Omeros Corporation (OMER) Earnings Call Transcript & Summary

Good afternoon, and welcome to today's earning 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 1 week from today. I'll turn the call over to Jennifer Williams, Investor Relations for Omeros.

Good afternoon and thank you for joining the call today. I'd like to remind you that some of the statements that will be made on the call today will be forward-looking. 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 special note regarding forward-looking statements in the company's quarterly report on Form 10-Q, which was filed today with the SEC and the risk factor section of the company's most recent annual report on Form 10-K 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, Jennifer, and good afternoon, everyone. I'm joined on today's call by David Borges, our Chief Accounting Officer; Nadia Dac, our Chief Commercial Officer; Andreas Grauer, our Chief Medical Officer; Cathy Melfi, our Chief Regulatory Officer; and Steve Whitaker, our Clinical Vice President. I'll start today with an overview and discussion of our 2024 second quarter financial results, followed by an update on our ongoing development programs. David will then provide a more detailed financial summary before we open the call to questions. Now let's look at our financial results for the second quarter. Our net loss for the second quarter of 2024 was $56 million or $0.97 per share compared to a net loss of $37.2 million or $0.63 per share in the first quarter of 2024. In the second quarter, we incurred $17.6 million of R&D expense related to the manufacture of narsoplimab drug substance lots that commenced in October 2023, $21.2 million in discounted term loan-related debt repurchase and $1.9 million of term loan related transaction costs. These significant cash outlays are representing a total of $40.7 million, are not expected to be repeated in the foreseeable future. As of June 30, 2024, we had $158.9 million of cash and investments on hand. In addition, as explained in earlier calls, our recent sale of OMIDRIA royalties to DRI Healthcare carries with it 2 sales contingent milestones payable by DRI to Omeros, each up to $27.5 million, with payment dates in January 2026 and January 2028. In the second quarter, we substantially strengthened our balance sheet through our debt repurchase and exchange transaction. At March 31, 2024, we had $216 million in notional value outstanding on our 2026 notes, all maturing in February 2026. In June, we entered into an agreement with Athyrium Capital Management and Highbridge Capital Management, under which we repurchased and retired 2026 notes held by Athyrium and by Highbridge, representing a collective notional value of $118.1 million for $21.2 million in cash and $67.1 million in a new secured term loan with maturity extended out to June of 2028. The total of $88.3 million in cash paid and new term loan represents a discount of approximately 25% or $29.8 million off of par. This transaction brings our remaining 2026 notes down by 55% from $216 million to a much more manageable $98 million with the option at Omeros' discretion to reduce that amount by another $15 million in notional value with additional lenders. We view the outcome of the transaction as highly favorable to Omeros for the following reasons. For both the restructuring and repurchase of $118.1 million of our outstanding 2026 notes, we extinguished nearly $30 million of debt through financial engineering alone. The transaction was completed at approximately 75% at par. So rather than being priced at the typical 10% to 15% premium above the prevailing market, our transaction was priced slightly below the market. We've further derisked the balance sheet with the majority of our debt now extinguished or having its maturity profile extended from February '26 to June 2028. Again, unusual for this type of transaction, the deal is non-dilutive for Omeros with no common stock or warrants included. The interest rate on the new term loan is highly competitive, resulting in a lower cash outflow than our prior principal and interest payments on the retired 2026 notes. Omeros also retains the ability to spend up to $25 million to repurchase additional outstanding 2026 notes. In addition, as I mentioned a bit earlier, Omeros has the option to allow other lenders to join the transaction to a total of an additional $15 million of notional value, provided that they are given terms no better than those received by Athyrium and Highbridge. The term loan agreement also includes an additional commitment by the lenders to fund a $25 million delayed draw facility at our request, prior to July 3, 2025, contingent on FDA approval of narsoplimab in TA-TMA. This additional commitment provides Omeros with a ready source of capital to fuel narsoplimab's early