x
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Washington
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91-1663741
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification Number)
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201 Elliott Avenue West
Seattle, Washington
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98119
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(Address of principal executive offices)
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(Zip Code)
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Common Stock, $0.01 par value per share
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The Nasdaq Stock Market LLC
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(Title of each class)
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(Name of each exchange on which registered)
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Large accelerated filer
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x
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Accelerated filer
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¨
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Non-accelerated filer
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¨
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Smaller reporting company
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¨
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Emerging growth company
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¨
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•
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our expectations related to demand for OMIDRIA
®
(phenylephrine and ketorolac intraocular solution) 1%/0.3% from wholesalers, ambulatory surgery centers, or ASCs, and hospitals, and our expectations regarding OMIDRIA product sales;
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•
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our plans for marketing and distribution of OMIDRIA and our estimates of OMIDRIA chargebacks and rebates, distribution fees and product returns;
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our estimates regarding how long our existing cash, cash equivalents, short-term investments and revenues will be sufficient to fund our anticipated operating expenses, capital expenditures and debt service obligations;
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our expectations related to obtaining a permanent separate or similar reimbursement for OMIDRIA from the Centers for Medicare and Medicaid Services, or CMS, particularly for periods after September 30, 2020;
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•
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our expectations regarding the clinical, therapeutic and competitive benefits of OMIDRIA and our product candidates;
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•
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our ability to design, initiate and/or successfully complete clinical trials and other studies for our products and product candidates and our plans and expectations regarding our ongoing or planned clinical trials, including for our lead MASP-2 inhibitor, narsoplimab (also referred to as OMS721), and for OMS527 and OMS906;
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•
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in our narsoplimab clinical programs, our expectations regarding: whether enrollment in any or all ongoing and planned Phase 3 and Phase 2 clinical trials will proceed as expected; whether we can capitalize on the financial and regulatory incentives provided by orphan drug designations granted by the U.S. Food and Drug Administration, or FDA, the European Commission, or EC, or the European Medicines Agency, or EMA; and whether we can capitalize on the financial and regulatory incentives provided by fast-track and/or breakthrough therapy designations granted by FDA;
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•
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our expectations regarding clinical plans and anticipated or potential paths to regulatory approval of narsoplimab by FDA and/or EMA in hematopoietic stem cell transplant-associated thrombotic microangiopathy (HSCT-TMA), Immunoglobulin A (IgA) nephropathy, and/or atypical hemolytic uremic syndrome (aHUS);
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•
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whether and when a Biologics License Application, or BLA, may be filed with FDA for narsoplimab in any indication and whether FDA will grant accelerated or regular (full) approval for narsoplimab in any indication;
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•
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whether and when a marketing authorization application, or MAA, may be filed with EMA for narsoplimab in any indication, and whether EMA will grant approval for narsoplimab in any indication;
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•
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our anticipation that we will rely on contract manufacturers to manufacture OMIDRIA for commercial sale and to manufacture our product candidates for purposes of clinical supply and in anticipation of potential commercialization;
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our ability to enter into acceptable arrangements with potential corporate partners or contract service providers, including with respect to OMIDRIA or our product candidates, and our ability and plans to effect any such arrangement with respect to OMIDRIA in the European Union, or EU, or in other foreign countries;
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•
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our ability to raise additional capital through the capital markets or through one or more corporate partnerships, equity offerings, debt financings, collaborations, licensing arrangements or asset sales;
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•
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our expectations about the commercial competition that OMIDRIA and our product candidates, if commercialized, face or may face;
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•
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the expected course and costs of existing claims, legal proceedings and administrative actions, our involvement in potential claims, legal proceedings and administrative actions, and the merits, potential outcomes and effects of both existing and potential claims, legal proceedings and administrative actions, as well as regulatory determinations, on our business, prospects, financial condition and results of operations;
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•
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the extent of protection that our patents provide and that our pending patent applications will provide, if patents are issued from such applications, for our technologies, programs, products and product candidates;
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the factors on which we base our estimates for accounting purposes and our expectations regarding the effect of changes in accounting guidance or standards on our operating results; and
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our expected financial position, performance, revenues, growth, costs and expenses, magnitude of net losses and the availability of resources.
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Page
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ITEM 1.
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BUSINESS
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•
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various purchase volume-discount programs for OMIDRIA;
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agreements to enable discounts on qualifying purchases of OMIDRIA by certain U.S. government purchasers and other eligible entities (
e.g.
, 340B-eligible hospitals and clinics); and
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•
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the OMIDRIAssure
®
Reimbursement Services Program, or OMIDRIAssure.
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Product Candidate/Program
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Targeted Disease(s)
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Development Status
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Next Expected
Milestone
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Worldwide
Rights
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Clinical
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Narsoplimab (OMS721/MASP-2) - Lectin Pathway Disorders
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Hematopoietic Stem-Cell Transplant-Associated Thrombotic Microangiopathy (HSCT-TMA)
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Phase 3
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Preparation and Submission of Biologics License Application (BLA) and Marketing Authorization Application (MAA)
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Omeros
(In-licensed)
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Narsoplimab (OMS721/MASP-2) - Lectin Pathway Disorders
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Immunoglobulin A Nephropathy (IgAN)
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Phase 3
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Complete Phase 3 Patient Enrollment or Perform 36-Week Assessment of Proteinuria
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Omeros
(In-licensed)
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Narsoplimab (OMS721/MASP-2) - Lectin Pathway Disorders
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Atypical Hemolytic Uremic Syndrome (aHUS)
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Phase 3
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Complete Phase 3 Patient Enrollment
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Omeros
(In-licensed)
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Narsoplimab (OMS721/MASP-2) - Lectin Pathway Disorders
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Lupus Nephritis and Other Renal Diseases
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Phase 2
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Review Data; Determine Whether to Initiate Phase 3 Program
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Omeros
(In-licensed)
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PDE10 (OMS824) - Central Nervous System (CNS) Disorders
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Huntington’s Disease; Schizophrenia
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Phase 2
(1)
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Internal Review of Compounds and Indications
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Omeros
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PPARγ (OMS405) - Addiction
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Opioid and Nicotine Addiction
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Phase 2
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Further Refine Development Path
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Omeros
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PDE7 (OMS527)
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Addictions and Compulsive Disorders; Movement
Disorders
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Phase 1
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Complete Phase 1 Trial and Evaluate Data
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Omeros (Compounds In-licensed)
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(1)
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No clinical trials for OMS824 are ongoing. Plans for continuation of the OMS824 program will be based on internal ongoing work and discussions with the FDA. Clinical trials in our Huntington’s program are authorized by the FDA to progress subject to dosing limitations. In light of these dosing limitations, we are currently focused on assessing the relative advantages of a number of our back-up compounds and potential indications. We are not authorized by the FDA to conduct further clinical trials in our schizophrenia program until we submit a study protocol to the FDA for review. For additional information, see “Other Clinical Programs-
PDE10 Programs-OMS824 for Huntington’s Disease and Schizophrenia
” below.
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Product Candidate/Program
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Targeted Disease(s)
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Development Status
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Next Expected
Milestone
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Worldwide
Rights
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Preclinical / Platform
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MASP-3 (OMS906) - Alternative Pathway Disorders
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Paroxysmal Nocturnal Hemoglobinuria (PNH) and Other Alternative Pathway Disorders
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Preclinical
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Complete Manufacturing Scale-up of the Clinical Candidate for IND-Enabling Toxicology Studies
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Omeros
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MASP-2 - Small-Molecule Inhibitors
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aHUS, IgAN, HSCT-TMA and Age-Related Macular Degeneration (AMD)
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Preclinical
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Optimize Compounds
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Omeros
(In-Licensed)
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MASP-3 - Small-Molecule Inhibitors
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PNH and Other Alternative Pathway Disorders
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Preclinical
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Continue Medicinal Chemistry and Advance Co-Crystallization Efforts
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Omeros
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GPCR Platform, including GPR174, GPR151, GPR161, and other Class A Orphan GPCRs
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Immunologic,
Immuno-oncologic,
Metabolic, CNS, Cardiovascular (CV), Musculoskeletal & Other Disorders
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Preclinical
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Continue Drug Discovery and Selected Medicinal Chemistry for Class A Orphan, Class B Orphan and Non-Orphan GPCRs
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Omeros
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Antibody Platform
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Metabolic, CV, Oncologic, Musculoskeletal & Other Disorders
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Preclinical
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Continue Developing Antibodies Targeting Lectin and Alternative Pathway of Complement System and Expanding Antibody Library
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Omeros
(In-licensed)
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•
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develop and market products that are less expensive, more effective or safer than our future products;
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•
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commercialize competing products before we can launch our products;
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•
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operate larger research and development programs, possess greater manufacturing capabilities or have substantially greater financial resources than we do;
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•
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initiate or withstand substantial price competition more successfully than we can;
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•
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have greater success in recruiting skilled technical and scientific workers from the limited pool of available talent;
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•
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more effectively negotiate third-party licenses and strategic relationships; and
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•
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take advantage of acquisition or other opportunities more readily than we can.
