Atossa Therapeutics, Inc. (Nasdaq: ATOS) (“Atossa” or the
“Company”) today announced financial results for the fiscal quarter
ended June 30, 2024, and provided an update on recent company
developments. Atossa is a clinical-stage biopharmaceutical company
developing proprietary innovative medicines in areas of significant
unmet medical need in oncology, with a focus on women's breast
cancer and other breast conditions.
Key developments from Q2 2024 and the year to date include:
- Completed enrollment in 80mg PK Run-in Cohort for
EVANGELINE trial - fully enrolled the 12-patient 80mg
pharmacokinetic Run-in Cohort in the Phase 2 EVANGELINE study
evaluating (Z)-endoxifen as a neoadjuvant treatment for estrogen
receptor-positive (ER+)/ Human Epidermal Growth Factor Receptor 2
negative (HER2-) breast cancer.
- Completed Phase 2 Karisma-Endoxifen clinical trial
dosing - the last patient received the final dose in
the 240-person trial investigating (Z)-endoxifen in premenopausal
women with measurable mammographic breast density (MBD).
- Supported Phase 2 study of AI breast cancer risk
assessment model - announced support for the SMART
study, a Phase 2 trial to validate an AI-driven breast cancer risk
assessment model for identifying women at highest risk of
developing breast cancer within two years.
- Presented data from 40mg cohort of Phase 2 EVANGELINE
clinical trial at AACR - demonstrated 100% disease control
rate after 24-weeks of treatment with (Z)-endoxifen.
- Initiated new study evaluating (Z)-endoxifen in
combination with abemaciclib (VERZENIO®) with Quantum Leap
Healthcare Collaborative™ - new study arm is part of the
ongoing I-SPY 2 Endocrine Optimization Pilot Protocol (EOP), which
targets patients with newly diagnosed ER+ invasive breast
cancer.
- Joined Russell 3000® Index - Atossa
Therapeutics was included in the Russell 3000® Index effective June
28, 2024.
- Appointed Heather Rees as Chief Financial Officer
- announced the promotion of Heather Rees, formerly
Senior Vice President of Finance and Principal Accounting Officer,
to the position of CFO.
“The second quarter of 2024 was highlighted by significant
advancements in our clinical programs and strategic development
initiatives as we seek to maximize our (Z)-endoxifen platform to
address areas of unmet need across the breast cancer treatment
continuum,” said Steven Quay, M.D., Ph.D., Atossa’s President and
Chief Executive Officer. “Over the next several months, we
anticipate key data readouts from both the Phase 2
Karisma-Endoxifen clinical trial and the monotherapy arm of our
Phase 2 I-SPY 2 clinical trial, setting the stage for what is
expected to be a milestone-rich period for Atossa. These potential
value drivers are supported by a strong financial foundation,
including a cash balance of $79.5 million, which we believe
positions Atossa for continued growth through the second half of
2024 and beyond. This is a very exciting time for Atossa.”
Comparison of Three and Six Months Ended
June 30, 2024 and 2023
Operating Expenses. Total operating expenses
were $7.1 million and $14.1 million for the three and six months
ended June 30, 2024, respectively, which was a decrease of $0.7
million and $0.8 million, respectively, from total operating
expenses for the three and six months ended June 30, 2023 of $7.8
million and $14.9 million, respectively. Factors contributing to
the decrease in operating expenses in the three and six months
ended June 30, 2024 are explained below.
R&D Expenses. The following table provides a breakdown of
major categories within R&D expense for the three and six
months ended June 30, 2024 and 2023, together with the dollar
change in those categories (dollars in thousands):
|
|
|
For the Three Months Ended June 30, |
|
|
For the Six Months Ended June 30, |
|
|
2024 |
|
2023 |
|
Increase (Decrease) |
|
% Increase (Decrease) |
|
|
2024 |
|
2023 |
|
Increase (Decrease) |
|
% Increase (Decrease) |
|
Research and Development Expense |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Clinical and non-clinical trials |
$ |
2,501 |
|
$ |
2,538 |
|
$ |
(37 |
) |
(1 |
)% |
|
|
$ |
5,384 |
|
$ |
4,874 |
|
$ |
510 |
|
10 |
% |
|
Compensation |
|
679 |
|
|
899 |
|
|
(220 |
) |
(24 |
)% |
|
|
|
1,305 |
|
|
1,932 |
|
|
(627 |
) |
(32 |
)% |
|
Professional fees and other |
|
373 |
|
|
268 |
|
|
105 |
|
39 |
% |
|
|
|
613 |
|
|
407 |
|
|
206 |
|
51 |
% |
|
Research and Development Expense Total |
$ |
3,553 |
|
$ |
3,705 |
|
$ |
(152 |
) |
(4 |
)% |
|
|
$ |
7,302 |
|
$ |
7,213 |
|
$ |
89 |
|
1 |
% |
|
|
|
- Clinical and non-clinical trial expense decreased for the three
months ended June 30, 2024 compared to the prior year period by $37
thousand. Clinical and non-clinical trial expense increased by $0.5
million for the six months ended June 30, 2024 compared to the
prior year period due to an increase in spending for the
(Z)-endoxifen trials, including an increase in drug development
costs.
