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DATE

Wednesday, May 13, 2026 at 4:30 p.m. ET

CALL PARTICIPANTS

  • Chairman & Chief Executive Officer — Gregory Demopulos
  • Chief Accounting Officer — David Borges
  • Chief Regulatory Officer — Catherine Melfi
  • Vice President, Clinical — Steve Whitaker

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TAKEAWAYS

  • FDA Approval and Launch -- YARTEMLEA received FDA approval as the first and only treatment for TA-TMA and the first approved lectin pathway inhibitor; launched in January with initial shipments and sales in mid-January.
  • YARTEMLEA Product Sales -- Gross revenues reached $11.1 million and net revenues were $9.9 million, reflecting an 11% gross-to-net adjustment composed mainly of chargebacks and distribution fees.
  • Early Uptake Metrics -- By March 31, 30 unique accounts ordered YARTEMLEA, including 6 of the top 10 and 24 of the top 80 U.S. transplant centers, with P&T approvals accelerating relative to typical 6- to 9-month timelines.
  • P&T Committee Approvals -- By quarter end, 60% of the top 10, 40% of the top 20, 38% of the top 40, and approximately 30% of the top 80 transplant centers had received P&T approval.
  • Reimbursement Access -- All prior authorization requests submitted to third-party commercial payers had been approved, with centers also beginning to receive full payment for YARTEMLEA.
  • Inventory Levels -- Distributor inventory levels averaged 1 to 1.5 weeks, with minimal stock held at health centers due to 24-hour delivery logistics.
  • Cash Flow Milestone -- YARTEMLEA became cash flow positive in its launch quarter; management projects company-wide positive cash flow within 18 months.
  • Net Income and Adjustments -- Net income was $56.1 million, or $0.78 per share, including a $73.1 million noncash mark-to-market gain on embedded derivatives; adjusted net loss excluding this item was $17.1 million, or $0.24 per share.
  • Liquidity Position -- Cash and investments were $135.3 million at quarter end, after retiring all remaining 2026 convertible notes.
  • Share Repurchase Activity -- The company repurchased and retired approximately 360,000 shares at an average price of $11.70 per share, totaling $4.2 million.
  • Novo Nordisk Transaction Proceeds -- Received $240 million upfront cash at closing for zaltenibart, with eligibility for an additional $100 million in near-term milestone payments and total potential deal value up to $2.1 billion, plus royalties in the high single-digit to high-teen percentage range.
  • J-code and NTAP Status -- CMS assigned a permanent J-code for YARTEMLEA, effective July 1, and proposed New Technology Add-On Payment (NTAP) approval, with the final rule expected in August and NTAP implementation anticipated for October 1.
  • European Regulatory Pathway -- The YARTEMLEA marketing authorization application for TA-TMA remains under review by the European Medicines Agency, with a decision expected midyear.
  • Future Label Expansion -- Management identified potential expansion indications for YARTEMLEA, including ARDS, sickle cell disease, acute kidney injury, solid organ transplant-related TMA, and delayed graft function.
  • Molecule Pipeline Progress -- Work continues on advancing the MASP-2 platform (OMS1029 in Phase II preparation and an oral MASP-2 candidate moving toward IND-enabling studies), and OMS527 for cocaine use disorder proceeding toward an inpatient human study funded by NIDA.
  • T-CAT Platform Recognition -- Preclinical data on the T-CAT platform appeared in a major scientific congress and will be published in Science Translational Medicine.
  • OncotoX-AML Data -- OncotoX-AML demonstrated "superior efficacy to current standard-of-care treatments" in animal and in vitro models, with IND-enabling studies underway and a first-in-human trial targeted for late 2027.
  • Debt Structure -- Only remaining debt is $70.8 million of unsecured 2029 convertible notes, due June 2029.
  • Guided Operating Expense and Revenue Commentary -- Operating expenses expected to rise moderately in the next quarter due to YARTEMLEA commercialization; revenue guidance for YARTEMLEA not provided pending further launch development.
  • Non-GAAP Reporting Clarification -- Management emphasized exclusion of noncash, mark-to-market derivative adjustments to reflect underlying operating performance.

