Can it cure diseases? YES! If you believe it can.... For very interesting text on the power of the mind and religion please read 'The Holographic Universe' quite interesting...
Also Asherman.... The mantra you mentioned is a Tibetan Buddhist Mantra (as you noted) and is much different from the 'om' inquired about by vinsan. And the 'Padmi' in the mantra is actually
padme pronounced more like 'pay-me'.
There are millions of mantras, many of them begin (and end) with OM.... Think of it more like 'Religious quotation marks' Beginning with an Om sets the stage so to speak, clearing the path for the sacred uttereance to follow. Ending with an Om is much the same as saying over and out.
Plus...Om is not 'om' in reality.... It is the principle vibration of 'reality' in Hinduism. The tone, inflection and volume of om do not change during a chant... Try this, close mouth and produce an
mmmmmmmmmmmm noise. now open mouth slightly, the sound has 'changed' to aaaaaaaaaaaa.... make a little 'o' with the lips and the sound 'changes' to ooooooooooo. return to the closed mouth position and you've completed your OM!
This is the 'primordial sound in its three distinct phases' Or four, or seven, or 108, all depends on who and what you refer to...
mmmmmmmmmmaaaaaaaaaaaoooooooooouuuuummmmmmmmmm...