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Item 1. Business

2024-04-01 compared with 2023-03-13 · 263 added, 375 removed, 504 unchanged (56% of the section changed)

Omeros Corporation (“Omeros,” the “Company” or “we”) is a clinical-stage biopharmaceutical company committed to discovering, developing and commercializing small-molecule and protein therapeutics for large-market as well as orphan indications targeting immunologic disorders including complement-mediated diseases, cancers, and addictive and compulsive disorders.

The lead drug candidate in our pipeline of complement-targeted therapeutics is narsoplimab (OMS721), a proprietary, patented human monoclonal antibody targeting mannan-binding lectin-associated serine protease 2 (“MASP-2”), the key activator of the lectin pathway of complement.

Clinical development of narsoplimab is currently focused primarily on hematopoietic stem cell transplant-associated thrombotic microangiopathy (“HSCT-TMA”) and immunoglobulin A (“IgA”) nephropathy.

We expect to read out 36-week proteinuria data from our Phase 3 clinical trial evaluating narsoplimab for the treatment of IgA nephropathy, ARTEMIS-IGAN, later this year .

We successfully completed a pivotal clinical trial for narsoplimab in HSCT-TMA and previously submitted to the U.S.

Food and Drug Administration (“FDA”) a biologics licensing application (“BLA”) seeking marketing approval for narsoplimab in this indication.

In late 2021, FDA issued a complete response letter (“CRL”) with respect to the BLA in which the agency indicated that additional information would be needed to support regulatory approval.

We appealed FDA’s decision to issue the CRL through a formal dispute resolution process that concluded in late 2022.

Although our appeal was denied, the decision identified potential paths for resubmission of the BLA based on both response data and survival data from the completed pivotal trial versus a historical control group, with or without an independent literature analysis.

We have requested a meeting with the review division at FDA to confirm the additional information required to be included in the resubmission to support approval of the BLA.

There can be no guarantee that the specific requirements for resubmission, when determined through interaction with the FDA review division, will be satisfactory in terms of the time and/or expenditure required, and there can be no guarantee that any resubmission will result in approval of narsoplimab for HSCT-TMA.

We are also developing OMS1029, a long-acting, next-generation antibody targeting MASP-2 and the lectin pathway.

Dosing of all cohorts in a single-ascending dose Phase 1 clinical trial of OMS1029 was successfully completed in early 2023.

OMS1029 was well tolerated with no safety concerns identified.

Preliminary pharmacokinetic (“PK”) and pharmacodynamic (“PD”) data show dose-proportional exposure and sustained lectin pathway inhibition, consistent with potentially quarterly intravenous or subcutaneous dosing.

Our pipeline of clinical-stage complement-targeted therapeutic candidates also includes OMS906, a proprietary, patented monoclonal antibody targeting mannan-binding lectin-associated serine protease 3 (“MASP-3”), the key activator of the alternative pathway of complement.

Omeros Corporation (“Omeros,” the “Company” or “we”) is a clinical-stage biopharmaceutical company committed to discovering, developing and commercializing small-molecule and protein therapeutics for large-market as well as orphan indications targeting immunologic diseases, including complement-mediated diseases and cancers related to dysfunction of the immune system, as well as addictive and compulsive disorders.

Complement-targeted Therapeutic Development Programs

We are advancing multiple development programs focused on diseases and disorders associated with the complement system, a group of specialized proteins that protect against invasive pathogens as well as damaged cells inside the body and comprise an important part of the body’s immune system.

When triggered, the various components of complement cooperate to generate an immune response that fights infection and clears damaged or dead cells, maintaining healthy function of the body’s systems.

However, dysregulation of the complement system (i.e., over- or under-activation) can be harmful and is associated with increased vulnerability to infections and non-infectious diseases, including autoimmune disorders, chronic inflammation, thrombotic microangiopathy, and cancer.

There are three distinct pathways of complement, each activated via one or more unique mechanisms :

Classical pathway:

activated by antigen-antibody complexes

Lectin pathway:

activated by lectin binding of carbohydrate patterns on the surfaces of damaged cells and microbes

Alternative pathway:

constitutively active and amplifies classical and lectin pathway activation

Our complement-targeted therapeutic development programs are primarily focused on diseases and disorders associated with the lectin and/or alternative pathways of complement.

Our lectin pathway program includes inhibitors of mannan-binding lectin-associated serine protease 2 (“MASP-2”) and our alternative pathway program includes inhibitors of mannan-binding lectin-associated serine protease 3 (“MASP-3”).

Narsoplimab (OMS721), the lead candidate in our lectin pathway program, is a proprietary, patented human monoclonal antibody inhibitor of MASP-2, the key effector enzyme of the lectin pathway.

Clinical development of narsoplimab is currently focused primarily on hematopoietic stem cell transplant-associated thrombotic microangiopathy (“TA-TMA”).

We are also developing OMS1029, a long-acting, next-generation antibody and an orally administered small molecule targeting MASP-2 and the lectin pathway.

The lead drug candidate in our development program focused on the alternative pathway of complement is OMS906, a proprietary, patented monoclonal antibody targeting MASP-3.

MASP-3 is the key activator of the alternative pathway of complement.

We believe OMS906 has the potential to treat a wide range of alternative pathway-related diseases and that its attributes favorably differentiate OMS906 from other marketed and in-development alternative pathway inhibitors.

Clinical development of OMS906 is currently focused on rapidly obtaining proof-of-concept data in multiple alternative pathway-related disorders, including paroxysmal nocturnal hemoglobinuria (“PNH”) and complement 3 glomerulopathy (“C3G”).

Following the successful completion of a Phase 1 single-ascending-dose study of OMS906 in healthy subjects, we initiated clinical programs evaluating OMS906 in PNH and C3G.

In late 2022, we began enrolling in a Phase 1b clinical trial evaluating OMS906 for the treatment of PNH.

The first treatment-naïve PNH patients were dosed with OMS906 in early 2023.

We have also begun enrolling a Phase 1b clinical trial evaluating OMS906 in PNH patients who have had an unsatisfactory response to the C5 inhibitor ravulizumab.

We have completed several regulatory and ethics committee submissions for a Phase 1b clinical trial evaluating OMS906 in patients with C3G and expect to begin enrolling patients next month following receipt of regulatory and ethics committee approvals.

Our development pipeline also includes OMS527, our phosphodiesterase 7 (“PDE7”) inhibitor focused on addiction and movement disorders, for which we have successfully completed a Phase 1 study.

We are evaluating OMS527 in a clinically predictive primate model of levodopa-induced dyskinesias (“LID”), a common and debilitating side effect of long-term levodopa dosing in patients with Parkinson’s disease.

We also have a diverse group of preclinical programs, including GPR174, a novel target in immuno-oncology that modulates a new cancer immunity axis that we discovered.

Inhibitors of GPR174 are part of our proprietary G protein-coupled receptor (“GPCR”) platform through which we control 54 GPCR drug targets and their corresponding compounds.

We are also developing novel adoptive T cell/CAR-T therapies and novel immunotherapeutics and cancer vaccines as part of our immuno-oncology platform.

We previously developed and commercialized OMIDRIA ® (phenylephrine and ketorolac intraocular solution) 1%/0.3%, which is approved by FDA for use during cataract surgery or intraocular lens (“IOL”) replacement to maintain pupil size by preventing intraoperative miosis (pupil constriction) and to reduce postoperative ocular pain.

Clinical development of OMS906 is currently ongoing in multiple alternative pathway-related disorders, including complement 3 glomerulopathy (“C3G”), a rare chronic kidney disease, and paroxysmal nocturnal hemoglobinuria (“PNH”), a rare and life-threatening hemolytic blood disorder.

An orally administered small molecule MASP-3 inhibitor is also in development.

Other Development Programs

Our development pipeline also includes OMS527, our phosphodiesterase 7 (“PDE7”) inhibitor program focused on addiction and movement disorders.

We also have a diverse group of preclinical programs, including five immuno-oncology platforms directed to development of novel adoptive T cell/CAR-T therapies, immunomodulators, immunotoxins and cancer vaccines.

OMIDRIA Sale and Royalty Monetization Transactions

We previously developed and commercialized OMIDRIA ® (phenylephrine and ketorolac intraocular solution) 1%/0.3%, which is approved for use during cataract surgery or intraocular lens (“IOL”) replacement to maintain pupil size by preventing intraoperative miosis (pupil constriction) and to reduce postoperative ocular pain.

We marketed OMIDRIA in the United States (the “U.S.”) from the time of its commercial launch in 2015 until December 2021.

On December 23, 2021, we completed the sale of OMIDRIA and certain related assets and liabilities to Rayner Surgical Inc.

On December 23, 2021, we sold OMIDRIA and certain related assets, including inventory and prepaid expenses to Rayner Surgical Inc.

(“Rayner”) pursuant to an Asset Purchase Agreement, dated December 1, 2021 (the “Asset Purchase Agreement”).

Under the Asset Purchase Agreement, we are entitled to receive royalties based on Rayner’s sales of OMIDRIA for the life of the patents covering OMIDRIA in the relevant jurisdiction.

From the closing date through the occurrence in late 2022 of the milestone event that resulted in our receipt of a $200 million milestone payment (the “Milestone Payment”) in early 2023, the applicable royalty rate on net revenue from OMIDRIA sales in the U.S.

Per the terms of the Asset Purchase Agreement, the applicable royalty rate was reduced to 30% of the net revenue from sales of OMIDRIA in the U.S.

following the occurrence of the milestone event.

On September 30, 2022, we sold to DRI Healthcare Acquisitions LP (“DRI”) an interest in a portion of our future OMIDRIA royalty receipts and received $125.0 million in cash consideration.

DRI receives their prorated monthly cap amount before we receive any royalty proceeds.

DRI is not entitled to carry-forward or to recoup any shortfall if the royalties paid by Rayner for an annual period are less than the cap amount applicable to each discrete calendar year.

Additionally, DRI has no recourse to or security interest in our assets other than our OMIDRIA royalty receipts, and we retain all royalty receipts in excess of the respective cap in any given calendar year.

Please refer to Part II, Item 8, “Note 9 – OMIDRIA Royalty Obligation ” to our Consolidated Financial Statements in this Annual Report on Form 10-K for information regarding the OMIDRIA royalty obligation .

Under the Asset Purchase Agreement, Rayner paid us $126.0 million in cash at the closing and we retained all outstanding accounts receivable, accounts payable, and accrued expenses as of the closing date.

Rayner is also obligated under the Asset Purchase Agreement to pay us royalties based on Rayner’s net sales of OMIDRIA for a term that extends for the life of the patents covering OMIDRIA in the relevant jurisdiction.

The latest expiration of a patent covering OMIDRIA in the United States is currently in 2035.