SUMMARY

Omeros Corporation (OMER 8.28%) launched YARTEMLEA in January following FDA approval, generating $11.1 million in gross product revenue and securing early adoption across leading U.S. transplant centers with accelerated P&T committee approvals. The Novo Nordisk zaltenibart transaction delivered $240 million in nondilutive funding, while a clean debt structure and strong liquidity position provide near-term financial flexibility. Beyond the initial launch, the company advanced both MASP-2 and T-CAT pipelines, reported OncotoX-AML preclinical efficacy across difficult AML mutations, and outlined further YARTEMLEA expansion opportunities. New CMS J-code billing and anticipated NTAP reimbursement could drive additional product utilization, while management expects company-wide positive cash flow within 18 months.

  • The precise number of patients treated with YARTEMLEA was not disclosed, as distribution data do not reflect patient-specific counts shared by treatment centers.
  • Chairman Demopulos said, "we do expect that YARTEMLEA will become standard of care for the treatment of TA-TMA." based on initial feedback and market responses.
  • The gross-to-net adjustment for YARTEMLEA revenue is expected to remain in the teens percent, primarily driven by 340B participation and distributor fees, with little anticipated discounting.
  • All commercial payer prior authorizations for YARTEMLEA had been approved, and reimbursement processes are poised to improve with CMS policy changes.
  • CMS's permanent J-code assignment for YARTEMLEA takes effect July 1, reducing billing complexity and supporting faster access, with NTAP potentially taking effect by October 1 following final rule issuance.
  • Management reported that early demand includes a higher-than-expected proportion of pediatric patients relative to the typical TA-TMA split.
  • Share repurchase activity reflected purchases at an average price of $11.70 per share, below the current market price during the quarter.

INDUSTRY GLOSSARY

  • TA-TMA (Transplant-Associated Thrombotic Microangiopathy): A life-threatening vascular complication following hematopoietic stem cell transplantation, marked by blood clotting in small vessels.
  • P&T Committee (Pharmacy and Therapeutics Committee): A hospital or health system body responsible for evaluating and approving drug formulary access.
  • J-code: A permanent Healthcare Common Procedure Coding System code used for billing biologics and drugs under Medicare and commercial insurance.
  • NTAP (New Technology Add-on Payment): A CMS program that provides additional hospital reimbursement for new, high-cost medical technologies not yet reflected in standard payment rates.
  • 340B Program: A U.S. federal program requiring drug manufacturers to provide outpatient drugs at reduced prices to eligible health care organizations.
  • IND-enabling Studies: Preclinical studies required to support the submission of an Investigational New Drug application to the FDA.
  • NIDA: National Institute on Drug Abuse, a U.S. federal agency funding research on drug abuse and treatment.

Full Conference Call Transcript

Gregory Demopulos: Thank you, Jennifer, and good afternoon, everyone. Joining me today are David Borges, our Chief Accounting Officer; Dr. Cathy Melfi, our Chief Regulatory Officer; and Dr. Steve Whitaker, Vice President of Clinical. I'll start with an overview of our first quarter 2026 operations and financial results, followed by program updates. After that, David will cover the financials in more detail and then we'll open the call for questions. We entered 2026 with 2 catalysts: the closing of our previously announced transaction with Novo Nordisk for zaltenibart, our lead investigational MASP-3 inhibitor and the FDA approval of YARTEMLEA, our lead MASP-2 inhibitor for the treatment of hematopoietic stem cell transplant-associated thrombotic microangiopathy, or TA-TMA.

This approval made YARTEMLEA the first and only approved treatment for this often fatal complication and the first and only approved inhibitor of the lectin pathway of complement. We launched in January with initial shipments to distributors beginning mid-month, followed shortly by first sales. In the first quarter, YARTEMLEA gross revenues were $11.1 million with net revenues of $9.9 million, reflecting gross to net adjustments of approximately 11%. Early demand and uptake are strong. YARTEMLEA became cash flow positive in the first quarter despite a mid-January launch and we expect it to drive company-wide positive cash flow within 18 months.

