Omeros(US:OMER)2025-08-14 20:09Part I — Financial Information This section presents the company's financial statements, MD&A, market risk disclosures, and controls and procedures Item 1. Financial Statements A $58.9 million net loss for H1 2025, with decreasing assets and shareholders' deficit, prompts a going concern warning Condensed Consolidated Financial Statements Unaudited financial statements show decreased cash, a $58.9 million net loss, and negative operational cash flow Condensed Consolidated Balance Sheets (in thousands) | | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total current assets | $69,647 | $134,120 | | Total assets | $200,569 | $277,079 | | Total current liabilities | $85,503 | $79,526 | | Total liabilities | $429,254 | $459,688 | | Total shareholders' deficit | ($228,685) | ($182,609) | Condensed Consolidated Statements of Operations (in thousands) | | Three Months Ended June 30, | Six Months Ended June 30, | | :--- | :--- | :--- | | | 2025 | 2024 | 2025 | 2024 | | Total costs and expenses | $32,354 | $59,157 | $67,323 | $98,191 | | Loss from operations | ($32,354) | ($59,157) | ($67,323) | ($98,191) | | Net loss from continuing operations | ($25,889) | ($65,125) | ($63,455) | ($108,975) | | Net income from discontinued operations | $465 | $9,084 | $4,571 | $15,750 | | Net loss | ($25,424) | ($56,041) | ($58,884) | ($93,225) | | Net loss per share | ($0.43) | ($0.97) | ($1.01) | ($1.60) | Condensed Consolidated Statements of Cash Flows (in thousands) | | Six Months Ended June 30, | | :--- | :--- | :--- | | | 2025 | 2024 | | Net cash used in operating activities | ($57,779) | ($87,765) | | Net cash provided by investing activities | $59,838 | $11,225 | | Net cash provided by (used in) financing activities | ($3,555) | $71,555 | | Net decrease in cash and cash equivalents | ($1,496) | ($4,985) | Notes to Condensed Consolidated Financial Statements Notes detail liquidity issues, going concern, narsoplimab BLA resubmission, debt restructuring, capital raising, and discontinued operations accounting - The company's need to raise additional capital raises substantial doubt about its ability to continue as a going concern; financial statements do not include adjustments related to this uncertainty4950 - The Biologics License Application (BLA) for narsoplimab in TA-TMA was resubmitted to the FDA in March 2025, with the PDUFA target action date extended to December 26, 2025; a Marketing Authorization Application (MAA) was submitted to the EMA in June 2025, with an opinion expected in mid-20262829 - In May 2025, the company restructured its debt by exchanging $70.8 million of its 2026 Notes for new 2029 Notes and converting an additional $10.0 million of 2026 Notes into common stock, reducing the aggregate principal of the 2026 Notes from $97.9 million to $17.1 million4143116 - The company raised $6.4 million through its at-the-market (ATM) facility in the first six months of 2025 and an additional $20.6 million through a registered direct offering in July 20254547149 - The sale of OMIDRIA is accounted for as a discontinued operation; as of June 30, 2025, the company reported an OMIDRIA contract royalty asset of $143.0 million and a related OMIDRIA royalty obligation of $197.7 million6089136 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations MD&A details clinical programs, reduced R&D expenses, liquidity, debt restructuring, and capital raising, reiterating going concern doubts Overview Omeros, a clinical-stage biopharmaceutical company, focuses on immunologic diseases with narsoplimab (TA-TMA BLA) and zaltenibart (PNH, Phase 3 paused) - The BLA for narsoplimab in TA-TMA has a PDUFA target action date of December 26, 2025, following an extension by the FDA160 - Phase 3 clinical development for zaltenibart in PNH has been temporarily paused to prioritize the use of available capital167 - The PDE7 inhibitor program (OMS527) for cocaine use disorder is supported by a NIDA grant, with a clinical study targeted for the first part of 2026168 Results of Operations Financial results show a significant 36% reduction in R&D expenses for the six-month period, with decreased SG&A and interest expenses Research and Development Expenses (in thousands) | | Six Months Ended June 30, | | :--- | :--- | :--- | | | 2025 | 2024 | | MASP-3 program - OMS906 (zaltenibart) | $12,355 | $13,426 | | MASP-2 program - OMS721 (narsoplimab) | $6,055 | $28,688 | | Total research and development expenses | $45,855 | $72,119 | - For the six months ended June 30, 2025, R&D expenses decreased by $26.3 million compared to the prior year, mainly due to a $22.6 million reduction in costs for the narsoplimab program and lower manufacturing expenses for zaltenibart192193 - SG&A expenses decreased by $4.6 million (18%) for the six months ended June 30, 2025, compared to the prior year, primarily due to capitalizing debt issuance costs and reduced consulting fees198 - Total interest expense decreased by $13.8 million for the six months ended June 30, 2025, primarily due to a $13.7 million favorable non-cash remeasurement on the OMIDRIA royalty obligation and lower interest on the reduced 2026 Notes balance201204 Financial Condition – Liquidity and Capital Resources The company held $28.7 million in cash and investments as of June 30, 2025, facing going concern doubts, while pursuing a potential licensing deal - Cash, cash equivalents, and short-term investments were $28.7 million at June 30, 2025, with cash used in operations totaling $57.8 million for the first six months of the year212 - The company is in discussions for a potential licensing agreement with a multi-billion total transaction value; if closed, the upfront payment is expected to repay its Term Loan and provide sufficient capital for more than 12 months of operations, though no assurance can be given that the transaction will be consummated216 - The company's financial condition and need to raise additional capital raise substantial doubt about its ability to continue as a going concern219 Item 3. Quantitative and Qualitative Disclosures About Market Risk Market risk stems from investment securities and debt instruments, with investment risk managed and debt risk involving fixed/variable-rate loans - Investment risk is considered low as funds are held in high-credit quality, short-term securities like money market funds and U.S. treasury bills233 - The company has exposure to interest rate changes through its Term Loan, which bears interest based on the adjusted SOFR235 - The 2029 Notes contain an embedded derivative that is marked to fair value each period, exposing the company to gains or losses based on changes in stock price, volatility, and interest rates234 Item 4. Controls and Procedures Management concluded disclosure controls were effective as of June 30, 2025, with no material changes to internal control over financial reporting - Disclosure controls and procedures were deemed effective as of June 30, 2025236 - There were no material changes in internal control over financial reporting during the quarter237 Part II — Other Information This section provides disclosures on legal proceedings, risk factors, equity sales, defaults, mine safety, insider trading, and exhibits Item 1. Legal Proceedings The company was not involved in any material legal proceedings as of the filing date of this Form 10-Q - As of the filing date, the company was not involved in any material legal proceedings239 Item 1A. Risk Factors Investors are directed to comprehensive risk factors in the 2024 Annual Report on Form 10-K, which could impact stock price - Investors are directed to the Risk Factors section of the company's 2024 Annual Report on Form 10-K for a comprehensive discussion of risks240 Other Items (Items 2, 3, 4, 5, 6) This section addresses standard disclosures, noting several items as not applicable, no new insider trading plans, and listing filed exhibits - Items 2 (Unregistered Sales of Equity Securities), 3 (Defaults Upon Senior Securities), and 4 (Mine Safety Disclosures) are not applicable241242243 - No directors or Section 16 reporting officers adopted or terminated a Rule 10b5-1 trading plan during the three months ended June 30, 2025244 - Item 6 lists exhibits filed with the 10-Q, including debt agreements and officer certifications245