commercialization while preserving our cash to fund program development to reduce the remaining balance of our outstanding 2026 notes and/or to reduce the outstanding balance on our term loan. As part of this transaction, we also retain all future value of the cap calls associated with all the 2026 notes, including those retired in the debt repurchase and exchange. Collectively, these cap calls represent substantial potential value. In summary, our recent debt repurchase and exchange non-dilutively, reduces by more than half the outstanding principal amount of our 2026 maturing date at a substantial discount to par value, replacing a portion of that outstanding debt with a term loan maturing out in June of 2028 and also provides funding flexibility to manage the remaining lesser balance of our 2026 notes to fund the early commercialization of narsoplimab and to continue advancing through upcoming shareholder value-driving catalysts within our development programs. Building on our earlier retirement of $9.1 million notional value of our 2026 notes and our recent open market purchases and return to our treasury of 8% of Omeros' outstanding common stock, this transaction with Athyrium and Highbridge represents another substantial step in managing our capital structure to remove financial overhang. Now with that, let's move on to an update on our development programs. I'll begin with narsoplimab, our MASP-2 inhibitor, targeting the lectin pathway of complement. As I described in our last earnings call and at our Annual Shareholder Meeting in June, we continue to engage with FDA regarding the proposed resubmission of our Biologics License Application, or BLA, for narsoplimab in hematopoietic stem cell transplant-associated thrombotic microangiopathy or TA-TMA. Another upcoming meeting has been scheduled with FDA. In the meantime, we're preparing the BLA for resubmission. We're further encouraged by FDA's recent establishment of the rare disease innovation hub, which will serve as a single point of connection and engagement within the FDA to promote and support the development of therapeutics for rare diseases. The hub is designed to focus especially on rare diseases for which the natural history is variable and not fully understood, recognizing that development of therapies for these conditions is often particularly challenging. Regarding our plans for resubmission and its anticipated timing, we will provide a further update when more definitive information from our FDA interactions becomes available. Also, in addition to the publications already available, 2 more manuscripts authored by international transplant experts are in preparation, one directed to the results of a survival comparison between our pivotal TA-TMA trial and a rigorous external control and the second detailing the survival data in our expanded access program. Physicians continue to increasingly request narsoplimab under expanded access for their patients with TA-TMA. Given that there is no approved treatment for this life-threatening condition, we continue to do what we can to help these patients. In parallel with our efforts to obtain FDA approval for narsoplimab, we continue rapidly advancing the clinical development program for our MASP-3 inhibitor targeting the alternative pathway of complement. OMS906, our lead MASP-3 antibody now has a recently adopted nonproprietary name, zaltenibart. We have multiple phase II studies of zaltenibart ongoing in 2 rare disease indications: paroxysmal nocturnal hemoglobinuria or PNH, a life-threatening hematologic disorder and complementary glomerulopathy or C3G, a debilitating and potentially life-threatening kidney disease. We'll look first at our ongoing phase II PNH clinical trial. The annual European Hematology Association Congress in June, Dr. Morag Griffin, an internationally recognized PNH expert from St. James University Hospital in the U.K., presented the results of the adjunctive treatment stage of our switchover study in PNH patients with a suboptimal response to treatment with the C5 inhibitor, ravulizumab. The study evaluated 2 zaltenibart dose levels. As previously discussed, patients in this study began adjunctive zaltenibart treatment while receiving ravulizumab and then those patients adequately responding to combination treatment were switched to zaltenibart monotherapy. During the adjunctive therapy period, the statistically significant mean hemoglobin improvement from baseline was 3.27 grams per deciliter and 10 of 12 patients advanced to monotherapy. Absolute reticulocyte count also demonstrated statistically significant improvement and consistent with our clinical experience with zaltenibart and the drug was safe and well tolerated. The last patient visit in the switchover study is scheduled for October, and patients completing the study