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•
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OMIDRIA-Ophthalmology.
OMIDRIA is encompassed by our PharmacoSurgery patent portfolio. The relevant patents and patent applications in this portfolio are directed to combinations of agents, generic and/or proprietary to us or to others, drawn from therapeutic classes such as pain and inflammation inhibitory agents, mydriatic agents and agents that reduce intraocular pressure, delivered locally and intraoperatively to the site of ophthalmological procedures, including cataract and lens replacement surgery. As of February 12, 2019, we owned eight issued U.S. patents and three pending U.S. patent applications and 60 issued patents and 54 pending patent applications in foreign markets that are directed to OMIDRIA. Our OMIDRIA patents have terms that will expire as late as October 23, 2033 and, if currently pending patent applications are issued, as late as November 30, 2035.
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•
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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 12, 2019, we exclusively controlled 20 issued patents and 33 pending patent applications in the U.S., and 314 issued patents and 246 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 2032 and, if currently pending patent applications are issued, as late as 2039.
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•
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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 12, 2019, we exclusively controlled three pending patent applications in the U.S. and 48 issued and 85 pending patent applications in foreign markets that are related to our MASP-3 program.
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•
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PDE10 Program - OMS824.
As of February 12, 2019, we owned 14 issued patents and two pending patent applications in the U.S., and 44 issued patents and 40 pending patent applications in foreign markets, that are directed to proprietary PDE10 inhibitors.
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•
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PPARγ Program - OMS405
. As of February 12, 2019, we owned two issued patents and one pending patent application in the U.S., and 29 issued patents and 10 pending patent applications in foreign markets, directed to our discoveries linking PPARγ and addictive disorders.
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•
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PDE7 Program - OMS527
. As of February 12, 2019, we owned two issued patents and one pending patent application in the U.S., and 59 issued patents and six pending patent applications in foreign markets directed to our discoveries linking PDE7 to movement disorders, as well as one issued patent and two pending patent applications in the U.S., and 44 issued patents and 18 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. patents and 54 issued and four pending patent applications in foreign markets that are directed to proprietary PDE7 inhibitors. For a more detailed description of our agreement with Daiichi Sankyo, see “License and Development Agreements” below.
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•
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OMS103-Arthroscopy.
As of February 12, 2019, we owned three issued U.S. patents and one pending U.S. patent application, together with 36 issued patents and eight pending patent applications in foreign markets that are directed to OMS103. Our OMS103 patents have terms that will expire as late as September 24, 2022 and, if currently pending patent applications are issued, as late as 2032. We are not actively pursuing development of OMS103 at this time.
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•
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GPCR Platform.
As of February 12, 2019, we owned six issued patents and 13 pending patent applications in the U.S., and 55 issued patents and one pending patent application in foreign markets, which are directed to previously unknown links between specific molecular targets in the brain and a series of CNS disorders, to our cellular redistribution assay 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 cellular redistribution assay.
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•
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Antibody Platform
. As of February 12, 2019, we owned and/or held worldwide exclusive license rights from the UW to eight issued patents and one pending patent application in the U.S., and 21 issued patents and eight pending patent applications in foreign markets, directed to our antibody platform and antibodies generated using our platform.
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•
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formulation development and manufacturing process development;
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•
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preclinical laboratory and animal testing;
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•
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submission to the FDA of an Investigational New Drug application, or IND, for human clinical testing, which must become effective before human clinical trials may begin; and in countries outside the U.S., a Clinical Trial Application, or CTA, is filed according to the country’s local regulations;
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•
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adequate and well-controlled human clinical trials to establish the efficacy and safety of the product for each indication for which approval is sought;
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•
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adequate assessment of drug product stability to determine shelf life/expiry dating;
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•
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in Europe, submission to the EMA or national regulatory authority of a marketing authorization application, or MAA, and in the U.S., submission to the FDA of a New Drug Application, or NDA, in the case of a drug product, or a BLA in the case of a biologic product;
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•
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satisfactory completion of inspections of one or more clinical sites at which clinical trials with the product were carried out and of the manufacturing facility or facilities at which the product is produced to assess compliance with Good Clinical Practices, or GCP, and current good manufacturing practices, or cGMP; and
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•
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FDA review and approval of an NDA or BLA, or review and approval of an MAA by the applicable regulatory authorities in the EU.
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•
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Phase 1 usually involves the initial administration of the investigational product to human subjects, who may or may not have the disease or condition for which the product is being developed, to evaluate the safety, dosage tolerance, pharmacodynamics and, if possible, to gain an early indication of the effectiveness of the product.
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•
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Phase 2 usually involves trials in a limited patient population with the disease or condition for which the product is being developed to evaluate appropriate dosage, to identify possible adverse side effects and safety risks, and to evaluate preliminarily the effectiveness of the product for specific indications.
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•
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Phase 3 clinical trials usually further evaluate and confirm effectiveness and test further for safety by administering the product in its final form in an expanded patient population.
|
•
|
the federal Anti-Kickback Statute, which prohibits offering or paying anything of value to a person or entity to induce or reward referrals for goods or services reimbursed by a federal health care program such as Medicare or Medicaid;
|
•
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the federal False Claims Act, which prohibits presenting or causing to be presented a false claim for payment by a federal health care program, and which has been interpreted to also include claims caused by improper drug-manufacturer product promotion or the payment of kickbacks;
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•
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a variety of governmental pricing, price reporting, and rebate requirements, including those under Medicaid and the Veterans Health Care Act; and
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•
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the so-called Sunshine Act and certain provisions of the Affordable Care Act, which require that we report to the federal government information on certain financial payments and other transfers of value made to certain healthcare providers and institutions, as well as certain information regarding our distribution of drug samples.
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•
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a covered benefit under its health plan;
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•
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safe, effective and medically necessary;
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•
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appropriate for the specific patient;
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•
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cost-effective; and
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•
|
neither experimental nor investigational.
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Name
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|
Age
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|
Position(s)
|
Executive Officers:
|
|
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|
|
Gregory A. Demopulos, M.D.
|
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60
|
|
President, Chief Executive Officer and Chairman of the Board of Directors
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Michael A. Jacobsen
|
|
60
|
|
Vice President, Finance, Chief Accounting Officer and Treasurer
|
Marcia S. Kelbon, J.D., M.S.
|
|
59
|
|
Vice President, Patent, General Counsel and Secretary
|
Significant Employees:
|
|
|
|
|
Christopher S. Bral, Ph.D.
|
|
53
|
|
Vice President, Nonclinical Development
|
Timothy M. Duffy
|
|
58
|
|
Vice President, Business Development
|
Timi Edeki, M.D., Ph.D.
|
|
58
|
|
Vice President, Clinical Development
|
George A. Gaitanaris, M.D., Ph.D.
|
|
62
|
|
Vice President, Science and Chief Scientific Officer
|
Daniel G. Kirby
|
|
47
|
|
Vice President, Head of Commercial
|
Eckhard S.D. Leifke, M.D.
|
|
55
|
|
Vice President, Clinical Development and Chief Medical Officer
|
Justin McCue, Ph.D.
|
|
44
|
|
Vice President, Chemistry, Manufacturing and Controls
|
Catherine A. Melfi, Ph.D.
|
|
59
|
|
Vice President, Regulatory Affairs & Quality Systems and Chief Regulatory Officer
|
J. Steven Whitaker, M.D., J.D.
|
|
63
|
|
Vice President, Clinical Development
|
•
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pricing, coverage and reimbursement policies of government and private payers such as Medicare, Medicaid, the U.S. Department of Veterans Affairs, group purchasing organizations, insurance companies, health maintenance organizations and other plan administrators;
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•
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a lack of acceptance by physicians, patients and other members of the healthcare community;
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•
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the availability, relative price and efficacy of the product as compared to alternative treatment options or branded, compounded or generic competing products;
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•
|
an unknown safety risk;
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•
|
the failure to enter into and maintain acceptable partnering arrangements for marketing and distribution of OMIDRIA outside of the U.S.;
|
•
|
changed or increased regulatory restrictions in the U.S., EU and/or other foreign territories; and
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•
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a lack of adequate financial or other resources.
|
•
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the level and timing of commercial sales of OMIDRIA, as well as our product candidates if and when approved or commercialized;
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•
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the extent of coverage and reimbursement for OMIDRIA;
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•
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the amount of OMIDRIA chargebacks, rebates and product returns;
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•
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the extent of any payments received from collaboration arrangements and development funding as well as the achievement of development and clinical milestones under collaboration and license agreements that we may enter into from time to time and that may vary significantly from quarter to quarter; and
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•
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the timing, cost and level of investment in our research and development activities as well as expenditures we will or may incur to acquire or develop additional technologies, products and product candidates, or in preparation for potential commercialization of our product candidates.