Net income for the first quarter was $56.1 million, or $0.78 per share, including a $73.1 million noncash mark-to-market gain on the embedded derivative associated with our 2029 convertible notes. Excluding this noncash item, adjusted net gross loss was -- or net loss was $17.1 million, or $0.24 per share. We ended the quarter with $135.3 million in cash and investments after retiring our remaining 2026 convertible notes. During the first quarter, we repurchased and retired approximately 360,000 shares of our common stock at an average price of $11.70 per share for a total of $4.2 million. We may continue to repurchase shares from time to time, subject to market conditions and other considerations.

Our transaction with Novo Nordisk provided substantial nondilutive capital to support our growth. At closing, we received $240 million in upfront cash, funding operations, including the YARTEMLEA launch. We are also eligible for another $100 million in near-term milestone payments from Novo. The deal is valued at up to $2.1 billion in upfront and milestone payments, plus royalties in the high single digit to high-teen range. Our early launch has been focused on 4 priorities: first, educating transplant care teams to drive earlier recognition and treatment of TA-TMA. Second, securing rapid institutional access through pharmacy and therapeutics, or P&T committee approvals and streamlined ordering.

Third, ensuring consistent, timely reimbursement; and finally, demonstrating strong economic value through health economics and outcomes research, or HEOR. Execution is ahead of plan. Our field force is fully deployed, detailing all 175 transplant centers nationwide. By March 31, 30 unique accounts had ordered YARTEMLEA, reflecting accelerated adoption. Despite the typical 6- to 9-month time line for P&T committee approvals, accounts are moving faster than expected. By quarter end, we understand that 60% of the top 10 centers, 40% of the top 20, 38% of the top 40 and approximately 30% of the top 80 U.S. centers had received P&T committee approval.

Looking at reimbursement, all prior authorization requests submitted to third-party commercial payers to date have been approved and centers have begun receiving full payment. HEOR analyses, which support YARTEMLEA pricing and show compelling quality of life improvements are being finalized and prepared for publication. Early indicators, including strong receptivity from transplant centers, formulary momentum and payer alignment with the label support our expectation that YARTEMLEA can become standard of care for TA-TMA. In April, the U.S. Centers for Medicare and Medicaid Services, or CMS, assigned a permanent health care common procedure coding system, J-code for YARTEMLEA. This simplifies billing and reimbursement across payers, reduces administrative burden, supports faster patient access and improves reimbursement predictability. The J-code becomes effective July 1.

Also in April, CMS in its Inpatient Prospective Payment System proposed rule, recommended approval of the New Technology Add-On Payment, or NTAP for YARTEMLEA. NTAP provides additional payments to hospitals for certain high-cost innovative technologies, helping bridge the gap until standard payment systems incorporate them. The final rule is expected in August with NTAP effective October 1 of this year. We remain focused on expansion opportunities for YARTEMLEA and our MASP-2 program. Beyond the U.S., our marketing authorization application for YARTEMLEA in TA-TMA is under review by the European Medicines Agency. We continue to expect a decision midyear. We are evaluating potential partnerships, including broad ex-U.S. and regional collaborations to support commercialization outside the U.S.

Beyond TA-TMA, we're assessing opportunities to expand the YARTEMLEA label to other indications involving lectin pathway activation, including acute respiratory distress syndrome, or ARDS, sickle cell disease, acute kidney injury, solid organ transplant-related TMA and delayed graft function. We're also broadening our MASP-2 inhibitor platform beyond YARTEMLEA, advancing both our Phase II ready long-acting MASP-2 antibody, OMS1029 and our oral MASP-2 small molecule program. Both are well suited for chronic indications, including membranous nephropathy, other renal diseases and neurological disorders such as Parkinson's and Alzheimer's. We're finalizing the initial Phase II indication for once-quarterly OMS1029. We're now also working to advance our small molecule program to IND-enabling studies, targeting once-daily oral delivery.