Also pursuant to the Asset Purchase Agreement, we were entitled to receive a milestone payment of $200.0 million (the “Milestone Payment”) within 30 days following an event (the “Milestone Event”) that establishes separate payment for OMIDRIA for a continuous period of at least four years when furnished in the ambulatory surgery center (“ASC”) setting.

The Milestone Event occurred in December 2022 and we recorded a $200.0 million milestone receivable.

We received the Milestone Payment together with accrued interest in February 2023.

On September 30, 2022, we entered into a Royalty Purchase Agreement (the “Original Agreement”) with DRI Healthcare Acquisitions LP (“DRI”) under which we received $125.0 million in cash in exchange for a portion of our royalties on global net sales of OMIDRIA payable by Rayner between September 1, 2022 and December 31, 2030, subject to certain annual caps on the royalty amounts payable to DRI, with Omeros entitled to receive all royalties paid in excess of the applicable caps.

On February 1, 2024, we entered into an amended and restated royalty purchase agreement (the “Amendment”) with DRI to effect the sale to DRI of an expanded interest in the OMIDRIA royalties.

The Amendment eliminated the annual caps on royalty payments to which DRI is entitled and provides that DRI will now receive all royalties on U.S.

net sales of OMIDRIA payable between January 1, 2024 and December 31, 2031.

We received $115.5 million in cash upon closing of the Amendment.

Additionally, we are eligible under the Amendment to receive two milestone payments of up to $27.5 million each, payable in January 2026 and January 2028, respectively, based on achievement of certain thresholds for U.S.

net sales of OMIDRIA.

DRI is entitled to payment only to the extent of royalty payments that are payable on U.S.

net sales of OMIDRIA on or before December 31, 2031 and DRI has no recourse to our assets other than its interest in the OMIDRIA royalties.

Omeros retains the right to receive all royalties payable by Rayner on any net sales of OMIDRIA outside the U.S.

payable from and after January 1, 2024, as well as all royalties on global net sales of OMIDRIA payable from and after December 31, 2031.

As discussed above, the term for royalty payments under the Asset Purchase Agreement expires based on the last-expiring OMIDRIA-related patent in the relevant country, which in the United States currently extends into 2035.

The royalty rate payable by Rayner on net sales of OMIDRIA is currently 30% in the United States and 15% outside the U.S.

These royalty rates are subject to reduction upon the occurrence of certain events described in the Asset Purchase Agreement.

For example, the applicable U.S.

royalty rate would be reduced to 10% during any specific period in which OMIDRIA is no longer eligible for separate payment (i.e., included in the packaged payment rate for the surgical procedure) under Medicare Part B.

Pursuant to legislation enacted in late 2022, we expect separate payment for OMIDRIA under Medicare Part B to extend until at least January 1, 2028.

Our Drug Candidates and Development Programs

2 unchanged sentences

Targeted Disease(s)

Next Expected

(MASP-2 / Lectin Pathway)

Hematopoietic stem-cell transplant-associated thrombotic microangiopathy (HSCT-TMA)

Development Status

Next Expected Milestone

Narsoplimab (MASP-2 / Lectin Pathway)

Hematopoietic stem-cell transplant-associated thrombotic microangiopathy (TA-TMA)

Pivotal trial complete;

CRL received;

working with FDA on BLA resubmission

BLA resubmission

Drug Candidate/Program

Targeted Disease(s)

Next Expected

(MASP-2 / Lectin Pathway)

Immunoglobulin A Nephropathy (IgAN)

Read out data from 36-week assessment of proteinuria

(MASP-2 / Lectin Pathway)

Severe COVID-19 requiring mechanical ventilation

Continue ongoing discussions with U.S.

government agencies regarding use of narsoplimab in acute, severe COVID-19, post-acute sequelae of SARS-CoV-2 infection (PASC, i.e., long COVID) and other causes of acute respiratory distress syndrome (ARDS);

continue developing companion diagnostic for lectin pathway involvement in COVID-19

(MASP-2 / Lectin Pathway)

Narsoplimab (MASP-2 / Lectin Pathway)

Severe COVID-19, post-acute sequelae of SARS-CoV-2 infection (PASC, i.e., long COVID) and other causes of acute respiratory distress syndrome (ARDS)

Phase 2 trial in severe COVID-19 completed

Continue development of narsoplimab and diagnostic for lectin pathway hyperactivation for COVID-19/ARDS and related indications

OMS1029 (MASP-2 / Lectin Pathway)

Long-acting second-generation antibody targeting lectin pathway disorders

Submit IND and commence Phase 1 multiple-ascending-dose study

(MASP-3 / Alternative Pathway)

Phase 1 trial nearly complete (dosing completed and follow-up ongoing)

Select indication for Phase 2 development

OMS906 (MASP-3 / Alternative Pathway)

Paroxysmal nocturnal hemoglobinuria (PNH), complement 3 glomerulopathy (C3G) and other alternative pathway disorders

Read out data from Phase 1b clinical trial in PNH patients

Complete Phase 2 trials with treated patients moving to extension study of long-term efficacy and finalize dose selections;

Initiate pivotal Phase 3 clinical trials.

OMS527 (PDE7)

Addictions and compulsive disorders;

Assess data in primate study of OMS527 in levodopa-induced dyskinesias (LID);

continue discussions regarding external funding for development in addictive disorders

Opioid and nicotine addiction

Evaluate data from investigator-sponsored trial in patients with cocaine use disorder

Our pipeline of development programs consists of the following:

Drug Candidate/Program

Continue NIDA-funded research through completion of a Phase 1 cocaine interaction study and Phase 2 clinical trial in patients with cocaine use disorder;

Determine whether and how best to continue development of OMS527 in levodopa-induced dyskinesia (LID).

Our pipeline of preclinical development programs includes the following:

Preclinical Program

Targeted Disease(s)

Development Status

Next Expected

Preclinical / Platform

MASP-2 - small-

molecule inhibitors

aHUS, IgAN, HSCT-TMA and age-related macular degeneration

Identify drug development candidate for clinical trials

MASP-3 - small-

molecule inhibitors

PNH and other alternative pathway disorders

Identify drug development candidate for clinical trials

GPR174 Inhibitors and Related Therapeutics

Wide range of cancers

Next Expected Milestone

small-molecule inhibitors

Lectin pathway disorders

Continue IND-enabling studies of current drug development candidate

small-molecule inhibitors

Alternative pathway disorders

Identify drug development candidate for clinical trials

Chimeric Antigen Receptor (CAR) T-Cell and Adoptive T-Cell Therapies

Adoptive T-Cell and Chimeric Antigen Receptor (CAR) T-Cell Therapies

Wide range of cancers

Scale up and initiate clinical trials

Immunotherapeutics

Complete preclinical proof of concept studies and evaluate data

Immunomodulators/Immunotoxins/Cancer Vaccines

Wide range of cancers

Scale up and initiate clinical trials

> 50 other GPCR targets

Immuno-oncologic,

metabolic, CNS, cardiovascular, musculoskeletal & other disorders

Identify drug development candidate for clinical trials

MASP Inhibitor Clinical Programs

MASP-2 Program - Lectin Pathway Disorders

MASP-2 is a novel pro-inflammatory protein target involved in activation of the complement system, which is an important component of the immune system.

Complete preclinical proof of concept studies and evaluate data

Complement Inhibitor Programs

The complement system plays a role in the body’s inflammatory response and becomes activated as a result of tissue damage or trauma or microbial pathogen invasion.

2 unchanged sentences

classical, lectin, and alternative.

MASP-2 is recognized as the effector enzyme of the lectin pathway and is required for the function of this pathway.

Importantly, inhibition of MASP-2 has been demonstrated not to interfere with the antibody-dependent classical complement activation pathway, a critical component of the acquired immune response to infection.

Our proprietary, patented lead human monoclonal antibody targeting MASP- 2, which we have referred to as OMS721, has been assigned the nonproprietary name narsoplimab.

The current development focus for narsoplimab is diseases in which the lectin pathway has been shown to contribute to significant tissue injury and pathology.

Omeros is focused on development of therapeutics to treat diseases associated with the lectin and/or alternative pathways of complement.

MASP-2 Program - Lectin Pathway Disorders

MASP-2, a novel pro-inflammatory protein target, is the effector enzyme of the lectin pathway and is required for the function of this pathway.

Omeros is developing antibodies and small-molecule inhibitors of MASP-2 as potential therapeutics for diseases in which the lectin pathway has been shown to contribute to significant tissue injury and pathology.

When not treated, these diseases are typically characterized by significant end-organ damage, such as kidney or central nervous system injury.

We have completed our pivotal clinical trial for narsoplimab in HSCT-TMA and expect later this year to read out 36-week proteinuria data from our Phase 3 clinical program evaluating narsoplimab in IgA nephropathy.

Narsoplimab has also been evaluated for treatment of COVID-19 in a nationwide adaptive platform trial and has been used under compassionate use to treat COVID-19 patients in Italy and in the U.S.

Our MASP-2 inhibitor program also includes OMS1029, our long-acting, next-generation antibody targeting the lectin pathway.

Dosing of all cohorts in a single-ascending dose Phase 1 clinical trial of OMS1029 was successfully completed in early 2023.

OMS1029 was well tolerated with no safety concerns identified.

Preliminary PK and PD data show dose-proportional exposure and sustained lectin pathway inhibition, consistent with potentially quarterly intravenous or subcutaneous dosing.

This next-generation MASP-2 inhibitor is intended to be complementary to narsoplimab, enabling us to pursue chronic indications in which dosing convenience would be of significant benefit to patients.

We are preparing to submit an IND to initiate a multiple-ascending-dose Phase 1 study of OMS1029 in healthy subjects.

Thrombotic Microangiopathies

In October 2020, we reported final clinical data from our pivotal trial of narsoplimab in HSCT-TMA, a frequently lethal complication of HSCT.

In November 2020, we completed the rolling submission of our BLA for narsoplimab for the treatment of HSCT-TMA and FDA accepted the BLA for filing in January 2021 under its Priority Review program.

In October 2021, we received a CRL from FDA regarding the BLA.

In the CRL, the FDA review division expressed difficulty in estimating the treatment effect of narsoplimab in HSCT-TMA and asserted that additional information would be needed to support regulatory approval.

In June 2022, we appealed the issuance of the CRL through a formal dispute resolution process and requested that FDA’s Office of New Drugs (“OND”) direct the FDA review division to accept a Class 1 resubmission of the existing BLA and to commence labeling discussions with Omeros immediately thereafter.

In November 2022 we received OND’s decision denying our appeal.

Although the decision denied our request for immediate resubmission of the BLA and commencement of labeling discussions, it also proposed paths forward to resubmission based on submission of both response and survival data from our completed pivotal trial compared to an appropriate historical control group, with or without an independent literature analysis.

We have requested a meeting with the review division at FDA to confirm the additional information required to be included in the resubmission to support approval of the BLA.

In Europe, the EMA has confirmed narsoplimab’s eligibility for the EMA’s centralized review of a single MAA that, if approved, authorizes the product to be marketed in all EU member states and European Economic Area countries.

