Mereo BioPharma Provides Corporate Update

Rhea-AI Summary

Mereo BioPharma (NASDAQ: MREO) reported Phase 3 updates for setrusumab (UX143) in osteogenesis imperfecta and progress on alvelestat (MPH-966) for AATD-LD, plus revised cash guidance. As of Dec 31, 2025, cash and equivalents were approximately $41 million, expected to fund operations to mid-2027. Orbit and Cosmic Phase 3 studies did not meet their primary fracture reduction endpoints, but both achieved statistically significant improvements in bone mineral density as a key secondary endpoint. Further analyses and potential regulator interactions are ongoing. Alvelestat Phase 3 is planned as a single global trial (~220 patients, 18 months), and vantictumab was out-licensed with a Phase 2 start planned in 2H 2026.

Positive

• Cash balance of approximately $41 million as of Dec 31, 2025
• Phase 3 studies achieved statistical significance on bone mineral density
• Alvelestat Phase 3 planned as single global trial of ~220 patients
• Vantictumab out-license with Phase 2 planned in 2H 2026

Negative

• Orbit and Cosmic Phase 3 did not meet primary fracture endpoints
• Pre-commercial and manufacturing reductions/delays implemented for setrusumab
• Cash runway extended only to mid-2027, limiting near-term flexibility

News Market Reaction

+14.75% 1.7x vol

62 alerts

+14.75% News Effect

+28.1% Peak Tracked

-4.9% Trough Tracked

+$14M Valuation Impact

$109M Market Cap

1.7x Rel. Volume

On the day this news was published, MREO gained 14.75%, reflecting a significant positive market reaction. Argus tracked a peak move of +28.1% during that session. Argus tracked a trough of -4.9% from its starting point during tracking. Our momentum scanner triggered 62 alerts that day, indicating high trading interest and price volatility. This price movement added approximately $14M to the company's valuation, bringing the market cap to $109M at that time. Trading volume was above average at 1.7x the daily average, suggesting increased trading activity.

Data tracked by StockTitan Argus on the day of publication.

Key Figures

Cash balance: $41 million Cash runway: mid-2027 Alvelestat Phase 3 size: 220 patients +5 more

8 metrics

Cash balance $41 million Cash and cash equivalents as of Dec 31, 2025

Cash runway mid-2027 Company’s updated runway guidance

Alvelestat Phase 3 size 220 patients Planned global Phase 3 AATD-LD trial enrollment

Alvelestat treatment duration 18 months Treatment period in planned global Phase 3 trial

Vantictumab prior trial size around 100 patients Phase 1a/b oncology trials for vantictumab

Vantictumab Phase 2 start 2H 2026 Planned Phase 2 ADO2 study initiation by āshibio

Price change 28.62% Move on the day of the corporate update

52-week high vs price -87.13% Current price relative to 52-week high

Market Reality Check

Price: $0.6400 Vol: Volume 44,756,230 vs 20-d...

normal vol

$0.6400 Last Close

Volume Volume 44,756,230 vs 20-day average 30,810,920 (1.45x average), showing elevated interest ahead of the update. normal

Technical Price $0.4944 remains well below the $2.01 200-day MA, reflecting prior severe downside despite today’s bounce.

Peers on Argus

MREO rose 28.62% while key peers were mixed: LXEO up 10.37%, others like OMER (-...

MREO rose 28.62% while key peers were mixed: LXEO up 10.37%, others like OMER (-8.57%) and LCTX (-3.39%) declined, indicating a stock-specific reaction rather than a broad biotech move.

Common Catalyst Several biotech peers also had clinical and pipeline updates today, but MREO’s move diverged in magnitude and direction, pointing to company-specific reassessment after its Phase 3 results.

Historical Context

4 past events · Latest: Dec 29 (Negative)

Pattern 4 events

Date	Event	Sentiment	Move	Catalyst
Dec 29	Phase 3 results	Negative	-87.7%	Setrusumab Phase 3 ORBIT and COSMIC failed primary fracture endpoints despite BMD gains.
Nov 10	Quarterly earnings	Positive	-1.7%	Q3 2025 results with cash runway into 2027 and upcoming Phase 3 readouts.
Aug 19	Licensing deal	Positive	-2.4%	Out-licensing vantictumab for ADO2 while retaining European commercial rights.
Aug 12	Quarterly earnings	Positive	+9.2%	Q2 2025 results with <b>$56.1M</b> cash and progression of Phase 3 setrusumab.