Let's now turn to development programs beyond our complement inhibitor franchise. Our PDE7 inhibitor program evaluating OMS527 for cocaine use disorder remains fully funded by a grant from the National Institute on Drug Abuse, or NIDA. We successfully completed animal cocaine interaction studies, supporting a scheduled inpatient human study evaluating OMS527 in cocaine users. Recently, together with NIDA representation, we met with FDA to discuss the agency's request for additional nonclinical information before starting the inpatient study. The meeting was productive and we are working with FDA to streamline the path to initiate the inpatient clinical trial, which is targeted to start by year-end.

Based on its mechanism of action and our extensive preclinical data, we believe that OMS527 could be effective across a wide range of addictions and compulsive disorders. Turning to our Targeted Complement Activating Therapy, or T-CAT platform. This represents a novel class of recombinant antibodies designed to target and directly kill pathogens, including bacteria, fungi, viruses and parasites. Our initial focus is on multidrug-resistant organisms, or MDROs, one of the most critical unmet needs in medicine. Unlike marketed antimicrobials, T-CAT is designed to kill pathogens regardless of resistance profile without promoting resistance.

Data from our T-CAT platform were recently featured in a podium presentation at the annual congress of the European Society of Clinical Microbiology and Infectious Diseases and the seminal manuscript describing our T-CAT technology was accepted for publication in Science Translational Medicine. Last but not least, we're pleased with the continued progress of OncotoX-AML, the lead development program in our OncotoX oncology platform. OncotoX-AML is an engineered biologic agent designed to treat acute myeloid leukemia, or AML, the most common and deadliest form of adult leukemia.

In both human, tumor-bearing animal and in vitro human AML cell line studies, OncotoX-AML has consistently shown superior efficacy to current standard-of-care treatments, even at very low doses and across mutations associated with AML, such as TP53 and FLT3, which have historically been difficult to treat. In a nonhuman primate study, a single course of OncotoX-AML demonstrated the desired pharmacologic response, a marked selective, reversible and dose-related reduction in myeloid progenitor cells, the cells that can mutate and lead to AML by up to 99%. Safety was equally strong. The treatment was well tolerated with no safety signal of concern. IND-enabling studies are underway and we are preparing for a first in-human trial targeted for late 2027.

So that concludes our financial, corporate and development program update. I'll now turn the call over to David Borges, our Chief Accounting Officer, for a detailed discussion of our financial results. David?

David Borges: Thanks, Greg. Net income for the first quarter of 2026 was $56.1 million, or $0.78 per share compared to net income of $86.5 million, or $1.22 per share in the fourth quarter of 2025. First quarter results include a $73.1 million noncash gain related to the mark-to-market adjustment on the embedded derivative associated with our 2029 convertible notes. By comparison, fourth quarter results included a net gain of $237.6 million on the sale of zaltenibart to Novo Nordisk, partially offset by a $136 million noncash loss related to mark-to-market adjustments on embedded derivatives associated with our 2029 convertible notes and term loan. A clearer view of the company's operating performance excludes the noncash remeasurements of our embedded derivatives.

Excluding the $73.1 million embedded derivative adjustment, non-GAAP adjusted net loss for the first quarter of '26 was $17.1 million and non-GAAP adjusted net loss per share was $0.24 per share. As of March 31, 2026, we had $135.3 million in cash and investments. This balance includes the repayment of the remaining $17.1 million principal on our notes -- on our 2026 notes at maturity in February of 2026. Following that repayment, our only remaining debt is $70.8 million of principal outstanding on our unsecured 2029 convertible notes, which are due in June 2029.

During the first quarter, we repurchased and retired approximately 360,000 shares of our common stock at an average price of $11.70 per share for a total of $4.2 million. As Greg mentioned, YARTEMLEA launched in mid-January 2026. Gross revenues for the first quarter were $11.1 million, all from YARTEMLEA product sales, reflecting strong early demand following launch. Uptake was driven by prescriber adoption and increasing market penetration and we continue to expand access and build awareness. Net revenues were $9.9 million, reflecting gross to net adjustments of approximately 11%. Gross to net adjustments were relatively modest and consisted of chargebacks and distribution fees.