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•
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initiate and conduct clinical trials and manufacture clinical and registration batches for our programs and product candidates;
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•
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continue OMIDRIA sales and marketing;
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•
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continue research and development in our programs;
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•
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make principal, interest and fee payments as required under our 6.25% Convertible Senior Notes due 2023, or the Convertible Notes; and
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•
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commercialize and launch product candidates for which we may receive regulatory approval.
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•
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reduced protection for intellectual property rights;
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•
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unexpected changes in tariffs, trade barriers and regulatory requirements, including those associated with the withdrawal of the United Kingdom from the EU;
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•
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economic weakness, including inflation, or political instability in particular foreign economies and markets;
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•
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foreign currency fluctuations and other obligations incident to doing business in another country; and
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•
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business interruptions resulting from geopolitical actions, including war and terrorism or natural disasters including earthquakes, typhoons, floods and fires.
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•
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discussions with the FDA, the EMA or other foreign authorities regarding the scope or design of our clinical trials or clinical data collection protocols;
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•
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delays or the inability to obtain required approvals from institutional review boards, ethics committees or other responsible entities at clinical sites selected for participation in our clinical trials;
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•
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delays in enrolling patients into clinical trials or collecting historical control data for any reason including disease severity, trial or data collection protocol design, study eligibility criteria, patient population size (
e.g.
, for orphan diseases or for some pediatric indications), proximity and/or availability of clinical trial sites for prospective patients,
|
•
|
lower than anticipated retention rates of patients in clinical trials;
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•
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the need to repeat or conduct additional clinical trials as a result of inconclusive or negative results, failure to replicate positive early clinical data in subsequent clinical trials, failure to deliver an efficacious dose of a product candidate, poorly executed testing, a failure of a clinical site to adhere to the clinical protocol, an unacceptable study design or other problems;
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•
|
adverse findings in clinical or nonclinical studies related to the safety of our product candidates in humans;
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•
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an insufficient supply of product candidate materials or other materials necessary to conduct our clinical trials;
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•
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the need to qualify new suppliers of product candidate materials for FDA and foreign regulatory approval;
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•
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an unfavorable inspection or review by the FDA or other regulatory authority of a clinical trial site or records of any clinical investigation;
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•
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the occurrence of unacceptable drug-related side effects or adverse events experienced by participants in our clinical trials;
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•
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the suspension by a regulatory agency of a trial by imposing a clinical hold; or
|
•
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the amendment of clinical trial or data collection protocols to reflect changes in regulatory requirements and guidance or other reasons as well as subsequent re-examination of amendments to clinical trial or data collection protocols by institutional review boards or ethics committees.
|
•
|
failure to conduct the clinical trial in accordance with regulatory requirements or our clinical protocols;
|
•
|
inspection of the clinical trial operations or trial sites by the FDA or other regulatory authorities resulting in the imposition of a clinical hold;
|
•
|
the failure to remove a clinical hold in a timely manner, if at all;
|
•
|
unforeseen safety issues or any determination that a trial presents unacceptable health risks;
|
•
|
inability to deliver an efficacious dose of a product candidate; or
|
•
|
lack of adequate funding to continue the clinical trial or development program, including as a result of unforeseen costs due to enrollment delays, requirements to conduct additional trials and studies and/or increased expenses associated with the services of our contract research organizations, or CROs, or other third-parties.
|
•
|
we may not be able to generate sufficient data to support full patent applications that protect the entire breadth of developments in one or more of our programs or platforms;
|
•
|
it is possible that one or more of our pending patent applications will not become an issued patent or, if issued, that the patent(s) will be sufficient to protect our technology, provide us with a basis for commercially viable products or provide us with any competitive advantages;
|
•
|
if our pending applications issue as patents, they may be challenged by third parties as not infringed, invalid or unenforceable under U.S. or foreign laws; or
|
•
|
if issued, the patents under which we hold rights may not be valid or enforceable.
|
•
|
increasing our vulnerability to adverse economic and industry conditions;
|
•
|
limiting our ability to obtain additional financing;
|
•
|
requiring a substantial portion of our cash flow from operations to service our indebtedness, which will reduce the amount of cash available for other purposes;
|
•
|
limiting our flexibility to plan for, or react to, changes in our business;
|
•
|
diluting the interests of our existing stockholders as a result of issuing shares of our common stock upon conversion of the Convertible Notes; and
|
•
|
placing us at a possible competitive disadvantage with competitors that are less leveraged than we are or have better access to capital.
|
ITEM 1B.
|
UNRESOLVED STAFF COMMENTS
|
ITEM 2.
|
PROPERTIES
|
ITEM 4.
|
MINE SAFETY DISCLOSURES
|
ITEM 5.
|
MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED SHAREHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
|
ITEM 6.
|
SELECTED CONSOLIDATED FINANCIAL DATA
|
|
Year Ended December 31,
|
||||||||||||||||||
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
|
(In thousands, except per share and share data)
|
||||||||||||||||||
Consolidated Statements of Operations and Comprehensive Loss Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
||||||||||
Product sales, net
|
$
|
29,868
|
|
|
$
|
64,826
|
|
|
$
|
41,617
|
|
|
$
|
13,509
|
|
|
$
|
539
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cost of product sales
