Omeros Corporation (NASDAQ: OMER) turns profitable as YARTEMLEA sales ramp
Omeros Corporation reported its first commercial quarter for YARTEMLEA, generating $28.5 million in product sales for the quarter and $38.4 million for the first half of 2026, compared with no product sales in 2025. Net income for the quarter was $13.2 million and for the first six months $69.3 million, versus net losses of $25.4 million and $58.9 million in the prior‑year periods, helped by a $84.6 million net gain on changes in fair value of financial instruments and income from discontinued OMIDRIA royalties.
Cash and cash equivalents were $2.0 million with $130.0 million in short‑term investments as of June 30, 2026. Net cash used in operating activities was $10.4 million for the first half. The OMIDRIA contract royalty asset totaled $116.5 million, offset by an OMIDRIA royalty obligation of $157.9 million. Omeros repurchased portions of its 2029 convertible notes, leaving $54.8 million principal outstanding, and shareholders’ deficit narrowed to $51.3 million from $121.2 million at year‑end 2025.
Positive
- Return to profitability: Net income of $13.2 million for Q2 and $69.3 million for the first half of 2026, compared with net losses of $25.4 million and $58.9 million in the prior‑year periods.
- Strong initial product revenue: YARTEMLEA generated $28.5 million in quarterly and $38.4 million in year‑to‑date product sales, versus no product sales in 2025.
- Balance sheet improvement: Shareholders’ deficit improved from $(121.2) million at December 31, 2025 to $(51.3) million at June 30, 2026, reflecting profitability and equity activity.
Negative
- Negative operating cash flow: Net cash used in operating activities was $10.4 million for the first half of 2026 despite positive reported earnings.
- High royalty and debt obligations: OMIDRIA royalty obligation of $157.9 million plus $54.8 million principal on 2029 convertible notes, with total scheduled OMIDRIA payments of $205.1 million through 2031.
- Limited on‑balance‑sheet cash: Cash and cash equivalents declined to $2.0 million (from $9.7 million), partially offset by $130.0 million in short‑term investments.
Filing Explained
Completed note repurchases reduced remaining debt and potential conversion shares, while $150 million of ATM issuance capacity remains available.
This Form 10-Q is an unaudited quarterly update. The company reports that its two 2029 Notes repurchases were completed on
The repurchases covered
The company also reports an at-the-market facility with
For holders, the filing separately records retirement of
Key Figures
Key Terms
OMIDRIA contract royalty asset financial
OMIDRIA royalty obligation financial
embedded derivative financial
make-whole fundamental change financial
lectin pathway of complement medical
discontinued operations financial
Earnings Snapshot
AI-generated analysis. How Rhea-AI works. Not financial advice.
FAQ
How did Omeros (OMER) perform financially in the quarter ended June 30, 2026?
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How much revenue did YARTEMLEA generate for Omeros (OMER) in 2026?
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F41
Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes
As of August 7, 2026, the number of outstanding shares of the registrant’s common stock, par value $0.01 per share, was
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934 (the “Exchange Act”), which are subject to the “safe harbor” created by those sections for such statements. Forward-looking statements are based on our management’s beliefs and assumptions and on currently available information. All statements other than statements of historical fact are “forward-looking statements.” Terms such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “goal,” “intend,” “likely,” “may,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “target,” “will,” “would,” and similar expressions and variations thereof are intended to identify forward-looking statements, but these terms are not the exclusive means of identifying such statements. Examples of these statements include, but are not limited to, statements regarding:
● our future performance, financial position and results of operations, including our expectations relating to income from product sales revenue, milestone payments potentially payable to us under certain agreements and other sources, our estimates of future operating expenses and projections regarding how long our existing cash, cash equivalents and short-term investments will fund our anticipated operating expenses, capital expenditures, and debt service obligations;
● the availability of capital resources, including our ability to raise additional capital through the capital markets or one or more future equity offerings, debt financings, industry collaborations, licensing arrangements, asset sales, or other means;
● our plans for sales, marketing, and distribution of YARTEMLEA® and our estimates and expectations regarding coverage and reimbursement for YARTEMLEA;
● our expectations regarding anticipated or potential paths to regulatory approval of YARTEMLEA by the European Medicines Agency (“EMA”), including the outcome of any reexamination of our marketing authorization application (“MAA”) for narsoplimab in hematopoietic stem cell transplant-associated thrombotic microangiopathy (“TA-TMA”), and whether the EMA or any other regulatory authority will ultimately grant approval for narsoplimab in TA-TMA or in any other indication;
● our expectations regarding supply and manufacturing of YARTEMLEA drug substance and finished drug product and the performance of the contract manufacturers on whom we rely to manufacture YARTEMLEA for commercial sale and for support with associated regulatory obligations, and our expectations related to manufacturing and supply of our product candidates in development;
● our expectations about the commercial competition that YARTEMLEA or our product candidates, if commercialized, face or may face;
● our expectations relating to the Asset Purchase and License Agreement (the “APLA”), by and between Omeros Corporation and Novo Nordisk Health Care AG (“Novo Nordisk”), including Novo Nordisk’s anticipated development plans for zaltenibart, anticipated outcomes of such plans and the amounts potentially payable to us under the terms of the APLA;
● our expectations regarding the clinical, therapeutic, and competitive benefits and importance of YARTEMLEA, zaltenibart, and the product candidates within our development pipeline;
● our expectations regarding planned or ongoing clinical trials, including anticipated strategies for future clinical development of our internal or partnered products and development candidates, and our ability or our partners’ ability to design, initiate and/or successfully complete clinical trials and other studies;
● our involvement in existing or 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;
● 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;
● our ability to consummate licensing, partnering or other transactions and the benefits, including potential milestone payments, if any, that we may receive under agreements to which we are currently a party or from any such future transactions;
● Our expectations with respect to share and debt repurchase activities; and
● 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.
Our actual results could differ materially from those anticipated in these forward-looking statements for many reasons, including the risks, uncertainties and other factors described in this Quarterly Report on Form 10-Q under the headings “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and in our other filings with the U.S. Securities and Exchange Commission (the “SEC”). Given these risks, uncertainties and other factors, actual results or anticipated developments may not be realized or, even if substantially realized, may not have the expected consequences to or effects on our company, business or operations. Accordingly, you should not place undue reliance on these forward-looking statements, which represent our estimates and assumptions only as of the date of the filing of this Quarterly Report on Form 10-Q. You should read this Quarterly Report on Form 10-Q completely and with the understanding that our actual results in subsequent periods may differ materially from current expectations. Except as required by applicable law, we assume no obligation to update or revise any forward-looking statements contained herein, whether as a result of any new information, future events or otherwise.
OMEROS CORPORATION
FORM 10-Q FOR THE QUARTER ENDED June 30, 2026
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PART I — FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
OMEROS CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share and per share data)
(unaudited)
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OMEROS CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
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(unaudited)
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OMEROS CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ DEFICIT
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OMEROS CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(unaudited)
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Six Months Ended June 30, |
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Net income (loss) |
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Loss on early extinguishment of 2029 Notes |
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Exchange of 2026 Notes for 2029 Notes |
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Exchange of 2026 Notes for share-settled liability |
$ | $ | ||||||
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Exchange of 2026 Notes for common stock |
$ | $ | ||||||
See accompanying Notes to Condensed Consolidated Financial Statements
OMEROS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
Note 1—Organization and Basis of Presentation
General
Omeros Corporation (“Omeros,” the “Company” or “we”) is an innovative, commercial-stage biotechnology company that discovers and develops first-in-class protein and small-molecule therapeutics for large-market and orphan indications. Our drug product YARTEMLEA® (narsoplimab-wuug) is commercially available in the U.S. for the treatment of hematopoietic stem cell transplant-associated thrombotic microangiopathy (“TA-TMA”) in adult and pediatric patients two years of age and older. Our diverse pipeline of development programs is focused on the treatment of complement-mediated diseases, cancers, and addictive or compulsive disorders.
Our clinical-stage development programs include: narsoplimab, our antibody targeting mannan-binding lectin-associated serine protease 2 (“MASP-2”), the effector enzyme of the lectin pathway of complement; OMS1029, our long-acting antibody targeting MASP-2; and OMS527, our phosphodiesterase 7 (“PDE7”) inhibitor program. On November 25, 2025, we completed a transaction under an Asset Purchase and License Agreement (“APLA”) with Novo Nordisk Health Care AG (“Novo Nordisk”) pursuant to which Novo Nordisk received exclusive global rights in all indications to develop and commercialize zaltenibart (formerly OMS906) and certain related compounds and products. Zaltenibart is a first-in-class, late-stage human monoclonal antibody targeting mannan-binding lectin-associated serine protease-3 (“MASP-3”), the most upstream and key activator of the alternative pathway of complement.
FDA Approval of YARTEMLEA®
On December 23, 2025, FDA approved YARTEMLEA® (narsoplimab-wuug) for the treatment of TA-TMA. TA-TMA is a severe and often-fatal complication of hematopoietic stem cell transplantation in adults and children, driven by systemic endothelial injury triggered by conditioning regimens, immunosuppressants, infection, graft-versus-host disease, and other transplant-related factors. Activation of the lectin pathway of complement plays a central role in disease pathogenesis. YARTEMLEA selectively inhibits MASP-2, blocking pathway activation while preserving classical and alternative complement pathway functions important for host defense. In TA-TMA, MASP-2 inhibition prevents lectin pathway-mediated cellular injury, including endothelial damage in small blood vessels, and thrombus formation.
YARTEMLEA is the first and only approved inhibitor of the lectin pathway of complement. YARTEMLEA is approved for the treatment of TA-TMA in adults and in children two years of age and older.
Commercial distribution and sales of YARTEMLEA commenced in January 2026.
In June 2026, the Committee for Medicinal Products for Human Use (“CHMP”) of the European Medicines Agency (“EMA”) adopted a negative opinion on our marketing authorization application (“MAA”) for narsoplimab in TA-TMA. We believe the clinical evidence supports approval and have requested re-examination. As part of that procedure, an Ad Hoc Expert Group, expected to comprise external scientific and clinical experts in hematology and stem cell transplantation, will review the evidence and address questions central to CHMP’s assessment. If the MAA is ultimately approved, it would authorize the product to be marketed in all European Union (“EU”) member states and European Economic Area countries, although there can be no guarantee that the re-examination will result in a reversal of CHMP’s negative opinion or the ultimate approval of the MAA. The European Commission has granted narsoplimab designation as an orphan medicinal product for treatment in hematopoietic stem cell transplantation. For potential commercialization of YARTEMLEA outside the U.S., including Europe, we are evaluating potential partnerships, including broad ex-U.S. and regional collaborations.
Sale of Zaltenibart
On November 25, 2025, we completed a transaction (the “Transaction”) pursuant to the APLA between Omeros and Novo Nordisk, dated October 10, 2025, in which Novo Nordisk received exclusive global rights in all indications to develop and commercialize zaltenibart (formerly OMS906), and certain related compounds and products. Zaltenibart is a first-in-class, late-stage clinical humanized monoclonal antibody targeting MASP-3, the most upstream and key activator of the alternative pathway of the complement system. Zaltenibart has shown multiple potential advantages over other alternative pathway inhibitors in development and on the market.
At the closing of the Transaction, we received an upfront cash payment of $
Pursuant to the APLA, we sold and transferred, and Novo Nordisk purchased, zaltenibart and certain related assets, and the parties agreed to grant and receive certain intellectual property licenses to facilitate the continued development and commercialization activities of both companies. We retain rights to our entire MASP-3 small-molecule program, including the ability to develop and commercialize small-molecule MASP-3 inhibitors, across a range of therapeutic areas, including, but not limited to, ophthalmology, neurology, gastrointestinal disorders, dermatology, musculoskeletal diseases and oncology. We also retain rights to our “grandfathered” MASP-3 antibodies, with temporal and indication restrictions on commercialization and for use in advancing our small-molecule therapeutics.
In accordance with the APLA, at the closing of the Transaction, Omeros and Novo Nordisk entered into a transition services agreement (the “Transition Services Agreement”) pursuant to which we are providing certain transition services to Novo Nordisk to facilitate the transfer of the acquired assets and liabilities under the APLA and to provide for the continued operation of relevant studies and program activities during the applicable term. Subject to certain exceptions and limitations, Novo Nordisk reimburses us for costs and expenses we incur under the Transition Services Agreement, including third-party costs and expenses, costs associated with delivery of transition services by Omeros personnel on an hourly basis at rates specified in the Transition Services Agreement, and for our inventories of zaltenibart drug substance and product.
Other Development Programs
Our lectin pathway program also includes OMS1029, our long-acting antibody targeting MASP-2. We have completed Phase 1 clinical trials evaluating both single-ascending and multiple ascending doses of OMS1029. Results of these studies support once-quarterly dosing administered either intravenously or subcutaneously. OMS1029 has been well tolerated to date with no safety concerns identified. As we assess new potential indications for YARTEMLEA, we are finalizing the initial indication in which to evaluate OMS1029 in a Phase 2 clinical program. In addition, we have selected a development candidate for our MASP-2 small molecule program, which is advancing to Investigational New Drug (“IND”)-enabling studies targeting once-daily oral administration.
Our PDE7 inhibitor program, which we refer to as OMS527, comprises multiple PDE7 inhibitor compounds and is based on our discoveries of previously unknown links between PDE7 and any addiction or compulsive disorder, and between PDE7 and any movement disorder. In April 2023, we were awarded a grant from the National Institute on Drug Abuse (“NIDA”) to develop an orally administered PDE7 inhibitor compound for the treatment of cocaine use disorder. NIDA awarded the grant to us for a total of $
We also have various programs in preclinical research and development. We continue to progress preclinical studies within our novel oncology program, which is focused on developing novel, proprietary large molecule therapeutics designed to selectively target and kill dividing cancer cells. We have completed selection of a drug development candidate, and IND-enabling studies are underway for this program, which we refer to as OncotoX-AML. We have partnered with a leading contract manufacturing organization for manufacturing process development and clinical supply. Acute myeloid leukemia (“AML”), an aggressive and highly fatal bone marrow and blood cancer, is the lead indication for development. We expect to initiate a Phase 1b clinical trial in late 2027.