Costs and expenses from continuing operations for the first quarter before interest and other income were $27.3 million, a decrease of $1.8 million from the fourth quarter of 2025. Concurrently with the closing of the sale of zaltenibart to Novo Nordisk, we entered into a transition services agreement to facilitate the transfer of the acquired assets and support the continued operation of relevant studies and program activities. Costs incurred by Omeros under the transition services agreement, including third-party expenses and internal full-time employee, or FTE costs are being reimbursed by Novo Nordisk. Interest expense in the first quarter was $5.9 million. The primary components of interest expense include the DRI royalty obligation and interest on the 2029 convertible notes.

Excluding the DRI OMIDRIA royalty obligation, which represents pass-through interest from Rayner to DRI and has no economic impact to us and excluding noncash amortization of debt issuance costs and discounts, contractual cash interest expense for the first quarter of '26 was $1.8 million compared to $3.2 million in the prior quarter. The decrease was primarily due to the full repayment of our secured term loan in November 2025. Interest and other income totaled $1.5 million in the first quarter, up from $1.1 million in the fourth quarter of '25, primarily reflecting higher average cash balances.

As previously mentioned, during the first quarter, we recorded a $73.1 million noncash gain from mark-to-market adjustment on the embedded derivative related to our 2029 convertible notes. The change in valuation was primarily driven by the decline in our stock price during the quarter, which decreased from $17.18 per share at December 31, 2025, to $10.56 per share at March 31, 2026. An increase in stock price in the second quarter would similarly result in a noncash loss during the quarter. Conversely, a decrease in our stock price during the second quarter would result in a noncash gain. This embedded derivative reflects certain features of the notes, including the conversion option and interest make-whole provision available to the noteholders.

Because the valuation of this derivative is influenced by our stock price and other market inputs, it can introduce significant volatility in our reported results from quarter-to-quarter. This adjustment is noncash and does not affect our operating performance or liquidity. Accordingly, we present non-GAAP adjusted net income and net loss to exclude the noncash nature of these volatile swings. Income from discontinued operations in the first quarter was $4.8 million, a decrease of $1.8 million from the fourth quarter, primarily reflecting lower-than-forecasted U.S.-based OMIDRIA royalties. Because U.S.-based OMIDRIA royalties are fully passed through to DRI, fluctuation in these payments do not affect our cash position. Now let's look at our expected second quarter 2026 results.

We anticipate that overall operating expenses from continuing operations will be slightly higher compared to the first quarter of '26. Sales and marketing expenses are expected to increase, reflecting costs associated with building our commercial infrastructure, including marketing expenses and other commercial launch activities for YARTEMLEA. As YARTEMLEA is in the early stages of launch, we are not providing revenue guidance at this time. This is consistent with our approach following a new product launch, while market access and physician adoption are still developing and until we are able to estimate revenue with greater accuracy. We remain focused on building physician awareness, expanding disease education and ensuring continued timely reimbursement.

Interest and other income are expected to be higher than in the first quarter. Interest expense is expected to be approximately $7.1 million, reflecting the reduction in our outstanding debt and excludes any potential noncash adjustments related to the OMIDRIA royalty obligation. Income from discontinued operations is expected to be in the $5 million to $6 million range, excluding any noncash remeasurement adjustment related to the OMIDRIA contract royalty asset. And finally, as a reminder, our reported results will continue to reflect mark-to-market adjustments on the embedded derivative tied to our 2029 convertible notes. These adjustments are noncash, can be volatile and are driven by -- largely driven by changes in our stock price and other market inputs.

As a result, we present non-GAAP adjusted net income and loss measures to provide additional visibility into our underlying operating performance. With that, turn the call back over to Greg.

Gregory Demopulos: Thanks, David. Operator, now please open the call to questions.

Operator: [Operator Instructions] Your first question comes from the line of Steve Brozak with WBB.

Stephen Brozak: I'd like to go into some granularity on YARTEMLEA. First question has to deal with from the time the clinician requests drug to the time you get it, can you detail how long it -- you get it to the hospital, can you detail us how long it takes and the process, please?

