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Omeros Corporation Reports Third Quarter 2009 Financial Results and Development Highlights

SEATTLE, Nov. 19 /PRNewswire-FirstCall/ -- Omeros Corporation (Nasdaq: OMER) today announced unaudited financial results for the third quarter ended September 30, 2009. For the three months ended September 30, 2009, Omeros reported a net loss of $3.9 million, or $1.34 per share, as compared to a net loss of $7.4 million, or $2.54 per share, for the same period in 2008. For the nine months ended September 30, 2009, the Company reported a net loss of $15.5 million, or $5.29 per share, as compared to a net loss of $17.4 million, or $6.07 per share, for the same period in 2008.

On October 7, 2009, Omeros priced its initial public offering (IPO), which generated net proceeds to the Company of approximately $61.8 million from the sale of 6,820,000 shares of its common stock at a price of $10.00 per share.

"Our IPO afforded Omeros the resources to advance aggressively our pipeline of clinical and preclinical programs. We expect that the proceeds will allow us to complete our ongoing Phase 3 clinical trials for our lead PharmacoSurgery(TM) product, OMS103HP, and fund its commercial launch into the arthroscopy market. We also recently amended a key agreement for our GPCR program, providing us with additional opportunities to realize the value of the program while limiting our expenditures," said Gregory A. Demopulos, M.D., Chairman and CEO of Omeros. "Throughout the course of next year, we look forward to releasing data from our Phase 3 arthroscopic program as well as meeting additional clinical milestones for our ophthalmologic and urologic programs."

Financial Results

Total operating expenses for the three months ended September 30, 2009 were $5.0 million compared to $8.2 million for the same period in 2008. The decrease in operating expenses in the third quarter of 2009 as compared to the same period of 2008 was primarily a result of the 2008 write-off of $1.9 million of deferred offering costs related to a delay in the Company's IPO. Also, in the 2009 period there were decreases in contract service costs associated with several of Omeros' clinical and preclinical programs and in clinical trial expenses due to the prior completion of enrollment in the Company's Phase 2 clinical study of OMS103HP for arthroscopic meniscectomy surgery.

Total operating expenses for the nine months ended September 30, 2009 were $16.5 million, compared to $19.1 million for the same period in 2008. The decrease in operating expenses in the nine months ended September 30, 2009 as compared to the same period of 2008 was primarily a result of items noted above.

Recent Highlights

  • Priced the Company's IPO on October 7, 2009, receiving net proceeds of approximately $61.8 million, and began trading on The NASDAQ Global Market under the ticker symbol "OMER" on October 8, 2009.
  • Announced positive results from the Phase 1/Phase 2 clinical trial of OMS302, Omeros' PharmacoSurgery product candidate being developed for use during ophthalmological procedures. OMS302 is a proprietary combination of an anti-inflammatory agent and an agent that causes pupil dilation (mydriasis), each with well-known safety and pharmacologic profiles. The Phase 1/Phase 2 trial enrolled 61 patients undergoing age-related cataract extraction with lens replacement, and was designed to evaluate efficacy and safety of OMS302 added to a standard surgical irrigation solution. Data from this study showed that patients treated with OMS302 reported less postoperative pain and demonstrated statistically significant improvement in maintenance of mydriasis during the surgical procedure compared to patients treated with vehicle control.
  • Amended its agreement with Patobios Limited by which Omeros has the exclusive right to acquire all intellectual property rights to an assay for use in the Company's GPCR program. As a result of the amendment, Omeros now has the right to de-orphanize at least three orphan GPCRs using the assay without having to immediately purchase the associated intellectual property from Patobios for the $10.8 million CAD purchase price, and Omeros can also grant to third parties development and/or commercialization rights to those de-orphanized GPCRs. Under the amendment, Omeros will be required to pay Patobios a one-time $500,000 CAD de-orphanization milestone payment instead of the $10.8 million CAD purchase price, with the $500,000 CAD milestone payment credited in full against the purchase price if Omeros acquires the assets.

Conference Call and Webcast Today at 5:00 p.m. Eastern Time

The Omeros management team will host a conference call today, November 19, at 5:00 p.m. Eastern Time (2:00 p.m. Pacific Time), to discuss the Company's third quarter 2009 financial results and development highlights. Interested parties may participate in the conference call by dialing 877-795-3638 (Domestic) or 719-325-4891 (International). To access the webcast, please go to the Company's website at and go to the "Events" section of the "Investors" page to log on.

A replay of the webcast will be available on the website for one week following the call. A telephone replay will also be available from 7:00 p.m. Eastern Time on November 19 through 11:59 p.m. Eastern Time on November 22 by dialing 888-203-1112 (Domestic) or 719-457-0820 (International) and entering conference ID number 4396920.

About Omeros Corporation

Omeros Corporation is a clinical-stage biopharmaceutical company committed to discovering, developing and commercializing products focused on inflammation and disorders of the central nervous system. Omeros' most clinically advanced product candidates are derived from its proprietary PharmacoSurgery(TM) platform designed to improve clinical outcomes of patients undergoing arthroscopic, ophthalmological, urological and other surgical and medical procedures. Omeros has four ongoing PharmacoSurgery(TM) clinical development programs, and its lead product candidate, OMS103HP, is being evaluated in Phase 3 clinical trials for use during arthroscopic surgery to improve postoperative joint function and reduce postoperative pain. Omeros is also building a diverse pipeline of preclinical programs targeting inflammation and central nervous system disorders.