We expect to complete our MAA submission following the resubmission of our BLA to FDA.

In the U.S., FDA has granted narsoplimab (1) breakthrough therapy designation in patients who have persistent TMA despite modification of immunosuppressive therapy, (2) orphan drug designation for the prevention (inhibition) of complement-mediated TMAs, and (3) orphan drug designation for the treatment of HSCT-TMA.

In addition to our clinical programs evaluating narsoplimab, we have generated positive preclinical data from MASP-2 inhibition in in vivo models of AMD, myocardial infarction, diabetic neuropathy, stroke, ischemia-reperfusion injury, and other diseases and disorders.

We own or hold worldwide exclusive licenses to rights related to MASP-2, the antibodies targeting MASP-2 and the therapeutic applications for those antibodies.

Narsoplimab (OMS721)

The lead candidate in our MASP-2 inhibitor program is narsoplimab (OMS721), a proprietary, patented human monoclonal antibody targeting MASP-2.

Narsoplimab is in clinical development for several indications.

Hematopoietic stem-cell transplant-associated thrombotic microangiopathy (“TA-TMA”):

We successfully completed a pivotal clinical trial for narsoplimab in TA-TMA and previously submitted to the FDA a biologics license application (“BLA”) seeking marketing approval for narsoplimab in this indication.

In late 2021, FDA issued a complete response letter (“CRL”) with respect to the BLA in which the agency indicated that additional information would be needed to support regulatory approval.

We appealed FDA’s decision to issue the CRL through a formal dispute resolution process that concluded in late 2022.

Consistent with subsequent interactions with FDA’s review division, we submitted to FDA in the fall of 2023 an analysis plan to assess already existing clinical trial data, existing data from a historical control population available from an external source, data from the narsoplimab expanded access program, and data directed to the mechanism of action of narsoplimab.

We are having ongoing discussions with the agency regarding the proposed analysis plan.

As a result, we are currently unable to estimate when we will submit the BLA or, subsequently, FDA’s timing for a decision regarding approval.

There can be no guarantee that FDA's specific recommendations for resubmission will be acceptable to Omeros in terms of the time and/or expenditure required or that any resubmission of the BLA will result in approval of narsoplimab for TA-TMA.

The European Commission (the “EC”) also granted narsoplimab designation as an orphan medicinal product for treatment in hematopoietic stem cell transplantation.

We have a Phase 3 clinical program to evaluate narsoplimab in patients with aHUS.

Enrollment in this trial has been challenging and, for commercial reasons specific to the aHUS market, we have prioritized the use of resources to other clinical programs within our complement portfolio.

Currently there is one clinical site in the U.S.

that remains open for patient enrollment.

Renal Disease

Phase 3 Program - IgA Nephropathy .

In our Phase 3 clinical trial evaluating narsoplimab in IgA nephropathy, which is referred to as ARTEMIS-IGAN, we expect to read out 36-week proteinuria data later this year.

The single Phase 3 trial design is a randomized, double-blind, placebo-controlled multicenter trial in patients at least 18 years of age with biopsy-confirmed IgA nephropathy and 24-hour urine protein excretion greater than 1 g/day at baseline on optimized

renin-angiotensin system blockade.

This trial includes a run-in period.

Initially, patients are expected to receive an IV dose of study drug each week for 12 weeks;

additional weekly dosing can be administered to achieve optimal response.

The primary endpoint, which could suffice for full or accelerated approval depending on the effect size, is reduction in proteinuria at 36 weeks after the start of dosing.

The trial is designed to allow intra-trial adjustments in sample size.

The initial sample size for the proteinuria endpoint remains unchanged at 140 patients in each of the treatment and placebo groups following a blinded sample-size re-estimation.

A subset of patients with high levels of proteinuria ( i.e.

, equal to or greater than 2 g/day) at baseline, and a substantial improvement at 36 weeks could potentially form the basis for approval.

An additional sample-size re-estimation for the eGFR endpoint will take place at the time of the 36-week primary endpoint analysis to ensure that the study is adequately powered for the eGFR readout at the end of the trial.

We believe that the trial design will allow assessment for either full or accelerated approval at 36 weeks based on proteinuria results in the high-proteinuria subset of patients.

In the event of full approval, estimated glomerular filtration rate (“eGFR”) becomes a safety endpoint only.

In the event that the primary endpoint at 36 weeks results in accelerated approval from FDA, change in eGFR is expected to be assessed at approximately two years after the start of dosing.

These eGFR data, if satisfactory, would then likely form the basis for full approval, which could be in the high-proteinuria subset or the general IgAN population.

In response to investigators’ concerns about extended withholding of narsoplimab treatment from any high-proteinuria patient initially randomized to the placebo-treated group, FDA will allow patients in that sub-population open-label treatment with narsoplimab after at least 18 months of blinded treatment.

In the U.S., narsoplimab has received breakthrough therapy and orphan drug designations from FDA for the treatment of IgA nephropathy.

In Europe, narsoplimab has received orphan drug designation from the EMA in patients with IgA nephropathy.

Narsoplimab also has been administered under compassionate use to treat COVID-19 patients in Italy and in the U.S.

and was the only complement inhibitor included in the I-SPY COVID-19 trial, a nationwide, late-stage adaptive platform trial evaluating multiple agents as potential treatments for COVID-19, sponsored by Quantum Leap Healthcare Collaborative (“Quantum Leap”), in which results of the narsoplimab treatment arm were reported in September 2022.

The I-SPY COVID-19 trial was designed for rapid screening of agents that show promise for two primary endpoints in critically ill COVID-19 patients:

the time to recovery (defined as reduction in oxygen demand) and the risk of mortality.

The study utilized Quantum Leap’s adaptive platform trial design methodology, which focuses on the simultaneous, efficient assessment of multiple investigational agents.

To streamline enrollment and allow rapid assessment of multiple drugs as required during the pandemic, the platform trial’s initial design included a requirement that patients be randomized prior to consenting to trial participation.

Because such analyses are known to create a risk of bias, Quantum Leap also prespecified analyses based on all randomized patients (the industry-standard intent-to-treat population).

Substantial imbalance in the consented population was detected and created a marked and statistically significant bias against the narsoplimab arm, rendering analysis of the consented population meaningless.

Although the narsoplimab treatment arm was terminated prior to accrual of the maximum of 125 patients on the basis of analysis in the pre-consented population in which substantial bias was detected, analysis in the randomized patient population showed that the addition of narsoplimab to treatment of critically ill patients with COVID-19 reduces the mortality risk (hazard ratio [HR]=0.81, with probability [HR <1] equal to 0.77).

In Europe, the European Medicines Agency (“EMA”) has confirmed narsoplimab’s eligibility for the EMA’s centralized review of a single marketing authorization application (“MAA”) that, if approved, authorizes the product to be marketed in all EU member states and European Economic Area countries.

We expect to complete our MAA submission following the resubmission of our BLA to FDA.

COVID-19 and Acute Respiratory Distress Syndrome ( “ ARDS ” ):

There is strong and increasingly well-established evidence of the central role of the lectin pathway in COVID-19 and ARDS and we have developed both mechanistic and proof-of-concept clinical data indicating that narsoplimab may be an effective therapeutic for COVID-19, ARDS and/or related indications.

We also continue to explore the mounting evidence that MASP-2 and the lectin pathway are important drivers of post-acute sequelae SARS-CoV-2 (“PASC”), commonly known as long COVID, as well as potential approaches to identify acute COVID-19 patients at high-risk for hospitalization and mortality, to identify those PASC patients with hyperactive lectin pathway-driven disease, and to monitor response to treatment with MASP-2 inhibitors.

Narsoplimab has been administered under compassionate use to treat COVID-19 patients in Italy and in the U.S., achieving encouraging results.

Additionally, narsoplimab was the only complement inhibitor included in the I-SPY COVID-19 trial, a nationwide, late-stage adaptive platform trial sponsored by Quantum Leap Healthcare Collaborative (“Quantum Leap”), that evaluated multiple agents as potential treatments for severe COVID-19 requiring mechanical ventilation.

Results of the I-SPY COVID-19 trial were reported in September 2022.

The narsoplimab treatment arm was terminated prior to accrual of the maximum of 125 patients on the basis of analysis in a pre-consented patient population in which substantial bias was detected.

Although narsoplimab was not observed in this study to shorten the time to recovery in critically ill patients with COVID-19, analysis in the randomized patient population showed that the addition of narsoplimab to treatment of critically ill patients with COVID-19 reduces the mortality risk (hazard ratio [HR]=0.81, with probability [HR <1] equal to 0.77).

In approximately half of the patients who died in the narsoplimab group, narsoplimab was not given or was prematurely stopped, with those patients dying 9 to 35 days later.

Neither the trial’s futility nor graduation criteria had been met in the analysis of the randomized population at the time the narsoplimab arm was terminated.

Narsoplimab was not observed to shorten the time to recovery in critically ill patients with COVID-19 in this study.

The study did not identify any new safety signals for narsoplimab in the setting of critically ill COVID-19 patients.

Next steps in the development of narsoplimab for COVID-19 are dependent on the availability of government or other external funding and support.

We continue to engage in discussions with the U.S.

government regarding its preparedness strategy for the current and potential future pandemics, including anticipated future funding programs and opportunities intended to advance development of therapeutics for COVID-19 and other infectious diseases.

we are developing an assay platform to identify hyperactivation of the lectin pathway in COVID-19 and post-acute sequelae SARS-CoV-2 (PASC).

Licensing Arrangements .

We hold worldwide exclusive licenses to rights related to MASP-2, the antibodies targeting MASP-2 and the therapeutic applications for those antibodies from the University of Leicester and from Helion Biotech ApS (“Helion”).

For a more detailed description of these licenses, see “License and Development Agreements” below.

MASP-3 Program - OMS906 - Alternative Pathway Disorders

Narsoplimab demonstrated the greatest reported survival benefit of all therapeutics evaluated in the I-SPY platform trial.

We have also developed an assay platform to identify hyperactivation of the lectin pathway.

Lectin pathway hyperactivation is correlated with COVID-19-related-ARDS and may be involved in the pathogenesis of other forms of ARDS and/or PASC.

As such, the assay may be useful to identify patients who are at greatest risk of hospitalization and/or mortality as well as those who are particularly amenable to lectin pathway inhibition therapy for the treatment of one or more of these conditions.

We continue to validate the clinical correlation of lectin pathway hyperactivation with COVID-19, ARDS and PASC.

We continue to engage in discussions with potential partners as well as with representatives of the U.S.

government regarding potential opportunities to obtain funding and advance development of our potential diagnostic and/or therapeutic product candidates for COVID-19, PASC or other infectious diseases.

