Zacks Small Cap Research – ORMP: Preparations for New Phase 3 Trial Advance, While ORMP Leverages Balance Sheet Through Recent Agreements – Technologist

By M. Marin

NASDAQ:ORMP

READ THE FULL ORMP RESEARCH REPORT

Planning Phase 3 Oral Insulin study under revised protocol, new CRO agreement in place

Oramed Pharmaceuticals (NASDAQ:ORMP) has pivoted its clinical R&D focus to prioritize studying ORMD 0801 for subpopulations of patients with pooled specific parameters who responded well to oral insulin in its prior trial. The subpopulation included patients with specific parameters such as body mass index (BMI), baseline HbA1c, age, gender and body weight. These subsets exhibited an over 1% placebo adjusted, statistically significant reduction in HbA1c.

ORMP intends to launch a Phase 3 oral insulin trial in the U.S. under a differentiated protocol that is aligned with the positive subpopulation data and informed by feedback from discussions with the FDA. ORMP entered into a JV with Hefei Tianhui Biotech Co., Ltd. (HTIT) as a strategic initiative to move assets forward. Their JV will focus on developing and commercializing innovative products worldwide based on their combined assets and capabilities worldwide. ORMP entered into a services agreement with a CRO (Clinical Research Organization) in September 2024 related to the planned Phase 3 clinical trial.

ORMD–0801 potential treatment for NASH, as well as diabetes…

Moreover, ORMP’s R&D activities include potentially developing an orally ingestible capsules for delivery of other polypeptides, as well as an orally ingestible insulin capsule for the treatment of diabetes. ORMP has evaluated potential opportunities to advance ORMD–0801 for nonalcoholic steatohepatitis (NASH), and obesity as an appetite suppressant in earlier studies.

Cash position strengthened by various agreements, including with Scilex…

At the same time, ORMP is also leveraging its balance sheet – about $142 million in cash, equivalents, short-term investments and deposits and no long-term debt – to optimize its cash position, augmenting its cash with debt principal / interest payments from Scilex Holding Company and a loan agreement to finance a real estate project that is essentially collateralized by the project. On October 7, 2024, ORMP entered into an agreement to refinance a portion of the original Tranche A Note to Scilex.

Company purchased shares in 3Q24 under buyback, cash runway ~a year or more

Through the end of 3Q24, Oramed had repurchased and retired 539,452 ORMP shares for roughly $1.3 million. Given the cash balance noted above, we expect the company has sufficient capital to maintain share repurchases and continue to advance its strategy.

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