Omeros Corp (OMER) 2014 Q3 法說會逐字稿

Good afternoon and welcome to today's conference call for Omeros Corporation. (Operator Instructions) Please be advised that this call is being recorded at the company's request, and a replay will be available on the company's website for one week from today.

Before I turn over the call, management has asked me to remind you that some of the statements made on the call today will be forward-looking statements. These statements are based on management's beliefs and expectations as of today only and are subject to change. All forward-looking statements involve risks and uncertainties that could cause the company's actual results to differ materially. Please refer to the risk factors section of the company's quarterly report filed with the SEC earlier today for a discussion of these risks and uncertainties.

Now I would like to turn the call over to Dr. Greg Demopulos, Chairman and CEO of Omeros.

Thank you, and good afternoon, everyone. With me today is Mike Jacobsen, our Vice President of Finance and Chief Accounting Officer.

I'll start today's call by providing a corporate update, including a discussion of the recent news on Omidria. After which, Mike will provide an overview of our third quarter financial results. We have reserved time for Q&A after the financial overview.

Our first commercial product, Omidria, was approved by the FDA on May 30 for use during cataract surgery or intraocular lens replacement. As many of you know, Omidria is the only FDA-approved product for intraocular administration that maintains pupil diameter by preventing intraoperative miosis or pupil constriction and reduces postoperative pain, providing consistent and predictable management of these problems for ophthalmic surgeons and their patients.

As we announced last week, we have received transitional pass-through reimbursement status for Omidria from the Center for Medicare & Medicaid Services, or CMS. This will be effective as of January 1, 2015. We are obviously pleased with this outcome, and we appreciate CMS's collaborative approach and their final decision.

As you may know, the pass-through program was initiated by Medicare in 2001 to ensure that important new technologies can be appropriately utilized and evaluated by health care providers. Pass-through is important for Omidria because ambulatory surgery centers and other outpatient facilities will be able to bill Medicare and other insurance providers for Omidria separately from the cost of the procedure. We expect pass-through reimbursement to remain in effect for a period of two to three years, after which time CMS will make a new reimbursement determination.

We believe that pass-through status should accelerate adoption of the product across cataract and other intraocular lens procedures and should streamline the billing and reimbursement process for providers that use Omidria. The need to maintain pupil size throughout the surgical procedure, particularly prevention of miosis or pupil constriction, and the need to inhibit postoperative pain are two key challenges facing ophthalmic surgeons and their patients in intraocular lens replacement today. We and the experts who perform these procedures believe that Omidria fits seamlessly into their surgical routine and will become an important part of their practice. In fact, the term offered by many is standard of use.

A single vial of Omidria is dosed for a single cataract or lens replacement procedure. Cataract surgery and intraocular lens replacement today represents the most common surgical procedure in the U.S., with approximately 4 million performed annually. Worldwide, there are an excess of 15 million of these procedures performed each year in the developed nations.

The wholesale acquisition cost, or WAC, for Omidria has been set at $465 per single use vial, and pass-through reimbursement will be based on WAC plus 6% for the first two quarters, followed thereafter by average selling price, or ASP, plus again 6%. As I mentioned earlier, CMS awarded Omidria a pass-through status effective January 1, 2015. We are planning to launch Omidria in the U.S. in early 2015. Our marketing and sales leadership, including our national and regional sales managers, have been hired, and our initial group of 20 contract sales representatives solely dedicated to Omeros began calling on ophthalmic surgeons and their staff in August. We are in the process of recruiting an additional 20 sales representatives and expect them to be hired, trained and in the field by the end of January.

On the marketing front, Omidria has received a substantial amount of attention from industry media in anticipation of our launch, a string of peer-reviewed journal articles have begun to publish. Our ads for Omidria have been running in the trade journals. We have built a presence at ophthalmology conferences, and our advisers include the ophthalmic surgeons who shape practice habits both today and in the future. The operational side of our launch is also in place. Manufacturing and supply agreements are completed. Wholesaler agreements are being finalized. Our third-party logistics provider is on board and ready to go, and product will be ready to ship in early 2015.