are entering our long-term extension study. In abstract providing results of these zaltenibart monotherapy stage has been submitted to the American Society of Hematology for presentation at their annual meeting in December. The efficacy and safety profiles of zaltenibart as monotherapy remains strong, including demonstration of sustained and clinically meaningful improvements in hemoglobin levels on absolute reticulocyte counts as well as prevention of extravascular and intravascular hemolysis. We look forward to sharing these data with you later this year. Our second ongoing phase II PNH study continues to progress well. This one is in patients who are naive to complement inhibitor treatment, meaning that they have not received previous complement therapy. After presentation of the early results of subcutaneous zaltenibart treatment at the 2023 American Society of Hematology meeting last December, we amended the study protocol to identify the plasma concentrations and the level of MASP-3 inhibition required to inhibit breakthrough hemolysis. These data, together with data derived from our switchover PNH study and from our phase I studies in healthy subjects provides the basis for selecting the zaltenibart dose for our upcoming phase III clinical trials. We now have the needed data to finalize our phase III dose selection and analysis will be completed soon. Looking ahead to our PNH phase III program, we remain on track to initiate both our naive patients and switch over phase III trials later this year. All required activities have either been completed or are progressing as planned. We have completed 3 international and U.S. medical advisory boards to gather input on the current and future needs of the PNH community and to understand how best to position zaltenibart for success against competitors. Physician advisers and focus group patients have uniformly responded positively to the unique properties of both zaltenibart and its MASP-3 target as well as to our clinical data, and they expect that zaltenibart when approved, will see significant uptake. These PNH experts are working closely with us to ensure that our study protocols are designed to demonstrate zaltenibart's potential and to help us prepare for efficient study execution. Our clinical operations team has already begun site identification and has been developing strong relationships with investigators, which should serve to speed enrollment. We anticipate having broad and geographically diverse site participation that will support both post-approval adoption and utilization. All external vendors have already been identified and awarded, and on the manufacturing front, all zaltenibart needed for our Phase III program has already been manufactured and earmarked for the clinical trials. With respect to our zaltenibart regulatory efforts, we have prepared our briefing materials to confirm FDA and European regulatory alignment with our clinical plan and Phase III trial designs. Following our meeting with FDA earlier this year, we incorporated all FDA feedback, and we look forward to our upcoming pre-Phase III meetings with both U.S. and European regulators, which have already been scheduled or requested. Turning now to zaltenibart in C3 glomerulopathy or C3G. Our Phase II study is enrolling. We look forward to sharing data from this study later this year or early next. The Phase III program in C3G is planned to initiate in the first quarter of 2025. Finally, while our current primary objective is to initiate our zaltenibart PNH Phase III trials quickly and to drive them to successful completion, we remain acutely focused on the wide applicability of MASP-3 and alternative pathway inhibition. As previously discussed, competitors with other agents targeting the alternative pathway have substantially derisked for zaltenibart an array of indications beyond PNH. These include IgA nephropathy, C3 glomerulopathy and age-related macular degeneration. All of these and others, the zaltenibart could provide significant patient benefits over currently available treatments, specifically better safety, more consistent efficacy and superior dosing convenience and compliance. I'll now turn back to our lectin pathway franchise and update you on OMS1029. Our next-generation, long-acting inhibitor of MASP-2. We've now successfully completed both the single and multiple ascending dose Phase I studies of OMS1029. The results support once quarterly dosing, administered either subcutaneously or intravenously. OMS1029 remains well tolerated with no safety concerns identified. As previously disclosed, we're evaluating several chronic large value indications for potential development of OMS1029, one of these being neovascular age-related macular degeneration, also known as Wet AMD. In a preclinical murine model of Wet AMD, MASP-2 