Summary of Atosa Therapeutics Webinar Company Overview - **Company**: Atosa Therapeutics - **Ticker**: ATOS (NASDAQ) - **Market Focus**: Estrogen receptor positive breast cancer, addressing a multibillion dollar market opportunity [5][39] Key Points and Arguments Product Development - **Drug**: Z endoxifen, a prodrug of tamoxifen, is being developed for various stages of breast cancer treatment including prevention, neoadjuvant, adjuvant, and metastatic settings [5][11][39] - **Market Potential**: The market for estrogen receptor positive breast cancer is projected to reach $42 billion by 2030 [25] - **Clinical Utility**: Z endoxifen shows broad clinical utility and aims to address significant unmet needs in breast cancer treatment, particularly in improving efficacy and reducing resistance to therapy [8][9][39] Clinical Insights - **Efficacy**: Approximately 50% of patients discontinue adjuvant endocrine therapy due to side effects, and nearly 60% do not respond to second-line therapies [8][9] - **Unique Mechanism**: Z endoxifen not only blocks estrogen receptor binding but also induces apoptosis, which is a critical mechanism lacking in current therapies [10][15] - **Resistance**: Z endoxifen remains effective even in cases of estrogen receptor mutations, which occur in over 50% of long-term endocrine therapy patients [16][17] Safety and Tolerability - **Adverse Events**: Z endoxifen has a low adverse event profile, enhancing patient adherence to treatment [18][32] - **Combination Therapy**: The drug is positioned as a promising backbone for combination therapies, showing compatibility with existing treatments [19][30] Regulatory Strategy - **FDA Approval Pathway**: The company is prioritizing the metastatic setting for FDA approval, which is expected to provide the fastest path to market [24][36] - **Ongoing Discussions**: Atosa is actively engaging with the FDA to align on registrational endpoints and accelerated approval pathways [47] Financial Position - **Cash Reserves**: Atosa has approximately $65 million in cash with nearly two years of runway and zero debt [37][39] - **Market Capitalization**: As of May, the company's market cap was $140 million, with a stock price of $1.06 [39] Additional Important Information - **Intellectual Property**: Atosa has a robust and growing IP portfolio providing protection in the US and globally [6][39] - **Leadership Team**: The company boasts an experienced leadership team with a history of successful drug development [6][40] - **Clinical Trials**: Ongoing trials include the EVANGELINE trial for grade one and two estrogen receptor breast cancers in the neoadjuvant setting [32][34] Conclusion Atosa Therapeutics is positioned to make significant advancements in the treatment of estrogen receptor positive breast cancer with its lead product Z endoxifen, backed by a strong financial position and a clear regulatory strategy aimed at addressing a substantial market need.

Core Insights - Atossa Therapeutics has reported promising results from the Phase 2 Endocrine Optimization Pilot sub-study, demonstrating the bioactivity of low-dose (Z)-endoxifen in treating stage II/III ER+/HER2- breast cancer [1][4] Group 1: Study Results - No participants achieved a pathologic complete response (pCR), with residual cancer burden (RCB) classes indicating moderate to extensive disease [3] - The study showed a median Ki-67 suppression from 10.5% at baseline to 5% by Week 3, with 65% of patients achieving Ki-67 ≤ 10% [6] - Median functional tumor volume decreased by 77.7% from baseline to surgery, with the longest tumor diameter reduced by 36.8% [6] Group 2: Drug Profile - (Z)-endoxifen is a potent Selective Estrogen Receptor Modulator (SERM) that can inhibit and potentially degrade estrogen receptors, showing activity in resistant tumors [5] - The drug targets PKCβ1, an oncogenic signaling protein, at clinically achievable blood levels, and offers comparable or superior bone protection compared to tamoxifen [5] Group 3: Future Directions - Atossa is enrolling participants in an additional I-SPY2 cohort testing (Z)-endoxifen at a 40 mg daily dose, with top-line data expected in 2026 [4] - The company is focused on developing (Z)-endoxifen for metastatic breast cancer, supported by a growing intellectual property portfolio [8]