We are also advancing our targeted complement activating therapy (“T-CAT”) platform: a new class of recombinant antibodies intended for broad action against pathogens, including bacteria, fungi, viruses, and parasites. T-CAT is designed to harness complement activation to kill pathogens directly, which represents a novel approach to infectious disease treatment. Our T-CAT antibodies are expected to treat drug-resistant organisms without enhancing drug resistance. Our initial focus is on developing T-CAT antibodies against infections caused by multidrug-resistant organisms.
Basis of Presentation
Our condensed consolidated financial statements include the financial position and results of operations of Omeros and our wholly owned subsidiaries. All inter-company transactions have been eliminated. The accompanying condensed consolidated financial statements reflect all adjustments, consisting of normal recurring adjustments and non-recurring adjustments, considered necessary for the fair presentation of such information. Our financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”).
Use of Estimates
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Significant items subject to such estimates include revenue recognition and the valuations of the OMIDRIA contract royalty asset, the OMIDRIA royalty obligation, and the embedded derivatives associated with our debt. We base our estimates on historical experience and on various other factors that we believe are reasonable under the circumstances; however, actual results could differ from these estimates.
Note 2—Significant Accounting Policies
Segment Reporting
We operate in one business segment focusing on the research, discovery, development and commercialization of small-molecule and protein therapeutics targeting immunologic diseases, including complement-mediated diseases and cancers related to dysfunction of the immune system, as well as addictive and compulsive disorders. The Company defines its operating segment based on internally reported financial information that is regularly used by the Chief Operating Decision Maker (“CODM”) to analyze performance, make decisions and allocate resources. The Company’s CODM is our Chief Executive Officer. For the three and six months ended June 30, 2026, the Company has identified one operating and reporting segment. The CODM reviews net income (loss) and expenses reported on the condensed consolidated statement of operations and comprehensive income (loss). The measurement of segment assets is reported on the condensed consolidated balance sheet as total consolidated assets. All long-lived assets are held in the U.S. Our segment net income (loss) aligns with our condensed consolidated statement of operations and comprehensive income (loss).
Revenue Recognition
When we enter into a customer contract, we perform the following five steps: (i) identify the contract with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) we satisfy a performance obligation.
Product Sales, Net
We generally recognize revenue from product sales when the product is delivered to our wholesalers and title to the product is transferred, upon which we have satisfied our performance obligations. Fulfillment activities by the wholesalers are not considered to be a separate performance obligation. Product revenue is recorded net of variable consideration, including wholesaler distribution fees, chargebacks, returns and discounts. We estimate variable consideration using the expected value approach. This estimate is based on several factors, including: historical return rates, expiration date by product and estimated levels of inventory in the wholesale channel. Since there is often a timing lag between the product sale and the settlement of accruals relating to these programs, our net product revenue may incorporate revisions of accruals for several periods. We include such estimates in the transaction price only to the extent that it is probable that a significant reversal of revenue will not occur when the uncertainty associated with the variable consideration is subsequently resolved.
Given the limited commercialization history of YARTEMLEA, our estimates of variable consideration require judgment and are subject to change as additional data becomes available. We recognize adjustments to net product revenue in the period in which changes in estimates become known.
Chargebacks
Chargebacks represent discounts provided to eligible covered entities under government programs, including the 340B Drug Pricing Program (“340B”) and the Medicaid Drug Rebate Program (“Medicaid”). In addition, we are subject to pricing obligations under our Federal Supply Schedule agreement with the U.S. government (the “FSS Agreement”), which establishes maximum prices for sales to certain federal agencies and may give rise to additional discounts and rebates. Chargebacks are recorded as a reduction of gross product revenue at the time of sale. Reserves for chargebacks are generally recorded as reductions of accounts receivable, while reserves for Medicaid rebates and patient co-pay assistance, if applicable, are recorded as accrued liabilities.
Chargeback estimates are based on statutory pricing requirements applicable to the 340B program and expected utilization by covered entities. Given the limited commercial history of YARTEMLEA, these estimates require significant judgment, including assumptions related to future utilization patterns and channel inventory. Estimates are reassessed at each reporting period and adjusted as necessary based on actual experience, changes in 340B utilization, and other relevant factors.
In addition to 340B chargebacks and Medicaid rebates, we maintain programs that may result in additional variable consideration, including a patient co-pay assistance program. There was no activity under the Medicaid and co-pay assistance program during the three and six months ended June 30, 2026, and, accordingly, no material related reductions to gross product revenue were recorded. We will continue to evaluate these programs as utilization evolves and will recognize the related reductions to revenue in the period in which they occur.
Distribution Fees and Return Allowances
We pay distribution fees to wholesalers for services they perform on our behalf. These fees are calculated based on the wholesalers’ average acquisition cost of purchases of YARTEMLEA, exclusive of any chargebacks. We estimate these amounts at the time of sale to the wholesaler and record them as a reduction in product sales in the same period the related revenue is recognized.
We allow for the return of product up to 12 months past its expiration date or for product that is damaged. In estimating product returns, we take into consideration our return experience to date, the remaining shelf-life of product we have previously sold, inventory in the wholesale channel, and our assessment based on the frequency of reorders that healthcare facilities are not maintaining material amounts of product on hand. There were no product returns in the three and six months ended June 30, 2026. Due to the ordering patterns associated with transplant centers and the extended shelf life of YARTEMLEA, returns are expected to be limited; however, our estimates may change as commercial experience matures.
Cost of Product Sales
Cost of product sales includes third-party manufacturing, royalties based on net product sales, and other costs directly related to the production and distribution of YARTEMLEA. We expensed as research and development expense all costs associated with the manufacture of YARTEMLEA produced prior to FDA approval. As a result, the cost basis of inventory available for sale at the time of commercialization was minimal, and cost of product sales is correspondingly low during the initial period following launch. Following FDA approval, we capitalize direct manufacturing costs as inventory and recognize these amounts in cost of product sales when the related inventory is sold. Accordingly, cost of product sales and gross margin during the initial periods following commercialization may not be indicative of future periods as we begin capitalizing and expensing post‑approval manufacturing costs.
Research and Development
Research and development expenses are comprised primarily of contracted research and development activities, clinical trial study and manufacturing costs prior to approval; consulting services; contract milestones; materials and supplies; costs for personnel, including salaries, benefits, and stock-based compensation; depreciation; an allocation of our occupancy costs; and other expenses incurred to sustain our overall research and development programs. Advance payments for goods or services that will be used for future research and development activities are deferred and then recognized as an expense as the related goods are delivered or the services are performed. All other research and development costs are expensed as incurred.
Selling, General and Administrative
Selling, general and administrative expenses are comprised primarily of marketing expenses; professional and legal services; patent costs; and salaries, benefits, and stock-based compensation costs for marketing and other personnel not directly engaged in research and development. Additionally, selling, general and administrative expenses include depreciation, an allocation of our occupancy costs, and other general corporate expenses. Advertising costs are expensed as incurred.
Stock-Based Compensation
Stock-based compensation expense is recognized for all share-based payments, including grants of stock option awards and restricted stock units based on estimated fair values. The fair value of our stock is calculated using the Black-Scholes option-pricing model, which requires assumptions around volatility, forfeiture rates, risk-free interest rate and expected term. Compensation expense is recognized over the requisite service periods, which is generally the vesting period, using the straight-line method. Forfeiture expense is estimated at the time of grant and revised in subsequent periods if actual forfeitures differ from those estimates.
Income Taxes
Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their tax basis. Deferred tax assets and liabilities are measured using enacted tax rates applied to taxable income in the years in which those temporary differences are expected to be recovered or settled. We recognize the effect of income tax positions only if those positions are more likely than not to be sustained upon an examination by the relevant taxing authority. A valuation allowance is established when it is more likely than not that the deferred tax assets will not be realized.
Asset Sale Transactions
The Company evaluates transactions involving the sale of our compounds, products or drug programs to determine whether such arrangements represent a sale of a business or a sale of a nonfinancial asset. Transactions that do not meet the definition of a business are accounted for as the sale of a nonfinancial asset under Accounting Standards Codification (“ASC”) 610‑20, Other Income—Gains and Losses from the Derecognition of Nonfinancial Assets.
Upon transfer of control of the compound, product or drug program asset to a counterparty, the Company recognizes consideration received. Any excess of consideration over the carrying value of the asset sold is recognized as a gain in the condensed consolidated statements of operations.
Potential Milestone Income
The APLA with Novo Nordisk includes variable consideration in the form of milestone payments that are contingent upon the achievement of specified development, regulatory or commercialization events. The Company applies the variable consideration and constraint guidance in ASC 606, Revenue from Contracts with Customers, by analogy. At contract inception and throughout the term of the arrangement, the Company assesses whether the achievement of each milestone is probable and estimates variable consideration using the most likely amount method. Contingent milestone payments are excluded from the transaction price until the related milestone is achieved and it is probable that a significant reversal of cumulative revenue recognized will not occur.
Amounts are included in the transaction price only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. The Company re-evaluates the transaction price at each reporting period, including the estimated variable consideration and the application of the constraint, to reflect changes in circumstances. Factors considered in these evaluations include the clinical or technical complexity of the milestone, the stage of development, and the risk of regulatory approval. Because of the risk that products in development will not receive regulatory approval, we generally do not recognize any contingent payments that would be due to us until regulatory approval.
Discontinued Operations
We review the presentation of planned or completed business dispositions in the condensed consolidated financial statements based on the available information and events that have occurred. The review consists of evaluating whether the business meets the definition of a component for which the operations and cash flows are clearly distinguishable from the other components of the business and, if so, whether it is anticipated that after the disposal the cash flows of the component would be eliminated from continuing operations and whether the disposition represents a strategic shift that has a major effect on operations and financial results. Planned or completed business dispositions are presented as discontinued operations when all the criteria described above are met.
We determined that the zaltenibart Transaction with Novo Nordisk did not meet the above criteria. As such, we recorded the gain on sale of zaltenibart in Other Income in our condensed consolidated statement of operations and comprehensive loss for the year ended December 31, 2025.
On December 23, 2021, we closed on an Asset Purchase Agreement (the “Asset Purchase Agreement”) with Rayner Surgical Inc. (“Rayner”) for the sale of our commercial product OMIDRIA, which we record as an OMIDRIA contract asset on our condensed consolidated balance sheet. As a result of the divestiture, the results of OMIDRIA activities are classified as discontinued operations in our condensed consolidated statement of operations and comprehensive income (loss) and excluded from continuing operations for all periods presented. We have rights to receive future royalties from Rayner on OMIDRIA net sales at royalty rates that vary based on geography and certain regulatory contingencies. Therefore, future OMIDRIA royalties are treated as variable consideration. The sale of OMIDRIA qualified as an asset sale under GAAP. To measure the OMIDRIA contract royalty asset, we use the expected value approach, which is the sum of the discounted probability-weighted royalty payments we would receive using a range of potential outcomes, to the extent that it is probable that a significant reversal in the amount of cumulative income recognized will not occur.
All U.S. royalties received from Rayner through December 31, 2031 are remitted by Rayner to an escrow account established by Omeros, from which payments are made to DRI Healthcare Acquisition LP (“DRI”) and are entirely pass-through in nature to the Company. These payments comprise interest expense, with the remainder treated as a reduction of the OMIDRIA royalty obligation. The amount recorded in discontinued operations in future periods will reflect interest earned on the outstanding OMIDRIA contract royalty asset at
OMIDRIA Royalty Obligation
On September 30, 2022, we sold to DRI a portion of our future OMIDRIA royalty receipts for a purchase price of $
To the extent our estimates of future royalties differ materially from the previous estimates, we will adjust for future OMIDRIA royalties to the present value of the revised estimated cash flows, discounted at the implied effective interest rate of
Cash and Cash Equivalents, Short-Term Investments and Restricted Investments
Cash and cash equivalents include highly liquid instruments with a maturity of three months or less on the date of purchase, which can be easily converted into cash without a significant impact on their value. Short-term investment securities are classified as held-to-maturity, except for money market funds, which are classified as available-for-sale. Investments classified as available-for-sale are measured at fair value. Investments classified as held-to-maturity are carried at cost. Amortization, accretion, interest, and dividends, realized gains and losses and declines in value judged to be other-than-temporary are included within other income.
The cost of securities sold is based on the specific-identification method. Investments with maturities of less than one year, or those for which management intends to use the investments to fund current operations, are included in current assets. We evaluate whether an investment is other-than-temporarily impaired based on the specific facts and circumstances. Factors that are considered in determining whether an other-than-temporary decline in value has occurred include: the market value of the security in relation to its cost basis; the financial condition of the investee; and the intent and ability to retain the investment for a sufficient period of time to allow for recovery in the market value of the investment. Restricted investments held in money-market funds include security deposits on our office lease.
Investment income, which is included as a component of other income, consists primarily of interest earned.
Receivables
Receivables relates primarily to sales of YARTEMLEA to wholesalers and include estimated chargebacks and product returns that are expected to be settled through reductions in receivables, royalties receivable from Rayner on sales of OMIDRIA and receivables from Novo Nordisk for work performed under the Transition Services Agreement. Considering the nature of our receivables, including that trade receivables are primarily due from a limited number of customers, we recorded no material allowance for expected credit losses as of June 30, 2026 and December 31, 2025, respectively.
Property and Equipment, Net
Property and equipment are stated at cost, and depreciation is calculated using the straight-line method over the estimated useful life of the assets, which is generally between three and ten years. Expenditures for repairs and maintenance are expensed as incurred.