With respect to Europe, this quarter, we expect to receive an opinion from CHMP on our Marketing Authorization Application. Our plan, as you know, is to partner in the EU for marketing and distribution of Omidria. So with respect to Omidria, all of the pieces are falling into place. In Europe, we expect to begin selling in the first half of 2015, and in the U.S., we expect to launch Omidria in early 2015 with pass-through reimbursement based on a WAC of $465 per single-use vial.

Turning now to our pipeline programs. Let's first focus on OMS721, our MASP-2 antibody program targeting the lectin pathway of the complement system, a key part of the immune response. Our current Phase II clinical program is evaluating OMS721 in patients with complement-mediated thrombotic microangiopathies, or TMAs, including atypical hemolytic uremic syndrome, or aHUS. We expect to be able to release data later this month on the effect of OMS721 on thrombus formation in a human ex vivo pathophysiologic system of aHUS using serum from aHUS patients both in the acute phase and in remission. We also hope to release preliminary data from our Phase II clinical program before yearend.

For OMS824, our PDE10 inhibitor in development for the treatment of cognitive disorders including Huntington's disease and schizophrenia, as previously announced, clinical trial enrollment is currently suspended in connection with an observation in a nonclinical study in rats at the maximum dose tested. As requested by FDA, we are further evaluating the nonclinical data from that rat study as well as from our other nonclinical studies that did not show the observation before we can reactivate clinical enrollment in our Phase II OMS824 program. Based on currently available data, we do not believe that the observation in the rats is caused by OMS824. We are working with the FDA and look forward to continuing the Phase II OMS824 program as soon as possible.

Our G protein-coupled receptor, or GPCR, program continues to advance as well. We have unlocked or identified compounds that functionally interact with 54 Class A orphan GPCRs. To put that in perspective, almost 40% of all drugs on the market today target 46 GPCRs, and we believe that we exclusively control an additional 54. We are also able to unlock Class B orphan GPCRs.

Medicinal chemistry is underway at Omeros on a number of Class A orphan GPCRs, including GPR17 tied to remyelination; GPR151, linked to neuropathic pain; and GPR161, which is strongly associated with triple-negative breast cancer. We're also moving ahead to bring our PDE7 inhibitor, OMS527, and our anti-plasmin protein, OMS616, into the clinic in 2015. Omeros discovered the link between PDE7 and any form of addiction as well as the link between PDE7 and any form of movement disorder. We are currently focused on developing what we believe could be a treatment for a wide range of addiction and compulsive disorders. OMS616 is our novel antifibrinolytic agent to limit blood loss during trauma or surgery, or other hyper fibrinolytic stage such as chronic liver disease.

Well, that concludes our corporate update. At this point, I'd like to turn the call over to Mike Jacobsen for a summary of our third quarter financial results.

Thanks, Greg, and hello, everyone. For the quarter ended September 30, 2014, we reported a net loss of $18.3 million or $0.54 per share, which includes noncash expenses of $2.5 million or $0.07 per share. This compares to a net loss of $13.9 million, or $0.46 per share for the same period in 2013, which included noncash expenses of $3.4 million or $0.11 per share. Operating expenses for this quarter were $17.3 million compared to $13.6 million one year ago. The increase was primarily related to preparing for the U.S. commercial launch of Omidria, which we are planning for early in 2015 and to costs associated with our Phase II clinical trials evaluating OMS824 in Huntington's and OMS721 in TMAs. NIH grant revenue for the current quarter was 214,000 compared to 196,000 for the same period a year ago. At September 30, 2014, we had cash and cash equivalents and short-term investments of $21.8 million.

As Greg discussed earlier, we plan to launch Omidria in the U.S. in early 2015. Accordingly, we do not project any product revenue in the fourth quarter of this year. In addition, we expect our operating expenses will increase over the current quarter run rate, primarily due to increased activities related to the U.S. commercial launch and the continued development of our product candidates. We also expect that our noncash expenses will increase.

That concludes our financial update. Let's turn the call back to the operator for the question-and-answer session.

(Operator Instructions) Our first question is from Jason Kolbert of Maxim Group.

Hi, guys. This is [Susie Lee], calling in for Jason Kolbert. Congrats on the pass-through pricing. How might that affect the CMS bundling?

