Omeros Corporation Q1 FY2026 earnings call

Commercial Launch of Yartemlia

• Yartemlia received FDA approval to become the first and only approved treatment for TA-TMA and the first approved lectin pathway complement inhibitor, launching in mid-January 2026 with first sales recorded in Q1.
• Early launch execution is ahead of plan: the full commercial field force is deployed across all 175 U.S. transplant centers, with 30 unique centers having ordered Yartemlia by quarter end. P&T committee approvals are proceeding faster than the typical 6-9 month timeline: 60% of the top 10, 40% of the top 20, 38% of the top 40, and 30% of the top 80 U.S. centers have already secured approval.
• All prior authorization requests to commercial payers have been approved to date, and all centers have received full payment. A permanent J-code for billing was assigned by CMS, effective July 1 2026, which simplifies reimbursement and reduces administrative burden.
• CMS proposed approval of the New Technology Add-On Payment (NTAP) for Yartemlia in its 2026 inpatient rule; the final rule is expected in August, with NTAP effective October 1 2026, providing additional payments to hospitals for this high-cost innovative therapy.
• Early anecdotal clinician feedback is uniformly positive, and adoption is seen across both adult and pediatric patients, with pediatric requests exceeding the baseline 15% population share for TA-TMA to date. Yartemlia achieved cash flow positivity in Q1 2026 despite its mid-quarter launch.

Corporate Strategic Update

• Omeros closed its Zoltenebar (lead MAST3 inhibitor) transaction with Novo Nordisk, receiving $240 million in upfront non-dilutive capital and becoming eligible for up to $100 million in additional near-term milestones. The total deal value is up to $2.1 billion in upfront and milestone payments, plus high single-digit to high teen royalties.

Pipeline Development Progress

• MASP2 Inhibitor Franchise: A marketing authorization application for Yartemlia in TA-TMA is under review by the EMA, with a decision expected mid-year 2026. Omeros is evaluating ex-U.S. commercialization partnerships. The company is assessing label expansion for Yartemlia into additional lectin pathway-related indications including ARDS, sickle cell disease, acute kidney injury, solid organ transplant-related TMA, and delayed graft function. OMS1029, a long-acting phase 2-ready MASP2 antibody for chronic indications, is completing initial phase 2 indication selection, and an oral small molecule MASP2 program is advancing to IND-enabling studies.
• PD7 Inhibitor Program (OMS527): The program for cocaine use disorder is fully funded by a NIDA grant. After completing preclinical animal studies, Omeros met with the FDA to address requests for additional non-clinical data, and is on track to initiate the planned inpatient human study by the end of 2026. OMS527 has potential utility across a range of addictions and compulsive disorders.
• TCAT Platform: This novel anti-pathogen platform targeting multi-drug resistant organisms (MDROs) recently received podium presentation at ECCMID, and its foundational technology manuscript was accepted for publication in Science Translational Medicine. TCAT kills pathogens regardless of existing resistance profiles without promoting new resistance.
• Oncatox Oncology Platform (Oncatox AML): The lead program for acute myeloid leukemia (AML) has demonstrated superior efficacy to standard of care in preclinical studies, including across hard-to-treat AML mutations such as TP53 and FLT3. A non-human primate study showed a 99% targeted reduction in high-risk myeloid progenitor cells with strong safety profile. IND-enabling studies are underway, with a first-in-human trial targeted for late 2027.

Omeros currently only has one commercial product segment: Yartemlia for the treatment of hematopoietic stem cell transplant-associated thrombotic microangiopathy (TA-TMA). In Q1 2026, Yartemlia generated 100% of the company's product revenue, with gross revenues of $11.1 million and net revenues of $9.9 million after an 11% gross-to-net adjustment. All other development programs remain in pre-commercial stages, so they do not contribute current revenue. For overall corporate results, GAAP net income was $56.1 million ($0.78 per diluted share), which includes a $73.1 million non-cash mark-to-market gain on embedded derivatives for 2029 convertible notes. Adjusted for this non-cash item, non-GAAP net loss from continuing operations was $17.1 million ($0.24 per diluted share). Total operating costs and expenses from continuing operations before interest and other income were $27.3 million, a $1.8 million decrease from Q4 2025. As of March 31, 2026, Omeros held $135.3 million in cash and investments. The company repurchased 360,000 common shares for a total of $4.2 million in Q1 2026.