Gregory Demopulos: Sure. The distributors deliver drug to the sites within about 24 hours of receipt of the request. And process is pretty straightforward. The request is made to the distributors, distributors deliver within 24 hours.

Stephen Brozak: Okay. And can you give us some detail on -- typically on stem cell TA-TMA on the transplant side, you're looking at about roughly 15% of the population are [ PEs ]. How does that reflect in terms of what you've seen so far on the request for YARTEMLEA, please?

Gregory Demopulos: Right. And you're correct about that. The split between adult and pediatric patients in TA-TMA is roughly 85-15, as you noted. We only have, again, through the first quarter, a little over 2 months of data. So these data may be skewed, but we are seeing a greater percentage of these patients being pediatric than the 15% that you cited. So it appears that we're having really rapid adoption across both adult and pediatric patients.

Stephen Brozak: Okay. Now I don't want to put words in your mouth, but typically, you would see the pediatric hematological oncologists being the most conservative. So you're saying that they are asking for YARTEMLEA in a greater number than the distribution. And look, I know it's only a partial quarter. But so far, you're seeing a trend that these more conservative prescribers are asking for drug at a greater rate than you would expect. Is that what I'm hearing?

Gregory Demopulos: Well, I'm not sure that a point would create a trend. But what we're seeing is what I said, which is that there is a larger percentage of pediatric transplanters that is represented by the overall split in TA-TMA between adults and pediatrics. We are seeing those pediatric transplanters requesting narsoplimab or YARTEMLEA.

Stephen Brozak: Okay. I thought I was the only person that was mixing narsoplimab and YARTEMLEA. You may have stated this earlier, but out of -- how many facilities out of the total targeted you started to get prescribing or get requests from so far?

Gregory Demopulos: We have at the end of March, so by March 31, we had 30 separate accounts requesting YARTEMLEA. And of that 30, let me just give you a little more color just -- we went through this in the prepared comments, but we were speaking there in percentages. So I think if I put it in absolute numbers, it may be helpful, may be helpful to everyone. Of the top 10, 6 of the top 10 sites had ordered by March 31, 24 of the top 80 centers had ordered by March 31.

Stephen Brozak: Okay. Okay. Last question, I'll get back in the queue. What kind of feedback, even if it's anecdotal, are you getting from the hematological oncologists in prescribing or anyone else on the clinician side?

Gregory Demopulos: Sure. Again, it's early, but the feedback that we have received has been effectively uniformly positive. I think that the results that are being seen with YARTEMLEA are impressive. And again, we're early in the launch, but as I said, all signs look very encouraging. And we do expect that YARTEMLEA will become standard of care for the treatment of TA-TMA.

Stephen Brozak: Great. Well, thank you for the granularity and I'm looking forward to the next call to see the trend after one point. How's that?

Gregory Demopulos: Very good. Yes, we look forward to that as well.

Operator: Your next question comes from the line of Olivia Saunders with Cantor.

Olivia Brayer: I know it's early, but Greg, how are you thinking about the split between inventory versus U.S. wholesaler sales versus hospital demand? And how that might play out over the course of the year just in terms of how we should think about the proportion of reported sales? And any comments on how many patients are actually on drug as of today?

Gregory Demopulos: Sorry, I lost the second question, Olivia, what was that? It was muted on my end maybe.

Olivia Brayer: Yes. Just a question about how many patients are actually on drug as of today that are being treated with YARTEMLEA.

Gregory Demopulos: Sure. First of all, with respect to inventory, given the short delivery process, which, as I explained in the last response, is 24 hours, the amount of inventory carried at the distributors and certainly at the centers is relatively small. So on the distributor side, we're seeing 1, 1.5 weeks of inventory on average across those distributors. I think your next question was the number of patients on drug. That's a difficult number to provide because often, the centers don't share the specific information about the number of patients or the type of patients or really any patient-specific information.

So really, what we see is how many vials are going into a center and from which center those vials are being requested. So that is -- I'm not trying to dodge the question. I'm trying to give you the best information we have. But we expect that it is a larger number of patients, obviously, than the number of accounts. But with respect to specific number, we just don't have that information.