inhibition showed good efficacy. But we are now running a primate study comparing OMS1029 to Eylea, which by recent report, holds the major revenue share in AMD. We look forward to receiving those data later this quarter. As discussed on our last call, all currently approved treatments for Wet AMD, be it Eylea, Lucentis, they all require frequent intravitreal injections, meaning injections directly into the posterior chamber of the eye. By contrast, because MASP-2 is produced only in the liver, MASP-2 inhibition throughout the body is achieved through systemic administration by any route of administration, whether that be intravenously, subcutaneous or orally. Wet AMD is a very large market, and our work to date indicates that an effective therapeutic that does not require patients to receive painful injections in their eyes would be regarded by both patients and their physicians as a highly attractive alternative. As detailed in the earlier earnings calls and during our Annual Shareholder Meeting last June, we continue our work with narsoplimab and MASP-2 inhibition in both severe acute and long COVID or [indiscernible] as well as an acute respiratory distress or ARDS, including H1N1 and the recently concerning H5N1. In addition to the wide therapeutic potential of MASP-2 inhibition, we're also developing a diagnostic approach for these broad indications. Adoption and utilization of a diagnostic for MASP-2 and lectin pathway hyperactivation would not only help physicians and their patients in early diagnosis but would also drive adoption and utilization of narsoplimab and other members of our MASP-2 inhibitor therapeutic franchise across these diseases. As they become available, we'll share further important updates on our efforts on this front. In addition to our MASP-2 and MASP-3 antibodies narsoplimab, zaltenibart and OMS1029, our growing complement franchise includes small molecule orally available MASP-2 and MASP-3 inhibitor programs. Both these programs are progressing rapidly with lessons learned from our MASP-2 small molecule program being applied to and levered for advancing development of our MASP-3 orally administered agents. Let's turn now to OMS527, our PDE7 inhibitor program aimed at treating addictions, compulsions and movement disorders. As previously disclosed, the National Institute on Drug Abuse or NIDA, requested that we shift our focus for OMS527 from nicotine addiction to the unmet and urgent need for a treatment for cocaine use disorder. Our program is funded by NIDA through a $6.7 million grant. We anticipate receiving results later this year from a preclinical toxicology study of primates exposed concurrently to cocaine and OMS527. Assuming positive results in the toxicology study, together with NIDA, we plan to initiate next year a randomized double-blind inpatient clinical trial evaluating OMS527 treatment in individuals with cocaine use disorder. As also discussed in earlier calls, we're exploring the potential use of OMS527 in movement disorders, specifically levodopa-induced dyskinesias or LID. This is a major problem in patients with Parkinson's disease and is caused by levodopa, the most common therapeutic used in Parkinson's disease. There is no good treatment for LID, and as a result, LID certainly represents a large and essentially untapped commercial market for an effective and safe therapeutic. We'll wrap up our program discussion with our family of biologic and cellular immuno-oncology platforms, namely our signaling driven immunomodulators, our antigen-driven immunomodulators that function not only as therapeutics, but also as cancer vaccines; our oncotoxins and our adoptive T cell therapy that requires no engineering and could supersede CAR-T, able to treat both liquid and solid tumors and amenable to multiply repetitive dosing. All these platforms are advancing quickly. Around each we continue generating really a steady stream of compelling and exciting in vivo data, expanding and strengthening their respective intellectual property positions. Each of our IO platforms represent novel approaches to cancer treatment designed to: one, target both cell surface and intracellular cancer targets for broad cancer applicability, 2, increase CD4, CD8 and memory T cell levels to attack cancer cells effectively and sustainably, 3, create immune memory against future relapse, and 4, eliminate the need for possibly and time-intensive cellular modification or engineering. Given the growing volume and breadth of encouraging data, we are working diligently to include them in our patent applications. Once all initial patent applications have been filed, we will share data through one or more public avenues. I'll now turn the call over to David Borges, our Chief Accounting Officer, to go through a more detailed discussion of our financial results.