Drug Development - The company is developing (Z)-endoxifen for breast cancer treatment, with a focus on metastatic breast cancer, aiming for a streamlined regulatory pathway[85] - The FDA has authorized the Investigational New Drug (IND) application for (Z)-endoxifen, with a Phase 2 study enrolling approximately 190 patients planned[98] - The ongoing Phase 2 DCIS study aims to evaluate (Z)-endoxifen's suitability for long-term active surveillance in women with ductal carcinoma in situ, with approximately 100 patients expected to be treated[96] - The treatment cohort for the neoadjuvant study of (Z)-endoxifen was initiated in April 2025, comparing it to exemestane plus OFS[100] - The company plans to conduct additional studies to assess (Z)-endoxifen's correlation with breast cancer risk reduction, as advised by the FDA[94] - (Z)-endoxifen achieved a primary endpoint with 95% of patients receiving over 75% of planned treatment, showing a 69% reduction in Ki-67 and a 30.4% reduction in functional tumor volume after three weeks[102] - The company has completed four Phase 1 and two Phase 2 clinical studies for (Z)-endoxifen, demonstrating its potential in treating breast cancer and reducing breast density[89] Financial Performance - Total operating expenses increased to $7.4 million for the three months ended March 31, 2025, up from $7.0 million in the same period in 2024, reflecting a $0.4 million increase[110] - Research and Development (R&D) expenses totaled $4.2 million for the three months ended March 31, 2025, an 11% increase from $3.7 million in 2024[111] - Compensation expenses within R&D rose by 41% to $0.9 million, while professional fees increased by 123% to $0.5 million for the same period[111] - Interest income decreased to $0.7 million for the three months ended March 31, 2025, down from $1.1 million in 2024, due to a lower balance in the money market account[112] - Net cash used in operating activities was $5.96 million for the three months ended March 31, 2025, compared to $4.70 million in 2024, reflecting a $1.3 million increase[115] - As of March 31, 2025, the company had $65.1 million in cash and cash equivalents, sufficient to fund projected operating requirements for at least the next 12 months[115] - The company has an estimated non-cancellable commitment of $9.4 million for clinical trial service providers as of March 31, 2025[122] - The company is not currently generating revenue and does not anticipate doing so until pharmaceutical programs are developed and launched[104] Intellectual Property - The company has been granted six U.S. and ten international patents for (Z)-endoxifen, with protection extending through at least November 17, 2038[83] Corporate Strategy - The company aims to opportunistically add programs in areas of high unmet medical need through acquisition or collaboration[84] - The company is focused on advancing its clinical studies and successfully commercializing new therapeutics[82] Compliance and Regulatory Issues - The company received a letter from Nasdaq regarding non-compliance with the minimum bid price requirement, with a deadline to regain compliance by August 20, 2025[121]

Announced strategic plan to advance (Z)-endoxifen for metastatic breast cancer indication SEATTLE, May 13, 2025 /PRNewswire/ -- Atossa Therapeutics, Inc. (Nasdaq: ATOS) (Atossa or the Company), a clinical-stage biopharmaceutical company developing innovative medicines for breast cancer, today announced its financial results for the first quarter ended March 31, 2025 and provided an update on recent company developments. First Quarter 2025 Highlights: "Our focus remains firmly on advancing (Z)-endoxifen as a ...

Core Viewpoint - Atossa Therapeutics has been granted a new patent for (Z)-endoxifen formulations, enhancing its intellectual property portfolio and supporting its mission to advance breast cancer treatment [1][2][3] Group 1: Patent and Intellectual Property - The newly granted patent (U.S. Patent No. 12,281,056) includes 58 claims related to (Z)-endoxifen formulations, focusing on purity, stability, and therapeutic methods [2] - Atossa's patent estate now encompasses over 200 claims related to (Z)-endoxifen formulations and their clinical applications, reinforcing the company's leadership in targeted therapies for hormone receptor-positive breast cancer [3] Group 2: Product Development and Efficacy - (Z)-endoxifen is a potent Selective Estrogen Receptor Modulator (SERM) that may cause estrogen receptor degradation and has shown efficacy in patients resistant to other hormonal treatments [4] - The company is developing an oral formulation of (Z)-endoxifen designed to bypass the stomach, which converts a significant portion of the drug to an inactive form [5] - Clinical studies indicate that (Z)-endoxifen is well tolerated in women with and without breast cancer, and it is being studied for both treatment and prevention of breast cancer, including a program for metastatic breast cancer [5] Group 3: Company Mission and Vision - Atossa is dedicated to transforming breast cancer treatment through innovative science and patient-focused solutions, aiming to improve the lives of millions of women while generating substantial value for shareholders [3][6]