I'm sorry, can you -- how will that affect the CMS bundling?

Bundling, yes.

For specifically cataract surgery?

Yes.

Yes. It's actually reimbursed outside of the bundle for cataract and refractive lens surgery. So it is outside of that bundle, so should not affect and will not affect during the pass-through period that bundle.

Got it. Thank you.

Our next question is from Yatin Suneja of Cowen and Company.

Hi, guys. Thank you for taking my question and congrats on all the progress. Greg, you mentioned that you're going to hire now 40 reps. Could you talk about -- do you think that these 40 reps would be enough to effectively target all the physician and centers in the U.S.? And maybe talk about how many centers are there and how many are you planning to target. And then one more question, are you also planning to hire people who will primarily work on long-term reimbursement? Thank you.

Yes. Thank you, Yatin. With respect to your first question, remember that we already have 20 reps hired. We're talking about now and in the process of hiring an additional 20. And as I said earlier, we expect to have those hired, trained and in the field by the end of January, which will bring the sales force, which is solely dedicated to Omeros and at this point solely dedicated to Omidria, to a total of 40 representatives.

In terms of the ability of that group to access adequately the ophthalmic surgeons who perform cataract and intraocular lens replacement, we are very comfortable with that number. Remember that we are targeting, first and foremost, high-volume cataract surgeons. So certainly, we expect we're going to be able to do that. We haven't given specific numbers yet as to what percentage of sites we expect to be able to detail, but the numbers will be substantial. So we're actually very comfortable with that 40.

Your second question with respect to long-term reimbursement. Again, we are thankful and, frankly, very appreciative of the decision by CMS to provide pass-through reimbursement for Omidria. But as we look to having pass-through begin on January 1 of this coming year, 2015, you have to imagine that we're already thinking about what we need to do to obtain really long-term reimbursement for the product. We're looking at multiple approaches there, and we've been active on that already, as you might imagine, and we plan to remain very active on that effort throughout the period of transitional pass-through.

Thank you.

Our next question is from Steve Brozak of WBB.

Hey, congratulations, gentlemen. There is one item that you had mentioned before in terms of Omidria's standard of use, which I would assume would be same as standard of care. In comparing what's currently out there, i.e. compounding and reimbursement for that, what exactly -- why exactly would a physician go out there and defy standard of care? And what are the financial considerations. And also, frankly, in going up against standard of care, what kind of a business model would anyone think of using versus just simply using Omidria?

That's a good question, Steve. And not to parse words here, but I prefer the term standard of use as opposed to standard of care. Standard of care carries medico legal implications, and I think I'd prefer standard of use here. But I think your question is relevant in either case. I mean, look, it's a very good question. We are optimistic about the potential utilization of Omidria. We're not overconfident about it, but we are optimistic.

In answer to your question directly, I mean, we frankly could not have scripted a better scenario than the one into which we are launching. You have a situation where currently, surgeons, ophthalmic surgeons who perform these procedures, are trying, in many cases, trying unsuccessfully to access compounded products, anything they can get their hands on to dilate the pupil, to keep the pupil open during the surgical procedure. As you know, with the Drug Quality and Security Act, that was passed into law in November of last year, that has just made access to compounded products and FDA's view on compounded products much more restrictive.

So surgeons currently are having a difficult time accessing those products. And remember that those products really don't do what Omidria does. So epinephrine, for example, dilates the pupil only. Remember that Omidria not only dilates, but more importantly in cataract surgery, it prevents miosis or pupil constriction. That's really the key. There is no other product that does what Omidria does. And so, here we have a product that is FDA-approved, has a well-understood, well-known safety profile, and that's in comparison to compounded products that are difficult to access, really aren't as effective as Omidria and don't carry that same safety profile. And then when you layer on top of that those compounded products need to be purchased out of the bundled payment for cataract surgery and in this case, again, thanks to the decision by CMS, Omidria will be reimbursed.

So when you put all of that together, I think it's difficult for me to give you a really good answer as to why a surgeon would opt for a compounded product over Omidria. But again, we'll have to see how the launch proceeds and how sales ramp following launch.