- The decrease in R&D compensation expense of $0.2 million
and $0.6 million for the three and six months ended June 30, 2024,
respectively, compared to the prior year periods was primarily due
to a decrease in non-cash stock-based compensation expense of $0.3
million and $0.7 million for the three and six months ended June
30, 2024, respectively. Non-cash stock-based compensation
expense decreased compared to the prior year periods due to the
weighted average fair value of stock options amortizing in the 2024
periods being lower.
- The increase in R&D professional fees and other expense of
$0.1 million and $0.2 million for the three and six months ended
June 30, 2024, respectively, compared to the prior year periods was
primarily attributable to higher consulting fees in 2024 related to
our (Z)-endoxifen program.
General and Administrative (G&A) Expenses. The following
table provides a breakdown of major categories within G&A
expenses for the three and six months ended June 30, 2024 and 2023,
together with the dollar change in those categories (dollars in
thousands):
|
|
|
For the Three Months Ended June 30, |
|
|
For the Six Months Ended June 30, |
|
|
2024 |
|
2023 |
|
Increase(Decrease) |
|
% Increase(Decrease) |
|
|
2024 |
|
2023 |
|
Increase(Decrease) |
|
% Increase(Decrease) |
|
General and Administrative Expense |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Compensation |
$ |
1,031 |
|
$ |
2,534 |
|
$ |
(1,503 |
) |
(59 |
)% |
|
|
$ |
2,356 |
|
$ |
4,619 |
|
$ |
(2,263 |
) |
(49 |
)% |
|
Professional fees and other |
|
2,269 |
|
|
1,213 |
|
|
1,056 |
|
87 |
% |
|
|
|
3,949 |
|
|
2,376 |
|
|
1,573 |
|
66 |
% |
|
Insurance |
|
252 |
|
|
341 |
|
|
(89 |
) |
(26 |
)% |
|
|
|
479 |
|
|
683 |
|
|
(204 |
) |
(30 |
)% |
|
General and Administrative Expense Total |
$ |
3,552 |
|
$ |
4,088 |
|
$ |
(536 |
) |
(13 |
)% |
|
|
$ |
6,784 |
|
$ |
7,678 |
|
$ |
(894 |
) |
(12 |
)% |
|
|
- The decrease in G&A compensation expense of $1.5 million
and $2.3 million for the three and six months ended June 30, 2024,
respectively, compared to the prior year periods was due to a
decrease in both cash compensation and non-cash stock-based
compensation expense. Non-cash stock-based compensation expense
decreased by $0.9 million and $1.7 million for the three and six
months ended June 30, 2024, respectively, compared to the prior
year periods due to the weighted average fair value of stock
options amortizing in 2024 being lower. Cash compensation decreased
by $0.6 million for the three and six months ended June 30, 2024,
compared to the prior year periods due to salary and bonus
severance expense for our former CFO of $0.6 million in the three
and six months ended June 30, 2023.
- G&A professional fees and other expense increased by $1.1
million and $1.6 million for the three and six months ended June
30, 2024, respectively, compared to the prior year periods due to
the increase in legal fees of $0.7 million and $0.8 million for the
three and six months ended June 30, 2024, respectively, compared to
the prior year periods due to higher patent-related activity as
well as other legal matters. Investor relations expenses increased
by $0.3 million and $0.5 million for the three and six months ended
June 30, 2024, respectively, compared to the prior year periods due
to an increase in investor outreach costs. Accounting fees also
increased by $0.3 million for the six months ended June 30, 2024
compared to the prior year period due to a change in the Company's
accounting firm as well as increased complexity of the
business.
- The decrease in G&A insurance expense of $0.1 million and
$0.2 million for the three and six months ended June 30, 2024,
respectively, compared to the prior year periods was due to lower
negotiated insurance premiums for the same or better coverage in
2024.
Interest Income. Interest income was $1.1 million and $2.2
million for the three and six months ended June 30, 2024,
respectively, an increase of $0.1 million and $0.4 million,
respectively, from interest income of $1.0 million and $1.8 million
for the three and six months ended June 30, 2023, respectively. The
increase was due to a change in the mix of our money market
accounts which yielded a higher rate of return in 2024.
