Omeros Corporation (NASDAQ: OMER), a biopharmaceutical company committed to discovering, developing and commercializing small-molecule and protein therapeutics for both large-market as well as orphan indications, today announced that it has entered into an exclusive license agreement with affiliates of Fagron NV (EBR: FAGR) for the commercialization of OMS103, Omeros' product for arthroscopic surgery.
OMS103, added to standard irrigation solution used in arthroscopy, is Omeros' proprietary PharmacoSurgery® product designed to provide a multimodal approach to block preemptively the inflammatory cascade induced by arthroscopic surgical procedures. Nearly five million arthroscopic procedures are projected to be performed in the U.S. in 2015.
Under the terms of the license agreement, Omeros granted Fagron an exclusive license to the OMS103 intellectual property, manufacturing information, and clinical data in the United States. In exchange for the U.S. license, Fagron will pay Omeros a substantial majority share of the gross revenues generated from sales of OMS103 with Omeros also receiving a minimum revenue per vial sold. In addition, Fagron will pay Omeros up to an aggregate total of $10 million in commercial milestones, some of which will be received by Omeros as revenue-share enhancement on early sales. Fagron is obligated to meet performance diligence requirements including the commencement of sales of OMS103 in 2015, to bear all sales and marketing costs, and to meet annual sales volume minimums. In addition to transferring the manufacturing and clinical information related to OMS103, Omeros is obligated to provide Fagron with introductions to arthroscopy thought leaders and assistance in understanding the therapeutic field as well as administration methods and to provide Fagron for 12 months with reasonable access to Omeros personnel to respond to any queries regarding the clinical and manufacturing data. Omeros will incur no further development costs, other than maintaining the licensed intellectual property, in connection with OMS103. The licensing agreement also contemplates potential partnerships for additional products from Omeros' PharmacoSurgery platform.
"Early postoperative pain is predominantly inflammatory pain, and clinical evaluation of OMS103 demonstrated better pain reduction together with less narcotic usage and less frequent incidence of postoperative inflammatory problems," stated William E. Garrett, Jr., M.D., Ph.D, professor of orthopaedic surgery and team physician at Duke University. "There is increasing evidence that intraoperative joint inflammation is detrimental to the long-term health of the joint, and control of postoperative pain and inflammation is critical to functional recovery in arthroscopy patients. Delivered intraoperatively, OMS103 provides an opportunity to inhibit inflammation and related problems before they begin and could become a key component in managing arthroscopy patients."
"We selected Fagron as our U.S. partner for OMS103 because of its robust sterile GMP manufacturing and commercial capabilities," stated Gregory A. Demopulos, M.D., chairman and chief executive officer of Omeros. "We believe that Fagron has the reach and expertise to bring OMS103 to orthopedic surgeons and their patients nationwide."
In addition to its current U.S. sterile manufacturing capabilities, Fagron is scheduled to open later this year one of the country's largest FDA-registered 503B human drug outsourcing facilities, which is expected to utilize automation not yet seen in the nation's sterile compounding industry. Together with Fagron's current operations, this state-of-the-art outsourcing facility is planned for use to produce commercial supplies of OMS103.