Olivia Brayer: Okay. Fair enough. And can I ask, how are you thinking about the AstraZeneca Ultomiris Phase III study that they're running in TMA? You think they're using disease relapse as an endpoint, and it is a randomized study. So I'm just curious if you have any thoughts on how that might fit into the landscape.

Gregory Demopulos: Right. Well, I understand that they've changed their endpoint. Their initial endpoint, as I understand it and again, I want to caveat that this is my understanding, but the initial endpoint, as I understand it, was response. But following the readout of their pediatric open-label trial, which used response as the endpoint, that response was not clearly what AstraZeneca had hoped to see. I think it had a 17% response rate. So I know that subsequently, or as I understand it, subsequently they revised the endpoint for their adult trial from response to survival. I don't know if they're looking at relapse.

Our understanding is that the patients in that controlled adult trial, by definition, would really -- our expectation would be need to be less severe than the patients we treated by virtue of the fact that in the patients we treated, running a controlled trial would really not be possible. So I think there's a difference in the severity of the patients. Don't know if they're looking at relapse. I'll open the question up to Steve and/or Cathy, if you have any other information about AstraZeneca and their data.

J. Whitaker: This is Steve. We only know what's on clinicaltrials.gov at this point. And the primary endpoint is event-free survival and that is death or clinical worsening. So it's not really relapse, as Greg said, it'd be worsening from their baseline condition. They do look at duration of response and relapse, but those are lower secondary endpoints. And obviously, I don't have the protocol, so I don't know how these were ranked hierarchically, but those are pretty far down the line, if that helps.

Olivia Brayer: Yes, that's great.

Gregory Demopulos: Yes. Thanks, Steve. Olivia, I think also that there have been a number of recent publications and data presentations around the increased infection rates and increased infection-related mortality with C5 inhibition. I know coming out of an adult study at MSK, Memorial Sloan Kettering, a pediatric study out of Children's Hospital in Atlanta associated with Emory and I understand that there also has been additional data generated and presented by Dana-Farber and Boston Children's again in the pediatric center. All of those data align quite nicely with each other. So those might be something that would help you as well.

Catherine Melfi: And Greg, you had mentioned the change in the endpoint, and I did confirm that on clinicaltrials.gov, your understanding was correct. It had been response. And currently, it's, as Steve said, event-free survival.

Gregory Demopulos: So thank you, Cathy. So yes, so they had changed from response to survival. Okay. Anything else, Olivia?

Olivia Brayer: No, that's perfect.

Operator: Your next question comes from the line of Brandon Folkes with H.C. Wainwright.

Brandon Folkes: Congrats on all the progress. Maybe just one for me, Greg, I think I heard you say, you're working on efforts to recognize TMA earlier. Can you just elaborate on those efforts and whether you believe once NTAP comes into practice, that may facilitate less friction to earlier intervention? Or what do you think drives earlier intervention?

Gregory Demopulos: Certainly, we're interested in earlier intervention. We want to save as many patients as possible. Our expectation and the data support that the earlier one jumps on this problem, the greater the likelihood of success in outcome. So I think that there certainly seems to be an increasing awareness of that within the transplant community. We are receiving incoming questions about the temporarily upstream administration of YARTEMLEA. All of that, I think, bodes well for patients. With respect to will the NTAP assist that? Yes. The NTAP increases the subsidization. So actually subsidizes in good part for Medicare patients, the payment on the inpatient side. And that's where you would expect that earliest treatment to begin.

So I think your thought around whether the NTAP would help in that respect, I think, is insightful. So we're waiting to see, but we do expect that there will be an increasing move to earlier treatment, particularly given that initially, a good number of the patients we were treating were eculizumab failures. So we were really catching patients in the first quarter, catching patients who were falling knives. And yet those patients, very many of them responded very well to narsoplimab or to YARTEMLEA. So I think that there will -- there's a greater understanding and increasing awareness of moving temporarily upstream in the administration process. I think that's a good thing. I think it's good for patients.

Does that help? Okay.

Brandon Folkes: It does. Sorry, just dealing with the mute button.

