Financial Performance - The net loss for the three months ended September 30, 2024, was $30.269 million, compared to a loss of $11.836 million for the same period in 2023, reflecting a 156% increase in losses[12]. - The net loss for the nine months ended September 30, 2024 and 2023, respectively, was $54.4 million and $37.6 million, with an accumulated deficit of approximately $804.0 million as of September 30, 2024[26]. - The basic and diluted loss per common share for the three months ended September 30, 2024, was $(0.63), compared to $(0.48) for the same period in 2023[12]. - The company has incurred significant operating losses and negative cash flows from operations since inception, which are expected to continue for the foreseeable future[25]. - The company has incurred recurring losses since inception and expects to continue generating operating losses for the foreseeable future[26]. Assets and Liabilities - As of September 30, 2024, total current assets increased to $112.657 million from $55.737 million as of December 31, 2023, representing a 102% increase[9]. - Total liabilities rose to $74.819 million from $49.176 million, marking a 52% increase[10]. - The total stockholders' equity increased significantly to $45.773 million from $14.826 million, representing a 208% increase[11]. - Total assets measured at fair value as of September 30, 2024, were $109,168 million, an increase from $72,305 million as of December 31, 2023[51]. - Total liabilities measured at fair value as of September 30, 2024, were $38,789 million, up from $31,352 million as of December 31, 2023[55]. Cash Flow and Investments - Cash and cash equivalents increased to $15.726 million as of September 30, 2024, from $14.473 million as of December 31, 2023, a rise of 9%[9]. - As of September 30, 2024, the Company had cash, cash equivalents, restricted cash, and short-term investments totaling $110.0 million, expected to fund operations for at least the next 12 months[26]. - The total cash, cash equivalents, and restricted cash at the end of the period is $16,064,000, compared to $5,050,000 at the end of the prior year[20]. - Total available-for-sale short-term investments amounted to $93.975 million as of September 30, 2024, with unrealized losses primarily due to changes in interest rates[42]. Research and Development - Research and development expenses for the nine months ended September 30, 2024, totaled $25.366 million, up from $23.712 million in the same period of 2023, indicating a 7% increase[12]. - The company is developing pz-cel, an autologous cell-based gene therapy for recessive dystrophic epidermolysis bullosa (RDEB)[21]. - The reimbursement of development and transition costs from Ultragenyx is recognized as a reduction of research and development costs[109]. Stock and Equity - The company issued 12,285,056 shares of common stock in connection with an underwritten offering, net of offering costs, during the reporting period[16]. - The Company sold 1,902,376 shares under the ATM Agreement during the nine months ended September 30, 2024, resulting in net proceeds of $10.0 million[84]. - The Company sold 3,284,407 shares and pre-funded warrants for an aggregate purchase price of $25.0 million gross on July 6, 2023[89]. - The Company sold 12,285,056 shares and pre-funded warrants for an aggregate purchase price of $75.0 million gross on May 7, 2024[90]. Revenue and Licensing - The company reported no license and other revenues for the three months ended September 30, 2024, compared to $3.5 million for the same period in 2023[12]. - The Company recognized no revenue from the sublicense agreements for the three and nine months ended September 30, 2024 and 2023[103]. - The transaction price for the sublicense agreement related to CLN1 disease includes $7.0 million of fixed consideration and up to $56.0 million of variable consideration[102]. - Under the Ultragenyx License Agreement, the Company is eligible to receive tiered royalties from mid-single-digit up to 10% on net sales and up to $30.0 million in commercial milestone payments[108]. Risks and Future Outlook - The company has highlighted potential risks including the timing and outcome of the FDA's review of its Biologics License Application for pz-cel, which could materially affect performance[7]. - The Company resubmitted its Biologics License Application (BLA) for pz-cel on October 28, 2024, with a target action date of April 29, 2025, set by the FDA[110]. - The BLA resubmission follows a Type A meeting with the FDA in August 2024, aligning on additional information required for Chemistry Manufacturing and Controls (CMC)[111]. Operating Costs and Expenses - Total operating lease costs for the nine months ended September 30, 2024, were $1,308 million, a decrease from $1,379 million in the same period of 2023[68]. - The Company incurred stock-based compensation expense of $4,673,000 for the nine months ended September 30, 2023, compared to $3,254,000 for the same period in 2022[20]. - Total stock-based compensation expense for the three months ended September 30, 2024 was $1.804 million, compared to $1.557 million for the same period in 2023[95].