Inventory
Inventory is stated at the lower of cost or market determined on a specific identification basis in a manner that approximates the first-in, first-out (FIFO) method. Costs include amounts related to third-party manufacturing, transportation and internal labor and overhead. Capitalization of costs as inventory begins when regulatory approval of the product candidate is reasonably assured in the U.S. or the EU. We expense inventory costs related to product candidates as research and development expenses prior to receiving regulatory approval in the applicable territory. Inventory is reduced to net realizable value for excess and obsolete inventories based on forecasted demand.
Debt
The Company accounts for its convertible debt at carrying value, net of applicable discounts, premiums and debt issuance costs. These instruments are recognized as a single liability on the condensed consolidated balance sheets unless specific features require treatment under separate accounting guidance. Debt issuance costs, which include legal, accounting, and underwriting fees directly attributable to the financing, are presented as a direct deduction from the carrying amount of the convertible debt. These costs and any original issue discounts are amortized to interest expense over the contractual term of the debt using the effective interest method.
The Company classifies convertible debt as long-term or current based on the remaining maturity and the status of the conversion features at the balance sheet date. If the holders of the debt possess the right to convert the instrument into shares of the Company’s common stock within one year of the balance sheet date, or if the debt is otherwise callable, the respectivecarrying value of the converted debt is classified as current. The Company performs a periodic evaluation of the conversion conditions to ensure proper classification and to determine if the debt should be measured based on its settlement value. Upon conversion, the carrying value of the debt, including any unamortized costs, is typically reclassified to stockholders’ equity, and no gain or loss is recognized unless the conversion includes an inducement.
As of June 30, 2026, the Company had outstanding one series of convertible notes, which mature on
Embedded Derivatives
We account for convertible instruments in accordance with ASC 470-20, Debt with Conversion and Other Options, when we determine that embedded conversion features do not require bifurcation from the host instrument. We account for convertible instruments (when we have determined that the embedded conversion options should be bifurcated from their host instruments) in accordance with ASC 815 – Derivative and Hedge Accounting (“ASC 815”). Under ASC 815, proceeds received upon the issuance of the hybrid contract are allocated between the fair value of the notes and the fair value of the derivative. The derivative is subsequently marked-to-market at each reporting date based on current fair value, with the changes in fair value reported in the condensed consolidated statements of operations and comprehensive loss.
The embedded derivative on our 2029 Notes represents the conversion feature and interest make-whole feature available to holders of the 2029 Notes allowing them to convert the notes into cash, common stock and/or a combination thereof. The embedded derivative on our Term Loan (as defined below) was eliminated upon repayment on November 25, 2025. (For further details, see “Note 4 – Fair Value Measurements” and “Note 6 – Debt”).
Right-of-Use Assets and Related Lease Liabilities
We record operating leases as right-of-use assets and recognize the related lease liabilities equal to the fair value of the lease payments using our incremental borrowing rate when the implicit rate in the lease agreement is not readily available. We recognize variable lease payments when incurred. Costs associated with operating lease assets are recognized on a straight-line basis within operating expenses over the term of the lease.
We record finance lease obligations as a component of property and equipment and amortize these assets within operating expenses on a straight-line basis to their residual values over the shorter of the term of the underlying lease or the estimated useful life of the equipment. The interest component of finance lease obligations is included in interest expense and recognized using the effective interest method over the lease term.
We account for leases with initial terms of 12 months or less as an operating expense.
Common Stock Repurchases
We have repurchased shares of our common stock from time to time under authorization made by our Board of Directors. Under applicable Washington State law, repurchased shares are retired and not presented separately as treasury stock in the condensed consolidated financial statements.
Financial Instruments and Concentrations of Credit Risk
Cash and cash equivalents, receivables, accounts payable and accrued liabilities, which are recorded at invoiced amount or cost, approximate fair value based on the short-term nature of these financial instruments. The fair value of short-term investments is based on quoted market prices. Financial instruments that potentially subject us to concentrations of credit risk consist primarily of cash and cash equivalents, short-term investments and receivables. Cash and cash equivalents are held by financial institutions and are federally insured up to certain limits. At times, our cash and cash equivalents balance held at a financial institution may exceed the federally insured limits. To limit the credit risk, we invest our excess cash in high-quality securities such as money market mutual funds, certificates of deposit and U.S. treasury bills.
Recent Accounting Pronouncements
In November 2024, the Financial Accounting Standards Board (“FASB”) issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expense (“ASU 2024-03”), requiring public entities to disclose additional information about specific expense categories in the notes to the financial statements on an interim and annual basis. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and for interim periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the impact of adopting ASU 2024-03 on its consolidated financial statements.
In December 2025, the FASB issued ASU 2025-10, Government Grants (Topic 832): Accounting for Government Grants Received by Business Entities (“ASU 2025-10”), which establishes authoritative guidance on the recognition, measurement, presentation, and disclosure of government grants. Under ASU 2025-10, government grants are recognized when it is probable that the entity will both comply with the conditions of the grant and the grant will be received. The ASU provides specific accounting models for grants related to assets and grants related to income, including options to recognize government grants as deferred income or as a reduction of the asset’s cost basis. The ASU also requires enhanced disclosures regarding the nature of government grants, significant terms and conditions, accounting policies applied, and amounts recognized in the financial statements. ASU 2025-10 is effective for fiscal years beginning after December 15, 2028, including interim periods within those fiscal years, with early adoption permitted. The Company is currently evaluating the impact of adopting ASU 2025-10 on its consolidated financial statements.
In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements (“ASU 2025-11”), which clarifies the guidance in Topic 270 to improve the consistency of interim financial reporting. The ASU provides a comprehensive list of required interim disclosures and introduces a disclosure principle requiring entities to disclose events since the end of the last annual reporting period that have a material impact on the entity. ASU 2025-11 is effective for fiscal years beginning after December 15, 2027, including interim periods within those fiscal years, with early adoption permitted. The Company is currently evaluating the impact of adopting ASU 2025-11 on its consolidated financial statements.
Note 3—Net Income (Loss) Per Share
Basic net income (loss) per share (“Basic EPS”) is computed by dividing net income (loss) by the weighted average number of common shares outstanding during the period. Diluted net loss per share (“Diluted EPS”) is computed by dividing net income (loss) by the weighted average number of common shares and potentially dilutive common shares outstanding during the period. Our potentially dilutive securities include common shares related to our stock options calculated using the treasury stock method and convertible senior notes calculated using the if-converted method. In periods where we have a net loss from continuing operations but overall net income, we do not compute Diluted EPS because the effect would be antidilutive. When there is a net loss, potentially dilutive securities, like stock options or convertible debt, are typically excluded from the diluted net loss per share calculation. Potentially dilutive securities excluded from Diluted EPS are calculated based on a weighted average of days in the quarter from when the respective transactions occurred and are shown as follows:
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Three Months Ended |
Six Months Ended |
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June 30, |
June 30, |
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2026 |
2025 |
2026 |
2025 |
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2029 Notes convertible to common stock (1)(2) |
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2026 Notes convertible to common stock (1)(3) |
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Outstanding options to purchase common stock |
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Share-settled liability (4) |
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Total potentially dilutive shares excluded from net income (loss) per share |
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(1) |
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| (2) |
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| (3) |
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| (4) |
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For further discussion of these transactions see “Note 6 — Debt.”
Note 4—Fair-Value Measurements
Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability, an exit price, in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The accounting standard establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs, where available. The following summarizes the three levels of inputs required:
Level 1—Observable inputs for identical assets or liabilities, such as quoted prices in active markets;
Level 2—Inputs other than quoted prices in active markets that are either directly or indirectly observable; and
Level 3—Unobservable inputs in which little or no market data exists, therefore they are developed using estimates and assumptions developed by us, which reflect those that a market participant would use.
We review the fair value hierarchy classification on a quarterly basis. Changes in the observability of valuation inputs may result in a reclassification of levels for certain securities within the fair value hierarchy. There have been no transfers of assets or liabilities between fair value measurement classifications during the three months ended June 30, 2026.
Our fair value hierarchy for our financial assets and liabilities measured at fair value on a recurring basis are as follows:
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June 30, 2026 |
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Level 1 |
Level 2 |
Level 3 |
Total |
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(In thousands) |
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Assets: |
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Cash and cash equivalents: |
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Certificate of deposit classified as non-current restricted investments |
$ | $ | $ | $ | ||||||||||||
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Short-term investments: |
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Money-market funds |
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Total Assets |
$ | $ | $ | $ | ||||||||||||
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Liabilities: |
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2029 Notes: |
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2029 Notes conversion option derivative |
$ | $ | $ | ( |
) | $ | ( |
) | ||||||||
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2029 Notes repurchase obligation, net |
( |
) | ( |
) | ||||||||||||
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Total Liabilities |
$ | $ | ( |
) | $ | ( |
) | $ | ( |
) | ||||||
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December 31, 2025 |
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Level 1 |
Level 3 |
Total |
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(In thousands) |
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Assets: |
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Cash and cash equivalents: |
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Certificate of deposit classified as non-current restricted investments |
$ | $ | $ | |||||||||
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Short-term investment |
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Money-market funds |
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Total Assets |
$ | $ | $ | |||||||||
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Liabilities: |
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2029 Notes: |
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|
2029 Notes conversion option derivative |
$ | $ | ( |
) | $ | ( |
) | |||||
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Total Liabilities |
$ | $ | ( |
) | $ | ( |
) | |||||
Cash held in demand deposit accounts of $
All our investments, which are classified as Level 1 assets, are short-term and held in our name. Money market funds are classified as available-for-sale.
Our embedded derivative is classified as a Level 3 liability. (For further details see “Note 6 – Debt”).
The fair value of our embedded derivative was determined using the Discounted Cash Flow model with the following key assumptions:
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June 30, |
December 31, |
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2026 |
2025 |
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2029 Note conversion option derivative |
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Stock price (per share) |
$ | $ | ||||||
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Unsecuritized discount rate |
% | % | ||||||
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Risk-free rate |
% | % | ||||||
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Stock price volatility |
% | % | ||||||
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Dividend yield |
% | % | ||||||
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Term (in years) |
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Changes in valuation assumptions could have a significant impact on the 2029 Note conversion option derivative. We can provide no assurance that changes in yield or in our stock price would not have a significant impact on the derivative in the future. An increase in our stock price volatility could increase the valuation of the 2029 Note conversion option derivative, whereas an increase in interest rates could decrease the valuation of the 2029 Note conversion option derivative. (For further details see “Note 6 — Debt”).
The following table sets forth the change in the fair value of the 2029 Note conversion option derivative for the six months ended June 30, 2026:
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Balance as of |
Balance as of |
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December 31, |
Conversions and |
June 30, |
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2025 |
Additions |
Change in Fair Value |
Extinguishments |
2026 |
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(In thousands) |
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Liabilities |
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2029 Notes |
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2029 Notes conversion option derivative |
$ | ( |
) | $ | $ | $ | (1) | ( |
) | |||||||||||
|
2029 Notes repurchase obligation, net |
( |
) | ( |
) | ( |
)(2) | ||||||||||||||
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Total |
$ | ( |
) | $ | ( |
) | $ | $ | $ | ( |
) | |||||||||
| (1) | ||
| (2) |
Note 5 — Certain Balance Sheet Accounts
OMIDRIA Contract Royalty Asset
The OMIDRIA contract royalty asset consists of the following:
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June 30, |
December 31, |
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2026 |
2025 |
|||||||
|
(In thousands) |
||||||||
|
Short-term contract royalty asset |
$ | $ | ||||||
|
Long-term contract royalty asset |
||||||||
|
Total OMIDRIA contract royalty asset |
$ | $ | ||||||
See “Note 7 — Discontinued Operations – Sale of OMIDRIA” for discussion regarding the estimated fair value of our OMIDRIA contract royalty asset.
OMIDRIA Royalty Obligation
The OMIDRIA contract royalty obligation consists of the following:
|
June 30, |
December 31, |
|||||||
|
2026 |
2025 |
|||||||
|
(In thousands) |
||||||||
|
Short-term OMIDRIA royalty obligation |
$ | $ | ||||||
|
Long-term OMIDRIA royalty obligation |
||||||||
|
Total OMIDRIA royalty obligation |
$ | $ | ||||||
See “Note 8 — OMIDRIA Royalty Obligation” for further details.
Receivables
Receivables consist of the following:
|
June 30, |
December 31, |
|||||||
|
2026 |
2025 |
|||||||
|
(In thousands) |
||||||||
|
Trade receivables, net |
$ | $ | ||||||
|
OMIDRIA royalty receivables |
||||||||
|
Novo Nordisk receivable |
||||||||
|
Other receivables |
||||||||
|
Total receivables |
$ | $ | ||||||
Trade receivables represent sales of YARTEMLEA to wholesalers and include reductions for estimated chargebacks. OMIDRIA royalty receivables represent approximately two months of royalty earnings from Rayner. All U.S. royalties received from Rayner are remitted by Rayner to an escrow account, established by Omeros, from which payments are made on our behalf to DRI. These payments are entirely pass-through in nature to the Company with DRI as the recipient.
Property and Equipment, Net
Property and equipment, net consists of the following:
|
June 30, |
December 31, |
|||||||
|
2026 |
2025 |
|||||||
|
(In thousands) |
||||||||
|
Equipment under finance lease obligations |
$ | $ | ||||||
|
Laboratory equipment |
||||||||
|
Computer equipment |
||||||||
|
Office equipment and furniture |
||||||||
|
Total cost |
||||||||
|
Less accumulated depreciation and amortization |
( |
) | ( |
) | ||||
|
Total property and equipment, net |
$ | $ | ||||||
For each of the three months ended June 30, 2026 and 2025, depreciation and amortization expense was $
Accrued Expenses
Accrued expenses consist of the following:
|
June 30, |
December 31, |
|||||||
|
2026 |
2025 |
|||||||
|
(In thousands) |
||||||||
|
Employee compensation |
$ | $ | ||||||
|
Deferred income |
||||||||
|
Clinical trials |
||||||||
|
Contract research and development |
||||||||
|
Consulting and professional fees |
||||||||
|
Sales, fees and discounts |
||||||||
|
Income taxes payable |
||||||||
|
Interest payable |
||||||||
|
Other accrued expenses |
||||||||
|
Total accrued expenses |
$ | $ | ||||||
Deferred income as of June 30, 2026 and December 31, 2025 primarily related to billings to Novo Nordisk under the Transition Services Agreement.
