Omeros Corporation

Good afternoon and welcome to today's earnings call for Omeros Corporation. At this time, all participants are in listen-only mode. After the company's remarks, we will conduct a question-and-answer session. If you would like to ask a question, please raise your hand. If you have dialed into today's call, please press star 9 to raise your hand and star 6 to unmute. Please be advised that this call is being recorded at the company's request and a replay will be available on the company's website. I'll now turn the call over to Jennifer Williams, Investor Relations for Omeros. Please go ahead.

Thank you and good afternoon, everyone. Before we begin, please note that today's discussion will include forward-looking statements. These statements reflect management's current expectations and beliefs as of today and are subject to risks and uncertainties that could cause actual results to differ materially. For a detailed discussion of these risks and uncertainties, please refer to the special note regarding forward-looking statements and the risk factors sections in our quarterly report on Form 10-Q filed today with the SEC, as well as our most recent annual report on Form 10-K. Today's call will include a discussion of certain non-GAAP financial measures. A reconciliation of these non-GAAP measures to the corresponding GAAP measures is included with O'Meara's earnings press release issued earlier today. which is available on the investor relations page of our website and has been furnished with the form 8K we filed with the SEC earlier today. With that, I'll turn the call over to Dr. Greg Dimopoulos, Chairman and CEO of Omeros.