Well, I can't wait to say I'm really, really looking forward to 2015 and the launch given everything you've just said.

Thank you. We're looking forward to it as well. It actually is, it's an exciting time for us.

Thank you.

Our next question is from Serge Belanger of Needham & Company.

Hey, good afternoon. A couple of questions on Omidria. I guess for Greg, what prompted the doubling of the sales force at this point? And it sounds like the first 20 sales reps have already been calling surgeons. Will the next 20 be calling the same group or a different group of physicians and surgeons?

Yes, Serge, again, good question. Let me start with some of the questions that you had near the end, and I'll work back to the front. Yes, you're correct that the 20 sales reps we already have began making calls on ophthalmic surgeons and their staff, so their facilities in August. We are hiring another 20. This was actually a decision that was made a while ago, but pulling the trigger on that was held really until we had clarity from CMS on whether or not there would be reimbursement for Omidria.

Now I could make the argument either way that had we not received reimbursement, we should have gone ahead with an additional 20 reps and really push hard, where in that case, payment for the product would have come out of the bundle. I can also make the other argument that certainly with reimbursement, we want to make sure that we are really crossing that starting line with a fully functional, hard-driving sales force.

I think coming back to the decision, it was really one of just holding until we had clarity. Given that we now have that clarity, we did go ahead and pulled the trigger on those additional 20 sales reps. We expect clearly that those 20 sales reps will be able to spread out our reach with our sales force and increase the number of ophthalmic surgeons, facilities, ophthalmic surgery staff that our sales force will be able to access.

Okay. And then one more. Just going forward, any plans on providing guidance? I know it's probably too early in the game to provide revenue guidance, but at least in operating expenses to get an idea of what we should expect for, I guess, both R&D and SG&A going forward in '15 and '16?

That's again a very good question, Serge. And the direct answer to that is, yes, we will be providing guidance with respect to operating expenses, and that will be at our next call, which will be early next year. With respect to revenue guidance, we really do not plan to provide guidance certainly for the first year. We'll revisit that decision subsequent to that time, but our plan currently is no revenue projection, no revenue guidance for at least the first year of commercial sales.

Let's just see how things progress, let's get our legs underneath us, the sales force, the marketing group, the entire commercial team, is sort of chomping at the bit to get this going. We're all excited. The objective here is to have as flawless launch as possible. That's been our focus, and I think the team has really done a tremendous job to make that objective a reality.

All right. Thank you. Congrats on the progress once again.

Thanks, Serge. We appreciate it.

Our next question is from Liana Moussatos of Wedbush Securities. You may begin.

Thank you for taking my question. Just a couple of questions on OMS721. You have announced some preclinical data on stroke, and I'm just wondering what the clinical plan is for stroke. And then when the Phase II TMAs data is released around year end, what kind of endpoints should we expect to be released with that data?

Hi, Liana, again, good questions. With respect to your question on stroke, we have not discussed publicly any plans with respect to stroke clinically. One would imagine and certainly would be accurate that we are looking at additional indications, not only for OMS721, which is our MASP-2 inhibitor, but also for MASP-3 inhibition, which sits at the top of the alternative pathway so -- which again, we control for a number of alternative pathway-related diseases. So we're looking at how we expand potential indications across both of those targets. But we'll update you as we move forward.

With respect to the endpoint for the TMA study, I think that you should be looking at those same endpoints that Alexion used for its drug product Soliris in aHUS. So you're looking at things like -- the things that we will be measuring are laboratory measures such as platelet count, haptoglobin, LDH, need for transfusion. These types of things are certainly those which we will be measuring and those that we expect to be sharing with you as we release preliminary data.

Thank you very much.

Our next question is from Thomas Yip of MLV & Co. You may begin.

Hey, hi, guys. Thank you so much for taking my question. Congrats on a great quarter. As we approach the yearend, and as you guided to decision by CHMP regarding Omidria in Europe, assuming positive news, and let's hope for a positive news, what do you foresee to the game plan in Europe?