Pattern Detected

Recent news shows binary reactions: major downside on negative Phase 3 data, but positive financial/pipeline updates have produced more moderate, sometimes divergent, moves.

Recent Company History

Over the last six months, Mereo reported quarterly results with cash of $56.1M in Q2 2025 and $48.7M in Q3 2025, guiding runway into 2027 while advancing Phase 3 setrusumab and partnering discussions for alvelestat. An August 2025 deal out-licensed vantictumab globally (ex-Europe) for ADO2. On Dec 29, 2025, Phase 3 ORBIT and COSMIC missed primary fracture endpoints but achieved BMD gains, triggering a -87.65% move. Today’s update revisits these trials, extends runway, and highlights ongoing partnering and Phase 3 planning for alvelestat.

Market Pulse Summary

The stock surged +14.8% in the session following this news. A strong positive reaction aligns with i...

Analysis

The stock surged +14.8% in the session following this news. A strong positive reaction aligns with investors refocusing on cash runway and pipeline optionality after the earlier Phase 3 setback. The stock had previously fallen 87.65% on the ORBIT and COSMIC fracture-endpoint failure, leaving shares trading 87.13% below the 52-week high before this update. Today’s move came with 1.45x average volume as the market reassessed the extended runway to mid-2027, secondary BMD data, and the planned 220-patient Phase 3 program for alvelestat.

Key Terms

osteogenesis imperfecta, alpha-1 antitrypsin deficiency-associated lung disease, phase 3, phase 2, +4 more

8 terms

osteogenesis imperfecta medical

"setrusumab (UX143) in osteogenesis imperfecta ongoing to determine potential path forward"

A genetic disorder that makes bones unusually fragile because the body produces faulty or too little of the protein that gives bone its strength; think of bones like a building made from weak bricks rather than strong ones. Investors track it because treatments, diagnostics, or therapies for the condition can create markets, affect clinical trial outcomes, regulatory approvals, and potential revenue for biotech and pharmaceutical companies developing interventions.

alpha-1 antitrypsin deficiency-associated lung disease medical

"alvelestat, which is being studied for the treatment of alpha-1 antitrypsin deficiency-associated lung disease"

A genetic condition in which the body lacks enough of a protein that protects the lungs, causing progressive lung damage and breathing problems similar to how a missing air filter lets dust gum up an engine. It matters to investors because it creates a defined group of patients and ongoing medical need, which shapes demand for treatments, the size of potential markets, clinical trial designs, regulatory decisions, and reimbursement dynamics.

phase 3 medical

"Additional data analyses from Orbit and Cosmic Phase 3 studies of setrusumab"

Phase 3 is the late-stage clinical testing step for a new drug or medical treatment, where the product is given to large groups of patients to confirm effectiveness, monitor side effects, and compare it to standard care. Successful Phase 3 results are often the final scientific hurdle before regulators decide on approval and market launch—like passing a final exam before graduation—and can sharply change a company's valuation and future revenue prospects.

phase 2 medical

"plans to initiate a Phase 2 study in 2H 2026"

Phase 2 is the mid-stage clinical trial where a new drug or treatment is tested in a larger group of patients to see if it works and to keep checking safety after initial human testing. Think of it as a field test that proves whether a product actually delivers its promised benefit. Investors watch Phase 2 closely because its results strongly influence a medicine’s chances of reaching the market, the size of its potential sales, and the company’s valuation.

phase 1a/b medical

"previously investigated in Phase 1a/b oncology trials in around 100 patients"

Phase 1a/b is an early-stage clinical trial that tests a new drug or medical treatment in people to assess safety, find the right dose, and look for early signs it might work. For investors it matters because positive phase 1a/b results lower scientific and regulatory uncertainty and unlock value by advancing the program to larger trials, while negative results can sharply reduce a treatment’s commercial prospects—similar to passing or failing an initial safety inspection before mass production.