Note 6—Debt
Convertible senior notes, net, balances are comprised of the following:
|
June 30, |
December 31, |
||||||||
|
2026 |
2025 |
||||||||
|
(In thousands) |
|||||||||
|
2029 Notes repurchase obligation, net, reported at fair value |
Current | $ | $ | ||||||
|
2026 Notes |
Current | ||||||||
|
2029 Notes |
Non-current | ||||||||
| $ | $ | ||||||||
| 2029 Notes embedded derivative reported at fair value | $ | $ | |||||||
2029 Notes
Exchange of 2026 Notes for 2029 Notes
On May 14, 2025, we completed the exchange (the “Convertible Note Exchange”) of $
The 2029 Notes were issued pursuant to an Indenture, dated as of August 14, 2020 (the “Base Indenture”), between the Company and Computershare Trust Company, National Association, as successor to Wells Fargo Bank, National Association, as trustee (the “Trustee”), as supplemented by a Second Supplemental Indenture, dated as of May 14, 2025 (the “Second Supplemental Indenture”), between the Company and the Trustee (the Base Indenture, as amended and supplemented by the Second Supplemental Indenture, the “Indenture”). The 2029 Notes will mature on
Repurchase of 2029 Notes
On June 17, 2026, the Company entered into privately negotiated agreements with certain holders of the 2029 Notes under which the Company agreed to repurchase $
For the three months ended June 30, 2026, the Company recognized a loss on extinguishment of debt of approximately $
On July 2, 2026, the Company entered into additional privately negotiated agreements with the same holders under which the Company agreed to repurchase $
From time to time, we may seek to repurchase, redeem, retire, refinance, exchange or otherwise restructure portions of our outstanding indebtedness through open-market purchases, privately negotiated transactions, tender offers or other means. Any such transactions will depend on prevailing market conditions, our liquidity and capital requirements, contractual restrictions and other factors.
Embedded Derivative
The embedded derivative on the 2029 Notes includes both a derivative for the interest make-whole feature and a derivative for the conversion feature available to holders allowing them to convert their notes to common stock, cash or a combination thereof. At each reporting date, we remeasure the embedded derivative instruments to fair market value. At June 30, 2026 and December 31, 2025, the fair market value of our embedded derivative was $
Interest Make Whole Feature
Holders who convert their 2029 Notes prior to June 1, 2029 (except for any conversion in connection with a make-whole fundamental change) are entitled to an interest make-whole payment equal to the sum of the remaining scheduled payments of interest that would have been made had the 2029 Notes remained outstanding from their conversion date through the earlier of (i) the date that is
Conversion Feature
The 2029 Notes are convertible at the option of the holder into shares of common stock, cash or a combination thereof at any time prior to the close of business on the second scheduled trading day immediately preceding the maturity date. The Company elects whether the conversion occurs in common stock, cash or a combination thereof. The conversion rate is
The amount outstanding on the 2029 Notes is as follows:
|
June 30, |
December 31, |
|||||||
|
2026 |
2025 | |||||||
|
(In thousands) |
||||||||
|
2029 Notes repurchase obligation, net, reported at fair value |
$ | $ | ||||||
|
Principal amount |
||||||||
|
Less unamortized debt discount, net of issuance costs |
( |
) | ( |
) | ||||
|
2029 Notes remaining |
||||||||
|
2029 Notes remaining embedded derivative reported at fair value (1) |
||||||||
|
Fair value of 2029 Notes (2) |
$ | $ | ||||||
|
(1) |
|
|
| (2) |
As of June 30, 2026, our only debt commitment relates to the 2029 Notes, which mature on
Interest on the 2029 Notes is payable semi-annually in arrears at a rate of
The following table sets forth interest expense recognized related to the 2029 Notes:
|
Three Months Ended |
Six Months Ended |
|||||||||||||||
|
June 30, |
June 30, |
|||||||||||||||
|
2026 |
2025 |
2026 |
2025 |
|||||||||||||
|
(In thousands) |
(In thousands) |
|||||||||||||||
|
Contractual interest expense |
$ | $ | $ | $ | ||||||||||||
|
Amortization of debt issuance costs |
||||||||||||||||
|
Total interest expense |
$ | $ | $ | $ | ||||||||||||
The 2029 Notes are redeemable, in whole or in part, at our option at any time, and from time to time, on or after June 20, 2027 and on or before the
The 2029 Notes are structurally subordinated to all existing and future indebtedness and other liabilities, including trade payables, and (to the extent we are not a holder thereof) preferred equity, if any, of our subsidiaries.
Term Loan
On June 3, 2024, we entered into a Credit and Guarantee Agreement with funds managed by Athyrium Capital Management LP and funds managed by Highbridge Capital Management, LLC, as lenders (the “Term Loan”), pursuant to which we had an outstanding balance of $
The Transaction with Novo Nordisk, which closed on November 25, 2025, provided us with $
The following table sets forth interest expense recognized related to the Term Loan:
|
Three Months Ended |
Six Months Ended |
|||||||||||||||
|
June 30, |
June 30, |
|||||||||||||||
|
2026 |
2025 |
2026 |
2025 |
|||||||||||||
|
(In thousands) |
||||||||||||||||
|
Contractual interest expense |
$ | $ | $ | $ | ||||||||||||
|
Amortization of debt premium and issuance costs |
( |
) | ( |
) | ||||||||||||
|
Total interest expense |
$ | $ | $ | $ | ||||||||||||
2026 Notes
We had outstanding convertible senior notes that accrued interest at an annual rate of
Amounts outstanding on our 2026 Notes as of June 30, 2026 and December 31, 2025 are as follows:
|
June 30, |
December 31, |
|||||||
|
2026 |
2025 |
|||||||
|
(In thousands) |
||||||||
|
Principal amount |
$ | $ | ||||||
|
Unamortized debt issuance costs |
( |
) | ||||||
|
Total 2026 Notes |
$ | $ | ||||||
|
Fair value of outstanding 2026 Notes (1) |
$ | $ | ||||||
|
(1) |
|
The following table sets forth interest expense recognized related to the 2026 Notes:
|
Three Months Ended |
Six Months Ended |
|||||||||||||||
|
June 30, |
June 30, |
|||||||||||||||
|
2026 |
2025 |
2026 |
2025 |
|||||||||||||
|
(In thousands) |
||||||||||||||||
|
Contractual interest expense |
$ | $ | $ | $ | ||||||||||||
|
Amortization of debt discount and issuance costs |
||||||||||||||||
|
Total interest expense |
$ | $ | $ | $ | ||||||||||||
Note 7—Discontinued Operations - Sale of OMIDRIA
On December 23, 2021, we sold the rights to OMIDRIA and related assets to Rayner, which is reported as discontinued operations in our condensed consolidated statements of operations and comprehensive loss and excluded from continuing operations for all periods presented.
The results of operations for OMIDRIA are recorded as income from discontinued operations for all periods presented in the condensed consolidated statements of operations and comprehensive loss are as follows:
|
Three Months Ended |
Six Months Ended |
|||||||||||||||
|
June 30, |
June 30, |
|||||||||||||||
|
2026 |
2025 |
2026 |
2025 |
|||||||||||||
|
(In thousands) |
||||||||||||||||
|
Interest earned on OMIDRIA contract royalty asset |
$ | $ | $ | $ | ||||||||||||
|
Remeasurement adjustments |
( |
) | ( |
) | ||||||||||||
|
Other income (loss), net |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||
|
Ex-U.S. royalties |
||||||||||||||||
|
Income before income tax |
||||||||||||||||
|
Income tax benefit (expense) |
( |
) | ( |
) | ||||||||||||
|
Net income from discontinued operations, net of tax |
$ | $ | $ | $ | ||||||||||||
The following is a roll-forward of the OMIDRIA contract royalty asset (in thousands):
|
OMIDRIA contract royalty asset at December 31, 2025 |
$ | |||
|
Royalties earned |
( |
) | ||
|
Interest earned on OMIDRIA contract royalty asset |
||||
|
Remeasurement adjustments |
||||
|
OMIDRIA contract royalty asset at June 30, 2026 |
$ |
We remeasure the OMIDRIA contract royalty asset on a quarterly basis using the expected value approach, which incorporates actual results and future expectations.
Cash flow from discontinued operations is as follows:
|
Six Months Ended |
||||||||
|
June 30, |
||||||||
|
2026 |
2025 |
|||||||
|
(In thousands) |
||||||||
|
Net cash provided by discontinued operations from operating activities |
$ | $ | ||||||
Net cash provided by discontinued operations primarily represents royalties received from Rayner. All royalties earned on OMIDRIA sales within the U.S. through December 31, 2031 are remitted by Rayner to an escrow account established by Omeros, from which payments are made to DRI.
Note 8—OMIDRIA Royalty Obligation
On September 30, 2022, we sold to DRI a portion of our future OMIDRIA royalty receipts for a purchase price of $
We currently retain the right to receive all royalties payable by Rayner on any ex-U.S. net sales. After December 31, 2031, we retain the right to receive all global royalties payable by Rayner on net sales of OMIDRIA. To date, international royalties have not been significant. DRI has no recourse to our assets other than its interest in OMIDRIA royalties.
We are entitled to receive a separate milestone payment ranging between $
The changes in the OMIDRIA royalty obligation during the six months ended June 30, 2026 are as follows (in thousands):
|
Balance at December 31, 2025 |
$ | |||
|
Non-cash interest |
( |
) | ||
|
Principal payments |
( |
) | ||
|
Balance at June 30, 2026 |
$ |
The OMIDRIA royalty obligation is classified as a Level 3 liability as its valuation requires substantial judgment and estimation of factors that are not currently observable in the market. The fair value of the OMIDRIA royalty obligation is determined by calculating the net present value of our estimated future OMIDRIA cash flows using the interest rate at inception of our royalty purchase agreement with DRI, adjusted for the change in the prime rate through the measurement date. As of June 30, 2026 and December 31, 2025, the approximate fair value of our obligation was $
Interest expense is comprised of the effective interest component of any cash payment remitted through an administrative agent to DRI, based on an implied effective interest rate of
|
Three Months Ended |
Six Months Ended |
|||||||||||||||
|
June 30, |
June 30, |
|||||||||||||||
|
2026 |
2025 |
2026 |
2025 |
|||||||||||||
|
(In thousands) |
||||||||||||||||
|
Pass through interest remitted through administrative agent |
$ | $ | $ | $ | ||||||||||||
|
Non-cash remeasurement adjustment |
( |
) | ( |
) | ( |
) | ||||||||||
|
Interest expense, net of remeasurement on OMIDRIA royalty obligation |
$ | $ | ( |
) | $ | $ | ( |
) | ||||||||
As of June 30, 2026, the expected scheduled principal and interest payments are as follows:
|
Principal |
Interest |
Total |
||||||||||
|
(In thousands) |
||||||||||||
|
2026 |
$ | $ | $ | |||||||||
|
2027 |
||||||||||||
|
2028 |
||||||||||||
|
2029 |
||||||||||||
|
2030 and thereafter |
||||||||||||
|
Total scheduled payments |
$ | $ | $ | |||||||||
Note 9—Lease Liabilities
We have an operating lease for our office and laboratory facilities with an initial term that ends in November 2027 and two options to extend the lease term, each by an additional five years. Restricted investments of $
Supplemental lease information is as follows:
|
Three Months Ended |
Six Months Ended |
|||||||||||||||
|
June 30, |
June 30, |
|||||||||||||||
|
2026 |
2025 |
2026 |
2025 |
|||||||||||||
|
(In thousands) |
||||||||||||||||
|
Lease cost |
||||||||||||||||
|
Operating lease cost |
$ | $ | $ | $ | ||||||||||||
|
Finance lease cost: |
||||||||||||||||
|
Amortization |
||||||||||||||||
|
Interest |
||||||||||||||||
|
Variable lease cost |
||||||||||||||||
|
Sublease income |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||
|
Net lease cost |
$ | $ | $ | $ | ||||||||||||
The supplemental cash flow information related to leases is as follows:
|
Six Months Ended |
||||||||
|
June 30, |
||||||||
|
2026 |
2025 |
|||||||
|
(In thousands) |
||||||||
|
Cash paid for amounts included in the measurement of lease liabilities |
||||||||
|
Cash payments for operating leases |
$ | $ | ||||||
|
Cash payments for financing leases |
||||||||
Note 10—Commitments and Contingencies
Good and Service Contracts
We have various agreements with third parties that collectively require payment of termination fees totaling $
Development Milestones and Product Royalties
We have entered a variety of development, collaboration, licensing or similar agreements with third parties under which we have accessed technology or services in connection with our development assets and programs. Some of these agreements require milestone payments based on achievements of development, regulatory or sales milestones, and/or very low-single digit royalties on net income or net sales of the relevant product. For the three and six months ended June 30, 2026 and 2025, royalties on sales of YARTEMLEA were $
Note 11—Shareholders’ Deficit
Common Stock
At-the-Market Sales Agreement - We have an “at the market” (“ATM”) facility agreement under which we have the capability to sell shares of our common stock, from time to time, through an ATM equity offering program. On November 14, 2025, the Company filed a shelf registration statement and prospectus supplement renewing the ATM for an aggregate offering price of up to $
Share Repurchase Program - On November 29, 2025, the Board of Directors approved a share repurchase program under which we are permitted to repurchase from time to time up to $
Equitization Transaction - During 2025, we entered into note conversion agreements with two holders of our 2026 Notes to convert $
Amended and Restated Omnibus Incentive Compensation Plan - At our annual meeting of shareholders, held on June 18, 2026, our shareholders approved an increase of
Note 12—Stock-Based Compensation
Our equity incentive plans provide for the grant of incentive and non-qualified stock options, restricted stock awards, restricted stock units, and other stock awards to employees, non-employee directors, and consultants.