IgA Nephropathy :

In October 2023, we announced the results of a pre-specified interim analysis in ARTEMIS-IGAN, our Phase 3 clinical trial evaluating narsoplimab for the treatment of immunoglobulin A (“IgA”) nephropathy.

Topline results of the interim analysis showed that narsoplimab did not achieve statistical significance on the primary endpoint of reduction in proteinuria from baseline compared to placebo.

Based on the absence of statistical significance and as previously agreed with FDA, we determined not to submit an application for approval of narsoplimab in this indication and the ARTEMIS-IGAN clinical trial has been discontinued.

Our lectin pathway program also includes OMS1029, our long-acting antibody targeting MASP-2.

Dosing of all cohorts in a single-ascending dose Phase 1 clinical trial of OMS1029 was successfully completed in early 2023.

Pharmacokinetic (“PK”) and pharmacodynamic (“PD”) data show dose-proportional exposure and sustained lectin pathway inhibition, consistent with dosing of OMS1029 once quarterly, either intravenously or subcutaneously.

Dosing has also been completed in both of two planned cohorts of our ongoing Phase 1 multiple-ascending-dose study of OMS1029 in healthy volunteers and we expect the study to conclude in mid-2024.

OMS1029 has been well tolerated to date with no safety concerns identified.

We continue to evaluate several potential indications for Phase 2 clinical development for OMS1029.

MASP-3 Program - Alternative Pathway Disorders

As part of our program to develop complement-targeted therapeutics, we have identified MASP-3, which has been shown to be the key activator of the complement system’s alternative pathway (“APC”), and we believe that we are the first to make this and related discoveries associated with the APC.

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which is necessary for the activation of the APC.

Based on our alternative pathway-related discoveries, we have expanded our intellectual property position to protect our inventions stemming from these discoveries beyond MASP-2 associated inhibition of the lectin pathway to include inhibition of the APC.

We believe that MASP-3 inhibitors have the potential to treat patients suffering from a wide range of diseases and conditions including:

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myasthenia gravis and others.

Our OMS906 monoclonal antibody program has generated positive data in a well-established animal model associated with PNH as well as strong pharmacodynamic activity in non-human primates.

The program has also generated positive data in a well-established animal model of arthritis.

Clinical development of OMS906 is currently focused on rapidly obtaining proof-of-concept data in multiple APC-related disorders, including PNH and C3G.

Clinical results of a placebo-controlled, double-blind, single-center Phase 1 clinical trial evaluating the safety, tolerability, pharmacodynamics and pharmacokinetics of single-ascending intravenous (“IV”) and subcutaneous (“SC”) doses of OMS906 in healthy subjects were presented at the American Society of Hematology Annual Meeting in December 2022.

Subjects were randomized into escalating single-ascending dose cohorts that received 0.1 to 5.0 mg/kg IV and 3.0 to 8.0 mg/kg SC of either OMS906 or placebo via infusion.

Overall, 72 subjects were enrolled, and demographics were generally balanced between the dosing cohorts, and between the OMS906 versus placebo groups.

OMS906 was well tolerated at all doses tested with no safety concerns.

OMS906 displayed consistent pharmacokinetic properties with dose proportionality (with non- linearity) for both IV and SC administration.

A long half-life (geometric mean range 94–406 hours) was observed, with measurable drug concentrations detected at Day 85 for both the IV (3 and 5 mg/kg) and SC (3, 5 and 8 mg/kg) OMS906 cohorts.

The key pharmacodynamic marker for MASP-3 inhibition – mature complement factor D – showed a dose-proportional response with rapid suppression and a substantial degree of suppression of long duration in subjects receiving 3 and 5 mg/kg OMS906 IV versus placebo.

The observed pharmacokinetic and pharmacodynamic profiles showed predictable systemic exposure, evidence of high levels of alternative pathway inhibition, and a long duration of action consistent with once-monthly to once-quarterly SC or IV dosing.

In late 2022 we began enrolling in a Phase 1b clinical trial evaluating OMS906 for the treatment of PNH.

The first treatment-naïve PNH patients were dosed with OMS906 in early 2023.

We have also begun enrolling a Phase 1b clinical trial evaluating OMS906 in PNH patients who have had an unsatisfactory response to the C5 inhibitor ravulizumab.

Several of these indications have been clinically validated by other agents targeting the APC.

Our MASP-3 program has also generated positive data in a well-established animal model of arthritis.

The lead candidate in our MASP-3 inhibitor program is OMS906, a proprietary, patented human monoclonal antibody targeting MASP-3.

Clinical development of OMS906 is currently focused on rapidly advancing to Phase 3 clinical trials in multiple APC-related disorders, including PNH and C3G.

OMS906 received designation from FDA as an orphan drug for the treatment of PNH in July 2022.

Licensing Arrangements.

We jointly own and hold worldwide exclusive license rights related to therapeutic applications for inhibiting MASP-3 from the University of Leicester.

We also hold an exclusive license from Xencor, Inc.

for the application of certain antibody technology to OMS906.

For a more detailed description of these licenses, see “License and Development Agreements” below.

MASP Inhibitor Preclinical Programs

Other MASP Inhibitor Preclinical Programs

We have generated positive preclinical data from MASP-2 inhibition in in vivo models of AMD, myocardial infarction, diabetic neuropathy, stroke, ischemia-reperfusion injury, and other diseases and disorders.

Development efforts are also directed to a small-molecule inhibitor of MASP-2 designed for oral administration, as well as small-molecule inhibitors of MASP-3 and bispecific small- and large-molecule inhibitors of MASP-2/-3.

Paroxysmal nocturnal hemoglobinuria ( “ PNH ” ):

We have three ongoing Phase 2 clinical trials evaluating OMS906 for PNH.

One in PNH patients who have not previously been treated with a complement inhibitor, and the second in PNH patients who have had an unsatisfactory response to ravulizumab, an inhibitor of complement component 5 (“C5”).

The third Phase 2 clinical trial is an open-label extension study to assess the long-term efficacy and safety of OMS906 in patients who have completed either of the other two PNH Phase 2 clinical trials.

In December 2023, updated results from a pre-specified interim analysis of our ongoing Phase 2 clinical trial of OMS906 in complement-inhibitor-naïve adults with PNH were featured in a podium presentation at the annual meeting of the American Society of Hematology.

The interim analysis results showed statistically significant and clinically meaningful improvements in all measured markers of hemolysis, including hemoglobin and lactate dehydrogenase.

No patients were reported to have had a clinical breakthrough of PNH or a thrombotic event, and none were reported to require a transfusion while receiving OMS906 treatment.

Enrollment is complete and dosing is ongoing in our Phase 2 trial evaluating OMS906 in PNH patients who have had an unsatisfactory response to the C5 inhibitor ravulizumab.

Utilizing a “switch-over” design, this study enrolls PNH patients receiving ravulizumab, adds OMS906 to provide combination therapy with ravulizumab for 24 weeks, and then, in those patients who demonstrate a hemoglobin response with the combination therapy, switches to OMS906 monother apy.

Data from a pre-specified interim analysis showed that the addition of OMS906 therapy to ravulizumab treatment resulted in statistically significant and clinical meaningful improvements in both mean hemoglobin levels and absolute reticulocyte counts by week 4 of combination therapy, with a sustained response demonstrated through week 24 (the latest assessment prior to the interim analysis cutoff).

Full details from the interim analysis are expected to be presented at a major hematology conference in mid-2024.

Interim analysis data from the monotherapy portion of the trial is expected to be available in late 2024.

We have initiated an open-label extension study to assess the long-term efficacy and safety of OMS906 in patients with PNH.

In the extension study, PNH patients who have completed a previous study evaluating OMS906 roll directly into the extension study without a break in OMS906 treatment.

Data from this study will contribute to a planned BLA for O MS906 in the treatment of PNH.

Based on PK data from a successful Phase 1 single-ascending-dose study of OMS906 in healthy subjects and interim data from our ongoing clinical trials in PNH patients, we are exploring two different dosing frequencies - once every eight weeks and once every 12 weeks - for the Phase 3 studies and commercialization.

In February 2024 we met with FDA to discuss our development program for OMS906 in PNH.

We presented clinical and nonclinical data and requested input on expectations for Phase 3 studies and BLA submission.

FDA confirmed that the scope of our nonclinical program is sufficient to support Phase 3 clinical studies and provided input on dosing and design of the proposed Phase 3 program to support a BLA in PNH.

We expect to meet again with FDA later this year to discuss further details of the design of our Phase 3 studies.

Phase 3 clinical trials evaluating OMS906 in PNH are targeted to begin in late 2024.

Complement 3 glomerulopathy ( “ C3G ” ):

We also have an ongoing Phase 2 clinical program evaluating OMS906 for the treatment of C3G, a rare and debilitating renal disease driven by complement dysregulation.

Notably, the relevance of the alternative pathway to C3G has been clinically validated in a Phase 3 trial with another inhibitor of the alternative pathway that reported positive results in the treatment of C3G.

Although a protocol amendment to modify the OMS906 dose based on information learned from our PNH program delayed initiation of the study, sites are now open in multiple countries and patients are being screened for enrollment.

We are targeting to initiate Phase 3 development for C3G in the first part of 2025, after Phase 2 results are available and discussions occur with regulators.

Preclinical Complement Inhibitor Programs

We have also directed efforts to development of small-molecule inhibitors of MASP-2 and MASP-3 designed for oral administration .

In our MASP-2 small molecule inhibitor program we continue to advance testing to enable the filing of an investigational new drug application.

Our MASP-3 small-molecule inhibitor is advancing rapidly toward selection of a drug development candidate.

Other Clinical Programs

PDE7 Program - OMS527

Our PDE7 program is based on our discoveries of previously unknown links between PDE7 and any addiction or compulsive disorder, and between PDE7 and any movement disorders, such as Parkinson’s disease.

PDE7 Inhibitor Programs - OMS527

Our PDE7 inhibitor programs, which we refer to as OMS527, comprise multiple PDE7 inhibitor compounds and are based on our discoveries of previously unknown links between PDE7 and any addiction or compulsive disorder, and between PDE7 and any movement disorders.

PDE7 appears to modulate the dopaminergic system, which plays a significant role in regulating both addiction and movement.

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Data generated in preclinical studies support the use of PDE7 inhibitors in both of these therapeutic areas.

In September 2019, we reported positive results from our completed Phase 1 clinical trial designed to assess the safety, tolerability and pharmacokinetics of our lead PDE7 inhibitor in healthy subjects.

In the double blind, randomized Phase 1 study, the study drug, referred to as OMS182399, met the primary endpoints of safety and tolerability and showed a favorable and dose-proportional pharmacokinetic profile supporting once-daily dosing.

There was no apparent food effect on plasma exposure to OMS182399.

Research collaborators at Emory University are currently evaluating, in a clinically predictive primate model, the potential of our PDE7 inhibitors to improve levodopa-induced dyskinesias.