st. george’s respiratory questionnaire medical

"The primary efficacy endpoint for U.S. approval will be the St. George’s Respiratory Questionnaire (SGRQ)"

A validated questionnaire that asks patients about breathing symptoms, how breathlessness affects daily activities, and the emotional and social impact of lung disease; it produces scores that quantify a patient’s respiratory quality of life. Investors watch these scores because they are widely used in clinical trials and regulatory reviews to show whether a treatment meaningfully improves patients’ lives—think of it like a customer satisfaction survey that helps prove a product’s real-world value.

ct scan medical

"with lung density measured by CT scan serving as the primary endpoint"

A CT scan (computed tomography) is a medical imaging test that uses X‑rays and computer processing to create detailed cross‑sectional pictures of the body, like viewing thin slices of a loaf of bread to see inside. For investors, CT scans matter because they drive demand for imaging equipment, influence hospital and clinic revenue, affect diagnostic accuracy that guides treatment choices, and factor into reimbursement and regulatory decisions in the healthcare sector.

autosomal dominant osteopetrosis type 2 medical

"out-licensed vantictumab for autosomal dominant osteopetrosis Type 2 (ADO2) to āshibio"

A rare inherited bone disorder in which genetic changes cause bones to become abnormally dense and brittle, similar to a sponge turning into rock: they look thick but break more easily and can compress nerves or marrow. For investors, it signals a small but critical market for therapies, diagnostic tests and regulatory attention, with drug development, clinical-trial results and approval decisions driving valuation and commercial opportunity.

AI-generated analysis. Not financial advice.

Additional data analyses from Orbit and Cosmic Phase 3 studies of setrusumab (UX143) in osteogenesis imperfecta ongoing to determine potential path forward for the program 

Cash balance of approximately $41 million as of December 31, 2025; runway guidance updated to mid-2027

LONDON, Jan. 12, 2026 (GLOBE NEWSWIRE) -- Mereo BioPharma Group plc (NASDAQ: MREO) (“Mereo” or the “Company”), a clinical-stage biopharmaceutical company focused on rare diseases, today provided an update on its programs, setrusumab for the treatment of osteogenesis imperfecta (OI) and alvelestat, which is being studied for the treatment of alpha-1 antitrypsin deficiency-associated lung disease (AATD-LD), and revised its cash runway guidance.

Data from the Phase 3 Orbit and Cosmic studies of setrusumab in osteogenesis imperfecta, including data on bone mineral density, vertebral fractures, and patient reported outcomes on pain and physical function, will be presented at the J.P. Morgan Healthcare Conference.

The Company is also updating its previous cash runway guidance. As of December 31, 2025, cash and cash equivalents were approximately $41 million, which are expected to fund operations to mid-2027.

“The reductions and delays in pre-commercial and manufacturing activities related to setrusumab that we implemented following the recent top-line data from the Phase 3 Orbit and Cosmic studies have extended our cash runway to mid-2027 and we will continue to tightly manage our resources as we assess potential next steps for the program, alongside our partner, Ultragenyx,” said Dr. Denise Scots-Knight, Chief Executive Officer of Mereo. “There are no FDA or EMA approved treatments for people living with OI. Although bisphosphonates are used to improve bone mineral density, OI remains a high unmet need. We will continue to assess the totality of the Phase 3 trial data to determine next steps, including potential interactions with the regulators. In parallel, we are advancing partnering discussions for our Phase 3 ready program, alvelestat in AATD-LD.”

Dr. Scots-Knight is scheduled to present at the 44th Annual J.P. Morgan Healthcare Conference on Wednesday, January 14, 2026 at 1:30pm PT (9:30pm GMT). A live audio webcast of the presentation can be accessed through the news and events section of the Company’s website at www.mereobiopharma.com/news. Following the conclusion of the live event, an archived replay will be available on the Company’s website.