Stock-based compensation is as follows:
|
Three Months Ended |
Six Months Ended |
|||||||||||||||
|
June 30, |
June 30, |
|||||||||||||||
|
2026 |
2025 |
2026 |
2025 |
|||||||||||||
|
(In thousands) |
||||||||||||||||
|
Research and development |
$ | $ | $ | $ | ||||||||||||
|
Selling, general and administrative |
||||||||||||||||
|
Total stock-based compensation |
$ | $ | $ | $ | ||||||||||||
The fair value of each option grant is estimated on the date of grant using the Black-Scholes option-pricing model. The following assumptions were applied to all stock option grants:
|
Three Months Ended |
Six Months Ended |
|||||||
|
June 30, 2026 |
June 30, 2026 |
|||||||
|
Estimated weighted-average fair value |
$ | $ | ||||||
|
Weighted-average assumptions: |
||||||||
|
Expected volatility |
% | % | ||||||
|
Expected life, in years |
||||||||
|
Risk-free interest rate |
% | % | ||||||
|
Expected dividend yield |
% | % | ||||||
Expected volatility is based on the historical volatility of our stock price weighted by grant issuances over the reporting period. We estimated the expected life of the stock options granted using the historical exercise behavior of option holders. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant. Forfeiture expense is estimated at the time of grant and revised in subsequent periods if actual forfeitures differ from those estimates.
Stock option activity for all stock plans and related information is as follows:
|
Weighted- |
||||||||||||||||
|
Average |
Aggregate |
|||||||||||||||
|
Exercise |
Remaining |
Intrinsic |
||||||||||||||
|
Options |
Price per |
Contractual Life |
Value |
|||||||||||||
|
Outstanding |
Share |
(In years) |
(In thousands) |
|||||||||||||
|
Balance at December 31, 2025 |
$ | |||||||||||||||
|
Granted |
||||||||||||||||
|
Exercised |
( |
) | ||||||||||||||
|
Forfeited |
( |
) | ||||||||||||||
|
Balance at June 30, 2026 |
$ | $ | ||||||||||||||
|
Vested and expected to vest at June 30, 2026 |
$ | $ | ||||||||||||||
|
Exercisable at June 30, 2026 |
$ | $ | ||||||||||||||
On July 22, 2026, annual stock options grants of approximately
Of the
As of June 30, 2026, there were
As of June 30, 2026, the total number of shares of common stock available for grant was
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the unaudited condensed consolidated financial statements and notes thereto included elsewhere in this Quarterly Report on Form 10‑Q and with our audited financial statements and the notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2025, which was filed with the SEC on March 31, 2026. In addition, you should read the section entitled “Risk Factors” and the disclaimers regarding forward-looking statements included herein and in our Annual Report on Form 10-K for the year ended December 31, 2025 for a discussion of important factors that could cause our results to differ materially from the results described in or implied by any forward-looking statements contained herein.
Overview
We are an innovative, commercial-stage biotechnology company that discovers and develops first-in-class protein and small-molecule therapeutics for large-market and orphan indications. Our drug product YARTEMLEA® (narsoplimab-wuug) is commercially available in the U.S. for the treatment of hematopoietic stem cell transplant-associated thrombotic microangiopathy (TA-TMA) in adult and pediatric patients two years of age and older. Our diverse pipeline of development programs is focused on the treatment of complement-mediated diseases, cancers, and addictive or compulsive disorders.
Commercial Product – YARTEMLEA
Our commercial product, YARTEMLEA, is the first and only approved inhibitor of the lectin pathway of complement. On December 23, 2025, FDA approved YARTEMLEA for the treatment of TA-TMA in adults and in children two years of age and older. TA-TMA is a severe and often-fatal complication of hematopoietic stem cell transplantation in adults and children, driven by systemic endothelial injury triggered by conditioning regimens, immunosuppressants, infection, graft-versus-host disease, and other transplant-related factors. Activation of the lectin pathway of complement plays a central role in disease pathogenesis. YARTEMLEA selectively inhibits MASP-2, blocking pathway activation while preserving classical and alternative complement pathway functions important for host defense. In TA-TMA, MASP-2 inhibition prevents lectin pathway-mediated cellular injury, including endothelial damage in small blood vessels, and thrombus formation. Unlike other complement inhibitors, YARTEMLEA has no boxed warning and no Risk Evaluation and Mitigation Strategy (REMS), and vaccinations are not required prior to treatment.
Commercial distribution and sales of YARTEMLEA began in January 2026. Both adult and pediatric patients with TA-TMA are now receiving YARTEMLEA, including patients who have recently failed prior off-label C5- and C3-inhibitor regimens, in both hospital and outpatient settings.
We are commercializing YARTEMLEA in the U.S. market and have deployed our field force of account managers and directors, market development managers, access leads, and medical science liaisons to engage directly with transplant centers across the U.S. There are 175 stem-cell transplant centers across the U.S., with the top 80 centers representing approximately 80% of procedures. Our field force is actively engaging all 175 U.S. transplant centers. By June 30, 2026, 73 unique accounts had ordered YARTEMLEA, representing a 143% increase in ordering accounts since March 31, 2026.
At this early stage, our primary launch objectives are fourfold: (i) educate the entire transplant care team, including transplant physicians, nurses, hospital pharmacies, and reimbursement teams, regarding the recently harmonized TA-TMA diagnostic criteria, thereby driving awareness, early diagnosis, and treatment of TA-TMA; (ii) support transplant centers in obtaining their pharmacy and therapeutic committee approvals and adding YARTEMLEA to their formularies to streamline the ordering process and facilitate access to YARTEMLEA in both in- and out-patient settings; (iii) work with third-party payers to provide timely reimbursement consistent with the YARTEMLEA label and published diagnostic criteria; and (iv) finalize and prepare for presentation and publication of the health economics and outcomes research analysis using the strong clinical efficacy data and favorable safety profile of YARTEMLEA to demonstrate its compelling cost-effectiveness to healthcare providers and payors. Together, these factors are intended to shift the paradigm toward proactive screening for TA-TMA, with the goal of enabling clinicians to identify and treat more patients earlier, thus ultimately improving transplant outcomes.
In June 2026, the Committee for Medicinal Products for Human Use (“CHMP”) of the European Medicines Agency (“EMA”) adopted a negative opinion on our marketing authorization application (“MAA”) for narsoplimab in TA-TMA. We believe the clinical evidence supports approval and have requested re-examination. As part of that procedure, an Ad Hoc Expert Group, expected to comprise external scientific and clinical experts in hematology and stem cell transplantation, will review the evidence and address questions central to CHMP’s assessment. If the MAA is ultimately approved, it would authorize the product to be marketed in all European Union (“EU”) member states and European Economic Area countries, although there can be no guarantee that the re-examination will result in a reversal of CHMP’s negative opinion or the ultimate approval of the MAA. The European Commission has granted narsoplimab designation as an orphan medicinal product for treatment in hematopoietic stem cell transplantation. For potential commercialization of YARTEMLEA outside the U.S., including Europe, we are evaluating potential partnerships, including broad ex-U.S. and regional collaborations.
Complement Inhibitor Programs
The complement system plays a role in the body’s inflammatory response and becomes activated as a result of tissue damage or trauma or microbial pathogen invasion. Inappropriate or uncontrolled activation of the complement system can cause diseases characterized by serious tissue injury. Three main pathways can activate the complement system: classical, lectin, and alternative. We are focused on development of therapeutics to treat diseases associated with the lectin and/or alternative pathways of complement. We are developing antibodies as well as small-molecule inhibitors of key enzymes known to be centrally involved in the activation of the targeted pathway of complement.
Lectin Pathway / MASP-2
MASP-2 is a novel pro-inflammatory protein target that is the effector enzyme of the lectin pathway and is required for the function of this pathway. We are developing antibodies and small-molecule inhibitors of MASP-2 as potential therapeutics for diseases in which the lectin pathway has been shown to contribute to significant tissue injury and pathology. When not treated, these diseases are typically characterized by significant end-organ damage, such as kidney or central nervous system injury. Importantly, inhibition of MASP-2 has been demonstrated not to interfere with the antigen-antibody complex-dependent classical complement activation pathway, a critical component of the acquired immune response to infection.
Clinical development of YARTEMLEA is anticipated to continue expanding the approved label in TA-TMA and to develop the drug in additional indications. We are assessing further development opportunities across indications involving endothelial injury, lectin pathway activation, or thrombo-inflammation, including solid organ transplant-related TMA, chemotherapy-induced TMA, acute respiratory distress syndrome (“ARDS”), sickle cell disease, acute kidney injury, delayed graft function, and stem cell transplant-related endothelial syndromes, including diffuse alveolar hemorrhage, capillary leak syndrome, graft-versus-host disease, and sinusoidal obstruction syndrome. By year-end 2026, we expect enrollment to begin in two investigator-sponsored and Omeros-supported studies, one evaluating YARTEMLEA in hyperinflammatory ARDS, and the other assessing prophylactic YARTEMLEA in pediatric patients with predictably severe TA-TMA.
We are also finalizing selection of an indication for a Phase 2 clinical program for OMS1029, our long-acting antibody targeting MASP-2, which we expect will be well-suited to indications requiring long-term, chronic administration once quarterly, either intravenously or subcutaneously. In addition, in our MASP-2 small molecule program, following the completion of one ongoing study, we expect to select a drug development candidate, targeting once-daily oral administration.
Alternative Pathway / MASP-3
On November 25, 2025, we completed a transaction (the “Transaction”) pursuant to our Asset Purchase and Licensing Agreement (“APLA”) with Novo Nordisk Healthcare AG (“Novo Nordisk”) for our candidate drug zaltenibart (formerly OMS906). Zaltenibart is a first-in-class, late-stage clinical humanized monoclonal antibody targeting MASP-3, the most upstream and key activator of the alternative pathway of the complement system. Zaltenibart has shown multiple potential advantages over other alternative pathway inhibitors in development and on the market.
At the closing of the Transaction, we received an upfront cash payment of $240.0 million. In addition, we are eligible to receive (i) up to $510.0 million in one-time milestone payments upon the first achievement by Novo Nordisk or its affiliates or sublicensees of each of the development and approval milestone events as set forth in the APLA, including $100.0 million in aggregate one-time milestone payments that we expect to be achievable in the near term, and (ii) up to $1.3 billion in one-time milestone payments upon the first achievement by Novo Nordisk or its affiliates or sublicensees of certain sales-based milestone events as set forth in the APLA. We are also eligible under the APLA to receive tiered royalties on annual net sales of products at percentage rates ranging from high single digit to high teens, subject to reduction in certain circumstances, as set forth in the APLA. In total, we have received and are eligible to receive up to $2.1 billion in potential development and commercial milestones, plus tiered royalties on net sales.
Pursuant to the APLA, we sold and transferred, and Novo Nordisk purchased zaltenibart and certain related assets, and the parties agreed to grant and receive certain intellectual property licenses to facilitate the continued development and commercialization activities of both companies. We retain rights to our entire MASP-3 small-molecule program, including the ability to develop and commercialize small-molecule MASP-3 inhibitors, across a range of therapeutic areas, including, but not limited to, ophthalmology, neurology, gastrointestinal disorders, dermatology, musculoskeletal diseases, and oncology. We also retain rights to our “grandfathered” MASP-3 antibodies, with temporal and indication restrictions on commercialization and for use in advancing our small-molecule therapeutics.
In accordance with the APLA, at the closing of the Transaction, Omeros and Novo Nordisk entered into a transition services agreement (the “Transition Services Agreement”) pursuant to which we are providing certain transition services to Novo Nordisk to facilitate the transfer of the acquired assets and liabilities under the APLA and to provide for the continued operation of relevant studies and program activities during the applicable term. Subject to certain exceptions and limitations, Novo Nordisk reimburses us for costs and expenses we incur under the Transition Services Agreement, including third-party costs and expenses, costs associated with delivery of transition services by Omeros personnel on an hourly basis at rates specified in the Transition Services Agreement, and for our inventories of zaltenibart drug substance and product.
Other Development Programs
PDE7 Inhibitor Program
Our PDE7 inhibitor program, which we refer to as OMS527, comprises multiple PDE7 inhibitor compounds and is based on our discoveries of previously unknown links between PDE7 and any addiction or compulsive disorder, and between PDE7 and any movement disorder. In April 2023, we were awarded a grant from the National Institute on Drug Abuse (“NIDA”) part of the National Institutes of Health, to develop our lead orally administered PDE7 inhibitor compound, for which we have successfully completed a Phase 1 study, for the treatment of cocaine use disorder. With NIDA funding, we successfully completed preclinical cocaine interaction/toxicology studies to assess safety of the OMS527 compound when co-administered with cocaine. FDA subsequently requested additional nonclinical information prior to initiating the clinical in-patient trial. We are commencing the nonclinical study, and we expect to be able to start enrollment in the in-patient clinical trial by year-end 2026.
Preclinical Program - OncotoX-AML (OMS805)
We continue to progress preclinical studies within our oncology program, focused on developing novel, proprietary large molecule therapeutics designed to selectively target and kill dividing cancer cells. We have completed selection of a drug development candidate, which we refer to as OncotoX-AML or OMS805. Acute myeloid leukemia (“AML”), an aggressive and highly fatal bone marrow and blood cancer, is the lead indication for development. The effectiveness of current AML treatments, such as chemotherapeutics and antibody-drug conjugates, is limited by a number of factors, including high relapse rates and substantial side effects.