Levodopa-induced dyskinesias are crippling, involuntary movements in patients with Parkinson’s disease that are caused by prolonged treatment with levodopa, the most prescribed therapy for Parkinson’s disease.

Cocaine Use Disorder ( “ CUD ” ):

In April 2023, we were awarded a grant from the National Institute on Drug Abuse, part of the National Institutes of Health, to develop our lead orally administered PDE7 inhibitor compound, for which we have successfully completed a Phase 1 study, for the treatment of CUD.

The grant amount, a total of $6.69 million over three years, is intended to support preclinical cocaine interaction/toxicology studies to assess safety of the therapeutic candidate in the presence of concomitant cocaine administration, as well as an in-patient, placebo-controlled clinical study evaluating the safety and effectiveness of OMS527 in adults with CUD who receive concurrent intravenous cocaine.

The preclinical study is intended to provide the toxicology data necessary to support the human study of OMS527 in CUD.

That study is underway and is expected to be completed in late 2024.

Levodopa-induced dyskinesia ( “ LID ” ):

With investigators at Emory University, we are also evaluating OMS527 as a potential treatment for LID, which are involuntary and often crippling movements in patients with Parkinson’s disease that are caused by prolonged treatment with levodopa, the most prescribed therapy for Parkinson’s disease.

More than 10 million patients are living with Parkinson’s disease worldwide.

Reportedly 50 percent or more of levodopa-treated patients with Parkinson’s disease suffer from LID.

Additionally, we are engaged in discussions with third parties regarding external funding for development of our PDE7 inhibitors as a treatment for addictive disorders.

Exclusive License Agreement with Daiichi Sankyo Co., Ltd.

We hold an exclusive license to certain PDE7 inhibitors claimed in patents and pending patent applications owned by Daiichi Sankyo Co., Ltd.

(“Daiichi Sankyo”), as successor-in-interest to Asubio Pharma Co., Ltd., or, for use in the treatment of movement, addiction and compulsive disorders as well as other specified indications.

(“Daiichi Sankyo”), as successor-in-interest to Asubio Pharma Co., Ltd.

for use in the treatment of movement, addiction and compulsive disorders as well as other specified indications.

For a more detailed description of our agreement with Daiichi Sankyo, see “License and Development Agreements” below.

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Data from clinical studies and from animal models of addiction suggest that PPARγ agonists could be efficacious in the treatment of a wide range of addictions.

Clinical trials.

Our collaborators at The New York State Psychiatric Institute have completed two Phase 2 clinical trials related to our PPARγ program.

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The National Institute on Drug Abuse (“NIDA”) provided substantially all of the funding for these clinical trials and solely oversaw the conduct of these trials.

We have the right or expect to be able to reference the data obtained from these studies for subsequent submissions to FDA and continue to retain all other rights in connection with the PPARγ program.

We have the right or expect to be able to reference the data obtained from these studies for any future FDA submission and continue to retain all other rights in connection with the PPARγ program.

We have also reported positive results ( i.e.

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The study is funded by NIDA.

Patent Assignment Agreement with Roberto Ciccocioppo, Ph.D.

We acquired the patent applications and related intellectual property rights for our PPARγ program in February 2009 from Roberto Ciccocioppo, Ph.D., of the Università di Camerino, Italy, pursuant to a patent assignment agreement.

For a more detailed description of our agreement with Dr.

Ciccocioppo, see “License and Development Agreements” below.

We own patents, patent applications and other intellectual property rights related to our PPARγ program, as described under “Intellectual Property” below.

Preclinical Programs and Platforms

GPCR Platform and GPR174

We have developed a proprietary cellular redistribution assay which we use in a high-throughput manner to identify synthetic ligands, including antagonists, agonists and inverse agonists, that bind to and affect the function of orphan GPCRs.

We have screened Class A orphan GPCRs against our small-molecule chemical libraries using the cellular redistribution assay and have identified and confirmed compounds that interact with 54 of the 81 Class A orphan GPCRs linked to a wide range of indications including cancer as well as metabolic, cardiovascular, immunologic, inflammatory and central nervous system disorders.

One of our priorities in this program is GPR174, which is involved in the modulation of the immune system.

In ex vivo human studies, our small-molecule inhibitors targeting GPR174 upregulate the production of cytokines, block multiple checkpoints and tumor promoters, and suppress regulatory T cells.

Based on our data, we believe that GPR174 controls a major, previously unrecognized pathway in cancer and modulation of the receptor could provide a seminal advance in immuno-oncologic treatments for a wide range of tumors.

Our studies in mouse models of melanoma and colon carcinoma found that GPR174-deficiency resulted in significantly reduced tumor growth and improved survival of the animals versus normal mice.

Our discoveries suggest a new approach to cancer immunotherapy that targets inhibition of GPR174 and can be combined with and significantly improve the tumor-killing effects of other oncologic agents, including radiation, adenosine pathway inhibitors and checkpoint inhibitors.

These discoveries include (1) identification of cancer-immunity pathways controlled by GPR174, (2) the identification of phosphatidylserine as a natural ligand for GPR174, (3) a collection of novel small-molecule inhibitors of GPR174 and (4) a synergistic enhancement of “tumor-fighting” cytokine production by T cells following the combined inhibition of both GPR174 and the adenosine pathway, another key metabolic pathway that regulates tumor immunity.

We are developing, and are considering advancing to clinical trials, inhibitors of GPR174 and of the pathways affected by this receptor and/or adenosine receptors.

GPCR Platform Funding Agreements with Vulcan Inc.

and the Life Sciences Discovery Fund.

In October 2010, we entered into funding agreements for our GPCR program with Vulcan Inc.

and its affiliate, which we refer to collectively as Vulcan, and with the Life Sciences Discovery Fund Authority (“LSDF”), a granting agency of the State of Washington.

For a more detailed description of these agreements, see “License and Development Agreements” below.

Immuno-Oncology Platform

We are advancing preclinical research on potential molecular and cellular therapies for cancer.

On the molecular front, we have developed novel biologic platforms to target cancer cells specifically and kill them directly or indirectly through the potentiation of the immune system.

Our novel molecules combine tumor antigens with a potent adjuvant and show high levels of killing in cancer cells.

We believe that some of these molecules could function as therapeutic vaccines against a broad range of tumors, potentially transforming treatment of both solid tumors and hematologic cancers.

On the cellular front, we are evaluating novel approaches for both CAR T and adoptive T cell therapies.

We have identified specific T cell signaling pathways, which, once inhibited, significantly and preferentially enhance the expansion of memory T cells that distinctively recognize and efficiently kill tumor cells.

We continue to develop and validate our novel approach, which we believe could improve response rates for patients receiving either engineered or native T cell therapies for liquid or solid tumors.

We have five immuno-oncology (I-O) platforms in preclinical development – adoptive T-cell therapy, CART-T, signaling-driven immunomodulators, antigen-driven immunomodulators that function both as therapeutics and vaccines, and oncotoxins.

To date, in vitro, ex vivo and animal studies using human cellular components have been positive with high response rates.

These data collectively reinforce the scientific basis for each platform, confirming our rationale for their design and development.

The data from our studies to date have demonstrated a number of potential advantages of our immuno-oncology franchise over other I-O approaches.

Our I-O franchise should be applicable to cancers broadly.

Rather than targeting only cell-surface antigens, our I-O franchise is designed to target both cell-surface and intracellular cancer targets, significantly broadening the range of indications.

Unlike other therapeutic approaches that affect either CD4 or CD8 levels, we have designed and demonstrated the ability of our technologies to increase levels of both CD4 and CD8 cells against a given cancer, both of which are necessary to kill tumor cells.

By increasing both the CD4 and CD8 cells, we should also be able to mitigate the “treatment exhaustion” – or the wearing-off of the treatment effect – seen with many currently available therapies.

This would allow repeated treatment, providing a sustained and better anti-tumor response.

Our cellular platforms do not require modification or engineering.

Instead, cells from the patient are simply treated outside the body and administered back to the patient.

We expect this simplicity in process, if achieved, to represent a major advance over currently available T-cell therapies, greatly decreasing both preparation time and cost.

When injected into the body, our novel biologic molecules should result not only in elimination of tumor cells but, importantly, in immune memory against future cancer relapse.

Our core technology is also amenable potentially to cancer prevention broadly.

We believe that all five platforms are entirely novel and proprietary.

We continue to confirm our results and to generate new data, all of which contribute to our intellectual property position.

Sales and Marketing

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We currently do not own or operate manufacturing facilities.

We utilized contract manufacturers to produce, store and distribute OMIDRIA and currently rely on third parties to produce sufficient quantities of our drug candidates for use in pre-clinical and clinical studies and for the manufacture of narsoplimab for commercial use following regulatory approval.

We assigned or otherwise transitioned to Rayner our agreements with the third parties that produced, stored and distributed OMIDRIA.

We required manufacturers that produced active pharmaceutical ingredients (“API s”) and finished drug products to operate in accordance with current Good Manufacturing Practices (“cGMPs”) and all other applicable laws and regulations.

We required manufacturers that produced active pharmaceutical ingredients (“APIs”) and finished drug products to operate in accordance with current Good Manufacturing Practices (“cGMPs”) and all other applicable laws and regulations.

In the U.S., we sold OMIDRIA through a limited number of wholesalers that distributed the product to ASCs and hospitals.

Title transferred upon delivery of OMIDRIA to the wholesaler.

For additional information, see Part II, Item 8, “Note 3—Discontinued Operations” to our Consolidated Financial Statements in this Annual Report on Form 10-K.

For additional information, see Part II, Item 8, “ Note 7 – Discontinued Operations – Sale of OMIDRIA ” to our Consolidated Financial Statements in this Annual Report on Form 10-K.

Drug Candidates .

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We utilize contract manufacturers to produce sufficient quantities of drug candidates for use in preclinical and clinical studies and to store and distribute our drug candidates.

We require manufacturers that produce APIs and finished drug products for clinical use to operate in accordance with cGMPs and all other applicable laws and regulations.

We require manufacturers that produce bulk drug substance and finished drug products for clinical use to operate in accordance with cGMPs and all other applicable laws and regulations.

We anticipate that we will rely on contract manufacturers to develop and manufacture our drug candidates for commercial sale.

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(“Lonza”) for the commercial production of narsoplimab and for certain regulatory support and related services to be provided by Lonza from time to time.

Under the agreement Lonza will manufacture narsoplimab pursuant to purchase orders issued in accordance with forecasts that we provide.

Under the agreement Lonza will manufacture narsoplimab pursuant to purchase orders issued in accordance with certain forecast and confirmation procedures specified in the contract.

We will purchase narsoplimab that meets agreed specifications in batches, with the price per batch varying according to the total number of batches ordered for serial production in a single manufacturing campaign.

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Other than our agreement for commercial supply of narsoplimab, we have not yet entered into a commercial supply agreement for any of our drug candidates.

If approved for commercial sale in the U.S., we expect to utilize one or more wholesalers for distribution of narsoplimab.

