What happened

Despite already rewarding investors with more than a 100% return this year, shares of Omeros Corporation (NASDAQ:OMER) are charging 33.3% higher at 1:45 p.m. EST Friday following the release of its third-quarter financials.

So what

Omeros is riding high on continued revenue growth for its only approved medicine, Omidria. Omidria, which is used in cataract and other lens replacement procedures, generated sales of $21.7 million last quarter, up 26% from the second quarter and 92% year over year.

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The results mark an acceleration from the second quarter when Omidria revenue climbed 71% higher year over year. Management said that the pick-up in sales is due to an increase in customers buying it and greater use of Omidria by existing customers.

Additionally, Omeros updated investors on the progress it's making on its second drug, OMS721. The company's already studying OMS721 in aHUS, a rare disease with limited and expensive treatment options, and following a meeting with the FDA, it says it can win full or accelerated approval of OMS721 in IgA nephropathy if one phase 3 trial shows it lowers proteinuria (protein levels in urine), a sign of kidney disease.

The confirmation that OMS721 can win FDA approval without a second phase 3 trial is important because conducting late-stage trials is expensive and despite Omidria's success, the company's still losing money.

Last quarter, operating expenses were $26.8 million and the company's net loss was $7.5 million.

Now what

In October, Omeros settled with Par Pharmaceutical, removing the threat of a generic Omidria from Par until 2032. That's good news because it suggests Omidria's patent protection is strong and thus, the company has a long runway ahead of it during which it can continue pocketing Omidria revenue.

However, Omidria's potential may pale in comparison to OMS721. The addressable aHUS patient population is small, but the IgA nephropathy patient pool is bigger. Assuming its phase 3 results are good, OMS721 could fetch premium pricing and be used in as many as 120,000 people in the United States.

Of course, there are no guarantees that trials will be successful, but given Omidria's sales growth, greater clarity into Omidria's patent protection, and a pathway to market for OMS721, it's understandable why investors are so excited about this company's prospects.

Todd Campbell has no position in any of the stocks mentioned. His clients may have positions in the companies mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.