Setrusumab (UX143)

As announced on December 29, 2025, the Phase 3 Orbit and Cosmic studies of setrusumab in OI did not achieve statistical significance against the primary endpoints of reduction in annualized clinical fracture rate compared to placebo or bisphosphonates, respectively. Both studies achieved strong statistical significance against the key secondary endpoint of improvement in bone mineral density versus comparator. The improvement in bone mineral density in the Cosmic study was associated with a decreased rate of fracture in this younger more highly fracturing patient population, although this was not statistically significant. The safety profile of setrusumab was consistent with that observed in prior studies.

Further analyses of the data from both studies are ongoing to determine the path forward, including potential regulatory interactions.

There is a high unmet medical need in OI, which is associated with a substantial clinical, humanistic and economic burden of illness due to the complexity of the condition and necessary medical care and support. As well as fractures, people living with OI present with a broad spectrum of skeletal features including bone deformity, scoliosis and growth impairment. Pain is the most common and impactful sign, symptom or clinical event reported in children and adolescents.

There are no EMA or FDA approved treatments for OI (except for neridronate, which is approved nationally in Italy). Bisphosphonates are used off-label in children in Europe and the U.S., despite the lack of clinical evidence to support their effectiveness in reducing fractures.

Alvelestat (MPH-966)

The Company is continuing to advance key activities to support the planned initiation of the global Phase 3 pivotal study. Based on previous discussions with the FDA and EMA, Mereo anticipates a single Phase 3 trial enrolling approximately 220 early- and late-stage AATD-LD patients evaluating alvelestat over an 18-month treatment period will support regulatory submissions in both the U.S. and Europe. The primary efficacy endpoint for U.S. approval will be the St. George’s Respiratory Questionnaire (SGRQ) Total Score, with lung density measured by CT scan serving as the primary endpoint for potential European regulatory approval.

Mereo continues to be in active discussions with potential partners for the Phase 3 development and commercialization of alvelestat.

Vantictumab (OMP18R5)

The Company out-licensed vantictumab for autosomal dominant osteopetrosis Type 2 (ADO2) to āshibio, Inc. whilst retaining European rights. āshibio, Inc. is responsible for funding the global program and following regulatory discussions, plans to initiate a Phase 2 study in 2H 2026. Vantictumab was previously investigated in Phase 1a/b oncology trials in around 100 patients with biomarker evidence of potential impact on osteoclast function and high bone turnover which led to fragility fractures in some patients. āshibio, Inc. reported promising pre-clinical data at ASBMR 2025 in ADO2 mouse model. Vantictumab significantly decreased areal bone mineral density and rescued the bone phenotype in the ADO2 mouse model.

About Mereo BioPharma

Mereo BioPharma is a biopharmaceutical company focused on the development of innovative therapeutics for rare diseases. The Company has three rare disease product candidates: setrusumab for the treatment of osteogenesis imperfecta (OI); alvelestat for the treatment of alpha-1 antitrypsin deficiency-associated lung disease (AATD-LD) and vantictumab for the treatment of autosomal dominant osteopetrosis type 2 (ADO2). The Company’s partner for setrusumab, Ultragenyx Pharmaceutical Inc., has reported results from the Phase 3 portion of a pivotal Phase 2/3 study in pediatrics and young adults (5 to 25 years old) for setrusumab in OI and in the Phase 3 study in pediatric patients (2 to <7 years old). The partnership with Ultragenyx includes potential additional milestone payments of up to $245 million and royalties to Mereo on commercial sales in Ultragenyx territories. Mereo has retained EU and UK commercial rights and will pay Ultragenyx royalties on commercial sales in those territories. Setrusumab has received orphan designation for osteogenesis imperfecta from the European Commission (“EC”) and the FDA, PRIME designation from the EMA, and has Breakthrough Therapy designation and rare pediatric disease designation from the FDA. Alvelestat has received Orphan Designation for AATD from the EC and the FDA, and Fast Track designation from the FDA for AATD-LD. Following results from ASTRAEUS and ATALANTa in AATD-lung disease, the Company has aligned with the FDA and the EMA on the primary endpoints for a Phase 3 pivotal study which, if successful, could enable full approval in both the U.S. and Europe. The Company’s partner for vantictumab, āshibio, Inc., is funding the global development program. Mereo has retained EU and UK commercial rights. Mereo has also entered into an exclusive global license agreement with ReproNovo SA, a reproductive medicine company, for the development and commercialization of leflutrozole, a non-steroidal aromatase inhibitor for the treatment of infertility in men with low testosterone. In addition, Mereo has two oncology product candidates, etigilimab, an anti-TIGIT; and navicixizumab for the potential treatment of late-line ovarian cancer. Navicixizumab has been partnered with Feng Biosciences, Inc. in a global licensing agreement that includes milestone payments and royalties.