OncotoX-AML is an engineered biologic designed to selectively kill both AML blasts (abnormal myeloid cells) and relapse-related leukemia stem cells. Its unique mechanism of action is independent of myeloid cell genetic mutations, including TP53, NPM1, KMT2A, and FLT3, which are collectively found in approximately 90% of AML patients and are historically difficult to treat.
In February 2026, we announced the successful completion of our initial study in nonhuman primates evaluating the efficacy and safety of OncotoX-AML. Administration of only one course of OncotoX-AML treatment to immunocompetent primates demonstrated the desired pharmacologic response, specifically marked, selective, reversible, and dose-related reduction in myeloid progenitor cells — the cells that can mutate and lead to AML — by up to 99%. OncotoX-AML was well tolerated, without causing broader or lasting hematologic changes while preserving hematopoietic stem cells. There were no observed safety signals or meaningful changes in blood chemistry values often seen with current AML treatments.
In April 2025, we established the Omeros Oncology Clinical Steering Committee to help advance our OncotoX-AML program. The clinical steering committee is comprised of leaders in AML treatment and research at premier cancer centers. Together with this steering committee, we are designing our first in-human clinical trial, which we are targeting to initiate in late 2027.
Investigational New Drug (IND)-enabling studies are underway, and we have entered into an agreement with a leading contract biologics manufacturer for process development and initial clinical supply of OMS805 drug substance.
Preclinical Program - T-CAT
We are also advancing our targeted complement activating therapy (“T-CAT”) platform: a new class of recombinant antibodies intended for broad action against pathogens, including bacteria, fungi, viruses, and parasites. T-CAT is designed to harness complement activation to kill pathogens directly, which represents a novel approach to infectious disease treatment.
T-CAT monoclonal antibodies were shown to safely and effectively treat infections in translationally relevant murine models of sepsis and pneumonia caused by Klebsiella pneumoniae, Pseudomonas aeruginosa, Streptococcus pneumoniae, and Neisseria meningitidis. We believe that the results of these studies demonstrate T-CAT’s potential as a next-generation platform with broad applicability across microbial species, including multidrug-resistant pathogens, and we intend to continue advancing T-CAT toward the clinic.
Debt Financing Transactions
Repurchase of 2029 Notes
In June and July 2026, we entered into privately negotiated agreements with certain holders of our unsecured convertible senior notes due 2029 (the “2029 Notes”) under which we agreed to repurchase approximately $30.5 million aggregate principal amount of 2029 Notes for a total purchase price of approximately $60.2 million, plus accrued and unpaid interest of $0.2 million. Both transactions closed in July 2026, leaving approximately $40.3 million aggregate principal amount of the 2029 Notes outstanding.
|
Purchase |
|||||||||||||||||
|
Price |
Underlying |
||||||||||||||||
|
Aggregate Principal |
Excluding Interest |
Interest |
Shares |
||||||||||||||
|
(in thousands) |
|||||||||||||||||
|
2029 Notes principal and related underlying shares at December 31, 2025 |
$ | 70,785 | 11,454 | ||||||||||||||
|
Agreement Date |
Closing |
||||||||||||||||
|
June 17, 2026 |
July 6, 2026 |
$ | (16,000 | ) | $ | 31,259 | $ | 89 | (2,589 | ) | |||||||
|
July 2, 2026 |
July 20, 2026 |
(14,463 | ) | 28,911 | 134 | (2,340 | ) | ||||||||||
| $ | (30,463 | ) | $ | 60,170 | $ | 223 | 6,525 | ||||||||||
|
Remaining principal outstanding at July 20, 2026 |
$ | 40,322 | |||||||||||||||
For the three months ended June 30, 2026, the Company recognized a loss on extinguishment of the first tranche of debt of approximately $1.9 million, reflecting the difference between the fair value of the payment obligation of $30.6 million established on June 17, 2026, the carrying amount of the repurchased notes ($16.0 million in aggregate principal amount net of any unamortized discount and issuance costs), and the de-recognition of the associated embedded derivative liability of $16.7 million. In addition, the Company recognized a $0.7 million increase in the fair value of the payment obligation from June 17, 2026 through June 30, 2026 which reflects the cash consideration of $31.3 million paid at closing on July 6, 2026. As of June 30, 2026, the initial repurchase was classified as a $31.3 million current note repurchase obligation in our condensed consolidated balance sheet. The repurchase agreements for the second tranche, comprising $14.5 million aggregate principal amount, were entered into in July 2026. As such, the related accounting will be reflected in our third quarter filing. (For further detail, see “Note 6 — Debt — 2029 Notes” in the Notes to the Condensed Consolidated Financial Statements included elsewhere in this Quarterly Report on Form 10-Q.)
Repayment of Debt
On February 17, 2026, we repaid the remaining $17.1 million aggregate principal balance outstanding on our 5.25% convertible senior notes (the “2026 Notes”) in full upon maturity.
Equity Financing Transactions
At the Market Sales Agreement
We have an “at the market” (“ATM”) facility agreement under which we have the capability to sell shares of our common stock from time to time, through an ATM equity offering program. On November 14, 2025, the Company filed a shelf registration statement and prospectus supplement renewing the ATM program for an aggregate offering price up to $150.0 million. We did not sell any shares under the ATM program during the three or six months ended June 30, 2026.
Share Repurchase Programs
On November 29, 2025, the Board of Directors approved a share repurchase program under which we are permitted to repurchase from time to time up to $100.0 million of our common stock in the open market or through privately negotiated transactions. During the three months ended June 30, 2026, we repurchased and retired 0.5 million shares of common stock pursuant to our share repurchase program, at an average cost of $11.70 per share, for an aggregate purchase price of $5.7 million. During the six months ended June 30, 2026, we repurchased and retired 0.8 million shares of common stock pursuant to our share repurchase program, at an average cost of $11.70 per share, for an aggregate purchase price of $9.9 million.
Financial Summary
As of June 30, 2026, we had cash, cash equivalents and short-term investments of $132.0 million. For the three months ended June 30, 2026, company-wide our cash provided by operations was $4.1 million. For the six months ended June 30, 2026, our cash used in operations was $10.4 million.
Results of Operations
Product Sales, Net
Distribution and sales of our only commercial product, YARTEMLEA, commenced in January 2026. Revenue in the current period reflects sales of YARTEMLEA to wholesalers in the U.S.
As YARTEMLEA is in the early stages of commercialization, period-over-period comparisons are of limited usefulness, and our product sales revenues mayfluctuate from quarter to quarter as physician adoption, patient access and ordering patterns continue to develop. For the three and six months ended June 30, 2026, gross revenues were $32.2 million and $43.4 million, respectively. The increase in revenue during the second quarter of 2026 primarily reflects continued physician adoption and increasing market penetration following product launch.
Product sales, net were as follows:
|
Three Months Ended |
Six Months Ended |
|||||||||||||||
|
June 30, |
June 30, |
|||||||||||||||
|
2026 |
2025 |
2026 |
2025 |
|||||||||||||
|
(In thousands) |
||||||||||||||||
|
Product sales, net |
$ | 28,529 | $ | — | $ | 38,422 | $ | — | ||||||||
Net revenues of $28.5 million and $38.4 million for the three and six months ended June 30, 2026, respectively, reflect gross-to-net adjustments of approximately 11.5% and 11.4%, respectively.
Gross-to-Net Deductions
We record YARTEMLEA product sales net of estimated chargebacks, distribution fees and returns, (collectively, gross-to-net deductions). Gross-to-net deductions are estimates based on contractual terms and expected utilization and require some judgment. For the three and six months ended June 30, 2026, no chargebacks were recorded related to Medicaid claims. Because YARTEMLEA remains in the early stages of commercialization, these estimates continue to be based on limited historical experience and are subject to change as additional information becomes available. A summary of our gross-to-net related accruals for the six months ended June 30, 2026 is as follows:
|
Chargebacks |
Distribution Fees |
|||||||||||
|
and Medicaid |
and Product |
|||||||||||
|
Rebates |
Return Allowance |
Total |
||||||||||
|
(In thousands) |
||||||||||||
|
Provisions |
$ | 3,560 | $ | 1,374 | $ | 4,934 | ||||||
|
Payments |
(2,984 | ) | (520 | ) | (3,504 | ) | ||||||
|
Balance as of June 30, 2026 |
$ | 576 | $ | 854 | $ | 1,430 | ||||||
Chargebacks
We record a provision for estimated chargebacks when YARTEMLEA product sales are recognized and reduce the accrual as payments are made or credits are granted. Chargebacks represent the difference between the price we charge wholesalers and the contracted or statutorily required prices available to eligible purchasers under government programs, including our federal supply schedule agreement, and are estimated based on known pricing terms and expected utilization.
Distribution Fees
We pay our wholesalers a distribution fee for services they perform for us based on the dollar value of their purchases of YARTEMLEA. We record a provision for these charges as a reduction to revenue at the time of sale to the wholesaler and make payments to our wholesalers based on contractual terms.
Cost of Product Sales
Cost of product sales is as follows:
|
Three Months Ended |
Six Months Ended |
|||||||||||||||
|
June 30, |
June 30, |
|||||||||||||||
|
2026 |
2025 |
2026 |
2025 |
|||||||||||||
|
(In thousands) |
||||||||||||||||
|
Cost of product sales |
$ | 798 | $ | — | $ | 1,385 | $ | — | ||||||||
Cost of product sold for the period was low, primarily reflecting the sale of inventory manufactured prior to regulatory approval, for which the associated manufacturing costs were expensed as research and development in prior periods. This inventory carries a low or no cost basis, resulting in lower cost of product sold and higher gross margin during the initial commercialization period. Accordingly, cost of product sold for the three and six months ended June 30, 2026 primarily reflects stability testing, storage and royalty payments on our product sales.
Research and Development Expenses
Our research and development expenses can be divided into three categories: direct external expenses, which include clinical and preclinical research and development activities; internal overhead and other expenses; and stock-based compensation expense. Direct external expenses consist primarily of expenses with third-party manufacturing organizations, contract research organizations, clinical trial sites, collaborators, licensors and consultants prior to receiving regulatory approval for a product candidate. Preclinical research and development include costs prior to beginning Phase 1 studies in human subjects. Internal overhead and other expenses primarily consist of costs for personnel, overhead, rent, utilities and depreciation. Our accounting policy is to expense all manufacturing costs related to product candidates until regulatory approval is reasonably assured in either the U.S. or EU.
The following table illustrates our expenses associated with these activities:
|
Three Months Ended |
Six Months Ended |
|||||||||||||||
|
June 30, |
June 30, |
|||||||||||||||
|
2026 |
2025 |
2026 |
2025 |
|||||||||||||
|
(In thousands) |
||||||||||||||||
|
Research and development expenses: |
||||||||||||||||
|
Direct external expenses: |
||||||||||||||||
|
Clinical research and development: |
||||||||||||||||
|
MASP-2 program - OMS721 (narsoplimab) |
$ | 3,278 | $ | 3,424 | $ | 5,855 | $ | 6,055 | ||||||||
|
MASP-3 program - OMS906 (zaltenibart) |
(208 | ) | 5,324 | (168 | ) | 12,355 | ||||||||||
|
MASP-2 program - OMS1029 and other |
305 | 567 | 502 | 930 | ||||||||||||
|
Total clinical research and development |
3,375 | 9,315 | 6,189 | 19,340 | ||||||||||||
|
Preclinical research and development |
1,072 | 978 | 2,188 | 2,361 | ||||||||||||
|
Total direct external expenses |
4,447 | 10,293 | 8,377 | 21,701 | ||||||||||||
|
Internal overhead and other expenses |
8,651 | 10,801 | 17,278 | 22,203 | ||||||||||||
|
Stock-based compensation expenses |
700 | 915 | 1,501 | 1,951 | ||||||||||||
|
Total research and development expenses |
$ | 13,798 | $ | 22,009 | $ | 27,156 | $ | 45,855 | ||||||||
For the three and six months ended June 30, 2026, clinical research and development expenses decreased $5.9 million and $13.2 million, respectively, as compared to the prior year period as a result of reduced expenditures on OMS906 due to the sale of zaltenibart to Novo Nordisk. For the three and six months ended June 30, 2026, internal overhead and other expenses decreased $2.2 million and $4.9 million, respectively, as compared to the prior year period primarily due to Novo Nordisk reimbursing the Company for hours worked under the Transition Services Agreement and decreased employee compensation costs.
We expect research and development expenses in the third quarter of 2026 to be higher than in the second quarter of this year, driven primarily by increased investment in YARTEMLEA and our other MASP-2 inhibitor programs and our OncotoX-AML program, including costs associated with manufacturing and related activities.
At this time, we are unable to estimate with certainty the longer-term costs we will incur in the continued development of our product candidates due to the inherently unpredictable nature of our preclinical and clinical development activities. Clinical development timelines, the probability of success, and development costs can differ materially as new data become available and as expectations change. Our future research and development expenses will depend, in part, on the preclinical or clinical success of each product candidate as well as ongoing assessments of each program’s commercial potential. In addition, we cannot forecast with precision which product candidates, if any, may be subject to future collaborations, when such arrangements will be secured, if at all, and to what degree such arrangements would affect our development plans and capital requirements.
We are required to expend substantial resources in the development of our product candidates due to the lengthy process of completing clinical trials and seeking regulatory approval. Any failure or delay in completing clinical trials, or in obtaining regulatory approvals, could delay our generation of product revenue and increase our research and development expenses.
Selling, General and Administrative Expenses
Selling, general and administrative expenses are as follows:
|
Three Months Ended |
Six Months Ended |
|||||||||||||||
|
June 30, |
June 30, |
|||||||||||||||
|
2026 |
2025 |
2026 |
2025 |
|||||||||||||
|
(In thousands) |
||||||||||||||||
|
Selling, general and administrative expenses: |
||||||||||||||||
|
Selling, general and administrative expenses, excluding stock-based compensation expense |
$ | 12,938 | $ | 9,195 | $ | 25,219 | $ | 18,901 | ||||||||
|
Stock-based compensation expense |
921 | 1,150 | 2,009 | 2,567 | ||||||||||||
|
Total selling, general and administrative expenses |
$ | 13,859 | $ | 10,345 | $ | 27,228 | $ | 21,468 | ||||||||
For the three and six months ended June 30, 2026, total selling, general and administrative expenses, excluding stock-based compensation, increased $3.7 million and $6.3 million, respectively, primarily due to the build-out of our U.S. commercial organization, including the hiring of a sales force and increased marketing and market access activities in support of the YARTEMLEA launch.