Thanks, Thomas. Yes, again, in Europe, we do plan to partner. That is currently not in our plan to launch and market distribute Omidria independently in Europe. So we are in discussions around partnering in Europe. We will provide an update as we see appropriate. As you know, we really don't discuss our partnering efforts. But the idea in Europe would be to partner, and the timing of launch in Europe, as we said, we expect in the first half of 2015.

Okay. That's good to hear. And just also a quick question about a couple of those assets that you say will -- that you plan to move into clinical studies in the upcoming year, namely 527, do you have preclinical data on hand that you plan to present or announce in the coming months?

Yes. We -- that's a good question as well. Again, remember that all projections with respect to clinical trials in the coming year are dependent on our ability to move those programs forward and also dependent on sufficient resources to fund those programs. But assuming both of those requirements are met, we do, as you know, have preclinical data in -- with our PDE7 inhibitor. Actually, we have preclinical data in cocaine, in alcohol, nicotine, opioids and in binge eating.

We are currently preparing a manuscript that addresses really those preclinical studies as well as the mechanism by which we believe and in fact that we have elucidated around the mechanism of PDE7 inhibition in addiction. So looking specifically at the ventral tegmental area and the nucleus accumbens, we have identified what we believe is the mechanism for that activity. And we do plan to be putting that out in a publication, hopefully later this year, meaning -- I'm sorry, in 2015.

Okay, fantastic. Well, thanks again, and we look forward to new data.

Yes, thank you.

Our next question is from Norm Hale of Stifel. You may begin.

Thank you. In relationship to the GPCR program, obviously, you guys have de-orphaned a large number of this GPCR. What is your game plan at the moment in terms of have you figured out which of these GPCRs you want to keep internally and those that you want to license out? Or are you still kind of working with that particular issue?

Yes. Thanks, Norm. That's such a good question, and we -- look, our game plan remains really unchanged there. We have 54 Class A orphan GPCRs that we have surrogate, de-orphanized, and the reason I'm using that term as opposed to de-orphanization specifically is that, as you know, we are not identifying the endogenous ligand, we are screening compound libraries, so we are finding small molecules out of compound libraries. So this is really surrogate de-orphanization, but the effect is that we're able then to identify the primary signaling profile, and we believe we're the only ones because you do need functionally active compound who can identify those primary signaling profiles for those receptors.

Now the game plan, as I said, remains the same. We have 54 of those targets. Some of those we will be moving into our development pipeline, and we will be developing independently. Our plan still remains to partner a good number of those. As I mentioned, we have initiated medicinal chemistry efforts across a number of those targets. I think I specifically mentioned today GPR17 linked to the remyelination, GPR151 tied to neuropathic pain, and GPR161, which has a very tight linkage to triple-negative breast cancer.

Those are ones that certainly we're interested in and we believe others are. Those may be ones or some subset of those are ones that we could be developing internally. There's the possibility as well that one or more of those could be readily partnered. So I don't think we're going into this thinking, this one we're going to independently develop, this one we're going to partner. But we are moving forward those that we feel are interesting from a clinical perspective, from a biological perspective, but also those which we think we can really add value quickly.

Okay. And from a standpoint of protecting your intellectual property, how many patents have you received or patents pending relative to the GPCR?

Yes, we have a number of patent applications pending around the GPCR program. We have patents on the screening, proprietary screening method by which we use. With respect to the receptors, the 54 receptors that, for which we have found functionally active compounds, those patents are all currently pending. We do remain optimistic that those will begin to issue in the not too distant future. I think that when they do, that will obviously be an important milestone for the program.

So we'll keep people advised as to our progress there, but really, we continue to remain very positive on that program, understanding that we have not yet announced any partnership around our GPCR program. And I know that, that was expected by many earlier, in fact, I'll tell you it was expected -- that announcement was expected by us earlier. That has not in any way dampened our enthusiasm or our optimism for the program. And again, we don't discuss partnering efforts but we will keep people informed as those things occur.

Great, okay. Second question on OMS824, my understanding is that this particular product has potential for treatment of schizophrenia, Alzheimer's disease and Huntington's disease. Which of those 3 diseases do you think that it has the greatest potential? And where has the most potential therapeutic benefit?