|
512
|
|
|
1,078
|
|
|
1,412
|
|
|
1,041
|
|
|
—
|
|
|||||
Research and development
|
89,860
|
|
|
55,599
|
|
|
50,699
|
|
|
48,379
|
|
|
47,946
|
|
|||||
Selling, general and administrative
|
51,718
|
|
|
52,044
|
|
|
43,782
|
|
|
35,327
|
|
|
22,601
|
|
|||||
Total costs and expenses
|
142,090
|
|
|
108,721
|
|
|
95,893
|
|
|
84,747
|
|
|
70,547
|
|
|||||
Loss from operations
|
(112,222
|
)
|
|
(43,895
|
)
|
|
(54,276
|
)
|
|
(71,238
|
)
|
|
(70,008
|
)
|
|||||
Loss on early extinguishment of debt
|
(12,993
|
)
|
|
—
|
|
|
(5,595
|
)
|
|
(1,315
|
)
|
|
—
|
|
|||||
Interest expense
|
(16,252
|
)
|
|
(11,030
|
)
|
|
(7,819
|
)
|
|
(3,573
|
)
|
|
(3,470
|
)
|
|||||
Other income (expense)
|
1,781
|
|
|
1,444
|
|
|
945
|
|
|
1,030
|
|
|
(195
|
)
|
|||||
Loss before income taxes
|
(139,686
|
)
|
|
(53,481
|
)
|
|
(66,745
|
)
|
|
(75,096
|
)
|
|
(73,673
|
)
|
|||||
Income tax benefit
|
12,929
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Net loss
|
$
|
(126,757
|
)
|
|
$
|
(53,481
|
)
|
|
$
|
(66,745
|
)
|
|
$
|
(75,096
|
)
|
|
$
|
(73,673
|
)
|
Comprehensive loss
|
$
|
(126,757
|
)
|
|
$
|
(53,481
|
)
|
|
$
|
(66,745
|
)
|
|
$
|
(75,096
|
)
|
|
$
|
(73,673
|
)
|
Basic and diluted net loss per share
|
$
|
(2.61
|
)
|
|
$
|
(1.17
|
)
|
|
$
|
(1.65
|
)
|
|
$
|
(2.00
|
)
|
|
$
|
(2.22
|
)
|
Weighted-average shares used to compute basic and diluted net loss per share
|
48,582,636
|
|
|
45,539,362
|
|
|
40,446,410
|
|
|
37,560,257
|
|
|
33,234,294
|
|
|
As of December 31,
|
||||||||||||||||||
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
Consolidated Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Cash, cash equivalents and short-term investments
|
$
|
60,498
|
|
|
$
|
83,749
|
|
|
$
|
45,331
|
|
|
$
|
28,263
|
|
|
$
|
6,886
|
|
Working capital (deficit)
|
52,511
|
|
|
82,065
|
|
|
44,191
|
|
|
20,893
|
|
|
(9,274
|
)
|
|||||
Restricted cash and investments
|
1,154
|
|
|
5,835
|
|
|
5,835
|
|
|
10,679
|
|
|
679
|
|
|||||
Total assets
|
95,936
|
|
|
116,328
|
|
|
67,278
|
|
|
48,995
|
|
|
10,834
|
|
|||||
Notes payable and lease financing obligations, net
|
2,467
|
|
|
84,117
|
|
|
79,512
|
|
|
49,842
|
|
|
32,453
|
|
|||||
Unsecured convertible senior notes
|
148,981
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Accumulated deficit
|
(650,125
|
)
|
|
(523,368
|
)
|
|
(469,887
|
)
|
|
(403,142
|
)
|
|
(328,046
|
)
|
|||||
Total shareholders’ deficit
|
(100,156
|
)
|
|
(2,814
|
)
|
|
(37,447
|
)
|
|
(26,234
|
)
|
|
(42,654
|
)
|
ITEM 7.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
(In thousands)
|
||||||||||
Product sales, net
|
$
|
29,868
|
|
|
$
|
64,826
|
|
|
$
|
41,617
|
|
|
|
Chargebacks and Rebates
|
|
Distribution Fees and Product Return Allowances
|
|
Total
|
||||||
|
|
(In thousands)
|
||||||||||
Balance as of December 31, 2015
|
|
$
|
180
|
|
|
$
|
277
|
|
|
$
|
457
|
|
Provisions
|
|
4,203
|
|
|
1,434
|
|
|
5,637
|
|
|||
Payments
|
|
(2,754
|
)
|
|
(1,230
|
)
|
|
(3,984
|
)
|
|||
Balance as of December 31, 2016
|
|
1,629
|
|
|
481
|
|
2,110
|
|
||||
Provisions
|
|
19,188
|
|
|
5,741
|
|
|
24,929
|
|
|||
Payments
|
|
(15,093
|
)
|
|
(2,849
|
)
|
|
(17,942
|
)
|
|||
Balance as of December 31, 2017
|
|
5,724
|
|
|
3,373
|
|
|
9,097
|
|
|||
Provisions
|
|
10,341
|
|
|
1,309
|
|
|
11,650
|
|
|||
Payments
|
|
(9,050
|
)
|
|
(3,197
|
)
|
|
(12,247
|
)
|
|||
Balance as of December 31, 2018
|
|
$
|
7,015
|
|
|
$
|
1,485
|
|
|
$
|
8,500
|
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
(In thousands)
|
||||||||||
Direct external expenses:
|
|
|
|
|
|
||||||
Clinical research and development:
|
|
|
|
|
|
||||||
MASP-2 Program - OMS721 (narsoplimab)
|
$
|
46,383
|
|
|
$
|
19,557
|
|
|
$
|
17,241
|
|
OMIDRIA - Ophthalmology
|
2,388
|
|
|
3,458
|
|
|
3,864
|
|
|||
PDE7 - OMS527
|
3,586
|
|
|
—
|
|
|
—
|
|
|||
Other clinical programs
|
838
|
|
|
1,714
|
|
|
500
|
|
|||
Total clinical research and development
|
53,195
|
|
|
24,729
|
|
|
21,605
|
|
|||
Preclinical research and development
|
5,627
|
|
|
4,269
|
|
|
1,731
|
|
|||
Total direct external expenses
|
58,822
|
|
|
28,998
|
|
|
23,336
|
|
|||
Internal, overhead and other expenses
|
26,077
|
|
|
21,361
|
|
|
21,059
|
|
|||
Stock-based compensation expense
|
4,961
|
|
|
5,240
|
|
|
6,304
|
|
|||
Total research and development expenses
|
$
|
89,860
|
|
|
$
|
55,599
|
|
|
$
|
50,699
|
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
(In thousands)
|
||||||||||
Selling, general and administrative expenses, excluding stock-based compensation expense
|
$
|
44,966
|
|
|
$
|
44,596
|
|
|
$
|
36,504
|
|
Stock-based compensation expense
|
6,752
|
|
|
7,448
|
|
|
7,278
|
|
|||
Total selling, general and administrative expenses
|
$
|
51,718
|
|
|
$
|
52,044
|
|
|
$
|
43,782
|
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
(In thousands)
|
||||||||||
Interest Expense
|
$
|
16,252
|
|
|
$
|
11,030
|
|
|
$
|
7,819
|
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
(In thousands)
|
||||||||||
Loss on early extinguishment of debt
|
$
|
12,993
|
|
|
$
|
—
|
|
|
$
|
5,595
|
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
(In thousands)
|
||||||||||
Other Income
|
$
|
1,781
|
|
|
$
|
1,444
|
|
|
$
|
945
|
|
|
Year ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
(In thousands)
|
||||||||||
Cash provided by (used in):
|
|
|
|
|
|
||||||
Operating activities
|
$
|
(103,737
|
)
|
|
$
|
(36,227
|
)
|
|
$
|
(51,504
|
)
|
Investing activities
|
25,151
|
|
|
(37,598
|
)
|
|
(16,335
|
)
|
|||
Financing activities
|
81,053
|
|
|
74,995
|
|
|
68,698
|
|
•
|
$
24.0 million
of net proceeds available for corporate use from the issuance of Convertible Notes, net of the
$146.0 million
used to repay our then outstanding CRG Loan,
$33.2 million
used to enter into the Capped Call Transaction and
$6.8 million
of debt issuance costs;
|
•
|
$44.6 million
in net proceeds from borrowings under our now extinguished CRG Loan without a similar borrowing in 2017;
|
|
Payments Due Within
|
||||||||||||||||||
|
1 Year
|
|
2-3 Years
|
|
4-5 Years
|
|
More than
5 Years
|
|
Total
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
Operating leases
|
$
|
5,361
|
|
|
$
|
11,987
|
|
|
$
|
12,551
|
|
|
$
|
22,798
|
|
|
$
|
52,697
|
|
Capital leases (principal and interest)
|
1,174
|
|
|
1,536
|
|
|
347
|
|
|
—
|
|
|
3,057
|
|
|||||
Unsecured convertible senior notes
|
13,198
|
|
|
26,396
|
|
|
236,396
|
|
|
—
|
|
|
275,990
|
|
|||||
Goods & services
|
$
|
11,283
|
|
|
$
|
339
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
11,622
|
|
Total
|
$
|
31,016
|
|
|
$
|
40,258
|
|
|
$
|
249,294
|
|
|
$
|
22,798
|
|
|
$
|
343,366
|
|
•
|
revenue recognition;
|
•
|
research and development expenses, primarily clinical trial expenses and manufacturing of drug product and clinical drug supply; and
|
•
|
stock-based compensation.
|
|
December 31,
|
||||||
|
2018
|
|
2017
|
||||
Assets
|
|
|
|
||||
Current assets:
|
|
|
|
|
|
||
Cash and cash equivalents
|
$
|
5,861
|
|
|
$
|
3,394
|
|
Short-term investments
|
54,637
|
|
|
80,355
|
|
||
Receivables, net
|
22,818
|
|
|
17,144
|
|
||
Inventory
|
88
|
|
|
443
|
|
||
Prepaid expense and other assets
|
6,463
|
|
|
7,036
|
|
||
Total current assets
|
89,867
|
|
|
108,372
|
|
||
Property and equipment, net
|
3,845
|
|
|
2,121
|
|
||
Restricted investments
|
1,154
|
|
|
5,835
|
|
||
Advanced payments, non-current
|
1,070
|
|
|
—
|
|
||
Total assets
|
$
|
95,936
|
|
|
$
|
116,328
|
|
Liabilities and shareholders’ deficit
|
|
|
|
||||
Current liabilities:
|
|
|
|
|
|
||
Accounts payable
|
$
|
6,281
|
|
|
$
|
6,691
|
|
Accrued expenses
|
30,186
|
|
|
19,126
|
|
||
Current portion of lease financing obligations
|
889
|
|
|
490
|
|
||
Total current liabilities
|
37,356
|
|
|
26,307
|
|
||
Lease obligation, net of current portion
|
1,578
|
|
|
810
|
|
||
Notes payable
|
—
|
|
|
83,307
|
|
||
Unsecured convertible senior notes
|
148,981
|
|
|
—
|
|
||
Deferred rent
|
8,177
|
|
|
8,718
|
|
||
Commitments and contingencies (Note 10)
|
|
|
|
|
|
||
Shareholders’ equity (deficit)
|
|
|
|
|
|
||
Preferred stock, par value $0.01 per share, 20,000,000 shares authorized and none issued at December 31, 2018 and 2017.
|
—
|
|
|
—
|
|
||
Common stock, par value $0.01 per share, 150,000,000 shares authorized at December 31, 2018 and 2017; 49,011,684 and 48,211,226 issued and outstanding at December 31, 2018 and 2017, respectively.