License and Development Agreements

MASP Program .

Under our exclusive license agreement with the University of Leicester, we have agreed to pay royalties to the University of Leicester that are a percentage of any proceeds we receive from the licensed MASP-2 technology during the term of the agreement.

The agreement also applies to other MASPs and continued maintenance of the agreement requires us to undertake development activities.

We must pay low single-digit percentage royalties with respect to proceeds that we receive from products incorporating certain intellectual property within the licensed technology that are used, manufactured, directly sold or directly distributed by us, and we must pay royalties, in the range of a low single-digit percentage to a low double-digit percentage, with respect to proceeds we receive from sublicense royalties or fees that we receive from third parties to which we grant sublicenses to certain intellectual property within the licensed technology.

We did not make any upfront payments for the exclusive license, nor are there any milestone payments or reversion rights associated with the license agreement.

We retain a worldwide exclusive license from the University of Leicester to develop and commercialize any intellectual property rights developed in the sponsored research.

The term of the agreement ends when there are no longer any pending patent applications, applications in preparation or unexpired issued patents related to any of the intellectual property rights we are licensing under the agreement.

The license agreement may be terminated prior to the end of its term by us for convenience or by one party if the other party (1) breaches any material obligation under the agreement and does not cure such breach after notice and an opportunity to cure or (2) is declared or adjudged to be insolvent, bankrupt or in receivership and materially limited from performing its obligations under the agreement.

In April 2010, we entered into an exclusive license agreement with Helion, pursuant to which we received a royalty-bearing, worldwide exclusive license to all of Helion’s intellectual property rights related to MASP-2 antibodies, polypeptides and methods in the field of inhibition of mannan-binding lectin-mediated activation of the complement system for the prevention, treatment or diagnosis of any disease or condition.

We are obligated to make remaining development and sales milestone payments to Helion of up to approximately $5.4 million upon the achievement of certain events, such as receipt of marketing approval, and reaching specified sales milestones.

We are obligated to pay Helion a low single-digit percentage royalty on net sales of a MASP-2 inhibitor product covered by the patents licensed under the agreement.

The term of the agreement continues so long as there is a valid, subsisting and enforceable claim in any patents or patent applications covered by the agreement.

The agreement may be terminated sooner by either party following a material breach of the agreement by the other party that has not been cured within 90 days.

In August 2020, we entered into a technology license agreement with Xencor, Inc., pursuant to which we received an exclusive license to apply Xencor’s Xtend Fc technology to OMS906 and options to access exclusive licenses to apply Xtend Fc technology to additional antibodies (the “Xencor Agreement”).

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With respect to each antibody for which we license the Xencor technology we are obligated to make milestone payments of up to $65.0 million, comprised of $15.0 million in development milestones, $25.0 million in regulatory milestones and $25.0 million in sales milestones.

We are obligated on a product-by-product and country-by-country basis to pay Xencor royalties in the mid-single digit

percentage range on net sales of any product covered by the license so long as there is a valid, subsisting and enforceable claim in any patents or patent applications covering the licensed technology.

In August 2023, we paid $5.0 million to Xencor in connection with the achievement of a development milestone in our OMS906 program.

We are obligated on a product-by-product and country-by-country basis to pay Xencor royalties in the mid-single digit percentage range on net sales of any product covered by the license so long as there is a valid, subsisting and enforceable claim in any patents or patent applications covering the licensed technology.

Thereafter, the royalty rate is reduced to the low single-digit percentage range, if the applicable licensed product is covered by Xencor know-how, or to zero, if the applicable licensed product is not covered by Xencor know-how.

The term of the Xencor Agreement continues on a product-by-product basis until the later of (i) expiration for the last-to-expire patent covering the licensed technology or (ii) five years from the date of first commercial sale of the applicable product.

We acquired the patent applications and related intellectual property rights for our PPARγ program in February 2009 from Roberto Ciccocioppo, Ph.D.

of the Università di Camerino, Italy, pursuant to a patent assignment agreement.

In February 2011, we amended the agreement to include all intellectual property rights, including patent applications, related to nutraceuticals that increase PPARγ activity.

Under the amended agreement, we have agreed to pay Dr.

Ciccocioppo a low-single digit percentage royalty on net sales of any products that are covered by any patents that issue from the patent applications that we acquired from him.

In addition, if we grant any third parties rights to manufacture, sell or distribute any such products, we must pay to Dr.

Ciccocioppo a percentage of any associated fees we receive from such third parties in the range of low single-digits to low double-digits depending on the stage of development at which such rights are granted.

We have also agreed to make total milestone payments of up to $3.8 million to Dr.

Ciccocioppo upon the occurrence of certain development events, such as patient enrollment in a Phase 1 clinical trial and receipt of marketing approval of a drug candidate covered by any patents that issue from the patent applications that we acquired from him.

If we notify Dr.

Ciccocioppo that we have abandoned all research and development and commercialization efforts related to the patent applications and intellectual property rights we acquired from him, Dr.

Ciccocioppo has the right to repurchase those assets from us at a price equal to a double-digit percentage of our direct and indirect financial investments and expenditures in such assets.

If he does not exercise his right to repurchase those assets within a limited period of time by paying the purchase price, we will have no further obligations to sell those assets to Dr.

The term of our agreement with Dr.

Ciccocioppo ends when there are no longer any valid and enforceable patents related to the intellectual property rights we acquired from him, provided that either party may terminate the agreement earlier in case of an uncured breach by the other party.

Under the terms of the agreement, we have agreed to pay a portion of the payments due to Dr.

Ciccocioppo to the Università di Camerino without any increase to our payment obligations.

Under an agreement with Daiichi Sankyo, we hold an exclusive worldwide license to PDE7 inhibitors claimed in certain patents and pending patent applications owned by Daiichi Sankyo for use in the treatment of (1) movement disorders and other specified indications, (2) addiction and compulsive disorders and (3) all other diseases except those related to dermatologic conditions.

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Daiichi Sankyo also has the right to terminate the agreement if we and our sublicensee(s) cease to conduct all research, development and/or commercialization activities for a PDE7 inhibitor covered by the agreement for a period of six consecutive months, in which case all rights held by us under Daiichi Sankyo’s patents will revert to Daiichi Sankyo.

GPCR Platform Funding Agreements with Vulcan Inc.

and the Life Sciences Discovery Fund.

In October 2010, we entered into funding agreements for our GPCR program with Vulcan and LSDF.

Under these agreements, we have

agreed to pay Vulcan and LSDF tiered percentages of the net proceeds, if any, that we derive from the GPCR program.

The percentage rates of net proceeds payable to Vulcan and LSDF decrease as the cumulative net proceeds reach specified thresholds, and the blended percentage rate payable to Vulcan and LSDF in the aggregate is in the mid-teens with respect to the first approximately $1.5 billion of cumulative net proceeds that we receive from our GPCR program.

If we receive cumulative net proceeds in excess of approximately $1.5 billion, the percentage rate payable to Vulcan and LSDF in the aggregate decreases to one percent.

An acquirer of the assets in our GPCR program may be required, and an acquirer of our company would be required, to assume all of our payment and other obligations under our agreements with Vulcan and LSDF.

Under our agreement with Vulcan, we granted Vulcan a security interest in our personal property related to the GPCR program, other than intellectual property, which security interest is junior to any existing or future security interests granted in connection with a financing transaction and which will be released automatically after Vulcan receives $25.0 million under the agreement.

We also agreed not to grant any liens on intellectual property related to the GPCR program without Vulcan’s consent, subject to specified exceptions.

These restrictions could limit our ability to pursue business opportunities involving the GPCR program or reduce the price that a potential buyer would pay for the GPCR assets.

If we default under our agreement with Vulcan, in certain circumstances Vulcan may, subject to the rights of any holders of senior security interests, take control of such pledged assets.

If we are liquidated, Vulcan’s right to receive any payments then due under our agreement would be senior to the rights of the holders of our common stock to receive any proceeds from the liquidation of our GPCR program assets.

The term of our agreement with Vulcan is 35 years, provided that the term will automatically extend until the cumulative net proceeds that we receive from the GPCR program are approximately $1.5 billion.

The term of our agreement with LSDF expires on the six-month anniversary following the last date that we deliver a report related to our incurrence of grant-funded expenses described in the agreement, provided that certain obligations will survive the expiration of the term.

The term of our payment obligations to LSDF is the same as that under our agreement with Vulcan.

The pharmaceutical and biotechnology industry is highly competitive and characterized by a number of established, large pharmaceutical and biotechnology companies as well as smaller companies like ours.

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We expect to compete for market share against large pharmaceutical and biotechnology companies, smaller companies that are collaborating with larger pharmaceutical companies, new companies, academic institutions, government agencies and other public and private research organizations.

In addition, the pharmaceutical and

biotechnology industry is characterized by rapid technological change.

In addition, the pharmaceutical and biotechnology industry is characterized by rapid technological change.

Because our research approach integrates many technologies, it may be difficult for us to remain current with the rapid changes in each technology.

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There are a number of complement-targeted therapeutics that are in advanced stages of clinical development, or which have been approved for commercial use.

These include Soliris ® (eculizumab), Ultomiris ® (ravulizumab-cwvz), Empaveli ® (pegcetacoplan), Tavneos ® (avocopan) and iptacopan.

We are aware of other companies attempting to de-orphanize orphan GPCRs.

If any of these companies is able to de-orphanize an orphan GPCR before we unlock this receptor, we may be unable to establish an exclusive or commercially valuable intellectual property position around that orphan GPCR.

These include Soliris® (eculizumab), Ultomiris® (ravulizumab-cwvz), Empaveli® (pegcetacoplan), Tavneos® (avocopan) and Fabhalta® (iptacopan).

Narsoplimab, OMS1029 and/or OMS906 will face competition from one or more of these products if approved for any indication(s) for which one or more of these potentially competitive products are also approved or for which a potentially competitive product is used off-label to treat a relevant condition.

Intellectual Property

We have retained control of all worldwide manufacturing, marketing and distribution rights for each of our drug candidates and programs.

Some of our drug candidates and programs are based on inventions and other intellectual property rights that we acquired through assignments, exclusive licenses or acquisitions described in further detail under “License and Development Agreements” below.

As of February 15, 2024, we owned or held worldwide exclusive licenses to a total of 78 issued patents and 60 pending patent applications in the U.S.

and 1,285 issued patents and 595 pending patent applications in foreign markets directed to therapeutic compositions and methods related to our research and development programs.

and 1,334 issued patents and 580 pending patent applications in foreign markets directed to therapeutic compositions and methods and other technologies related to our research and development programs.

For each program, our decision to seek patent protection in specific foreign markets, in addition to the U.S., is based on many factors, including one or more of the following:

our available resources, the size of the commercial market, the presence of a potential competitor or a contract manufacturer in the market and whether the legal authorities in the market effectively enforce patent rights.