Our net loss for the second quarter of 2024 was $56 million or $0.97 per share compared to a net loss of $37.2 million or $0.63 per share in the first quarter of 2024. In Q2, we incurred $17.6 million of R&D expense related to the manufacture of narsoplimab drug substance lots that commenced in October 2023 and were delivered in the second quarter of this year. Recall that our accounting policy is to expense all manufacturing costs related to drug candidates until regulatory approval is reasonably assured in either the U.S. or the European Union. We also incurred $21.2 million in discounted term loan-related debt repurchase and $1.9 million for term loan related transaction costs in the second quarter. Costs and expenditures of this significance, the narsoplimab manufacturing amounts, the discounted term loan related debt repurchase and the term loan related transaction costs, representing a total of $40.7 million, are not expected in the foreseeable future. As of June 30, 2024, we had $158.9 million of cash and investments on hand, a decrease of $71.4 million from March 31, 2024. 2 second quarter transactions significantly affected our Q2 ending cash balance. 1, we paid $10.7 million in the second quarter and $6.9 million in the first quarter related to 6 lots of narsoplimab drug substance, which were commenced in October 2023 and released in the current quarter; and 2, we faced $21.2 million to Highbridge and Athyrium in connection with the discounted debt repurchase in June 2024. Costs and expenses from continuing operations for the second quarter were $59.2 million, which was an increase of $20.1 million from the first quarter of this year. The increase was driven by narsoplimab drug substance manufacturing, zaltenibart clinical research and the discounted debt repurchase transaction cost, all partially offset by lower expenditures on the [ IDN ] clinical trial as we close down that trial. Interest expense for the second quarter was $9.2 million, which is $1 million higher than the first quarter of this year due to increased interest expense associated with the DRI transaction that was finalized in February 2024. The primary drivers of interest expense are the 2026 notes and the DRI-Omidria royalty obligation. Interest and other income for the second quarter was $3.2 million, which was slightly lower compared to interest and other income from the first quarter of this year due to lower cash balances to invest. Income from discontinued operations in the second quarter of this year was $9.1 million and includes 2 primary components: 1, $4.3 million of interest earned on the Omidria contract royalty asset; 2, $4.3 million of remeasurement adjustments to the Omidria contract royalty asset. As we have previously made clear, royalties earnings are either recorded as a reduction in the Omidria contract royalty asset on our balance sheet and not in our income statement. Omidria royalties for the second quarter were $10.9 million on Omidria net sales of $36.4 million. This is compared to royalties of $9.4 million on first quarter net sales of $31.2 million, a $5.2 million increase in net sales over the first quarter of 2024. The increase in net sales from the first quarter is consistent with historical Omidria net sales trends. As we discussed in last quarter's earnings call, in February 2024, we entered into an amended agreement with DRI by which they acquired the right to receive all U.S. and [ Midway ] royalties payable by Rayner through December 31, 2031. We continue to hold all royalty rights to ex U.S. sales of Omidria and after December 31, 2031, all U.S. royalty payments also accrued to Omeros. In addition, we have the opportunity to earn 2 sales contingent milestones, each up to $27.5 million with payment dates in January 26 and January 2028. As Greg mentioned, in June, we substantially strengthened our balance sheet through our debt repurchase and exchange transaction, whereby we repurchased and retired a portion of our 2026 notes for cash and a new term loan. The total principal amount of the 2026 notes exchange was $118.1 million in exchange for a total consideration of $88.3 million, consisting of a cash payment of $21.2 million and a new secured loan of $67.1 million, extending maturity on that portion of our debt out to June of 2028. In addition, we have a $25 million delayed draw term loan available to be drawn on or prior to June 3, 2025, contingent on regulatory approval for narsoplimab and TA-TMA. The term loan is secured by substantially all our assets and carries an interest rate based on the current adjusted secured overnight financing rate or SOFR, plus 875 basis points. The combined rate at June 30, 2024, was 14.2%. The term loan agreement includes a covenant requiring us to maintain unrestricted cash and cash equivalents of at least $25 million. $88.3 million of new term loans and total cash spent to repurchase debt represent a discount of approximately 25% or $29.8 million off of par. This transaction brings our remaining total of outstanding 2026 notes down by 55% from $216 million to a much more manageable $98 million. The $29.8 million discount from par has been recorded as a premium, i.e., an increase to the term loan being recognized as a gain on early extinguishment of debt. The $29.8 million premium will be amortized against interest expense over the term of the loan, which results in an effective interest rate of 1.6% for financial statement purposes. The amount of interest expense expected to be recognized in the third quarter related to this new term loan is approximately $400,000. Now let's look at our expected third quarter results. We expect overall operating costs from continuing operations in the third quarter to decrease by approximately $20 million. The decrease is primarily due to the significant expenses reported in the second quarter related to the receipt of narsoplimab drug substance, the cash paid to repurchase our '26 notes and transaction costs incurred in connection with the discounted debt repurchase. Interest income for the third quarter should be nearly $2.5 million and interest expense should be approximately $8.2 million, a decrease of $1 million from the second quarter due to a decrease in our outstanding debt and the lower financial statement interest rate on the term loan. And finally, income from discontinued operations should be in the $7 million to $8 million range. With that, I'll turn the call back over to Greg.