Impairment Charge on Investment in Equity Securities. For the
three and six months ended June 30, 2024, there were no impairment
charges related to our investment in equity securities. For the
three and six months ended June 30, 2023, we wrote down our
investment in equity securities by $3.0 million due to impairment
of our investment in DCT.
About (Z)-Endoxifen(Z)-endoxifen is the most
potent Selective Estrogen Receptor Modulator (SERM) for estrogen
receptor inhibition and also causes estrogen receptor degradation.
It has also been shown to have efficacy in the setting of patients
with tumor resistance to other hormonal treatments. In addition to
its potent anti-estrogen effects, (Z)-endoxifen has been shown to
target PKCβ1, a known oncogenic protein, at clinically attainable
blood concentrations. Finally, (Z)-endoxifen appears to deliver
similar or even greater bone agonistic effects while resulting in
little or no endometrial proliferative effects compared with
standard treatments, like tamoxifen.
Atossa is developing a proprietary oral formulation of
(Z)-endoxifen that does not require liver metabolism to achieve
therapeutic concentrations and is encapsulated to bypass the
stomach, as acidic conditions in the stomach convert a significant
proportion of (Z)-endoxifen to the inactive (E)-endoxifen. Atossa’s
(Z)-endoxifen has been shown to be well tolerated in Phase 1
studies and in a small Phase 2 study of women with breast cancer.
(Z)-endoxifen is currently being studied in five Phase 2 trials:
one in healthy women with measurable breast density, one in women
diagnosed with ductal carcinoma in situ, and two other studies
including the EVANGELINE study in women with ER+/HER2- breast
cancer. Atossa’s (Z)-endoxifen is protected by three issued U.S.
patents and numerous pending patent applications.
About Atossa TherapeuticsAtossa Therapeutics,
Inc. is a clinical-stage biopharmaceutical company developing
innovative medicines in areas of significant unmet medical need in
oncology with a focus on using (Z)-endoxifen to prevent and treat
breast cancer. For more information, please visit
www.atossatherapeutics.com.
ContactTiberend Strategic Advisors, Inc.Jason
Rando917-930-6346jrando@tiberend.com
FORWARD LOOKING STATEMENTSThis press release
contains certain information that may constitute forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. We may identify these forward-looking
statements by the use of words such as “expect,” “potential,”
“continue,” “may,” “will,” “should,” “could,” “would,” “seek,”
“intend,” “plan,” “estimate,” “anticipate,” “believe,” “future,” or
other comparable words. Forward-looking statements in this press
release are subject to risks and uncertainties that may cause
actual results, outcomes, or the timing of actual results or
outcomes, such as data related to the (Z)-endoxifen program and the
potential of (Z)-endoxifen as a breast cancer prevention and
treatment agent, and potential milestones and growth opportunities
for the Company, to differ materially from those projected or
anticipated, including risks and uncertainties associated with:
macroeconomic conditions and increasing geopolitical instability;
the expected timing of releasing data; any variation between
interim and final clinical results; actions and inactions by the
FDA and foreign regulatory bodies; the outcome or timing of
regulatory approvals needed by Atossa, including those needed to
continue our planned (Z)-endoxifen trials; our ability to satisfy
regulatory requirements; our ability to remain compliant with the
continued listing requirements of the Nasdaq Stock Market; our
ability to successfully develop and commercialize new therapeutics;
the success, costs and timing of our development activities,
including our ability to successfully initiate or complete our
clinical trials, including our (Z)-endoxifen trials; our
anticipated rate of patient enrollment; our ability to contract
with third-parties and their ability to perform adequately; our
estimates on the size and characteristics of our potential markets;
our ability to successfully defend litigation and other similar
complaints and to establish and maintain intellectual property
rights covering our products; whether we can successfully complete
our clinical trial of oral (Z)-endoxifen in women with mammographic
breast density and our trials of (Z)-endoxifen in women with breast
cancer, and whether the studies will meet their objectives; our
expectations as to future financial performance, expense levels and
capital sources, including our ability to raise capital; our
ability to attract and retain key personnel; our anticipated
working capital needs and expectations around the sufficiency of
our cash reserves; and other risks and uncertainties detailed from
time to time in Atossa’s filings with the Securities and Exchange
Commission, including without limitation its Annual Reports on Form
10-K and Quarterly Reports on 10-Q. Forward-looking statements are
presented as of the date of this press release. Except as required
by law, we do not intend to update any forward-looking statements,
whether as a result of new information, future events or
circumstances or otherwise.