● MASP-2 Program - Narsoplimab (OMS721).

We hold worldwide exclusive licenses to rights in connection with MASP-2, the antibodies targeting MASP-2 and the therapeutic applications for those antibodies from the University of Leicester, MRC and Helion.

As of February 15, 2023, we exclusively controlled 31 issued patents and 34 pending patent applications in the U.S., and 694 issued patents and 438 pending patent applications in foreign markets, related to our MASP-2 program.

Our MASP-2 and narsoplimab patents have terms that will expire as late as 2038 and, if currently pending patent applications are issued, as late as 2043.

● MASP-2 Program - Narsoplimab (OMS721) and OMS1029.

We own and hold worldwide exclusive licenses to rights in connection with MASP-2, antibodies targeting MASP-2, small-molecule MASP-2 inhibitors, and related therapeutic applications.

As of February 15, 2024, we exclusively controlled 38 issued patents and 32 pending patent applications in the U.S., and 793 issued patents and 435 pending patent applications in foreign markets, related to our MASP-2 program, including narsoplimab and our second-generation MASP-2 antibody OMS1029.

Our MASP-2-related patents have terms that will expire as late as 2038 and, if currently pending patent applications are issued, as late as 2043.

● MASP-3 Program - OMS906 .

We own and exclusively control under a license from the University of Leicester all rights to methods of treating various disorders and diseases by inhibiting MASP-3.

As of February 15, 2023, we exclusively controlled three issued patents and seven pending patent applications in the U.S.

We own and exclusively control rights in connection with MASP-3, antibodies targeting MASP-3 and related therapeutic applications.

We also hold an exclusive license from Xencor, Inc.

for the application of certain antibody technology to OMS906, as well as the option to obtain additional licenses to such technology for exclusive application to additional antibodies that we may select.

As of February 15, 2024, we exclusively controlled four issued patents and eight pending patent applications in the U.S.

and 188 issued and 104 pending patent applications in foreign markets that are related to our MASP-3 program.

Our MASP-3-related patents have terms that will expire as late as 2037 and, if currently pending patent applications are issued, as late as 2043.

● PPAR γ Program - OMS405 .

As of February 15, 2023, we owned three issued patents and one pending patent application in the U.S., and 37 issued patents and 6 pending patent applications in foreign markets, directed to our discoveries linking PPARγ and addictive disorders.

As of February 15, 2024, we owned three issued patents and one pending patent application in the U.S., and 37 issued patents and two pending patent applications in foreign markets, directed to our discoveries linking PPARγ and addictive disorders.

Our PPARγ-related patents have terms that will expire as late as 2030.

● PDE7 Program - OMS527 .

As of February 15, 2023, we owned two issued patents and one pending patent application in the U.S., and 61 issued patents and two pending patent applications in foreign markets directed to our discoveries linking PDE7 to movement disorders, as well as three issued patent and two pending patent applications in the U.S., and 53 issued patents and 8 pending patent applications in foreign markets directed to the link between PDE7 and addiction and compulsive disorders.

Additionally, under a license from Daiichi

Sankyo, we exclusively control rights to three issued U.S.

As of February 15, 2024, we owned two issued patents and two pending patent application in the U.S., and 61 issued patents and two pending patent applications in foreign markets directed to our discoveries linking PDE7 to movement disorders, as well as three issued patent and two pending patent applications in the U.S., and 54 issued patents and three pending patent applications in foreign markets directed to the link between PDE7 and addiction and compulsive disorders.

Additionally, under a license from Daiichi Sankyo, we exclusively control rights to two issued U.S.

patents and 53 issued patents in foreign markets that are directed to proprietary PDE7 inhibitors.

Our PDE7-related patents have terms that will expire as late as 2031 and, if currently pending patent applications are issued, as late as 2043.

For a more detailed description of our agreement with Daiichi Sankyo, see “License and Development Agreements” below.

● GPCR Platform and Immuno-oncology Program.

As of February 15, 2023, we owned six issued patents and 13 pending patent applications in the U.S., and 57 issued patents and 26 pending patent applications in foreign markets, which are directed to previously unknown links between specific molecular targets in the brain and a series of CNS disorders, to potential cancer therapies, to our CRA and to other research tools that are used in our GPCR program, and to orphan GPCRs and other GPCRs for which we have identified functionally interacting compounds using our CRA.

Two of the pending patent applications in the U.S.

and 24 of the pending patent applications in foreign markets are directed to GPR174.

Three of the pending patent applications in the U.S.

and two pending applications in foreign markets are directed to potential cancer therapies.

● Immuno-oncology Program.

O ur Immuno-oncology program includes five proprietary platforms relating to potential therapies for cancer.

As of February 15, 2024, we owned two pending patent applications in foreign markets directed to potential cancer therapies.

All of our employees enter into our standard employee proprietary information and inventions agreement, which includes confidentiality provisions and provides us ownership of all inventions and other intellectual property made by our employees that pertain to our business or that relate to our employees’ work for us or that result from the use of our resources.

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Failure to comply with applicable requirements, both before and after receipt of regulatory approval, may subject us, our third-party manufacturers, and other partners to administrative and judicial sanctions, such as warning letters, product recalls, product seizures, a delay in approving or refusal to approve pending applications, civil and other monetary penalties, total or partial suspension of production or distribution, injunctions, and/or criminal prosecutions.

In the U.S., our drug candidates are regulated by FDA as drugs or biologics under the FDCA and implementing regulations and under the Public Health Service Act (“PHSA”).

In the U.S., our drug candidates are regulated by FDA as drugs or biologics under the Federal Food, Drug, and Cosmetic Act (“FDCA”) and implementing regulations and under the Public Health Service Act (“PHSA”).

In the EU, our drug candidates are regulated by the EMA and national medicines regulators under the rules governing medicinal products in the EU as well as national regulations in individual countries.

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Clinical trials involve the administration of the investigational product to human subjects under the supervision of qualified personnel and must be conducted in accordance with local regulations and GCPs.

Clinical trials

are conducted under protocols detailing, for example, the parameters to be used in monitoring patient safety and the efficacy criteria, or endpoints, to be evaluated.

Clinical trials are conducted under protocols detailing, for example, the parameters to be used in monitoring patient safety and the efficacy criteria, or endpoints, to be evaluated.

Each trial must be reviewed and approved by an independent institutional review board or ethics committee for each clinical site at which the trial will be conducted before it can begin.

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The FDA may refer the NDA or BLA to an advisory committee for review and recommendation as to whether the application should be approved and under what conditions.

The FDA is not bound by the recommendation of an advisory

committee, but it generally follows such recommendation.

The FDA is not bound by the recommendation of an advisory committee, but it generally follows such recommendation.

In addition, even if a drug candidate satisfied its endpoints with statistical significance during clinical trials, FDA could determine that the overall balance of risks and benefits for the drug candidate is not adequate to support approval, or only justifies approval for a narrow set of clinical uses and/or subject to restricted distribution or other burdensome post-approval requirements or limitations.

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Accelerated Approval .

The FDA may grant accelerated approval to a product for a serious or life-threatening condition that provides a meaningful therapeutic advantage to patients over existing treatments based upon a

determination that the product has an effect on a surrogate endpoint that is reasonably likely to predict clinical benefit.

The FDA may grant accelerated approval to a product for a serious or life-threatening condition that provides a meaningful therapeutic advantage to patients over existing treatments based upon a determination that the product has an effect on a surrogate endpoint that is reasonably likely to predict clinical benefit.

The FDA may also grant accelerated approval for such a condition when the product has an effect on an intermediate clinical endpoint that can be measured earlier than an effect on irreversible morbidity or mortality and that is reasonably likely to predict an effect on irreversible morbidity or mortality or other clinical benefit.

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Pursuant to new statutory authority under the Food and Drug Omnibus Reform Act of 2022, FDA can require confirmatory studies to be underway at the time of the accelerated approval.

If the required confirmatory studies fail to verify the clinical benefit of the drug, or if the applicant fails to perform the required confirmatory studies with due diligence, FDA may withdraw approval of the drug under streamlined procedures in accordance with the Agency’s regulations.

The Agency may also withdraw approval of a drug if, among other things, other evidence demonstrates that the drug product is not shown to be safe or effective under its conditions of use.

FDA may also withdraw approval of a drug if, among other things, other evidence demonstrates that the drug product is not shown to be safe or effective under its conditions of use.

The EU also has accelerated approval programs.

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For products and transactions falling within DSCSA’s scope, manufacturers are required to verify that purchasers of the manufacturers’ products are appropriately licensed.

Further, under the DSCSA, covered manufacturers have drug product investigation, quarantine, disposition, and notification responsibilities for product that is reasonably believed or that credible evidence shows to be counterfeit, diverted, stolen, intentionally adulterated such that the product would result in serious adverse health consequences or death, the subject of fraudulent transactions or otherwise unfit for distribution such that they would be reasonably likely

to result in serious health consequences or death.

Anti-counterfeiting and serialization requirements similar to those under the DSCSA have also been adopted in the EU and became effective in February 2019.

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Upon approval of a drug, each of the patents listed in the application for the drug is then published in FDA’s Approved Drug Products with Therapeutic Equivalence Evaluations, commonly known as the Orange Book.

Drugs listed in the Orange Book can, in turn, be cited by potential competitors in support of approval of an ANDA or a 505(b)(2) application.

Drugs listed in the Orange Book can, in turn, be cited by potential competitors in support of approval of an Abbreviated New Drug Application (“ANDA”) or a 505(b)(2) application.

In this case the original NDA, i.e., the pioneer drug, is known as the “listed” drug or “reference-listed” drug.

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If the ANDA or 505(b)(2) applicant does not include a Paragraph IV certification, the ANDA or 505(b)(2) application will not be approved until all of the listed patents claiming the referenced drug have expired, except for any listed patents that only apply to uses of the drug not being sought by the ANDA or 505(b)(2) applicant.

If the ANDA or 505(b)(2) applicant has made a Paragraph IV certification, the applicant must also send notice of a Paragraph IV Notice Letter to the NDA and patent holders once the ANDA or 505(b)(2) application has been accepted for filing by FDA.

The NDA and patent holders may then initiate a patent infringement lawsuit in response to the notice of the Paragraph IV Notice Letter.

The filing of a patent infringement lawsuit within 45 days of the receipt of notice of a Paragraph IV Notice Letter automatically prevents FDA from approving the ANDA until the earlier of 30 months, expiration of the patent, settlement of the lawsuit, modification by a court or a decision in the infringement case that is favorable to the ANDA or 505(b)(2) applicant.

If the ANDA or 505(b)(2) applicant has made a Paragraph IV certification, the applicant must also send a Paragraph IV Notice Letter to the NDA and patent holders once the ANDA or 505(b)(2) application has been accepted for filing by FDA.

The NDA and patent holders may then initiate a patent infringement lawsuit in response to the Paragraph IV Notice Letter.