• Omeros expects overall operating expenses from continuing operations in Q2 2026 to be slightly higher than Q1 2026, driven by increased sales and marketing expenses to support Yartemlia's commercial launch and infrastructure buildout.
• The company is not providing Yartemlia revenue guidance at this early launch stage, while market access and physician adoption are still developing and cannot be estimated with sufficient accuracy.
• Interest and other income is expected to be higher in Q2 2026 than in Q1 2026. Interest expense is projected to be approximately $7.1 million, excluding potential non-cash adjustments related to the Amidria royalty obligation.
• Income from discontinued operations is expected to be in the $5 million to $6 million range for Q2 2026, excluding non-cash remeasurement adjustments for the Amidria contract royalty asset.
• Reported GAAP results will continue to include volatile non-cash mark-to-market adjustments for the embedded derivative tied to 2029 convertible notes, driven primarily by changes in Omeros' share price.
• Management expects the large majority of top U.S. transplant centers to complete P&T committee approval for Yartemlia within the next few months.
• Management expects Yartemlia will drive company-wide positive cash flow within 18 months of launch.

• Forward-looking statements (including launch adoption, regulatory timelines, clinical trial initiation, and cash flow projections) are subject to risks and uncertainties that could cause actual results to differ materially from current expectations. Detailed risk factors are disclosed in Omeros' recent 10-Q and 10-K filings with the SEC.
• Quarterly GAAP results will continue to face significant volatility from non-cash mark-to-market adjustments on the embedded derivative tied to 2029 convertible notes, which are driven by changes in Omeros' share price and other market inputs. These adjustments do not impact operating performance or liquidity but can distort reported quarterly net income.
• Revenue and adoption projections for Yartemlia remain uncertain at this early launch stage, as market penetration, payer coverage, and physician adoption are still developing.
• Clinical development programs carry inherent risk: regulatory requirements may delay or prevent initiation of clinical trials (as seen with the OMS527 request for additional non-clinical data), and preclinical results do not guarantee successful clinical or regulatory outcomes.
• Gross-to-net adjustments for Yartemlia are expected to increase over time as 340B governmental program participation grows, which could reduce net revenue relative to current levels if discounts increase more than expected.

Q: What is the delivery timeline for Yartemlia after a clinician request, what adoption has been seen across adult vs pediatric patients, how many facilities have placed orders, and what clinician feedback has been received?

A: Distributors deliver Yartemlia to hospital sites within 24 hours of receiving a request. Through the first two months of launch, pediatric patient requests make up a larger share of total orders than the baseline 15% TA-TMA population split, showing rapid adoption even among traditionally conservative pediatric prescribers. 30 unique accounts had ordered by March 31, including 6 of the top 10 U.S. transplant centers and 24 of the top 80 centers. Anecdotal clinician feedback has been uniformly positive, with early results described as impressive.

Q: How much inventory is held by distributors, how many patients are on Yartemlia as of Q1 end, and what is Omeros' view of AstraZeneca's competing Phase 3 TMA study?

A: Average distributor inventory is only 1-1.5 weeks of supply, given the fast 24-hour delivery model, so inventory levels do not materially distort reported sales. Omeros cannot report a specific patient count because centers do not share patient-level data, though the total number of treated patients is larger than the number of ordering accounts. AstraZeneca changed their Phase 3 primary endpoint from response to event-free survival after an earlier pediatric trial yielded a low 17% response rate, and the trial is expected to enroll less severe patients than those currently treated with Yartemlia. Recent published data also links competing C5 inhibition to higher infection and infection-related mortality rates, which aligns with Yartemlia's differentiated safety profile.

Q: What efforts is Omeros undertaking to drive earlier TA-TMA intervention, and will NTAP approval facilitate earlier treatment?

A: Management is prioritizing clinician education to increase awareness of TA-TMA and the benefits of earlier intervention, since clinical data shows earlier treatment improves patient outcomes. There is already growing clinician interest in earlier Yartemlia use, after many early Q1 patients were treatment-resistant eculizumab failures that still responded well to Yartemlia. NTAP will increase Medicare reimbursement for Yartemlia in the inpatient setting, where early treatment typically occurs, so management expects NTAP will reduce access friction and support more earlier intervention.

Q: Can you disclose Q1 vial volume, what is the expected future trend for gross-to-net adjustments, when will most P&T approvals be completed, and what impact will J-code and NTAP have on uptake?

A: Omeros does not disclose vial count, only provided gross and net revenue figures. Q1 gross-to-net adjustments of 11% consist only of 340B chargebacks and distributor fees; no discounts or product returns. Gross-to-net is expected to rise slightly as 340B participation grows, but management expects it to remain in the teens, with no plans to discount the drug. Most top transplant centers are expected to complete P&T approvals within the next few months, with approvals already running well ahead of the typical timeline. The July 1 J-code will streamline billing and reimbursement, and NTAP will further standardize and improve reimbursement, which management expects to drive additional utilization uptake beyond the already stronger-than-expected early adoption.