|
|
ATOSSA THERAPEUTICS, INC.CONDENSED
CONSOLIDATED BALANCE SHEETS(amounts in thousands,
except share and per share
data)(Unaudited) |
|
|
|
|
June 30, 2024 |
|
|
December 31, 2023 |
|
|
Assets |
|
|
|
|
|
|
Current assets |
|
|
|
|
|
|
Cash and cash equivalents |
$ |
79,526 |
|
|
$ |
88,460 |
|
|
Restricted cash |
|
110 |
|
|
|
110 |
|
|
Prepaid materials |
|
1,095 |
|
|
|
1,487 |
|
|
Prepaid expenses and other current assets |
|
987 |
|
|
|
2,162 |
|
|
Total current assets |
|
81,718 |
|
|
|
92,219 |
|
|
Investment in equity securities |
|
1,710 |
|
|
|
1,710 |
|
|
Other assets |
|
2,430 |
|
|
|
2,323 |
|
|
Total assets |
$ |
85,858 |
|
|
$ |
96,252 |
|
|
Liabilities and
stockholders' equity |
|
|
|
|
|
|
|
|
Current liabilities |
|
|
|
|
|
|
|
|
Accounts payable |
$ |
1,056 |
|
|
$ |
806 |
|
|
Accrued expenses |
|
1,907 |
|
|
|
973 |
|
|
Payroll liabilities |
|
939 |
|
|
|
1,654 |
|
|
Other current liabilities |
|
1,794 |
|
|
|
1,803 |
|
|
Total current liabilities |
|
5,696 |
|
|
|
5,236 |
|
|
Total liabilities |
|
5,696 |
|
|
|
5,236 |
|
|
Commitments and
contingencies |
|
|
|
|
|
|
|
|
Stockholders' equity |
|
|
|
|
|
|
|
|
Convertible preferred stock - $0.001 par value; 10,000,000 shares
authorized; 582 shares issued and outstanding as of
June 30, 2024 and December 31, 2023 |
|
— |
|
|
|
— |
|
|
Common stock - $0.18 par value; 350,000,000 and 175,000,000 shares
authorized as of June 30, 2024 and December 31, 2023,
respectively; 125,757,416 and 125,304,064 shares issued
and outstanding as of June 30, 2024 and December 31,
2023, respectively |
|
22,874 |
|
|
|
22,792 |
|
|
Additional paid-in capital |
|
256,978 |
|
|
|
255,987 |
|
|
Treasury stock, at cost; 1,320,046 shares of common stock
at June 30, 2024 and December 31, 2023 |
|
(1,475 |
) |
|
|
(1,475 |
) |
|
Accumulated deficit |
|
(198,215 |
) |
|
|
(186,288 |
) |
|
Total stockholders' equity |
|
80,162 |
|
|
|
91,016 |
|
|
Total liabilities and stockholders' equity |
$ |
85,858 |
|
|
$ |
96,252 |
|
|
|
|
|
|
ATOSSA THERAPEUTICS, INC.CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS (amounts in
thousands, except share and per share
data)(Unaudited) |
|
|
|
|
For the Three Months Ended June 30, |
|
|
For the Six Months Ended June 30, |
|
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
|
Operating expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and development |
$ |
3,553 |
|
|
$ |
3,705 |
|
|
$ |
7,302 |
|
|
$ |
7,213 |
|
|
General and administrative |
|
3,552 |
|
|
|
4,088 |
|
|
|
6,784 |
|
|
|
7,678 |
|
|
Total operating expenses |
|
7,105 |
|
|
|
7,793 |
|
|
|
14,086 |
|
|
|
14,891 |
|
|
Operating loss |
|
(7,105 |
) |
|
|
(7,793 |
) |
|
|
(14,086 |
) |
|
|
(14,891 |
) |
|
Impairment charge on investment in equity securities |
|
— |
|
|
|
(2,990 |
) |
|
|
— |
|
|
|
(2,990 |
) |
|
Interest income |
|
1,073 |
|
|
|
983 |
|
|
|
2,211 |
|
|
|
1,833 |
|
|
Other expense, net |
|
(17 |
) |
|
|
(30 |
) |
|
|
(52 |
) |
|
|
(63 |
) |
|
Loss before income taxes |
|
(6,049 |
) |
|
|
(9,830 |
) |
|
|
(11,927 |
) |
|
|
(16,111 |
) |
|
Income tax benefit |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
Net loss |
|
(6,049 |
) |
|
|
(9,830 |
) |
|
|
(11,927 |
) |
|
|
(16,111 |
) |
|
Net loss per share of common stock - basic and diluted |
$ |
(0.05 |
) |
|
$ |
(0.08 |
) |
|
$ |
(0.10 |
) |
|
$ |
(0.13 |
) |
|
Weighted average shares outstanding used to compute
net loss per share - basic and diluted |
|
125,732,140 |
|
|
|
126,622,798 |
|
|
|
125,525,959 |
|
|
|
126,623,450 |
|
|
|
|
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