|
490
|
|
|
482
|
|
||
Additional paid-in capital
|
549,479
|
|
|
520,072
|
|
||
Accumulated deficit
|
(650,125
|
)
|
|
(523,368
|
)
|
||
Total shareholders’ deficit
|
(100,156
|
)
|
|
(2,814
|
)
|
||
Total liabilities and shareholders’ deficit
|
$
|
95,936
|
|
|
$
|
116,328
|
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Revenues:
|
|
|
|
|
|
|
|
|
|||
Product sales, net
|
$
|
29,868
|
|
|
$
|
64,826
|
|
|
$
|
41,617
|
|
|
|
|
|
|
|
|
|
|
|||
Costs and expenses:
|
|
|
|
|
|
||||||
Cost of product sales
|
512
|
|
|
1,078
|
|
|
1,412
|
|
|||
Research and development
|
89,860
|
|
|
55,599
|
|
|
50,699
|
|
|||
Selling, general and administrative
|
51,718
|
|
|
52,044
|
|
|
43,782
|
|
|||
Total costs and expenses
|
142,090
|
|
|
108,721
|
|
|
95,893
|
|
|||
Loss from operations
|
(112,222
|
)
|
|
(43,895
|
)
|
|
(54,276
|
)
|
|||
Loss on early extinguishment of debt
|
(12,993
|
)
|
|
—
|
|
|
(5,595
|
)
|
|||
Interest expense
|
(16,252
|
)
|
|
(11,030
|
)
|
|
(7,819
|
)
|
|||
Other income
|
1,781
|
|
|
1,444
|
|
|
945
|
|
|||
Loss before income taxes
|
(139,686
|
)
|
|
(53,481
|
)
|
|
(66,745
|
)
|
|||
Income tax benefit
|
12,929
|
|
|
—
|
|
|
—
|
|
|||
Net loss
|
$
|
(126,757
|
)
|
|
$
|
(53,481
|
)
|
|
$
|
(66,745
|
)
|
Comprehensive loss
|
$
|
(126,757
|
)
|
|
$
|
(53,481
|
)
|
|
$
|
(66,745
|
)
|
Basic and diluted net loss per share
|
$
|
(2.61
|
)
|
|
$
|
(1.17
|
)
|
|
$
|
(1.65
|
)
|
Weighted-average shares used to compute basic and diluted net loss per share
|
48,582,636
|
|
|
45,539,362
|
|
|
40,446,410
|
|
|
Common Stock
|
|
Additional
Paid-in Capital |
|
Accumulated
Deficit |
|
Total
Shareholders’ Deficit |
|||||||||||
|
Shares
|
|
Amount
|
|
||||||||||||||
Balance at December 31, 2015
|
38,040,891
|
|
|
380
|
|
|
376,528
|
|
|
(403,142
|
)
|
|
(26,234
|
)
|
||||
Issuance of common stock in direct offering, net of offering costs
|
3,478,260
|
|
|
35
|
|
|
37,279
|
|
|
—
|
|
|
37,314
|
|
||||
Issuance of common stock upon exercise of stock options
|
1,486,167
|
|
|
15
|
|
|
3,131
|
|
|
—
|
|
|
3,146
|
|
||||
Warrant exercises
|
749,250
|
|
|
7
|
|
|
—
|
|
|
—
|
|
|
7
|
|
||||
Issuance of common stock in connection with the ATM, net of offering costs
|
64,565
|
|
|
1
|
|
|
724
|
|
|
—
|
|
|
725
|
|
||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
13,582
|
|
|
—
|
|
|
13,582
|
|
||||
Fair value of warrants in connection with amendment to notes payable
|
—
|
|
|
—
|
|
|
758
|
|
|
—
|
|
|
758
|
|
||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(66,745
|
)
|
|
(66,745
|
)
|
||||
Balance at December 31, 2016
|
43,819,133
|
|
|
438
|
|
|
432,002
|
|
|
(469,887
|
)
|
|
(37,447
|
)
|
||||
Issuance of common stock in direct offering, net of offering costs
|
3,000,000
|
|
|
30
|
|
|
63,627
|
|
|
—
|
|
|
63,657
|
|
||||
Issuance of common stock upon exercise of stock options
|
1,392,093
|
|
|
14
|
|
|
11,755
|
|
|
—
|
|
|
11,769
|
|
||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
12,688
|
|
|
—
|
|
|
12,688
|
|
||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(53,481
|
)
|
|
(53,481
|
)
|
||||
Balance at December 31, 2017
|
48,211,226
|
|
|
482
|
|
|
520,072
|
|
|
(523,368
|
)
|
|
(2,814
|
)
|
||||
Issuance of common stock upon exercise of stock options
|
800,458
|
|
|
8
|
|
|
6,724
|
|
|
—
|
|
|
6,732
|
|
||||
Issuance of warrants in connection with amendment of notes payable
|
—
|
|
|
—
|
|
|
1,424
|
|
|
—
|
|
|
1,424
|
|
||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
11,713
|
|
|
—
|
|
|
11,713
|
|
||||
Premium paid for Capped Call in connection with Convertible Notes
|
—
|
|
|
—
|
|
|
(33,180
|
)
|
|
—
|
|
|
(33,180
|
)
|
||||
Equity component of issuance of Convertible Notes
|
—
|
|
|
—
|
|
|
55,655
|
|
|
—
|
|
|
55,655
|
|
||||
Tax benefit related to equity component of Convertible Notes
|
—
|
|
|
—
|
|
|
(12,929
|
)
|
|
—
|
|
|
(12,929
|
)
|
||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(126,757
|
)
|
|
(126,757
|
)
|
||||
Balance at December 31, 2018
|
49,011,684
|
|
|
$
|
490
|
|
|
$
|
549,479
|
|
|
$
|
(650,125
|
)
|
|
$
|
(100,156
|
)
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Operating activities:
|
|
|
|
|
|
||||||
Net loss
|
$
|
(126,757
|
)
|
|
$
|
(53,481
|
)
|
|
$
|
(66,745
|
)
|
Adjustments to reconcile net loss to net cash used in operating activities:
|
|
|
|
|
|
||||||
Stock-based compensation expense
|
11,713
|
|
|
12,688
|
|
|
13,582
|
|
|||
Non-cash interest expense
|
5,635
|
|
|
4,187
|
|
|
1,977
|
|
|||
Depreciation and amortization
|
962
|
|
|
551
|
|
|
300
|
|
|||
Loss on early extinguishment of debt
|
12,993
|
|
|
—
|
|
|
5,595
|
|
|||
Deferred income tax
|
(12,929
|
)
|
|
—
|
|
|
—
|
|
|||
Fair value adjustment to convertible notes in equity
|
354
|
|
|
—
|
|
|
—
|
|
|||
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
|
|||
Receivables
|
(5,674
|
)
|
|
(5,107
|
)
|
|
(5,520
|
)
|
|||
Inventory
|
355
|
|
|
685
|
|
|
(656
|
)
|
|||
Prepaid expenses and other assets
|
(498
|
)
|
|
(5,270
|
)
|
|
347
|
|
|||
Accounts payable and accrued expenses
|
10,544
|
|
|
9,616
|
|
|
(421
|
)
|
|||
Deferred rent
|
(435
|
)
|
|
(96
|
)
|
|
37
|
|
|||
Net cash used in operating activities
|
(103,737
|
)
|
|
(36,227
|
)
|
|
(51,504
|
)
|
|||
Investing activities:
|
|
|
|
|
|
|
|
||||
Purchases of property and equipment
|
(567
|
)
|
|
(350
|
)
|
|
(126
|
)
|
|||
Purchases of investments
|
(68,782
|
)
|
|
(65,326
|
)
|
|
(73,966
|
)
|
|||
Proceeds from the sale and maturities of investments
|
94,500
|
|
|
28,078
|
|
|
57,757
|
|
|||
Net cash provided by (used in) investing activities
|
25,151
|
|
|
(37,598
|
)
|
|
(16,335
|
)
|
|||
Financing activities:
|
|
|
|
|
|
|
|
||||
Proceeds from issuance of convertible senior notes
|
210,000
|
|
|
—
|
|
|
—
|
|
|||
Proceeds from borrowings under notes payable
|
44,550
|
|
|
—
|
|
|
100,000
|
|
|||
Proceeds upon exercise of stock options and warrants
|
6,732
|
|
|
11,769
|
|
|
3,153
|
|
|||
Proceeds from issuance of common stock, net
|
—
|
|
|
63,657
|
|
|
38,039
|
|
|||
Release in restricted investments
|
4,681
|
|
|
—
|
|
|
4,844
|
|
|||
Repayment of notes payable
|
(132,077
|
)
|
|
—
|
|
|
(70,137
|
)
|
|||
Premium paid for capped call option
|
(33,180
|
)
|
|
—
|
|
|
—
|
|
|||
Payments on debt prepayment and extinguishment
|
(11,902
|
)
|
|
—
|
|
|
(5,700)
|
||||
Payments for debt issuance costs
|
(6,800
|
)
|
|
—
|
|
|
(1,501
|
)
|
|||
Payments on lease financing obligations
|
(951
|
)
|
|
(431
|
)
|
|
|
|
|||
Net cash provided by financing activities
|
81,053
|
|
|
74,995
|
|
|
68,698
|
|
|||
Net increase in cash and cash equivalents
|
2,467
|
|
|
1,170
|
|
|
859
|
|
|||
Cash and cash equivalents at beginning of period
|
3,394
|
|
|
2,224
|
|
|
1,365
|
|
|||
