Omeros Corporation (OMER) Takes TMA Stride Closer To Pivotal Phase III Trial; Maxim Bull Weighs In

Jason Kolbert believes that OMER's OMS721 flashes an upper hand over competitor Soliris drug.


Omeros Corporation (NASDAQ:OMER) shares climbed almost 12% on Friday on back of additional positive Phase II trial data for kidney disorder drug OMS721 in cell thrombotic microangiopathy (TMA), and continue to soar 9% today. Investors across the Street are excited by the TMA asset’s opportunity as the bullish parade continues to march onward.

Maxim analyst Jason Kolbert believes that as this data keeps building, the drug maker is “aiming to go pivotal,” i.e. transition to a Phase III trial after eight patients that have wrapped up with treatment revealed they had meaningfully improved in the following TMA “markers:” a boost in platelet counts, a dip in lactate dehydrogenase, and a rise in haptoglobin.

In reaction, the analyst reiterates a Buy rating on OMER stock with a $24 price target, which represents a 42% increase from where the stock is currently trading. (To watch Kolbert’s track record, click here)

“It’s all good,” writes Kolbert, who dives into a question of recent share weakness from a confident standpoint: “So why the pullback in valuation lately? We believe the recent weakness in OMER shares may be due to concerns around the ever changing landscape in the complement inhibitor space as well assumptions/ expectations for Omidria as Omeros prepares to report the quarter. We see Omidria as the ‘cash engine’ (the means) that drives OMS721 (the ends), and of course the rest of the pipeline, which IOHO is not priced in.”

Glancing ahead, the analyst gives the advantage to Omeros’ OMS721 over rival Alexion’s Soliris, believing the drug could be effective in its competitor’s refractory patient pool. Additionally, the analyst anticipates Omeros’ asset could be effective in severe Graft vs. Host Disease (GvHD), another strength weighing in the drug maker’s corner.

“Omeros continues to demonstrate that OMS721 resolves TMA in post-HCT, including HCT complicated by severe GvHD. The data in the P2 study will be used to support moving to a pivotal program. OMS721 is already in a pivotal study for aHUS (atypical hemolytic uremic syndrome) and could move into a pivotal program in IgA nephropathy where the P2 data thus far has also been impressive,” Kolbert surmises.

Early word on the Street points to cautious optimism for this biotech player, as TipRanks analytics indicate OMER as a Buy. Out of 3 analysts polled by TipRanks in the last 3 months, 2 are bullish on Omeros stock while 1 remains sidelined. With a return potential of 68%, the stock’s consensus target price stands at $26.00.