Operator, let's please open the call to questions.

[Operator Instructions] Our first question today comes from Steve Brozak with WBB.

The first one is on the quarter in terms of the expenses, can you give us any modeling or any idea as to how this expense that we modeled in basically would factor into the future?

Sure. I think -- I hope we were pretty clear, Steve, that those expenses that were -- the large expenses and charges and costs incurred in the second quarter were those that we don't expect to be repeated. There was a large manufacturing cost, there was a repurchase of the term loan related debt, $21.2 million, where, again, that was at 75% off par. So all of that got retired and then there were the term loan related transaction costs. So I think that -- I'm not sure that answered your question, but if not, let me know and we can…

No. that covered it exactly. I just wanted to understand how to see about modeling into the future, and these were just obviously onetime expenses, which actually brings me on the manufacturing side. For the purposes of future when you see approval, what else do you need now that you've got this manufacturing expense done? What else do you need to be able to go out there and when you will get approval, what else would you need to literally go into the markets? And you can be as detailed as you want on that because I'm coming through o see how model that in the future, please.

Well, there's one rather large component that we would need, which would be FDA approval. And we're working hard to secure that. I mean when you look at the data, we think the data are very clear. And frankly, as I said, we have a meeting scheduled with FDA. Those were part of the prepared comments. And we believe we're in very good shape with respect to the data and the case for its approval. So we just need to play this out a bit. But that's really what we need in the U.S. We're also pursuing, as you know, EMA approval for narsoplimab. Let me stop and get Cathy to weigh in, and then I'll also ask Nadia and Andreas to comment if they have anything else to add from the commercial or clinical perspective. But Cathy, do you want to take that?

Yes, sure. And I think also part of the question was when we get approval, what next? And we are well positioned and we're anticipating and we're preparing for success, and we're set up in terms of our packaging operations and that sort of thing from a regulatory perspective. So we are definitely planning for success in terms of what we have lined up, as you said, Steve, when we get approval. But I'll let commercial and clinical teams weigh in as well.

Yes. I'll jump in, and we are planning for success and have been. And so we have everything laid out is in town to the last month and gated behind key decisions all the way down to brand name as well and making sure all of that is ready to go. So that's kind of the good news of the delay is that we could plan for this, but there are multiple things that we still need and everything is being planned for and progressed.

From a clinical point of view, I think what we need or after approval is patients and physicians ready to use the product. And if our expanded access program is any indication, then they're already there. They want narsoplimab. They're using it in their patients, especially in patients that fail currently available treatments. So we're encouraged that we actually can bring something to market that is needed and will help patients. And also the international scientific community seems to look differently at transplant-associated TMA in the last years. They've issued a harmonization of the diagnostic criteria. They've identified clear high risk and treatment criteria. So to Greg's point, the only thing we need is approval.

And we certainly, as I think everyone has relayed in their comments, we believe we are well prepared and frankly, well deserving of having narsoplimab approved; patients clearly need it. Patients clearly are using it, physicians using it, as Andreas said, through the expanded access program. And remember, the only thing they have available now are all off-label therapies. And as I think we've pointed out in the previous call in the expanded access program, where we treat both adult and pediatric patients, of the 136 patients when we did the data cut on the expanded access program, 53 of those had failed or stopped treatments with one or more other agents. And so you really have to think about that as when narsoplimab was used in these patients, it was really catching a falling knife. And yet despite that, about half of those patients did well and resolved their TMA. So that is a somewhat controlled experiment in internal control that you see the effect of narsoplimab. So we are obviously pushing hard here, and we need to get to resolution quickly.

Our next question comes from Olivia Brayer with Cantor.

Greg, can you tell us when that additional meeting with the FDA is expected to happen? And whether there's any new information or data that they passed for ahead of that meeting? And then I have a follow-up on the pipeline on 906.

We won't specify the date of the meeting and the information is, as you might expect, it's information on our programs and responses to FDA questions. I think that's a fair representation, but again, let me see if Cathy wants to add anything specifically to that.

Yes, really nothing to add. I think you covered it Greg.

And then on 906, I just wanted to clarify that you guys do have the monotherapy data in-house? And if so, can you give us a sense for just level of confidence around that program? And anything you can tell us at this point on the Phase III trial design, both for PNH but also C3b.