Cash and cash equivalents at end of period
|
$
|
5,861
|
|
|
$
|
3,394
|
|
|
$
|
2,224
|
|
Supplemental cash flow information
|
|
|
|
|
|
|
|
|
|||
Cash paid for interest
|
$
|
8,896
|
|
|
$
|
6,895
|
|
|
$
|
5,293
|
|
Conversion of accrued interest to notes payable
|
$
|
3,408
|
|
|
$
|
3,315
|
|
|
$
|
516
|
|
Issuance of warrants in connection with amendments to notes payable
|
$
|
1,424
|
|
|
$
|
—
|
|
|
$
|
758
|
|
Property acquired under capital lease
|
$
|
2,118
|
|
|
$
|
1,141
|
|
|
$
|
404
|
|
|
|
2018
|
|
2017
|
|
2016
|
|||||||||
|
|
Percentage of Total Revenue
|
|
Percentage of Accounts Receivable
|
|
Percentage of Total Revenue
|
|
Percentage of Accounts Receivable
|
|
Percentage of Total Revenue
|
|||||
Distributor A
|
|
31
|
%
|
|
27
|
%
|
|
29
|
%
|
|
31
|
%
|
|
32
|
%
|
Distributor B
|
|
27
|
%
|
|
25
|
%
|
|
26
|
%
|
|
23
|
%
|
|
31
|
%
|
Distributor C
|
|
22
|
%
|
|
25
|
%
|
|
22
|
%
|
|
26
|
%
|
|
28
|
%
|
Distributor D
|
|
20
|
%
|
|
23
|
%
|
|
23
|
%
|
|
20
|
%
|
|
*
|
|
|
Year Ended December 31,
|
|||||||
|
2018
|
|
2017
|
|
2016
|
|||
Outstanding options to purchase common stock
|
10,313,138
|
|
|
9,657,259
|
|
|
9,809,374
|
|
Warrants to purchase common stock
|
243,115
|
|
|
100,602
|
|
|
100,602
|
|
Total potentially dilutive securities
|
10,556,253
|
|
|
9,757,861
|
|
|
9,909,976
|
|
|
December 31,
|
||||||
|
2018
|
|
2017
|
||||
|
(In thousands)
|
||||||
Trade receivables, net
|
$
|
22,654
|
|
|
$
|
17,079
|
|
Subleases and other receivables
|
164
|
|
|
65
|
|
||
Accounts receivables, net
|
$
|
22,818
|
|
|
$
|
17,144
|
|
|
December 31, 2018
|
||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
|
(In thousands)
|
||||||||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Money-market funds classified as non-current restricted cash and investments
|
$
|
1,154
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,154
|
|
Money-market funds classified as short-term investments
|
54,637
|
|
|
—
|
|
|
—
|
|
|
54,637
|
|
||||
Total
|
$
|
55,791
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
55,791
|
|
|
December 31, 2017
|
||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
|
(In thousands)
|
||||||||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Money-market funds classified as non-current restricted cash and investments
|
$
|
5,835
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
5,835
|
|
Money-market funds classified as short-term investments
|
80,355
|
|
|
—
|
|
|
—
|
|
|
80,355
|
|
||||
Total
|
$
|
86,190
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
86,190
|
|
|
December 31,
|
||||||
|
2018
|
|
2017
|
||||
|
(In thousands)
|
||||||
Capital lease equipment
|
$
|
4,034
|
|
|
$
|
1,915
|
|
Laboratory equipment
|
2,569
|
|
|
2,180
|
|
||
Computer equipment
|
862
|
|
|
684
|
|
||
Office equipment and furniture
|
625
|
|
|
625
|
|
||
Total cost
|
8,090
|
|
|
5,404
|
|
||
Less accumulated depreciation and amortization
|
(4,245
|
)
|
|
(3,283
|
)
|
||
Total property and equipment, net
|
$
|
3,845
|
|
|
$
|
2,121
|
|
|
December 31,
|
||||||
|
2018
|
|
2017
|
||||
|
(In thousands)
|
||||||
Contract research and development
|
$
|
12,012
|
|
|
$
|
4,251
|
|
Sales rebates, fees and discounts
|
8,075
|
|
|
6,561
|
|
||
Employee compensation
|
2,714
|
|
|
2,309
|
|
||
Consulting and professional fees
|
3,669
|
|
|
1,627
|
|
||
Interest payable
|
1,677
|
|
|
—
|
|
||
Clinical accrual
|
820
|
|
|
1,026
|
|
||
ASC/Hospital return liability
|
—
|
|
|
2,350
|
|
||
Other accruals
|
1,219
|
|
|
1,002
|
|
||
Total accrued liabilities
|
$
|
30,186
|
|
|
$
|
19,126
|
|
|
(In thousands)
|
||
Convertible Notes initially issued
|
$
|
210,000
|
|
Repayment of the CRG Loan
|
(146,046
|
)
|
|
Purchase of Capped Call
|
(33,180
|
)
|
|
Issuance costs
|
(6,800
|
)
|
|
Net proceeds available for corporate use
|
$
|
23,974
|
|
Year Ending December 31,
|
|
The Omeros Building Lease
|
|
Building Sublease Income
|
|
Operating Lease, Net
|
|
Capital Leases
|
|
Total
|
||||||||||
|
|
(in thousands)
|
||||||||||||||||||
2019
|
|
$
|
5,361
|
|
|
$
|
(558
|
)
|
|
$
|
4,803
|
|
|
$
|
1,174
|
|
|
$
|
5,977
|
|
2020
|
|
5,926
|
|
|
—
|
|
|
5,926
|
|
|
955
|
|
|
6,881
|
|
|||||
2021
|
|
6,061
|
|
|
—
|
|
|
6,061
|
|
|
581
|
|
|
6,642
|
|
|||||
2022
|
|
6,203
|
|
|
—
|
|
|
6,203
|
|
|
252
|
|
|
6,455
|
|
|||||
2023
|
|
6,348
|
|
|
—
|
|
|
6,348
|
|
|
95
|
|
|
6,443
|
|
|||||
Thereafter
|
|
22,798
|
|
|
—
|
|
|
22,798
|
|
|
—
|
|
|
22,798
|
|
|||||
Total
|
|
$
|
52,697
|
|
|
$
|
(558
|
)
|
|
$
|
52,139
|
|
|
$
|
3,057
|
|
|
$
|
55,196
|
|
Options granted and outstanding
|
10,313,138
|
|
Options available for future grant
|
2,092,210
|
|
Common stock warrants
|
243,115
|
|
Total shares reserved
|
12,648,463
|
|
Outstanding At
December 31, 2018 |
|
Expiration Date
|
|
Exercise Price
|
43,115
|
|
May 18, 2023
|
|
$9.94
|
200,000
|
|
April 12, 2023
|
|
$23.00
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
(In thousands)
|
||||||||||
Research and development
|
$
|
4,961
|
|
|
$
|
5,240
|
|
|
$
|
6,304
|
|
Selling, general and administrative
|
6,752
|
|
|
7,448
|
|
|
7,278
|
|
|||
Total stock-based compensation expense
|
$
|
11,713
|
|
|
$
|
12,688
|
|
|
$
|
13,582
|
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Estimated weighted-average fair value
|
$
|
10.32
|
|
|
$
|
8.66
|
|
|
$
|
6.89
|
|
Weighted-average assumptions:
|
|
|
|
|
|
||||||
Expected volatility
|
78
|
%
|
|
74
|
%
|
|
74
|
%
|
|||
Expected term, in years
|
6.0
|
|
|
6.0
|
|
|
5.7
|
|
|||
Risk-free interest rate
|
2.68
|
%
|
|
2.05
|
%
|
|
1.63
|
%
|
|||
Expected dividend yield
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|
Options
Outstanding
|
|
Weighted-
Average
Exercise
Price per
Share
|
|
Remaining
Contractual Life
(in years)
|
|
Aggregate
Intrinsic
Value
(In thousands)
|
|||||
Balance at December 31, 2017
|
9,657,259
|
|
|
$
|
10.39
|
|
|
|
|
|
||
Granted
|
1,891,757
|
|
|
15.01
|
|
|
|
|
|
|||
Exercised
|
(765,949
|
)
|
|
8.79
|
|
|
|
|
|
|||
Forfeited/expired
|
(469,929
|
)
|
|
13.42
|
|
|
|
|
|
|||
Balance at December 31, 2018
|
10,313,138
|
|
|
$
|
11.22
|
|
|
6.41
|
|
$
|
11,319
|
|
Vested and expected to vest at December 31, 2018
|
10,005,615
|
|
|
$
|
11.13
|
|
|
6.34
|
|
$
|
11,283
|
|
Exercisable at December 31, 2018
|
7,468,806
|
|
|
$
|
10.21
|
|
|
5.51
|
|
$
|
10,984
|
|
|
December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
(In thousands)
|
||||||||||
Current income tax benefit:
|
|
|
|
|
|
||||||
Federal
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
State
|
—
|
|
|
—
|
|
|
—
|
|
|||
Total current income tax benefit
|
—
|
|
|
—
|
|
|
—
|
|
|||
Deferred income tax benefit:
|
|
|
|
|
|
|
|
||||
Federal
|
11,261
|
|
|
—
|
|
|
—
|
|
|||
State
|