We expect selling, general and administrative expenses in the third quarter of 2026 to be higher than in the second quarter of 2026, driven primarily by increased selling and marketing activities associated with YARTEMLEA.
Interest Expense
Interest expense, net of premiums, discounts, issuance costs, and remeasurement adjustments is shown below:
|
Three Months Ended |
Six Months Ended |
|||||||||||||||
|
June 30, |
June 30, |
|||||||||||||||
|
2026 |
2025 |
2026 |
2025 |
|||||||||||||
|
(In thousands) |
||||||||||||||||
|
OMIDRIA royalty obligation |
||||||||||||||||
|
Pass through interest remitted to administrative agent |
$ | 3,885 | $ | 5,069 | $ | 7,898 | $ | 10,286 | ||||||||
|
Non-cash remeasurement adjustment |
556 | (8,506 | ) | (853 | ) | (11,878 | ) | |||||||||
|
Interest expense, net of remeasurement on OMIDRIA royalty obligation |
4,441 | (3,437 | ) | 7,045 | (1,592 | ) | ||||||||||
|
2029 Notes |
||||||||||||||||
|
Contractual interest expense |
1,681 | 859 | 3,362 | 859 | ||||||||||||
|
Amortization of debt discount and issuance costs |
1,438 | 748 | 2,883 | 748 | ||||||||||||
|
Interest expense on 2029 Notes |
3,119 | 1,607 | 6,245 | 1,607 | ||||||||||||
|
2026 Notes |
||||||||||||||||
|
Contractual interest expense |
— | 790 | 112 | 2,074 | ||||||||||||
|
Amortization of debt discount and issuance costs |
— | 92 | 14 | 240 | ||||||||||||
|
Interest expense on 2026 Notes |
— | 882 | 126 | 2,314 | ||||||||||||
|
Term Loan |
||||||||||||||||
|
Contractual interest expense |
— | 2,231 | — | 4,464 | ||||||||||||
|
Amortization of debt premium and issuance costs |
— | (1,306 | ) | — | (3,214 | ) | ||||||||||
|
Interest expense on Term Loan |
— | 925 | — | 1,250 | ||||||||||||
|
Finance leases and other |
25 | 38 | 63 | 90 | ||||||||||||
|
Total interest expense, net of remeasurement and other |
$ | 7,585 | $ | 15 | $ | 13,479 | $ | 3,669 | ||||||||
Interest on our OMIDRIA royalty obligation is calculated under the effective interest method and represents a portion of the royalties remitted by Rayner to our administrative agent, Wilmington Savings Fund Society, FSB, along with principal. Pass-through interest paid to DRI is offset by non-cash remeasurement adjustments taken to properly reflect the OMIDRIA royalty obligation for changes in probable cash flows on our future expected Rayner royalties.
Contractual interest expense is comprised of cash interest paid during the year and the net change in accrued interest. Amortization of debt discounts, premiums and issuance costs are reflected as non-cash interest expense. Debt discounts on the 2026 Notes and 2029 Notes are accretive whereas the premium on the Credit and Guarantee Agreement with funds managed by Athyrium Capital Management LP and funds managed by Highbridge Capital Management, LLC, as lenders (the “Term Loan”) is deducted from contractual interest expense.
For the three months ended June 30, 2026, interest expense increased $7.6 million, compared to the same period in 2025. The increase primarily relates to a remeasurement change occurring in the prior year period related to the OMIDRIA royalty obligation due to a change in forecasted royalties from Rayner.
For the six months ended June 30, 2026, interest expense increased $9.8 million, compared to the same period in 2025. The increase primarily relates to a remeasurement change occurring in the prior year period related to the OMIDRIA royalty obligation due to a change in forecasted royalties from Rayner and additional interest incurred on our 2029 Notes as the notes were issued May 2025; however, we incurred a full six months of interest in the current year. These increases are partially offset by decreases in interest related to our 2026 Notes, which were repaid in February 2026, and the Term Loan, which was repaid in November 2025.
For further details, please see “Note 6 — Debt” and “Note 8 – OMIDRIA Royalty Obligation” in the Notes to the Condensed Consolidated Financial Statements included elsewhere in this Quarterly Report on Form 10-Q.
We expect interest expense for the third quarter of 2026 to be lower than in the second quarter of 2026, driven primarily by the decreased aggregate principal amount of 2029 Notes outstanding.
Interest and Other Income
|
Three Months Ended |
Six Months Ended |
|||||||||||||||
|
June 30, |
June 30, |
|||||||||||||||
|
2026 |
2025 |
2026 |
2025 |
|||||||||||||
|
(In thousands) |
||||||||||||||||
|
Interest and other income |
$ | 4,626 | $ | 1,241 | $ | 6,101 | $ | 2,363 | ||||||||
Interest and other income increased $3.4 million and $3.7 million, respectively, for the three and six months ended June 30, 2026 as compared to the same period in 2025 primarily due to reimbursement from Novo Nordisk for inventory which we transferred during the quarter.
We expect interest and other income for the third quarter of 2026 to be lower than in the second quarter of 2026, reflecting the completion of planned transfers of zaltenibart inventory to Novo Nordisk.
Net Gain on Change in Fair Value of Financial Instruments
|
Three Months Ended |
Six Months Ended |
|||||||||||||||
|
June 30, |
June 30, |
|||||||||||||||
|
2026 |
2025 |
2026 |
2025 |
|||||||||||||
|
(In thousands) |
||||||||||||||||
|
Net gain on change in fair value of financial instruments |
$ | 11,447 | $ | 8,207 | $ | 84,593 | $ | 8,142 | ||||||||
Our embedded derivatives comprise interest make-whole and conversion options related to our 2029 Notes as well as call and put options related to the Term Loan. We repaid our Term Loan on November 25, 2025, thereby eliminating the Term Loan embedded derivative in the current year. The net gain of $11.4 million and $84.6 million on the 2029 Notes derivative for the three and six months ended June 30, 2026, respectively, reflects marking to market the option of the holders to convert their notes into shares of common stock, cash or a combination thereof.
Swings in our stock price could significantly affect the valuation of the 2029 Note conversion derivative. In addition, a decrease in interest rates could increase the valuation of the derivative.
Loss on early extinguishment of 2029 Notes
|
Three Months Ended |
Six Months Ended |
|||||||||||||||
|
June 30, |
June 30, |
|||||||||||||||
|
2026 |
2025 |
2026 |
2025 |
|||||||||||||
|
(In thousands) |
||||||||||||||||
|
Loss on early extinguishment of 2029 Notes |
$ | (1,896 | ) | $ | — | $ | (1,896 | ) | $ | — | ||||||
On June 17, 2026, the Company entered into privately negotiated agreements with certain holders of its 2029 Notes under which the Company agreed to repurchase a portion of the outstanding notes. For the three months ended June 30, 2026, the Company recognized a loss on extinguishment of debt of approximately $1.9 million. This loss reflects the difference between the fair value of the payment obligation of $30.6 million established on June 17, 2026 less the carrying amount of the repurchased notes (the aggregate principal of $16.0 million net of unamortized discount and issuance costs) and the de-recognition of the associated embedded derivative liability of $16.7 million.
In addition, the Company recognized a $0.7 million increase in the fair value of the payment obligation from June 17, 2026 through June 30, 2026 to more properly reflect the approximated contractual settlement amount of $31.3 million.
Loss on early extinguishment of 2026 Notes
|
Three Months Ended |
Six Months Ended |
|||||||||||||||
|
June 30, |
June 30, |
|||||||||||||||
|
2026 |
2025 |
2026 |
2025 |
|||||||||||||
|
(In thousands) |
||||||||||||||||
|
Loss on early extinguishment of 2026 Notes |
$ | — | $ | (2,968 | ) | $ | — | $ | (2,968 | ) | ||||||
In May 2025, we exchanged $70.8 million of 2026 Notes for 2029 Notes and entered into agreements to equitize $10.0 million of 2026 Notes, realizing a $3.0 million non-cash loss on extinguishment. The extinguishment reflects marking-to-market the 2029 Notes and the expensing of capitalized debt issuance costs on the retired portion of the 2026 Notes.
Income tax expense
|
Three Months Ended |
Six Months Ended |
|||||||||||||||
|
June 30, |
June 30, |
|||||||||||||||
|
2026 |
2025 |
2026 |
2025 |
|||||||||||||
|
(In thousands) |
||||||||||||||||
|
Income tax expense |
$ | (29 | ) | $ | — | $ | (86 | ) | $ | — | ||||||
Income tax expense reflects estimated income tax expense for various state jurisdictions.
Discontinued operations and the OMIDRIA contract royalty asset
Net income from OMIDRIA discontinued operations, net of tax is shown below:
|
Three Months Ended |
Six Months Ended |
|||||||||||||||
|
June 30, |
June 30, |
|||||||||||||||
|
2026 |
2025 |
2026 |
2025 |
|||||||||||||
|
(In thousands) |
||||||||||||||||
|
Interest earned on OMIDRIA contract royalty asset |
$ | 3,063 | $ | 3,886 | $ | 6,195 | $ | 7,839 | ||||||||
|
Remeasurement adjustments |
3,571 | (3,149 | ) | 5,191 | (2,981 | ) | ||||||||||
|
Other income (loss), net |
(82 | ) | (83 | ) | (32 | ) | (98 | ) | ||||||||
|
Ex-U.S. royalties |
6 | 6 | 12 | 6 | ||||||||||||
|
Income before income tax |
6,558 | 660 | 11,366 | 4,766 | ||||||||||||
|
Income tax benefit (expense) |
37 | (195 | ) | 40 | (195 | ) | ||||||||||
|
Net income from discontinued operations, net of tax |
$ | 6,595 | $ | 465 | $ | 11,406 | $ | 4,571 | ||||||||
Net income from discontinued operations increased $6.1 million and $6.8 million for the three and six months ended June 30, 2026, primarily due to remeasurement of the OMIDRIA contract royalty asset in the same period in the prior year due to a change in Rayner’s revenue forecast.
We expect income from discontinued operations in the third quarter of 2026 to be comparable to the second quarter of 2026.
The following schedule presents a roll-forward of the OMIDRIA contract royalty asset (in thousands):
|
OMIDRIA contract royalty asset at December 31, 2025 |
$ | 121,786 | ||
|
Royalties earned |
(16,694 | ) | ||
|
Interest earned on OMIDRIA contract royalty asset |
6,195 | |||
|
Remeasurement adjustments |
5,191 | |||
|
OMIDRIA contract royalty asset at June 30, 2026 |
$ | 116,478 |
Financial Condition – Liquidity and Capital Resources
As of June 30, 2026, we had cash, cash equivalents, and short-term investments of $132.0 million. For the three months ended June 30, 2026, company-wide our cash provided by operations was $4.1 million. For the six months ended June 30, 2026, our cash used in operations was $10.4 million.
On February 17, 2026, we repaid at maturity the remaining $17.1 million outstanding aggregate principal amount of our 2026 Notes.
In June and July 2026, the Company entered into privately negotiated agreements with certain holders of the 2029 Notes under which we agreed to repurchase approximately $30.5 million aggregate principal amount of 2029 Notes for a total purchase price of approximately $60.2 million, plus accrued and unpaid interest of $0.2 million. Both transactions closed in July 2026, leaving approximately $40.3 million aggregate principal amount of 2029 Notes outstanding. The transactions also reduced the aggregate number of shares issuable on conversion of the 2029 Notes from approximately 11.4 million to 6.5 million. We achieved this reduction at a weighted average cost of $12.21 per share and concurrently eliminated $8.6 million dollars in future interest payments.
Furthermore, during the six months ended June 30, 2026, we repurchased and retired 0.8 million shares of common stock pursuant to our share repurchase program, at an average cost of $11.70 per share, for an aggregate purchase price of $9.9 million.
Year to date, our share repurchase program repurchases and privately negotiated 2029 Note repurchases have reduced our potential fully diluted share count by 5.8 million shares.
Omeros expects that it will be able to fund more than 12 months of operations from the date the financial statements are issued, utilizing our current cash, cash equivalents, and short-term investments, along with funds we expect to receive from commercial sales of YARTEMLEA.
From time to time, we may seek to repurchase, redeem, retire, refinance, exchange or otherwise restructure portions of our outstanding indebtedness through open-market purchases, privately negotiated transactions, tender offers or other means. Any such transactions will depend on prevailing market conditions, our liquidity and capital requirements, contractual restrictions and other factors. Should it be necessary or determined to be strategically advantageous, we also could pursue debt transactions or public and private offerings of our equity securities, future royalty sales, or other strategic transactions, which may include licensing or selling a portion or all of one or more of our existing technologies. In addition, we have an at-the-market (“ATM”) facility agreement under which we have the capability to sell shares of our common stock, from time to time, in an ATM equity offering through which we may offer and sell shares of our common stock equaling an aggregate amount of up to $150.0 million.