Interesting question. Certainly, where we focused is in Huntington's disease and schizophrenia. Remember that, as you pointed out, PDE10 inhibitors hold the promise of improving cognition in these cognitive disorders. Our focus on schizophrenia -- as you know, Pfizer also was in schizophrenia. Interestingly, Pfizer is also now in Huntington's disease. Schizophrenia requires, in most cases, very large studies, and they are costly. We believe we can run some schizophrenia studies or studies in patients with schizophrenia a little more cost-effectively, again, if we're very smart in how we design the study protocols. But our focus on Huntington's also was really one of capability for a company with our resources. I mean, that's something -- that's an area that we felt that certainly we could and that we can get after with the kind of resources that Omeros has.

With respect to biologically, which of these areas really hold the most promise for a PDE10 inhibitor, in a way, your guess is as good as ours. There currently, as you know, is no commercial validation of a PDE10 inhibitor and there is really no clinical validation to date. I believe that we and Pfizer are at the leading edge in terms of clinical development of the PDE10 inhibitors. So you're not really -- we're not really sure how this is all going to wash out. What we are quite confident in is that PDE10 is going to prove to be a valuable target for some substantial set of CNS disorders. I think that, that's a belief shared by a number of the large pharmaceutical companies who are similarly pursuing PDE10. We believe we really do have the premier PDE10 inhibitor tied to the absence of extrapyramidal symptoms with our compound even at high interaction with the PDE7 -- I'm sorry, with the PDE10 enzyme.

So our confidence remains, and we'll keep people informed as we further sort of sort out what indication is best for PDE10. Obviously, we're also looking at what other groups are doing. So we're very aware of what Pfizer is doing, what other companies are doing with their PDE10 inhibitors, again, believing that ours has very certain advantages.

Okay. My third and final question, relative to MASP-2, Soliris, right now is approved for aHUS and I believe some other diseases as well, and from what I'm reading, relative to Alexion Pharmaceuticals, they are (inaudible) also projecting that by 2020, revenues for Soliris could be in excess of $5 billion per year. Do you guys believe that ...

That's good for them.

-- this company, that the product -- that your product, MASP-2, is potentially safer, and yet it is highly effective in the therapeutic benefit. Can you discuss just a little bit about how you can see your product versus Soliris?

Yes, that's again a good question. I don't feel so comfortable discussing really comparisons between our product and, or any of our products and any other product out there. I can tell you that what we believe to be the advantages of a MASP-2 inhibitor over a C5 inhibitor in general, one is, you allude to it when you said safety, I would refine that a bit just to say that MASP-2 inhibition does not affect the lytic arm of the classical pathway, so the ability to fight infection, whereas a C5 inhibitor does, by its location in the complement system, its downstream location at the top of the terminal cascade, does by definition block the lytic arm of the classical pathway. The other advantage we believe that we will see with OMS721, and I think we demonstrated this in our Phase I clinical trial, is the ability to deliver OMS721 as a subcutaneous administration. This, of course, is different than C3 inhibitors, C5 inhibitors, those which are targeting really ubiquitous targets in human.

MASP-2 is much lower in concentration. Native circulating levels of MASP-2 are orders of magnitude lower, and therefore, makes an inhibitor of MASP-2 amenable to subcutaneous administration as opposed to other targets, which require IV, intravenous infusion. We also believe that with respect to thrombotic microangiopathies that the role of MASP-2 in the coagulation cascade, so not just the complement system but also the coagulation cascade really play into its ability to be effective in thrombotic microangiopathies because, of course, the pathophysiologic end point is thrombus formation. So the role of the coagulation system certainly is in play in those diseases, not just the complement system. So having a target that can affect both the complement system and the coagulation cascade theoretically would be advantageous, and this is again where we think OMS721 certainly has a role.

Very good. Thank you very much. You guys really have some exciting products in the pipeline. I think you have a great (inaudible). That's all for me.

Thank you very much, Norm.

Our next question is from [David Cone of MS Howells].