1,668
|
|
|
—
|
|
|
—
|
|
|||
Total deferred income tax benefit
|
12,929
|
|
|
—
|
|
|
—
|
|
|||
Income tax benefit
|
$
|
12,929
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
December 31,
|
||||||
|
2018
|
|
2017
|
||||
|
(In thousands)
|
||||||
Deferred tax assets:
|
|
|
|
||||
Net operating loss carryforwards
|
$
|
113,928
|
|
|
$
|
90,498
|
|
Research and development tax credits
|
35,739
|
|
|
26,748
|
|
||
Stock-based compensation
|
8,969
|
|
|
7,829
|
|
||
Deferred rent
|
2,037
|
|
|
2,123
|
|
||
Other
|
10,564
|
|
|
4,759
|
|
||
Total deferred tax assets
|
171,237
|
|
|
131,957
|
|
||
Deferred tax liabilities:
|
|
|
|
|
|||
Property and equipment
|
(151
|
)
|
|
(10
|
)
|
||
Equity component of Convertible Notes
|
(12,706
|
)
|
|
—
|
|
||
Total deferred tax liabilities
|
(12,857
|
)
|
|
(10
|
)
|
||
Net deferred tax assets before valuation allowance
|
158,380
|
|
|
131,947
|
|
||
Less valuation allowance
|
(158,380
|
)
|
|
(131,947
|
)
|
||
Net deferred tax assets
|
$
|
—
|
|
|
$
|
—
|
|
|
Year ended December 31,
|
|||||||
|
2018
|
|
2017
|
|
2016
|
|||
U.S. Federal statutory rate on net loss
|
(21
|
)%
|
|
(34
|
)%
|
|
(34
|
)%
|
State tax, net of federal tax benefit
|
(2
|
)%
|
|
(2
|
)%
|
|
(2
|
)%
|
Effects of statutory rate change
|
—
|
%
|
|
115
|
%
|
|
—
|
%
|
Change in valuation allowance
|
19
|
%
|
|
(60
|
)%
|
|
37
|
%
|
Tax credits
|
(5
|
)%
|
|
(11
|
)%
|
|
(4
|
)%
|
Other
|
—
|
%
|
|
(8
|
)%
|
|
3
|
%
|
Effective tax rate
|
(9
|
)%
|
|
—
|
%
|
|
—
|
%
|
2018
|
|
For the Quarter Ended
|
||||||||||||||
|
|
March 31,
|
|
June 30,
|
|
September 30,
|
|
December 31,
|
||||||||
Revenue (1)
|
|
$
|
1,588
|
|
|
$
|
1,655
|
|
|
$
|
4,608
|
|
|
$
|
22,017
|
|
Total costs and expenses
|
|
29,277
|
|
|
32,272
|
|
|
40,050
|
|
|
40,491
|
|
||||
Loss from operations
|
|
(27,689
|
)
|
|
(30,617
|
)
|
|
(35,442
|
)
|
|
(18,474
|
)
|
||||
Net loss
|
|
(30,054
|
)
|
|
(33,696
|
)
|
|
(39,472
|
)
|
|
(23,534
|
)
|
||||
Basic and diluted net loss per share
|
|
$
|
(0.62
|
)
|
|
$
|
(0.70
|
)
|
|
$
|
(0.81
|
)
|
|
$
|
(0.48
|
)
|
|
||||||||||||||||
|
||||||||||||||||
2017
|
|
For the Quarter Ended
|
||||||||||||||
|
|
March 31,
|
|
June 30,
|
|
September 30,
|
|
December 31,
|
||||||||
Revenue
|
|
$
|
12,257
|
|
|
$
|
17,151
|
|
|
$
|
21,658
|
|
|
$
|
13,760
|
|
Total costs and expenses
|
|
24,982
|
|
|
29,090
|
|
|
26,768
|
|
|
27,881
|
|
||||
Loss from operations
|
|
(12,725
|
)
|
|
(11,939
|
)
|
|
(5,110
|
)
|
|
(14,121
|
)
|
||||
Net loss
|
|
(15,089
|
)
|
|
(14,359
|
)
|
|
(7,482
|
)
|
|
(16,551
|
)
|
||||
Basic and diluted net loss per share
|
|
$
|
(0.34
|
)
|
|
$
|
(0.33
|
)
|
|
$
|
(0.16
|
)
|
|
$
|
(0.34
|
)
|
ITEM 9.
|
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
|
ITEM 9B.
|
OTHER INFORMATION
|
ITEM 10.
|
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
|
ITEM 11.
|
EXECUTIVE COMPENSATION
|
ITEM 12.
|
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED SHAREHOLDER MATTERS
|
|
Number of Securities to be
Issued Upon Exercise of
Outstanding Options,
Warrants and Rights
|
|
Weighted-Average
Exercise Price of
Outstanding Options,
Warrants and Rights
|
|
Number of Securities
Remaining Available for
Future Issuance Under
Equity Compensation
Plans
|
||||
Equity compensation plans approved by security holders:
|
|
|
|
|
|
||||
2017 Omnibus Incentive Compensation Plan (1)
|
1,914,730
|
|
|
$
|
15.60
|
|
|
2,092,210
|
|
2008 Equity Incentive Plan (2)
|
8,398,408
|
|
|
$
|
10.22
|
|
|
—
|
|
Total
|
10,313,138
|
|
|
$
|
11.22
|
|
|
2,092,210
|
|
ITEM 13.
|
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
|
ITEM 14.
|
PRINCIPAL ACCOUNTING FEES AND SERVICES
|
ITEM 15.
|
EXHIBITS, FINANCIAL STATEMENT SCHEDULES
|
|
Exhibit Description
|
Incorporated by Reference
|
||||
Exhibit
No.
|
Form
|
File No.
|
Exhibit
No.
|
Filing Date
|
Filed
Herewith
|
|
|
|
|
|
|
|
|
3.1
|
10-K
|
001-34475
|
3.1
|
03/31/2010
|
|
|
|
|
|
|
|
|
|
3.2
|
10-K
|
001-34475
|
3.2
|
03/31/2010
|
|
|
|
|
|
|
|
|
|
4.1
|
S-1/A
|
333-148572
|
4.1
|
10/02/2009
|
|
|
|
|
|
|
|
|
|
4.2
|
8-K
|
001-34475
|
10.3
|
05/19/2016
|
|
|
|
|
|
|
|
|
|
4.3
|
8-K
|
001-34475
|
10.2
|
4/13/2018
|
|
|
|
|
|
|
|
|
|
4.4
|
8-K
|
001-34475
|
4.1
|
11/15/2018
|
|
|
|
|
|
|
|
|
|
10.1*
|
S-1
|
333-148572
|
10.1
|
01/09/2008
|
|
|
|
|
|
|
|
|
|
10.2*
|
10-K
|
001-34475
|
10.6
|
03/16/2017
|
|
|
|
|
|
|
|
|
|
10.3*
|
10-Q
|
001-34475
|
10.2
|
11/07/2013
|
|
|
|
|
|
|
|
|
|
10.4*
|
S-8
|
333-218882
|
4.3
|
06/21/2017
|
|
|
|
|
|
|
|
|
|
10.5*
|
S-8
|
333-218882
|
4.4
|
06/21/2017
|
|
|
|
|
|
|
|
|
|
10.6*
|
8-K
|
001-34475
|
10.1
|
04/12/2010
|
|
|
|
|
|
|
|
|
|
10.7*
|
S-1
|
333-148572
|
10.12
|
01/09/2008
|
|
|
|
|
|
|
|
|
|
10.8*
|
S-1
|
333-148572
|
10.14
|
01/09/2008
|
|
|
|
|
|
|
|
|
|
10.9
|
S-1
|
333-148572
|
10.15
|
01/09/2008
|
|
|
|
|
|
|
|
|
|
10.10*
|
S-1
|
333-148572
|
10.16
|
01/09/2008
|
|
|
|
|
|
|
|
|
|
10.11
|
S-1
|
333-148572
|
10.17
|
01/09/2008
|
|
|
|
|
|
|
|
|
|
10.12*
|
10-Q
|
001-34475
|
10.3
|
08/08/2017
|
|
|
|
|
|
|
|
|
|
10.13
|
8-K
|
001-34475
|
10.1
|
02/01/2012
|
|
|
|
|
|
|
|
|
|
10.14
|
10-Q
|
001-34475
|
10.2
|
11/09/2012
|
|
|
|
|
|
|
|
|
|
10.15
|
10-K
|
001-34475
|
10.18
|
03/18/2013
|
|
|
|
|
|
|
|
|
|
10.16
|
10-K
|
001-34475
|
10.18
|
03/13/2014
|
|
|
|
|
|
|
|
|
|
10.17
|
10-Q
|
001-34475
|
10.3
|
11/09/2015
|
|
|
|
|
|
|
|
|
|
10.18
|
10-Q
|
001-34475
|
10.1
|
05/10/2017
|
|
|
|
|
|
|
|
|
|
10.19
|
|
|
|
|
X
|
|
|
|
|
|
|
|
|
10.20†
|
S-1/A
|
333-148572
|
10.29
|
09/16/2009
|
|
|
|
|
|
|
|
|
|
10.21†
|
S-1
|
333-148572
|
10.30
|
01/09/2008
|
|
|
|
|
|
|
|
|
|
10.22†
|
10-K
|
001-34475
|
10.24
|
03/16/2015
|
|
|
|
|
|
|
|
|
|
10.23†
|
S-1/A
|
333-148572
|
10.31
|
09/16/2009
|
|
|
|
|
|
|
|
|
|
10.24†
|
S-1
|
333-148572
|
10.32
|
01/09/2008
|
|
|
|
|
|
|
|
|
|
10.25†
|
S-1/A
|
333-148572
|
10.33
|
05/15/2009
|
|
|
|
|
|
|
|
|
|
10.26†
|
S-1/A
|
333-148572
|
10.47
|
09/16/2009
|
|
|
|
|
|
|
|
|
|
10.27†
|
10-K
|
001-34475
|
10.28
|
03/18/2013
|
|
|
|
|
|
|
|
|
|
10.28†
|
10-Q
|
001-34475
|
10.1
|
05/12/2010
|
|
|
|
|
|
|
|
|
|
10.29†
|
10-Q
|
001-34475
|
10.1
|
05/10/2011
|
|
|
|
|
|
|
|
|
|
10.30†
|
10-Q
|
001-34475
|
10.1
|
05/09/2013
|
|
|
|
|
|
|
|
|
|
10.31†
|
10-Q
|
001-34475
|
10.2
|
08/10/2010
|
|
|
|
|
|
|
|
|
|
10.32†
|
10-K
|
001-34475
|
10.44
|
03/15/2011
|
|
|
|
|
|
|
|
|
|
10.33†
|
10-K
|
001-34475
|
10.45
|
03/15/2011
|
|
|
|
|
|
|
|
|
|
10.34†
|
10-K
|
001-34475
|
10.46
|
03/16/2015
|
|
|
|
|
|
|
|
|
|
10.35†
|
10-Q
|
001-34475
|
10.1
|
11/09/2015
|
|
|
|
|
|
|
|
|
|
10.36
|
8-K
|
001-34475
|
10.2
|
11/15/2018
|
|
|
|
|
|
|
|
|
|
10.37
|
8-K
|
001-34475
|
10.1
|
10/05/2017
|
|
|
|
|
|
|
|
|
|
10.38
|
8-K
|
001-34475
|
10.1
|
05/24/2018
|
|
|
|
|
|
|
|
|
|