Core Viewpoint - Atossa Therapeutics has been granted a new patent for enteric oral formulations of (Z)-endoxifen, enhancing its intellectual property portfolio and supporting its mission to develop innovative treatments for breast cancer [1][2][3]. Intellectual Property - The newly granted U.S. Patent No. 12,275,684 covers enteric oral formulations of (Z)-endoxifen and methods for treating hormone-dependent breast and reproductive tract disorders [2]. - Atossa's patent estate now includes multiple U.S. patents with over 100 claims related to (Z)-endoxifen formulations and their clinical applications, reinforcing the company's leadership in targeted therapies for hormone receptor-positive breast cancer [3]. Product Development - (Z)-endoxifen is a potent Selective Estrogen Receptor Modulator (SERM) that may cause estrogen receptor degradation and has shown efficacy in patients resistant to other hormonal treatments [4]. - Atossa is developing a proprietary oral formulation of (Z)-endoxifen designed to bypass the stomach, as acidic conditions convert a significant portion of (Z)-endoxifen to the inactive (E)-endoxifen [5]. - Clinical studies indicate that (Z)-endoxifen is well tolerated in women with and without breast cancer, and it is currently being studied for both treatment and prevention of breast cancer, including a program in metastatic breast cancer [5]. Company Overview - Atossa Therapeutics is a clinical-stage biopharmaceutical company focused on transforming breast cancer treatment through innovative science and patient-centered solutions [6]. - The company's lead product candidate, (Z)-endoxifen, is designed for use across the breast cancer spectrum, including prevention, neoadjuvant, adjuvant, and metastatic settings [6].

Core Viewpoint - Atossa Genetics Inc. (ATOS) has received a Zacks Rank 2 (Buy) upgrade, indicating a positive trend in earnings estimates which is a significant factor influencing stock prices [1][3]. Earnings Estimates and Stock Price Movement - The Zacks rating system is based on the consensus measure of EPS estimates from sell-side analysts, reflecting the company's changing earnings picture [1][2]. - A strong correlation exists between earnings estimate revisions and near-term stock price movements, influenced by institutional investors who adjust their valuations based on these estimates [4][6]. Company Performance and Outlook - The upgrade for Atossa Genetics signifies an improvement in the company's underlying business, which is expected to drive stock appreciation [5][10]. - For the fiscal year ending December 2025, Atossa Genetics is projected to earn -$0.25 per share, a decrease of 31.6% from the previous year, but analysts have raised their estimates by 7.4% over the past three months [8]. Zacks Rank System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with a proven track record of Zacks Rank 1 stocks generating an average annual return of +25% since 1988 [7][9]. - Atossa Genetics' upgrade to Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, indicating strong potential for market-beating returns in the near term [10].

Financial Data and Key Metrics Changes - Total operating expenses for 2024 were $27.6 million, down from $31.4 million in 2023, a decrease of $3.8 million [29] - R&D expenses declined by $3.2 million from $17.3 million in 2023 to $14.1 million in 2024, primarily due to reduced spending on (Z)-endoxifen trials [30] - Net loss for 2024 was $25.5 million or $0.20 per share, compared to $30.1 million or $0.24 per share in 2023 [34] - The company closed the year with $71.1 million in cash and cash equivalents, providing a healthy runway for advancing (Z)-endoxifen and other research initiatives [34] Business Line Data and Key Metrics Changes - The focus remains on the lead program (Z)-endoxifen, which is positioned as a next-generation anti-estrogen therapy for breast cancer [12][17] - The company aims to address significant unmet needs in endocrine therapy for breast cancer, including patient adherence and drug resistance [10][11] Market Data and Key Metrics Changes - The company is prioritizing the metastatic breast cancer indication for (Z)-endoxifen, which is a clinical setting of high unmet need [19] - Clinical investigations have shown a clinical benefit rate of approximately 26% in patients with endocrine refractory ER-positive HER2-negative metastatic breast cancer [21] Company Strategy and Development Direction - The company plans to advance (Z)-endoxifen in metastatic breast cancer first, potentially leading to a more streamlined path to regulatory approval [19][26] - There is a commitment to continue dialogue with the FDA regarding the potential for (Z)-endoxifen in earlier disease settings [22] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the potential of (Z)-endoxifen to transform breast cancer treatment, especially in metastatic disease where new options are urgently needed [36] - The company remains focused on executing research and regulatory strategies to meet clinical milestones [27] Other Important Information - The company reported a write-off of $1.7 million related to its investment in dynamic cell therapies, which ceased operations in Q4 2024 [33] - Professional fees increased by $1.8 million year-over-year, primarily due to higher legal and investor relation costs [32] Q&A Session Summary Question: Timing for initiating a study in the metastatic setting - Management is consulting with key opinion leaders and plans to discuss details with the FDA over the next four to six months [39][40] Question: Update on EVANGELINE trial enrollment and data - Updates on enrollment and interim data results will be provided at upcoming meetings; the primary endpoint difference is due to requirements for early Ki-67 value assessments [43] Question: Pursuing global markets for metastatic breast cancer - The focus is currently on the U.S. FDA process, with plans to consider other major markets in early 2026 [48]

