of 2019
`Non-Food Pacesetters and
`one-third of Food & Beverage
`Pacesetters achieved 30%
`distribution or more in the first
`quarter of the calendar year.
`
`NEW PRODUCT PACESETTERS: Innovation Before the “New Normal”
`
`IRIworldwide.com
`
`15
`
`SPECIAL REPORT
`
`Eye Therapies Exhibit 2045, 15 of 23
`Slayback v. Eye Therapies - IPR2022-00142
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`

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`Eye Therapies Exhibit 2045, 16 of 23
`Slayback v. Eye Therapies - IPR2022-00142
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`

`

`Eye Therapies Exhibit 2045, 17 of 23
`Slayback v. Eye Therapies - IPR2022-00142
`
`

`

`Eye Therapies Exhibit 2045, 18 of 23
`Slayback v. Eye Therapies - IPR2022-00142
`
`

`

`Eye Therapies Exhibit 2045, 19 of 23
`Slayback v. Eye Therapies - IPR2022-00142
`
`

`

`Eye Therapies Exhibit 2045, 20 of 23
`Slayback v. Eye Therapies - IPR2022-00142
`
`

`

`Eye Therapies Exhibit 2045, 21 of 23
`Slayback v. Eye Therapies - IPR2022-00142
`
`

`

`ABOUT NEW PRODUCT PACESETTERS
`IRI has a long history of celebrating the consumer
`packaged goods (CPG) industry’s most powerful
`brand launches. New Product Pacesetters is
`consistently rich with iconic brands and game-
`changing innovations, brought to market by
`behemoths and new market entrants. New Product
`Pacesetters gives innovators inside and outside
`the CPG industry an opportunity to learn from the
`best of the best in new product innovation and
`learn the strategies for accelerating growth.
`
`ABOUT THE AUTHORS
`Joan Driggs is the vice president of Content and
`Thought Leadership in the Chicago office of IRI.
`You may email her at
`Joan.Driggs@IRIworldwide.com.
`
`Larry Levin is the executive vice president of
`Consumer & Shopper Marketing, Sales and
`Thought Leadership in the Chicago office of IRI.
`You may email him at
`Larry.Levin@IRIworldwide.com.
`
`ACKNOWLEDGMENTS
`Vital and appreciated contributors to the
`development and analysis of this report include
`Claudia Burgos and Ryan Stredney, new product
`specialists in the Chicago office of IRI.
`
`IRI NEW PRODUCT PACESETTER CRITERIA
`• Completed a full year of sales in calendar-year
`2019 (brands that complete year one in 2020
`qualify for Rising Star status, the top 10 brands
`based on a projected year-one sales total, that
`would have crossed 30% ACV in the February
`2019 quad or later).
`
`• Begin tracking year-one sales after 30% ACV
`weighted distribution achieved across multi-
`outlet geography; must have 30% ACV or
`higher at date of year-one completion.
`
`• New Product Pacesetters are the Top 100 new
`banners (for each, food and beverage, and
`non-food) based on year-one sales across
`multi-outlet geography.
`
`• MULO/multi-outlet = supermarkets, drugstores,
`mass market retailers, military commissaries,
`and select club and dollar retail chains.
`
`NEW PRODUCT PACESETTERS: Innovation Before the “New Normal”
`
`IRIworldwide.com
`
`22
`
`SPECIAL REPORT
`
`Eye Therapies Exhibit 2045, 22 of 23
`Slayback v. Eye Therapies - IPR2022-00142
`
`

`

`Eye Therapies Exhibit 2045, 23 of 23
`Slayback v. Eye Therapies - IPR2022-00142
`
`