10.39
|
10-Q
|
001-34475
|
10.2
|
11/09/2016
|
|
|
|
|
|
|
|
|
|
10.40
|
8-K
|
001-34475
|
10.1
|
10/17/2017
|
|
|
|
|
|
|
|
|
|
10.41
|
10-K
|
001-34475
|
10.40
|
03/01/2018
|
|
|
|
|
|
|
|
|
|
10.42
|
8-K
|
001-34475
|
10.1
|
04/13/2018
|
|
|
|
|
|
|
|
|
|
23.1
|
|
|
|
|
X
|
|
|
|
|
|
|
|
|
31.1
|
|
|
|
|
X
|
|
|
|
|
|
|
|
|
31.2
|
|
|
|
|
X
|
|
|
|
|
|
|
|
|
32.1
|
|
|
|
|
X
|
|
|
|
|
|
|
|
|
32.2
|
|
|
|
|
X
|
|
|
|
|
|
|
|
|
101.INS
|
XBRL Instance Document
|
|
|
|
|
X
|
|
|
|
|
|
|
|
101.SCH
|
XBRL Taxonomy Extension Schema Document
|
|
|
|
|
X
|
|
|
|
|
|
|
|
101.CAL
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
|
|
|
X
|
|
|
|
|
|
|
|
101.DEF
|
XBRL Taxonomy Extension Definition Linkbase Document
|
|
|
|
|
X
|
|
|
|
|
|
|
|
101.LAB
|
XBRL Taxonomy Extension Labels Linkbase Document
|
|
|
|
|
X
|
|
|
|
|
|
|
|
101.PRE
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
|
|
|
X
|
*
|
Indicates management contract or compensatory plan or arrangement.
|
†
|
Portions of this exhibit are redacted in accordance with a grant of confidential treatment.
|
ITEM 16.
|
FORM 10-K SUMMARY
|
OMEROS CORPORATION
|
/s/ GREGORY A. DEMOPULOS, M.D.
|
Gregory A. Demopulos, M.D.
|
President, Chief Executive Officer
and Chairman of the Board of Directors |
Signature
|
Title
|
Date
|
|
|
|
/s/ GREGORY A. DEMOPULOS, M.D.
|
President, Chief Executive Officer and Chairman of the Board of Directors (Principal Executive Officer)
|
March 1, 2019
|
Gregory A. Demopulos, M.D.
|
|
|
|
|
|
/s/ MICHAEL A. JACOBSEN
|
Vice President, Finance, Chief Accounting Officer and Treasurer (Principal Financial Officer and Principal Accounting Officer)
|
March 1, 2019
|
Michael A. Jacobsen
|
|
|
|
|
|
/s/ RAY ASPIRI
|
Director
|
March 1, 2019
|
Ray Aspiri
|
|
|
|
|
|
/s/ THOMAS F. BUMOL, PH.D.
|
Director
|
March 1, 2019
|
Thomas F. Bumol, Ph.D.
|
|
|
|
|
|
/s/ THOMAS J. CABLE
|
Director
|
March 1, 2019
|
Thomas J. Cable
|
|
|
|
|
|
/s/ PETER A. DEMOPULOS, M.D.
|
Director
|
March 1, 2019
|
Peter A. Demopulos, M.D.
|
|
|
|
|
|
/s/ ARNOLD C. HANISH
|
Director
|
March 1, 2019
|
Arnold C. Hanish
|
|
|
|
|
|
/s/ LEROY E. HOOD, M.D., PH.D.
|
Director
|
March 1, 2019
|
Leroy E. Hood, M.D., Ph.D.
|
|
|
|
|
|
/s/ RAJIV SHAH, M.D.
|
Director
|
March 1, 2019
|
Rajiv Shah, M.D.
|
|
|
1.
|
Tenant accepted possession of the Third Floor Additional Premises for use in accordance with the Permitted Use on [_______], 20[__]. Tenant first occupied the Third Floor Additional Premises for the Permitted Use on [_______], 20[__].
|
2.
|
The Third Floor Additional Premises are in good order, condition and repair.
|
3.
|
The Third Floor Additional Premises Tenant Improvements are Substantially Complete.
|
4.
|
In accordance with the provisions of
Article 3
of the Amendment, the Third Floor Additional Premises Commencement Date is [_______], 20[__].
|
5.
|
The obligation to pay Rent is presently in effect with respect to the Third Floor Additional Premises and all Rent obligations on the part of Tenant under the Lease with respect to the Third Floor Additional Premises commenced to accrue on [_______], 20[__], with Base Rent for the Third Floor Additional Premises payable on the dates and amounts set forth in the chart below:
|
6.
|
The undersigned Tenant has not made any prior assignment, transfer, hypothecation or pledge of the Lease or of the rents thereunder or sublease of the Premises or any portion thereof.
|
1.
|
I have reviewed this annual report on Form 10-K of Omeros Corporation;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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a.
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b.
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c.
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d.
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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a.
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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b.
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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Dated: March 1, 2019
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/s/ Gregory A. Demopulos
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Gregory A. Demopulos, M.D.
Principal Executive Officer
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1.
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I have reviewed this annual report on Form 10-K of Omeros Corporation;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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a.
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b.
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c.
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d.
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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a.
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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b.
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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Dated: March 1, 2019
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/s/ Michael A. Jacobsen
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Michael A. Jacobsen
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Principal Financial and Accounting Officer
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(1)
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The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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(2)
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The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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Dated: March 1, 2019
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/s/ Gregory A. Demopulos
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Gregory A. Demopulos, M.D.
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Principal Executive Officer
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(1)
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The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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(2)
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The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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Dated: March 1, 2019
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/s/ Michael A. Jacobsen
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Michael A. Jacobsen
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Principal Financial and Accounting Officer
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