Gregory Demopulos: No, that's fine. Any other questions?

Operator: Your next question comes from the line of Serge Belanger with Needham.

Serge Belanger: I guess a few on -- just to get a little more granularity on the 1Q sales number. Greg, can you disclose what the number of vials that were, I guess, dispersed from your distributor over the quarter? And then secondly, I think you talked about a gross to net of 11% for the first quarter here. Just curious where you expect that gross to net to go once you have more comprehensive formulary coverage? And then I have some -- a couple of reimbursement questions.

Gregory Demopulos: Sure. In response to your first question, no, we aren't providing the number of vials. We're providing gross and net revenue numbers. With respect to your second around what is -- what constitutes that gross to net number, that really is made up of chargebacks and fees. So chargebacks, meaning governmental programs, so 340B and fees being largely bona fide fees to distributors. So that's largely it. We would expect that over time to increase as 340B participation increases. With respect to a target, I would not expect that to be reaching the 20 percentile. I would be thinking we're going to remain in the teens on that search, but we'll have to see how that plays out.

We are not planning at all to discount the drug. So -- and I think returns are -- I don't think we've had any, but I think that will be negligible. So going forward, I would expect the components of the gross to net to be what they were in Q1, which is the chargebacks and the fees only.

Serge Belanger: Got it. And then regarding P&T approvals, clearly, you got some good traction through the end of the first quarter here with the numbers you gave us.

Gregory Demopulos: Yes.

Serge Belanger: Curious when do you expect the rest of them to go through the P&T approval process? Are they already scheduled? And then secondly, you talked that you got approval for a J-code as well as the NTAP for later this year. Curious since you said that most centers have had some very good access to the product, access hasn't been an issue. Will these J-codes and I guess, an NTAP, what kind of impact could they have on further uptake once they are in effect?

Gregory Demopulos: Yes. First of all, with respect to P&T committees, there are a number of them that are in process. Remember, we launched this in mid-January, third week of January. So we are really still very early in the process and the P&T committee approvals that we've seen, as I mentioned, are quite satisfying in that they are well ahead of what we would have expected in terms of just time line and number of P&T approvals. So clearly, there is an urgency, I think, that's being recognized and manifest across the sites with physicians and pharmacists recognizing the value of YARTEMLEA and moving quickly to make it available.

There are centers, obviously, that are approving access to the drug absent P&T approvals, but additional P&T approvals will certainly help that access, streamline it, make it more quick, more efficient. With respect to when we would expect all of those to have gone through the P&T process, all is an absolute number, I would expect that the large majority of them will be coming through in the next few months. Your second question about the J-code and the NTAP. Well, the J-code certainly streamlines the billing process and the reimbursement process. So certainly, having the J-code now awarded and going into effect on July 1, I think, will be very helpful.

The NTAP, CMS has in its proposed Inpatient Prospective Payment Systems rule has indicated that they support the approval of the NTAP for YARTEMLEA. That we expect will be finalized in the inpatient final rule in August. Assuming that's the case, it will become or should become finalized and available for use on November 1st or sometime very close to November 1st. It runs on CMS' schedule. Both of those, the J-code and the NTAP, I expect will obviously help with reimbursement anytime you have secured reimbursement, that certainly helps with utilization. So I think -- I'm quite -- it's been quite surprising, frankly, how broadly YARTEMLEA has been used in the absence of the historical reimbursement already in place.

But once -- as you know, Serge, once that reimbursement becomes much more standard and much more well-recognized, that just drives front-end utilization as it should.

Operator: There are no further questions at this time. I will now turn the call back to Dr. Demopulos for closing remarks.

Gregory Demopulos: All right. Thank you, operator, and thank you all for joining us this afternoon. As we've said, we're pleased with the strength of the YARTEMLEA launch and the continued progress across our pipeline and our platform programs with expanding commercial momentum, multiple near-term catalysts and continued execution across the organization, we believe Omeros is well positioned for continued growth and long-term value creation. As always, we appreciate your continued support and confidence. Have a good evening.

Operator: This concludes today's call. Thank you for attending. You may now disconnect.