First, I'll talk about the monotherapy data. Unfortunately, we can't give you any specific details on that data because, as Greg said, that's been submitted to an ASH abstract and it's embargoed until ASH publishes that, which will come later in the year. The data is strong, we're feeling positive about everything we're seeing, both in that adjunctive switch study as well as the data we've already presented in the naive study. And Greg also mentioned that we've amended that protocol to develop data to help with dose selection. Your second question was related to how the Phase III program is moving forward.

Well, I think one was also how are we viewing the program generally, how do we…

Very excited about the program. The data coming in strongly, good differentiators with competitors out there, both in the target as well as the drug and having tremendous response from both key opinion leaders as well as potential clinical trial sites who we're talking to now. The response has been uniformly positive in the advisory boards that we've conducted to date. Just a little anecdotal example, at European Hematology Association, we took clinical operations people with us to get ready for the Phase III trials. Not only did they have a lot of meetings set up with investigative sites who were interested, but people we hadn't contacted were coming up to our booth and asking to talk to them about potentially getting their patients into clinical trials. So there's a lot of excitement out there around the program, which is keeping us very excited.

And Steve, yours and Andreas', collectively your views of the Phase III program and upcoming, do you anticipate any change in the response we're seeing in patients between the Phase II program and what we could see in the Phase III?

I think even in the Phase II, though the Phase II studies are naturally small, we've treated a fairly representative set of patients. And so we expect to see very similar results in the Phase III program.

And our next question comes from Serge Belanger with Needham & Company.

This is John on for Serge today. Just my first question regarding zaltenibart and the C3G program. You're currently still enrolling patients for the Phase II study. Do you have any time line set to complete that study ahead of the potential launch in the first quarter of next year, whether or not there could be any potential overlap between Phase II and Phase III during that time? And then just my second question was regarding OMS1029. You're expecting data in the third quarter of this year. How quickly do you think, pending good data, how quickly do you think you'd be able to get this into the clinic following the study?

Well, let me first -- I'll hand this off to clinical in a moment, but as I mentioned, we think that we will have data from the C3G Phase II study later this year or early next. And also, as I noted, we're planning to initiate the Phase III program early in 2025. But let -- Steve again, do you want to take this on C3G and the question about potential overlap of our Phase II and Phase III?

Sure. I would actually anticipate having no overlap between Phase II and Phase III. The Phase II study has a [indiscernible] improvement. And if you recall, I believe it was 7 patients that Novartis presented at an ASH meeting or an ERA meeting, so you can get a good sense of efficacy with small numbers of patients in an open-label study. So we would -- as soon as we gather the data to see a strong efficacy signal, we would start initiating Phase III activities immediately before we run the study out completely.

Your second question about 1029 was how quickly following data, we think we could be in the clinic, and I'm assuming, meaning in the clinic in our Phase II study. Andreas, do you have any thoughts on that?

Well, I mean, if the data are as clear as we would hope, then I think we would get right to finalizing a clinical trial design. We would get the necessary input from key opinion leaders in the field to make sure that the trial design makes sense, and we'll deliver a clear answer. So I would expect us to move into the clinic sometime early in 2025.

Again, the objective of the primate study is to run a comparator. So we're looking at the effects of 1029 versus Eylea in these animals. So we think that, that model is representative or pretty well predictive of what one would see in the human. And that way, I think we'll get a pretty good sense coming out of these primate studies. And as Andreas said, we're hoping to see the data that we expect.

This does conclude our question-and-answer session. I would now like to turn it back to Dr. Demopulos for final remarks.

And again, thank you all for joining this afternoon. I think we've laid out clear paths around how we are advancing our program. We are really quite excited about the data we're generating. I know there again remains the question about narsoplimab in everyone's mind and timing. We are confident in the effect of narsoplimab in these patients, the need for narsoplimab in these patients. And we expect we're going to get there. As Cathy made clear, I can't give you the win right now, but as soon as we have a better sense of the win, we will. But all of these programs are moving forward and I think when you look at what's coming next in zaltenibart, certainly looks to be exciting. So with that, I will thank you all for your continued support, and have a good rest of the day.

This concludes the program. You may now disconnect.