Forward-Looking Statements

This press release contains forward-looking statements as defined within the Private Securities Litigation Reform Act of 1995, which are subject to the "safe harbor" created by those sections. These statements include, but are not limited to, statements regarding the Company's ability to advance its clinical and preclinical pipeline, including completing its ongoing Phase 3 clinical trials of OMS103HP and funding the commercial launch of OMS103HP with the proceeds from its initial public offering; to realize the value of its GPCR program while limiting the Company's expenditures as a result of changes to its agreement with Patobios Limited; to release data from its Phase 3 arthroscopic program as well as meet additional clinical milestones for its ophthalmologic and urologic programs over the course of next year; and to de-orphanize orphan GPCRs and grant related development and/or commercialization rights to third parties. Forward-looking statements are based on management's beliefs and assumptions and on information available to management only as of the date of this press release. Omeros' actual results could differ materially from those anticipated in these forward-looking statements for many reasons, including, without limitation, the risks, uncertainties and other factors described under the heading "Risk Factors" in the Company's Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on November 19, 2009. Given these risks, uncertainties and other factors, you should not place undue reliance on these forward-looking statements, and the Company assumes no obligation to update these forward-looking statements publicly, even if new information becomes available in the future.

                                OMEROS CORPORATION
                           (A Development Stage Company)
                  (In thousands, except share and per share data)
                                                                  Period from
                                                                   June 16,
                          Three Months            Nine Months    (Inception)
                              Ended                  Ended          through
                          September 30,          September 30,   September 30,
                          ---------------        ----------------
                         2009       2008        2009        2008         2009
                         ----       ----        ----        ----         ----
    Grant revenue        $442       $501      $1,010        $989       $4,403
    Research and
     development        3,692      4,737      12,291      12,755       74,525
    Acquired in-
     research and
     development            -          -           -           -       10,891
    General and
     administrative     1,277      3,428       4,162       6,327       36,645
                        -----      -----       -----       -----       ------
     expenses           4,969      8,165      16,453      19,082      122,061
                        -----      -----      ------      ------      -------
    Loss from
     operations        (4,527)    (7,664)    (15,443)    (18,093)    (117,658)
     income                47        114         189         574        5,352
     expense             (540)       (52)     (1,705)        (90)      (2,334)
    Other income
     (expense)          1,104        222       1,452         165        1,886
                        -----        ---       -----         ---        -----
    Net loss          $(3,916)   $(7,380)   $(15,507)   $(17,444)   $(112,754)
                      =======    =======    ========    ========    =========
    Basic and
     net loss per
     common share      $(1.34)    $(2.54)     $(5.29)     $(6.07)
                       ======     ======      ======      ======
     average shares
     used to
     basic and
     net loss per
     common share   2,930,391  2,909,688   2,929,728   2,871,704
                    =========  =========   =========   =========
    Pro forma
     basic and
     diluted net
     loss per
     common share      $(0.33)    $(0.52)     $(1.14)     $(1.21)
                       ======     ======      ======      ======
     average pro
     forma shares
     used to
     pro forma
     basic and
     diluted net
     loss per
     share         14,444,897 14,301,745  14,422,465  14,263,761
                   ========== ==========  ==========  ==========

                         OMEROS CORPORATION
                    (A Development Stage Company)
                           (In thousands)
                                       September 30,  December 31,
                                            2009          2008
                                         ----------    ----------
    Current assets:
      Cash and cash equivalents            $1,367       $12,726
      Short-term investments                3,125         7,256
      Grant and other receivables             320           207
      Prepaid expenses and other
       current assets                         128           289
                                              ---           ---
        Total current assets                4,940        20,478
    Deferred offering costs                 1,034             -
    Property and equipment, net               681           918
    Intangible assets, net                      -            60
    Restricted cash                           193           193
    Other assets                               62            32
                                               --            --
    Total assets                           $6,910       $21,681
                                           ======       =======
    Liabilities, convertible
     preferred stock and
     shareholders' equity (deficit)
    Current liabilities:
      Accounts payable                     $1,530        $1,229
      Accrued expenses                      3,739         3,764
      Preferred stock warrant
       liability                              902         1,780
      Deferred revenue                      1,019           232
      Current portion of notes
       payable                              4,750        16,556
                                            -----        ------
        Total current liabilities          11,940        23,561
    Notes payable, less current
     portion                                9,244           118
    Commitments and contingencies
    Convertible preferred stock:
      Issued and outstanding
       shares-11,514,506 at
       September 30, 2009
       (unaudited) and
       11,392,057 at December 31,
      Liquidation preference of
       $93,284 at September 30,
       2009 (unaudited) and
        at December 31, 2008               91,019        89,168
    Shareholders' equity (deficit):
      Preferred stock, par value
       $0.01 per share:
        Authorized shares -
         13,425,919 at September
         30, 2009 (unaudited) and
          December 31, 2008
        Designated convertible -
         13,425,919 at September
         30, 2009 (unaudited) and
         December 31, 2008                      -             -
      Common stock, par value
       $0.01 per share:
         Authorized shares -
          20,410,000 at September
          30, 2009 (unaudited) and
          December 31, 2008;
      Issued and outstanding
       shares-2,930,167 and
       2,951,406 at September 30,
       2009 (unaudited) and December
       31, 2008, respectively                  30            30
      Additional paid-in capital            7,408         6,150
      Accumulated other
       comprehensive loss                      23           (99)
      Deficit accumulated during
       the development stage             (112,754)      (97,247)
                                         --------       -------
      Total shareholders' deficit        (105,293)      (91,166)
                                         --------       -------
      Total liabilities,
       convertible preferred stock,
       and shareholders' equity
       (deficit)                           $6,910       $21,681
                                           ======       =======

SOURCE Omeros Corporation

SOURCE Omeros Corporation
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