Thank you, Jennifer, and good afternoon, everyone. Joining me today are David Borges, our Chief Accounting Officer, Dr. Kathy Melfi, our Chief Regulatory Officer, and Dr. Steve Whitaker, Vice President of Clinical. I'll start with an overview of our first quarter 2026 operations and financial results, followed by program updates. After that, David will cover the financials in more detail, and then we'll open the call for questions. We entered 2026 with two catalysts, the closing of our previously announced transaction with Novo Nordisk for Zoltenebar, our lead investigational MAST3 inhibitor, and the FDA approval of Yartemlia, our lead MASP2 inhibitor, for the treatment of hematopoietic stem cell transplant-associated thrombotic microangiopathy, or TA, TMA. This approval made Yartemlia the first and only approved treatment for this often fatal complication, and the first and only approved inhibitor of the lectin pathway of complement. We launched in January with initial shipments to distributors beginning mid-month, followed shortly by first sales. In the first quarter, Yard Temlia gross revenues were $11.1 million, with net revenues of $9.9 million. reflecting gross to net adjustments of approximately 11%. Early demand and uptake are strong. Yartemliya became cash flow positive in the first quarter, despite a mid-January launch, and we expect it to drive company-wide positive cash flow within 18 months. Net income for the first quarter was $56.1 million or 78 cents per share, including a $73.1 million non-cash mark-to-market gain on the embedded derivative associated with our 2029 convertible notes. Excluding this non-cash item, adjusted net gross loss was or net loss was $17.1 million or 24 cents per share. We ended the quarter with 135.3 million in cash and investments after retiring our remaining 2026 convertible notes. During the first quarter, we repurchased and retired approximately 360,000 shares of our common stock at an average price of $11.70 per share for a total of $4.2 million. We may continue to repurchase shares from time to time subject to market conditions and other considerations. Our transaction with Novo Nordisk provided substantial non-dilutive capital to support our growth. At closing, we received $240 million in upfront cash, funding operations, including the Artemlia launch. We are also eligible for another $100 million in near-term milestone payments from Novo. The deal is valued at up to $2.1 billion in upfront and milestone payments, plus royalties in the high single digit to high teen range. Our early launch has been focused on four priorities. First, educating transplant care teams to drive earlier recognition and treatment of TATMA. Second, securing rapid institutional access through pharmacy and therapeutics or P&T committee approvals and streamlined ordering. Third, ensuring consistent, timely reimbursement. And finally, demonstrating strong economic value through health economics and outcomes research, or HEOR. Execution is ahead of plan. Our field force is fully deployed, detailing all 175 transplant centers nationwide. By March 31, 30 unique accounts had ordered Yartemlia, reflecting accelerated adoption. Despite the typical six to nine month timeline for P&T committee approvals, accounts are moving faster than expected. By quarter end, we understand that 60% of the top 10 centers, 40% of the top 20 centers, 38% of the top 40 and approximately 30% of the top 80 US centers have received P&T committee approval. Looking at reimbursement, all prior authorization requests submitted to third party commercial payers to date have been approved. and centers have begun receiving full payment. HEOR analyses which support the Artemlia pricing and show compelling quality of life improvements are being finalized and prepared for publication. Early indicators, including strong receptivity from transplant centers, formulary momentum, and payer alignment with the label support our expectation that Yartemliya can become standard of care for TATMA. In April, the US Centers for Medicare and Medicaid Services, or CMS, assigned a permanent healthcare common procedure coding system, JCODE, for Yartemliya. This simplifies billing and reimbursement across payers, reduces administrative burden, supports faster patient access, and improves reimbursement predictability. The J-code becomes effective July 1. Also in April, CMS in its inpatient prospective payment system proposed rule recommended approval of the new technology add-on payment, or NTAP, for Yartemlio. NTAP provides additional payments to hospitals for certain high-cost innovative technologies, helping bridge the gap until standard payment systems incorporate them. The final rule is expected in August with NTAP effective October 1 of this year. We remain focused on expansion opportunities for Yartemliya and our MASP2 program. Beyond the U.S., our marketing authorization application for Yartemlia in TATMA is under review by the European Medicines Agency. We continue to expect a decision mid-year. We are evaluating potential partnerships, including broad ex-U.S. and regional collaborations to support commercialization outside the U.S., Beyond TATMA, we're assessing opportunities to expand the Artemlia label to other indications involving lectin pathway activation, including acute respiratory distress syndrome, or ARDS, sickle cell disease, acute kidney injury, solid organ transplant-related TMA, and delayed graft function. We're also broadening our MASP2 inhibitor platform beyond Yartemlia, advancing both our phase two ready long acting MASP2 antibody OMS1029 and our oral MASP2 small molecule program. Both are well-suited for chronic indications, including membranous nephropathy, other renal diseases, and neurological disorders such as Parkinson's and Alzheimer's. We're finalizing the initial phase two indication for once quarterly OMS 1029. We're now also working to advance our small molecule program to IND enabling studies targeting once daily oral delivery. Let's now turn to development programs beyond our complement inhibitor franchise. Our PD7 inhibitor program evaluating OMS527 for cocaine use disorder remains fully funded by a grant from the National Institute on Drug Abuse or NIDA. We successfully completed animal cocaine interaction studies, supporting a scheduled inpatient human study, evaluating OMS 527 in cocaine users. Recently, together with NIDA representation, we met with FDA to discuss the agency's request for additional non-clinical information before starting the inpatient study. The meeting was productive and we are working with FDA to streamline the path to initiate the inpatient clinical trial, which is targeted to start by year end. Based on its mechanism of action and our extensive preclinical data, we believe that OMS 527 could be effective across a wide range of addictions and compulsive disorders. Turning to our targeted complement activating therapy or TCAT platform. This represents a novel class of recombinant antibodies designed to target and directly kill pathogens, including bacteria, fungi, viruses, and parasites. Our initial focus is on multi-drug resistant organisms or MDROs, one of the most critical unmet needs in medicine. Unlike marketed antimicrobials, TCAT is designed to kill pathogens regardless of resistance profile without promoting resistance. Data from our TCAT platform were recently featured in a podium presentation at the annual Congress of the European Society of Clinical Microbiology and Infectious Diseases. And the seminal manuscript describing our TCAT technology was accepted for publication in Science Translational Medicine. Last but not least, we're pleased with the continued progress of Oncatox AML, the lead development program in our Oncatox oncology platform. Oncatox AML is an engineered biologic agent designed to treat acute myeloid leukemia or AML. the most common and deadliest form of adult leukemia. In both human tumor-bearing animal and in vitro human AML cell line studies, Oncotox AML has consistently shown superior efficacy to current standard of care treatments. even at very low doses and across mutations associated with AML, such as TP53 and FLT3, which have historically been difficult to treat. In a non-human primate study, a single course of Oncotox AML demonstrated the desired pharmacologic response. a marked selective, reversible, and dose-related reduction in myeloid progenitor cells, the cells that can mutate and lead to AML, by up to 99%. Safety was equally strong. The treatment was well tolerated with no safety signal of concern. IND enabling studies are underway and we are preparing for a first in human trial targeted for late 2027. So that concludes our financial corporate and development program update. I'll now turn the call over to David Borges, our chief accounting officer for a detailed discussion of our financial results. David. Thanks, Greg.