Cash Flow Data
|
Six Months Ended |
||||||||
|
June 30, |
||||||||
|
2026 |
2025 |
|||||||
|
(In thousands) |
||||||||
|
Selected cash flow data |
||||||||
|
Cash provided by (used in): |
||||||||
|
Operating activities |
$ | (10,357 | ) | $ | (57,779 | ) | ||
|
Investing activities |
$ | 32,134 | $ | 59,838 | ||||
|
Financing activities |
$ | (29,449 | ) | $ | (3,555 | ) | ||
Operating Activities. Net cash used in operating activities for the six months ended June 30, 2026 decreased $47.4 million compared to the same period in 2025, driven primarily by a $128.2 million increase in net income reflecting commercial sales of YARTEMLEA in the current period and lower research and development expenditures following the sale of zaltenibart to Novo Nordisk. This favorable change is partially offset by $69.8 million of non-cash charges, primarily relating to the fair value remeasurement of our 2029 Notes embedded derivative and a significantly lower remeasurement of the OMIDRIA contract royalty asset. Following the commercialization of YARTEMLEA in January 2026, trade receivables also increased by $11.7 million in the current year.
Investing Activities. Cash flows provided by investing activities primarily reflects cash used to purchase short-term investments and proceeds from the sale of those investments. This frequently causes a shift between our cash, cash equivalents, and short-term investment balances. As we manage our usage with respect to total cash, cash equivalents, and short-term investments, we do not consider fluctuations in cash flows from investing activities to be important to the understanding of our liquidity and capital resources.
Net cash provided by investing activities during the six months ended June 30, 2026 decreased $27.7 million, reflecting the timing of purchase of investments from proceeds received on maturities and sales.
Financing Activities. Net cash used in financing activities for the six months ended June 30, 2026 increased $25.9 million compared to the same period in the prior year. This increase was primarily driven by the repayment of $17.1 million in aggregate principal amount of our 2026 Notes in February 2026, the repurchase of $9.9 million of our common stock and $3.6 million of other financing related activities. In addition, the prior year included $6.3 million in proceeds from our ATM facility that did not recur in the current period. This use of cash and decreases in proceeds were offset by cash received from employee exercises of stock options of $11.0 million.
Contractual Obligations and Commitments
Our future minimum contractual commitments and obligations were reported in our Annual Report on Form 10-K for the year ended December 31, 2025. Other than the following, our future minimum contractual obligations and commitments have not changed materially from the amounts previously reported. See “Note 10 — Commitments and Contingencies” in the Notes to the Condensed Consolidated Financial Statements included elsewhere in this Quarterly Report on Form 10-Q.
Operating Leases
Our lease for our office and laboratory space ends in November 2027. We have two options to extend the lease term, each by five years. In addition, we carry various finance lease obligations for laboratory and office equipment. As of June 30, 2026, the remaining aggregate non-cancelable rent payable under the initial term of the lease, excluding common area maintenance and related operating expenses, is $9.4 million.
Convertible Senior Notes and Long-Term Debt
See “Note 6 — Debt” in the Notes to the Condensed Consolidated Financial Statements included elsewhere in this Quarterly Report on Form 10-Q.
OMIDRIA Royalty Obligation
See “Note 8 — OMIDRIA Royalty Obligation” in the Notes to the Condensed Consolidated Financial Statements included elsewhere in this Quarterly Report on Form 10-Q.
Goods and Services Contracts, Development Milestones and Product Royalties
See “Note 10 — Commitment and Contingencies” in the Notes to the Condensed Consolidated Financial Statements included elsewhere in this Quarterly Report on Form 10-Q.
Critical Accounting Policies and Significant Judgments and Estimates
The preparation of our condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions that affect the amounts reported in the financial statements and accompanying notes. We base our estimates on historical experience, current conditions and other factors we believe to be reasonable under the circumstances; however, actual results could differ materially from those estimates. We consider an accounting policy to be critical if it requires significant judgment and has a material impact on our financial condition and results of operations.
Revenue Recognition
We recognize revenue from product sales when title of the product is transferred to our customers, which generally occurs upon delivery to wholesalers. At that point, our performance obligations are satisfied. Activities performed by wholesalers after delivery are not considered separate performance obligations.
We generally record revenue from product sales when the product is delivered to our wholesalers and title for the product is transferred, upon which we have satisfied our performance obligations. Fulfillment activities by the wholesalers are not considered to be a separate performance obligation. Product revenue is recorded net of variable consideration, including wholesaler distribution fees, chargebacks, returns and discounts. We estimate variable consideration using the expected value approach. This estimate is based on several factors, including: historical return rates, expiration date by product, estimated levels of inventory in the wholesale channel. Since there is often a timing lag between the product sale and the settlement of accruals relating to these programs, our net product revenue may incorporate revisions of accruals for several periods. We include such estimates in the transaction price only to the extent that it is probable that a significant reversal of revenue will not occur when the uncertainty associated with the variable consideration is subsequently resolved.
Chargebacks represent discounts provided to eligible covered entities under government programs, including the 340B Drug Pricing Program and the Medicaid Drug Rebate Program. In addition, we are subject to pricing obligations under our Federal Supply Schedule agreement with the U.S. government (the “FSS Agreement”), which establishes maximum prices for sales to certain federal agencies and may give rise to additional discounts and rebates. Chargebacks are recorded as a reduction of gross product revenue at the time of sale. Reserves for chargebacks are generally recorded as reductions of accounts receivable, while reserves for Medicaid rebates and patient co-pay assistance, if applicable, are recorded as accrued liabilities.
We also maintain programs that may give rise to similar deductions, including patient co-pay assistance programs. For the six months ended June 30, 2026, chargebacks were primarily attributable to discounts under the 340B Drug Pricing Program, and no material reductions to gross product revenue were recorded for other programs. We will continue to evaluate utilization of these programs and recognize the related reductions to revenue in the period in which they occur.
For further details of our other Critical Accounting Policies, see “Note 2 — Significant Accounting Policies” in the Notes to the Condensed Consolidated Financial Statements included elsewhere in this Quarterly Report on Form 10-Q and Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our Annual Report on Form 10-K for the year ended December 31, 2025, which was filed with the SEC on March 31, 2026.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Our exposure to market risk is primarily confined to our investment securities, debt instruments and embedded derivatives.
Cash, Cash Equivalents, and Short-Term Investments
Our exposure to market risk is primarily confined to our investment securities. The primary objective of our investment activities is to preserve our capital to fund operations, and we do not enter into financial instruments for trading or speculative purposes. We also seek to maximize income from our investments without assuming significant risk. To achieve our objectives, we maintain a portfolio of investments in high-credit-quality securities. As of June 30, 2026, we had cash, cash equivalents and short-term investments of $132.0 million. In accordance with our investment policy, we invest funds in highly liquid, investment-grade securities. The money market funds in our investment portfolio are not leveraged and are classified as available-for-sale. We currently do not hedge interest rate exposure. Because of the short-term maturities of our investments, we do not believe that an increase in market rates would have a material negative effect on the realized value of our investment portfolio. We actively monitor changes in interest rates and, with our current portfolio of short-term investments, we are not exposed to significant potential loss due to changes in interest rates.
Convertible Notes, Term Debt, and Embedded Derivatives
As of June 30, 2026, we had fixed-rate borrowings from our 2029 Notes, and as of December 31, 2025, we had fixed-rate borrowings from our 2026 Notes and 2029 Notes. We record all our fixed-rate borrowings at carrying value and, therefore, do not experience any risk for changes in interest rates. However, we include an embedded derivative along with our debt in our reporting of our 2029 Notes. The derivative on our 2029 Notes is marked to fair value every reporting period. The fair value inputs to the 2029 Notes’ derivative valuation include stock price, unsecuritized discount rate, risk-free rate, volatility, and term. Swings in our stock price could significantly affect the valuation of the 2029 Note conversion derivative. In addition, a decrease in interest rates could increase the valuation of the derivative. As of June 30, 2026, a 20% decrease or increase in our stock price would result in an approximate $15.8 million change in the fair value of the 2029 Notes embedded derivative within the range of $40.4 million to $71.0 million.
ITEM 4. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
Our management, with the participation of our principal executive officer and principal financial officer, evaluated the effectiveness of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, as of June 30, 2026. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives, and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Based on the evaluation of our disclosure controls and procedures as of June 30, 2026, our principal executive officer and principal financial officer concluded that, as of such date, our disclosure controls and procedures were effective at the reasonable assurance level.
Changes in Internal Control over Financial Reporting
There was no change in our internal control over financial reporting identified in connection with the evaluation required by Rule 13a-15(d) and 15d-15(d) under the Exchange Act that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
PART II — OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
From time to time, in the ordinary course of business, we may be involved in various claims, lawsuits and other proceedings. As of the date of filing of this Quarterly Report on Form 10-Q, we were not involved in any material legal proceedings.
ITEM 1A. RISK FACTORS
We operate in an environment that involves a number of risks and uncertainties. Before making an investment decision you should carefully consider the risks described in Part I, Item 1A, “Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2025, as filed with the SEC on March 31, 2026. In assessing the risk factors set forth in our Annual Report on Form 10-K for the year ended December 31, 2025, you should also refer to the other information included therein and in this Quarterly Report on Form 10-Q, including the supplemental risk factor below. In addition, we may be adversely affected by risks that we currently deem to be immaterial or by other risks that are not currently known to us. Due to these risks and uncertainties, known and unknown, our past financial results may not be a reliable indicator of future performance and historical trends should not be used to anticipate results or trends in future periods. The trading price of our common stock could decline due to any of these risks and you may lose all or part of your investment.
Our share repurchase program could affect the price of our common stock and increase volatility and may be suspended or terminated at any time, which may result in a decrease in the trading price of our common stock.
In November 2025, our Board of Directors authorized a share repurchase program to repurchase, from time to time, up to $100.0 million of our common stock in the open market or through privately negotiated transactions. The share repurchase program does not have a fixed expiration date, may be suspended or discontinued at any time, and does not obligate us to acquire any amount of our common stock. The timing, manner, price, and amount of any repurchases may be determined by us at our discretion and will depend on a variety of factors, including business, economic and market conditions, prevailing stock prices, corporate and regulatory requirements, and other considerations. As of August 12, 2026, approximately $90.1 million remained available to repurchase our outstanding shares of common stock under the share repurchase program.
Repurchases pursuant to our share repurchase program could affect our stock price and increase its volatility. The existence of a share repurchase program could also cause our stock price to be higher than it would be in the absence of such a program and could potentially reduce the market liquidity for our common stock. There can be no assurance that any repurchases will enhance shareholder value because the market price of our common stock may decline below the levels at which we repurchased our common stock. Although our share repurchase program is intended to enhance long-term shareholder value, short-term stock price fluctuations could reduce the share repurchase program’s effectiveness.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
The following table provides information regarding our repurchases of our common stock during the quarter ended June 30, 2026:
|
Period |
Total Number of Shares Purchased |
Average Price Paid per Share (1) |
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (2) |
Maximum Approximate Dollar Value of Shares That May Yet Be Purchased Under the Plans or Programs (in thousands) (2) |
||||||||||||
|
04/01/2026-04/30/2026 |
— | $ | — | — | $ | 95,854 | ||||||||||
|
05/01/2026-05/31/2026 |
375,000 | 12.17 | 375,000 | 91,291 | ||||||||||||
|
06/01/2026-06/30/2026 |
113,716 | 11.34 | 113,716 | 90,138 | ||||||||||||
|
Total |
488,716 | $ | 11.70 | 488,716 | ||||||||||||
| (1) | Average price paid per share excludes commissions and excise tax. | |
| (2) | On November 29, 2025, the Board of Directors approved an indefinite term share repurchase program under which we are permitted to repurchase from time to time up to $100.0 million of our common stock in the open market or through privately negotiated transactions. Since the inception of the program, we have repurchased and retired approximately 0.5 million shares at an average share price of $11.70 per share. As of August 12, 2026, approximately $90.1 million remained available for repurchase of our outstanding shares of common stock under the share repurchase program. |
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
Not applicable.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.
ITEM 5. OTHER INFORMATION
(a)
(b) None.
(c) Our directors and Section 16 reporting officers may from time to time enter into plans or other arrangements for the purchase or sale of our shares that are intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) under the Exchange Act (a “10b5-1 Plan”).
During the three months ended June 30, 2026, none of our directors or Section 16 reporting officers adopted or terminated any contract, instruction or written plan for the purchase or sale of our securities that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) under the Exchange Act or any “non-Rule 10b5-1 trading arrangement” (as defined in Item 408(c) of Regulation S-K).
ITEM 6. EXHIBITS
|
Exhibit Number |
|
Description |
|
|
|
|
|
31.1 |
|
Certification of Principal Executive Officer Pursuant to Rule 13-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934 as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
|
31.2 |
|
Certification of Principal Financial Officer Pursuant to Rule 13-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934 as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
|
32.1 |
|
Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
|
32.2 |
|
Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
|
101.INS |
|
Inline XBRL Instance Document |
|
101.SCH |
|
Inline XBRL Taxonomy Extension Schema Document |
|
101.CAL |
|
Inline XBRL Taxonomy Extension Calculation Linkbase Document |
|
101.DEF |
|
Inline XBRL Taxonomy Extension Definition Linkbase Document |
|
101.LAB |
|
Inline XBRL Taxonomy Extension Label Linkbase Document |
|
101.PRE |
|
Inline XBRL Taxonomy Extension Presentation Linkbase Document |
|
104.1 |
|
Cover Page Interactive Data File, formatted in Inline XBRL (included in Exhibit 101) |
|
The certifications attached as Exhibits 32.1 and 32.2 that accompany this Quarterly Report on Form 10-Q are not deemed filed with the SEC and are not to be incorporated by reference into any filing of Omeros Corporation under the Securities Act or the Exchange Act, whether made before or after the date of this Quarterly Report on Form 10-Q, irrespective of any general incorporation language contained in such filing. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
|
|
OMEROS CORPORATION |
|
|
|
|
Dated: August 12, 2026 |
/s/ Gregory A. Demopulos |
|
|
Gregory A. Demopulos, M.D. |
|
|
President, Chief Executive Officer and Chairman of the Board of Directors |
|
|
|
|
Dated: August 12, 2026 |
/s/ David J. Borges |
|
|
David J. Borges |
|
|
Vice President, Finance, Chief Accounting Officer and Treasurer |