The filing of a patent infringement lawsuit within 45 days of the receipt of a Paragraph IV Notice Letter automatically prevents FDA from approving the ANDA until the earlier of 30 months, expiration of the patent, settlement of the lawsuit, modification by a court or a decision in the infringement case that is favorable to the ANDA or 505(b)(2) applicant.

The ANDA or 505(b)(2) application also will not be approved until any applicable non-patent exclusivity, such as exclusivity for obtaining approval of a new chemical entity, listed in the Orange Book for the reference-listed drug has expired.

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During those three years of exclusivity, FDA cannot grant approval of an ANDA or 505(b)(2) application for the protected dosage form, route of administration or combination, or use of that listed drug.

In December 2019, a piece of legislation referred to as the Creating and Restoring Equal Access to Equivalent Samples Act of 2019 (“CREATES Act”) was signed into law, which is intended to address the concern that some brand manufacturers have improperly denied generic and biosimilar product developers access to samples of brand products.

In December 2019, the Creating and Restoring Equal Access to Equivalent Samples Act of 2019 (“CREATES Act”) was signed into law.

The legislation is intended to address the concern that some brand manufacturers have improperly denied generic and biosimilar product developers access to samples of brand products.

The CREATES Act establishes a private cause of action that permits a generic or biosimilar product developer to sue the brand manufacturer to compel it to furnish the necessary samples on commercially reasonable, market-based terms.

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For example, the 2010 Affordable Care Act (the “ACA”), is intended to broaden access to health insurance, reduce or constrain the growth of healthcare spending, enhance remedies against fraud and abuse, add transparency requirements for the healthcare and health insurance industries, impose new taxes and fees on the health industry and impose additional health policy reforms.

Other legislative changes included a two percent across-the-board reduction to Medicare payments to providers, effective April 1, 2013, which, due to subsequent legislative amendments, will begin to increase gradually starting in April 2030, reaching 4 percent in April 2031 and continuing until the reduction ends in October 2031, unless additional

congressional action is taken.

The American Taxpayer Relief Act of 2012, among other things, reduced Medicare payments to several providers, and increased the period for the government to recover overpayments to providers from three to five years.

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We operate cross-functionally and are led by an experienced management team.

We use rigorous project management techniques to make disciplined strategic decisions regarding our research and development programs and to limit the risk profile of our product pipeline.

We strive to make disciplined strategic decisions regarding our research and development programs and to limit the risk profile of our product pipeline.

We also access relevant market information and key opinion leaders in creating target product profiles and, when appropriate, as we advance our programs to commercialization.

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however, we are not substantially dependent on any third parties for our preclinical research nor do any of these third parties conduct a major portion of our preclinical research.

We also engage multiple clinical sites to conduct our clinical trials.

None of these sites conduct the major portion of our clinical trials and we are not substantially dependent on any one of them.

We also engage multiple clinical sites to conduct our clinical trials and rely on third-party contract research organizations (“CROs”) to coordinate and execute aspects of clinical trial operations.

None of these CROs or clinical sites are responsible for the major portion of our clinical trials and we are not substantially dependent on any one of them.

As of December 31, 2023, we had 198 full-time employees, 132 of whom are in research and development, 19 of whom are in sales and marketing and 47 of whom are in finance, legal, business development and administration.

Our full-time employees include five with M.Ds and 36 with Ph.Ds., of whom four and 36, respectively, are in research and development.

Our full-time employees include six with M.Ds and 40 with Ph.Ds., of whom five and 39, respectively, are in research and development.

None of our employees are represented by a labor union, and we consider our employee relations to be good.

Information about Our Executive Officers and Significant Employees

The following table provides information regarding our executive officers and significant employees as of March 13, 2023:

The following table provides information regarding our executive officers and significant employees as of April 1, 2024:

Executive Officers:

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Significant Employees:

Vice President, Chief Business Development Officer

Vice President, Chief Commercial Officer

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Vice President, Science and Chief Scientific Officer

Andreas Grauer, M.D.

Vice President, Chief Medical Officer

Vice President, Regulatory Affairs & Quality Systems and Chief Regulatory Officer

Tina Quinton, J.D., M.S.

Vice President, Patents

Steven Whitaker, M.D., J.D.

Vice President, Chief Medical Officer

Vice President, Clinical Development

Vice President, Human Resources

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has served as our vice president, general counsel and secretary since June 2019.

He joined Omeros as deputy general counsel, corporate governance and securities in January 2019.

He joined Omeros as deputy general counsel in January 2019.

Prior to joining Omeros, Mr.

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from Saint Michael’s College.

Bowes, MBEE has served as our chief business development officer since September 2022.

Bowes brings over 30 years of industry experience in corporate and product strategic planning, global licensing and business development.

Prior to joining Omeros, Ms.

Bowes served as a fractional executive for several small biotechnology companies through Chevy Chase BioPartners, LLC, periodically between 2006 to 2022.

From 2016 to 2019 she served as the chief business officer for the CARMA cell therapy drug development division of Maxcyte, Inc., a provider of cell-engineering platform technologies.

From 2011 to 2013 Ms.

Bowes served as the vice president of licensing and commercial strategy for CBLI Pharma, an orphan disorder company.

From 2003 to 2006 she served as MedImmune’s senior director of strategic planning, overseeing corporate and new product planning.

Prior to MedImmune, Ms.

Bowes held several roles of increasing responsibility for Amylin, Agouron/Pfizer, Centocor/Johnson & Johnson and Hybritech/Eli Lilly & Company.

She holds a Masters in Biotechnology Enterprise and Entrepreneurship (MBEE) from Johns Hopkins University, a B.S.

in biology from the University of Cincinnati and a medical technology certification from the American Society of Clinical Pathologists.

Nadia Dac has served as our chief commercial officer since January 2021.

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from the Aristotelian University of Greece.

Andreas Grauer, M.D.

has served as our chief medical officer since October 2023.

Prior to joining Omeros, Dr.

Grauer served as chief medical officer at Federation Bio from October 2021, where he led all clinical activities with a focus on hyperoxaluria and immuno-oncology.

From March 2019 to August 2021, Dr.

Grauer was chief medical officer of Corcept Therapeutics, Inc., leading its global development organization in the design and execution of clinical programs directed to oncology, neurology, endocrinology, and metabolism indications.

From December 2007 to December 2018, Dr.

Grauer held several roles of increasing responsibility at Amgen, most recently serving as vice president of global development, therapeutic area head, and co-chair of the franchise steering committee for bone, nephrology and inflammation.

Earlier in his career, Dr.

Grauer was at Proctor and Gamble Pharmaceuticals where he held roles as global executive medical director for bone and for new technology development.

Grauer received his M.D.

from the University of Heidelberg Medical School in Germany, where he also completed his clinical training in internal medicine and endocrinology.

He did research in molecular and cellular endocrinology both there and during a post-doctoral fellowship at Baylor College of Medicine.

He holds an active associate professorship of medicine at the University of Heidelberg Medical School.

has served as our vice president, regulatory affairs and quality systems since October 2012 and has served as our chief regulatory officer since April 2016.

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Prior to joining Eli Lilly, Dr.

Melfi held various faculty and research positions at Indiana

University, including appointments in its Economics Department, in the School of Public and Environmental Affairs, and in the Indiana University School of Medicine.

Melfi held various faculty and research positions at Indiana University, including appointments in its Economics Department, in the School of Public and Environmental Affairs, and in the Indiana University School of Medicine.

Melfi received her Ph.D.

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in Economics from John Carroll University.

Tina Quinton, J.D., M.S.

has served as our vice president, patents, since June 2019 and previously served as our deputy general counsel, patents from August 2017 to June 2019 and as associate general counsel, patents from 2012 to 2017.

Prior to joining Omeros, Ms.

Quinton was a partner with the firm Christensen O'Connor Johnson & Kindness, PLLC, where she represented clients in the biotechnology and medical sciences industries in all aspects of worldwide patent procurement and enforcement.

Before Christensen O'Connor Johnson & Kindness, Ms.

Quinton was a research scientist at several biotechnology companies and centers, including ZymoGenetics, Targeted Genetics Corporation and Fred Hutchinson Cancer Research Center.

Quinton received her J.D.

in Molecular and Cellular Biology from the University of Washington and her B.S.

from Gordon College.

Steven Whitaker, M.D., J.D.

has served as our vice president, clinical development since joining Omeros in 2010, and served as our chief medical officer from March 2010 to August 2018 and since November 2019.

has served as our vice president, clinical development since joining Omeros in 2010, and served as our chief medical officer from March 2010 to August 2018 and from November 2019 to October 2023.

From May 2008 to March 2010, Dr.

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The SEC maintains a website that contains reports, proxy and information statements, and other information regarding reports that we file or furnish electronically with them at www.sec.gov.

SUMMARY RISK FACTORS

The risk factors described below are a summary of the principal risk factors associated with an investment in our company.

These are not the only risks we face.

You should carefully consider the risk factors discussed in this summary, as well as the risk factors described in Item 1A.

of this Annual Report on Form 10-K.

Risks related to our drug candidates, programs and operations include, but are not limited to, the following:

● the magnitude and duration of future royalties paid to us based on net sales by Rayner of OMIDRIA, which are dependent on Rayner’s ability to successfully market and sell OMIDRIA;

● lack of adequate coverage or reimbursement from government and/or private payers for OMIDRIA or any of our drug candidates that we commercialize in the future;

● whether any of our drug candidates will successfully complete clinical development or be suitable for successful commercialization or generation of revenue;

● failure to obtain and maintain regulatory approval for marketing of future commercial products in the U.S.

or in foreign jurisdictions;

● lack of internal manufacturing capacity and reliance on third parties to manufacture, finish, store and ship supplies of our drug candidates for clinical and, after approval, commercial use;

● inability to acquire ingredients, excipients, test kits and other materials to manufacture our drug candidates on commercially reasonable terms;

● delays, suspensions or terminations of our clinical trials or clinical protocols;

● failure to capitalize on drug candidates or indications;

● unpredictability of our operating results;

● inability to raise capital when needed;

● any failure to comply with current or future government regulations;

● substantial costs as a result of commercial disputes, claims, litigation or other legal proceedings;

● inability to protect our intellectual property and proprietary technologies;

● our indebtedness and liabilities, which could limit the cash flow available for our operations;

● competition with companies with more resources and experience;

● reliance on members of our management team and our ability to recruit and retain key personnel;

● reliance on third parties to conduct portions of our preclinical research and clinical trials.

General risks related to our business include the following:

● cyber-attacks or failures in telecommunications or other information technology systems;

● volatility of our stock price;

● dilution to our existing shareholders if we issue additional shares of our common stock or other securities that may be convertible into, or exercisable for, our common stock;

● the impact of anti-takeover provisions in our charter documents and under Washington law on potential acquisitions of our company.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business