Drug Development and Clinical Trials - The company is developing oral (Z)-endoxifen for breast cancer prevention and treatment, with a focus on overcoming the limitations of tamoxifen[27]. - Four Phase 2 clinical trials are currently investigating (Z)-endoxifen, including the EVANGELINE trial, which aims to enroll approximately 190 patients[30]. - In the EVANGELINE trial, approximately 50% of patients in the 80 mg cohort reached the target plasma concentration of 500 to 1000 ng/mL, with an average plasma concentration of 484 ng/mL[31]. - The Karisma-(Z)-endoxifen study showed that the 1 mg dose reduced mammographic breast density by 17.3% and the 2 mg dose by 23.5%, compared to a minimal change of 0.27 percentage points in the placebo group[38]. - The I-SPY 2 trial reported that (Z)-endoxifen reduced Ki-67 by 69% and functional tumor volume by 30.4% after three weeks of treatment[44]. - The company plans to pursue a metastatic breast cancer indication for (Z)-endoxifen to expedite regulatory approval[51]. - The company may encounter delays in clinical trials or may not be able to conduct them in a timely manner, impacting product development[155]. - The company reported that interim clinical trial data may differ from final results, impacting the perceived value and approval of its product candidates[178]. - The company may experience delays in clinical trials due to various factors, including patient enrollment issues and regulatory approvals, which could hinder product commercialization[197]. Financial Performance and Capital Resources - As of December 31, 2024, the company had cash and cash equivalents of approximately $71.1 million[56]. - Research and development (R&D) expenses for the years ended December 31, 2024 and 2023 were approximately $14.1 million and $17.3 million, respectively, indicating a decrease of about 18.9%[62]. - The company has a history of operating losses and has not established sources of ongoing revenue to cover operating costs, which raises concerns about its ability to continue as a going concern[161]. - The company expects to need to raise substantial additional capital in the future to fund operations, as it currently has no sources of revenue[162]. - The company incurred net losses of approximately $25.5 million and $30.1 million for the years ended December 31, 2024 and 2023, respectively, with an accumulated deficit of approximately $211.8 million since inception[162]. Market Potential and Competitive Landscape - The global ER+ breast cancer treatment market is projected to reach $33.7 billion by 2030, growing at a CAGR of 7.89% from 2024 to 2030[54]. - The potential U.S. market for (Z)-endoxifen in breast cancer treatment and prevention could be up to $1 billion or more annually[54]. - The company may not achieve significant commercial market acceptance for its products, which could hinder revenue generation[169]. Regulatory Environment and Compliance - The FDA review user fee for submitting a New Drug Application (NDA) is $4.3 million for fiscal year 2025, highlighting the financial requirements for drug approval[82]. - Approval of a New Drug Application (NDA) requires FDA inspection of clinical sites and manufacturing facilities, with concerns potentially delaying approval[85]. - The FDA has various programs to expedite drug review processes, including breakthrough therapy designation and accelerated approval, which may allow for approval based on surrogate endpoints for serious conditions[84]. - The company is subject to rigorous regulation by the FDA and other international agencies, which may delay or prevent product approvals[180]. Intellectual Property and Legal Risks - The company owns and is pursuing 119 pending patent applications and has 13 issued patents as of February 3, 2025, which are crucial for its competitive advantage[212]. - On August 18, 2023, Intas Pharmaceuticals LTD. filed a Petition for Post Grant Review (PGR) to invalidate claims of U.S. Patent No. 11,572,334 titled "Methods for Making and Using Endoxifen"[217]. - On January 29, 2025, the PTAB issued a final decision declaring all claims under the Patent unpatentable[218]. - Litigation related to proprietary technology may lead to substantial costs and distract management, with risks of compromising confidential information during discovery[219]. - The current patent portfolio may not encompass all necessary rights for full product development and commercialization, potentially delaying or preventing product launches[224]. Operational Risks and Challenges - The company is dependent on third-party service providers for critical operational activities, which poses risks to its business[155]. - The company may face challenges in establishing sales, marketing, and commercial supply capabilities if any product candidates are approved[170]. - The company faces challenges in attracting and retaining qualified personnel, particularly in the greater Seattle area, which may lead to increased operating expenses due to labor shortages and high inflation[174]. - Business disruptions, including natural disasters and pandemics, could materially harm the company's financial condition and increase operational costs[202]. Corporate Governance and Management - The company employs two executive officers and thirteen full-time employees, with plans to hire more as current and future programs develop[148]. - The loss of the Chief Executive Officer could adversely affect the company's business, as his experience is critical for executing the business plan[171]. - The company aims to attract, retain, and motivate personnel through stock-based and cash-based compensation awards, aligning interests with stockholders[149].