Thanks for having the call today, and thank you so much for taking my questions. Congratulations on the CMS, again, as well. So, Greg, I have three questions for you. The first of which is have you already begun discussions with potential partners for Europe for Omidria? And then the second question is I noted a new international GPCR Consortium that was formed with pharma and academia, was announced last week. Are you planning to participate in that consortium? And my third question was with such a broad portfolio of opportunities, could you give us an idea of how you're prioritizing your opportunities for 2015?

Right. Hi, David, and then thanks. Let's take them in order. We have said that we are in discussions around the European partnership. At that point, I think I just stop and say that we really don't discuss routinely our partnering efforts. With respect to the GPCR Consortium, yes, I think that's very interesting. It clearly underscores the importance of GPCRs in drug development and in the pharmaceutical industry.

Now remember that these are really looking at structures of those GPCRs. My expectation is that those aren't orphans because, as you know, the easiest way to get a crystal structure is to also have a ligand. So orphans don't have ligands, therefore it's going to be very difficult for, I would expect, that consortium to find crystal structures for orphan GPCRs.

Having said that, we are interested, given that we have ligands, in assessing and determining crystal structures for our GPCRs or for a subset of our GPCRs. Whether that would require us joining that consortium, probably premature, I wouldn't immediately see a need for us to do that or even perhaps the wisdom in us doing that, of course, unless it was structured around some broader deal structure with pharmaceutical companies interested specifically in crystal structure for GPCRs or who are part of that consortium. But I'm not sure that, that consortium really helps us in any way. I mean I see what we provide, but -- and I don't mean this arrogantly at all, I'm just -- and again, I want to talk in greater depth with our science team, but I currently am not seeing what that consortium brings directly to us and our orphan GPCR effort.

Sounds fair.

And then your final question about how we prioritize, we're prioritizing all the time. With this many assets, we have to prioritize. Clearly, our number one priority for 2015 is the successful launch and ramp of Omidria. I mean that's critical. I think that CMS's favorable decision for us certainly helps along that path. It is the revenue that we expect to generate with Omidria, which we expect really brings substantial value to the ophthalmic community. Again, in our minds, there really is no question about it, this product is needed, and we're delivering it. But those revenues from that program, we're really looking to help drive the development of the rest of our pipeline.

So obviously, that is our number priority. I think behind that there's sort of a cluster of priorities. I think OMS721, our MASP-2 program, certainly is a high priority for us. I mean, as I mentioned in my update, we do expect to be releasing data from the ex vivo pathophysiologic system of aHUS looking at thrombus formation. I think if those data are positive, boy, I will certainly sleep better with respect to the likelihood of success in our Phase II TMA program. I think -- so let's see what those data look like. We'll put those out as they are available, but that certainly would move that program high up the priority list for us ...

Pardon me, and you still -- you did expect to have that data before yearend for 721?

Well, for 721, we've said the ex vivo pathophysiologic system data and thrombus formation using 721, and that's in the ex vivo system using serum or sera from aHUS patients both in remission and in the acute phase. Actually, David, we said we'll have those data this month. So we'll be putting those out this month. And the data that we're hoping to have before the end of the year are preliminary data from the Phase II TMA study. I do think that the thrombus formation data, assuming those are positive, and of course, I'm not making any comment as to whether they are or not positive data, we'll release them as we have them available. But for purposes of discussion, if they were to be positive, I think that, that would presage certainly the outcome in the Phase II clinical trial to a good extent.

That's our opinion internally. Whether that's shared externally, I don't want to comment. But certainly that would give us increased confidence. I think then you've got to look at 824. Our push is to get that off of the clinical enrollment suspension. We're currently -- there, we're really somewhat victims of our own success. We continue to try to reach a maximum tolerated dose, an MTD, and given the safety profile today of that compound and our need to continue to push in humans. To try to find an MTD, well, you know you need to get coverage in the animals to be able to do that. So at some point you start to push to the limit of what animals can tolerate, and we may have just reached that point.

And so, our objective here is to get off of that clinical suspension to review, and we did put out in the press release what the FDA asked us to do. We were pretty clear about that. And I think that their requests were not overly onerous. We can take care of that, and we expect to be back on.

So I think I'll stop there and just say, clearly, we look at the priorities, we adjust them as data come in, and it's somewhat of a living document for us. But without doubt, our primary priority is the success of Omidria.