Forward-Looking Statements

This press release contains “forward-looking statements” that involve substantial risks and uncertainties. All statements other than statements of historical fact contained herein are forward-looking statements within the meaning of Section 27A of the United States Securities Act of 1933, as amended, and Section 21E of the United States Securities Exchange Act of 1934, as amended. Forward-looking statements usually relate to future events and anticipated revenues, earnings, cash flows or other aspects of our operations or operating results. Forward-looking statements are often identified by the words “believe,” “expect,” “anticipate,” “plan,” “intend,” “foresee,” “should,” “would,” “could,” “may,” “estimate,” “outlook” and similar expressions, including the negative thereof. The absence of these words, however, does not mean that the statements are not forward-looking. These forward-looking statements are based on the Company’s current expectations, beliefs and assumptions concerning future developments and business conditions and their potential effect on the Company. While management believes that these forward-looking statements are reasonable as and when made, there can be no assurance that future developments affecting the Company will be those that it anticipates.

All of the Company’s forward-looking statements involve known and unknown risks and uncertainties some of which are significant or beyond its control and assumptions that could cause actual results to differ materially from the Company’s historical experience and its present expectations or projections. Such risks and uncertainties include, among others, the uncertainties inherent in the clinical development process; the Company’s reliance on third parties to conduct and provide funding for its clinical trials; the Company’s dependence on enrollment of patients in its clinical trials; and the Company’s dependence on its key executives. You should carefully consider the foregoing factors and the other risks and uncertainties that affect the Company’s business, including those described in the “Risk Factors” section of its Annual Report on Form 10-K, as well as discussions of potential risks, uncertainties, and other important factors in the Company’s subsequent filings with the Securities and Exchange Commission. The Company wishes to caution you not to place undue reliance on any forward-looking statements, which speak only as of the date hereof. The Company undertakes no obligation to publicly update or revise any of our forward-looking statements after the date they are made, whether as a result of new information, future events or otherwise, except to the extent required by law.

Mereo BioPharma Contacts:
Mereo	+44 (0)333 023 7300
Denise Scots-Knight, Chief Executive Officer
Christine Fox, Chief Financial Officer
Burns McClellan (Investor Relations Adviser to Mereo)	+01 646 930 4406
Lee Roth
Investors	investors@mereobiopharma.com

FAQ

What did Mereo (MREO) announce about setrusumab Phase 3 results on Jan 12, 2026?

The Orbit and Cosmic Phase 3 studies did not meet their primary fracture reduction endpoints but showed statistically significant bone mineral density improvements as a key secondary endpoint.

How much cash did Mereo (MREO) report and how long is the runway?

Mereo reported approximately $41 million in cash and equivalents as of Dec 31, 2025, with a runway expected to mid-2027.

What are Mereo's next steps for setrusumab (UX143) after the Phase 3 readouts?

Mereo is conducting further analyses of Orbit and Cosmic data and assessing potential regulatory interactions and program options with partner Ultragenyx.

What is the planned design for alvelestat Phase 3 and regulatory endpoints?

Mereo anticipates a single global Phase 3 enrolling ~220 AATD-LD patients over 18 months; SGRQ Total Score for the U.S. and CT lung density for Europe.

Will Mereo present data from the Phase 3 studies at J.P. Morgan 2026?

Yes, Mereo will present Orbit and Cosmic data, including bone mineral density, vertebral fractures, and patient-reported outcomes, at the J.P. Morgan Healthcare Conference.

What happened to vantictumab in Mereo's portfolio and the development timeline?

Vantictumab was out-licensed to āshibio with Mereo retaining European rights; āshibio plans a Phase 2 study in 2H 2026.