Financial Performance - Atossa Therapeutics ended 2024 with $71.1 million in cash and cash equivalents and no debt[1]. - Total operating expenses decreased to $27.6 million in 2024, down from $31.4 million in 2023, representing a reduction of approximately 12.1%[7]. - Net loss narrowed from $30,094,000 in 2023 to $25,504,000 in 2024, reflecting an improvement of about 15.1%[20]. - Net loss per share improved from $(0.24) in 2023 to $(0.20) in 2024, indicating a positive trend[20]. - Total stockholders' equity decreased from $91,016,000 in 2023 to $71,477,000 in 2024, a decline of approximately 21.5%[18]. Research and Development - Research and Development (R&D) expenses totaled $14.1 million in 2024, a decrease of 19% from $17.3 million in 2023, primarily due to reduced spending on (Z)-endoxifen trials[8]. - Atossa is currently studying (Z)-endoxifen in four Phase 2 trials targeting various breast cancer indications[13]. - The 4-week Ki-67 ≤ 10% response rate was above 85% across dosing levels in the Phase 2 EVANGELINE trial[2]. - (Z)-endoxifen demonstrated a 17.3 percentage-point reduction in mammographic breast density at a 1 mg dose and a 23.5 percentage-point reduction at a 2 mg dose, both statistically significant (p<0.01)[2]. - The company plans to advance (Z)-endoxifen for metastatic breast cancer, aiming for a more streamlined regulatory pathway[2]. General and Administrative Expenses - General and Administrative (G&A) expenses totaled $13.5 million in 2024, a decrease of 4% from $14.0 million in 2023[9]. - G&A compensation expenses decreased by $1.9 million in 2024, primarily due to lower cash and non-cash stock-based compensation[12]. - General and administrative expenses slightly decreased from $14,043,000 in 2023 to $13,504,000 in 2024, a decline of about 3.8%[20]. Assets and Cash Flow - Total assets decreased from $96,252,000 in 2023 to $76,444,000 in 2024, a decline of approximately 20.6%[18]. - Cash and cash equivalents fell from $88,460,000 in 2023 to $71,084,000 in 2024, representing a decrease of about 19.6%[18]. - Interest income for 2024 was $4.1 million, a decrease of $0.2 million compared to the previous year[10]. - Interest income decreased from $4,343,000 in 2023 to $4,050,000 in 2024, a decline of about 6.7%[20]. - Impairment charge on investment in equity securities decreased from $2,990,000 in 2023 to $1,710,000 in 2024, a reduction of approximately 42.8%[20].