Awesome. Thank you so much for answering my questions, Greg, and congratulations again.

Thank you, David.

Our next question is from Austin Hopper of AWH Capital.

Hi, Greg. Thanks for taking my question and congrats on all the progress. Can you just comment about Omidria and kind of what surgeons are doing today to prevent, I guess, really, or address pupil constriction? Are they're doing anything preoperatively or intra-operatively? Thank you.

Sure. Sure, Austin. What they're currently doing preoperatively is pretty standard. They use mydriatic topical drops preoperatively. And then intra-operatively, a lot of physicians in the U.S. are using epinephrine in the bag or in the bottle. Now there is one approved epinephrine for use in the eye, and that is a product trade name is Adrenalin. It's as you would expect to spell it, without the E at the end. That's epinephrine. It does contain bisulfites. As you know, Omidria is preservative- and bisulfite-free. Bisulfites and preservatives are associated with TASS, or toxic anterior segment syndrome, which is a noninfectious inflammatory condition that can be sight-threatening.

So -- and all of these products, epinephrine, et cetera, as I mentioned earlier, dilate only. It is our product, Omidria, that can inhibit, prevent miosis, which is really the key in these surgical procedures, right? You dilate, but then you have to maintain that dilation. And it's surgical trauma that causes the release of prostaglandin from local tissues. Those prostaglandins affect the sphincter muscle in the eye and cause that pupil or that iris to come down. And so, you really want to inhibit that miosis, that's what Omidria does. And it does what, really, that can't be done by either phenylephrine alone or epinephrine alone.

So we think that certainly, we have a superior product. We have a product that's FDA-approved as opposed to one that is compounded. And as you know, again, I mentioned, I think, in a response to an earlier question about the Drug Quality and Security Act of November of 2013, clearly the FDA is clamping down on compounding and again, our opinion only. We don't expect that to get better. We expect that, frankly, to become more restrictive with the passage of time. So let me stop there, and I think that -- I hope that answered your question.

Great. Thank you.

Thank you.

Our next question is from David Lundquist of UBS Financial Services. You may begin.

Hi, Greg. Congratulations on all the great progress that you and the team are getting here. You've referenced resources a couple of times, and it seems to beg the question, to jump back to the financial aspects, then maybe Mike can jump in here, too, obviously, where you were a quarter ago and where you are now, the understandable burn rate is up a bit. Now that you've had these business developments, is there a way you can talk around what the variety of options you have in financing going forward might be?

Sure, Deke. Thanks for the question. As you know, we really don't comment on our financing plans, but I can answer that in the general, which is our options really are the options that we always have. There is the option of partnering from revenue or revenue-partnering, there is the option of additional debt or some debt structure, and there is the option of equity financing. And those are really the three that are in place and always remain in place.

So certainly, we look at our cash situation. But I think that if you look historically at how we in Omeros have managed that, I think we tended to manage that pretty well. We have a total of slightly less than $34 million outstanding shares as a company that is now commercial or just about to become commercial with sales revenue. So -- and that I would expect is really on the low end of the spectrum in terms of outstanding shares for a company of our development stage. So I think that -- and again, I'm not trying to sidestep your question --

No, it's fine.

-- yes, within the parameters that we really allow ourselves to talk about these kinds of things. But I think that, certainly, we handle these things, I think, in a pretty smart way. And I wouldn't see that we would veer from that kind of historical track record.

Super. Thanks for taking the questions, and best of luck downstream. Thanks, Greg.

Thanks a lot, Deke.

Thank you. I would now like to turn the conference back over to Dr. Demopulos for closing remarks.

All right. Thank you very much, operator. We appreciate that. And that wraps up our call for today. Again, thanks to all of you for taking the time to listen in. As always, all of us at Omeros appreciate your continued interest and your support. As I said a little earlier, this really is an exciting time for Omeros. And we'll keep you updated on our progress toward not only commercial success of Omidria but also our efforts to advance all of the products in our pipeline.

With that, I'll just say have a good afternoon, and we look forward to talking with you all again.

Thank you. Ladies and gentlemen, this concludes today's conference. Thanks for your participation. Have a wonderful day.