Financial Performance - Abeona Therapeutics reported a net loss of $30.3 million for Q3 2024, compared to a net loss of $11.8 million in Q3 2023, reflecting an increase in losses due to higher expenses[8]. - Abeona's total expenses for Q3 2024 were $15.3 million, compared to $11.3 million in Q3 2023, indicating a significant increase in operational costs[12]. - Research and development expenses for Q3 2024 were $8.9 million, up from $7.1 million in the same period of 2023, while general and administrative expenses rose to $6.4 million from $4.2 million[8]. - Total stockholders' equity increased to $45,773 million as of September 30, 2024, compared to $14,826 million as of December 31, 2023[15]. - Accumulated deficit rose to $(803,965) million from $(749,524) million[15]. - Total liabilities and stockholders' equity reached $120,592 million, up from $64,002 million[15]. - Additional paid-in capital increased to $849,388 million from $764,151 million[15]. - Accumulated other comprehensive loss increased to $(84) million from $(66) million[15]. - Total shares issued and outstanding remained at 26,523,878 as of September 30, 2024, unchanged from December 31, 2023[15]. Cash Position - As of September 30, 2024, the company had cash, cash equivalents, short-term investments, and restricted cash totaling $110.0 million, down from $123.0 million as of June 30, 2024[6]. - Abeona's current cash resources are estimated to fund operations into 2026, excluding potential revenue from pz-cel sales[7]. Product Development and Regulatory Progress - The FDA accepted the resubmission of Abeona's Biologics License Application (BLA) for pz-cel, with a target action date set for April 29, 2025[1][4]. - Abeona has made significant progress in commercial readiness for pz-cel, including discussions with payors and onboarding treatment centers[2][4]. - The Centers for Medicare and Medicaid Services (CMS) assigned a product-specific procedure code for pz-cel, facilitating higher reimbursement levels for the therapy[3]. - The company has received new patents related to pz-cel, which are expected to enhance its intellectual property position in the market[3]. Operational Expansion - The company entered a lease agreement for additional manufacturing space in Cleveland, Ohio, to expand its production capacity[3].

Core Viewpoint - The FDA has accepted the Biologics License Application (BLA) resubmission for pz-cel, targeting a PDUFA action date of April 29, 2025, indicating significant progress towards potential commercialization of the therapy for recessive dystrophic epidermolysis bullosa (RDEB) [1][2][3]. Company Progress - Abeona Therapeutics has made strides in commercial readiness for pz-cel, including discussions with payors and onboarding treatment centers [2][3]. - The company completed a Type A meeting with the FDA in August 2024, aligning on the BLA resubmission content and addressing Chemistry Manufacturing and Controls (CMC) issues noted in a previous Complete Response Letter [3]. - The Centers for Medicare and Medicaid Services (CMS) granted a product-specific procedure code for pz-cel and assigned it to a high reimbursement category, facilitating hospital billing and patient access [3]. - Abeona has expanded its manufacturing capacity with a new facility lease in Cleveland, Ohio, and received new patents related to pz-cel, with the '504 Patent expiring on January 3, 2037 [3][4]. Financial Results - As of September 30, 2024, the company reported cash and cash equivalents totaling $110.0 million, down from $123.0 million as of June 30, 2024 [4]. - Research and development expenses for Q3 2024 were $8.9 million, an increase from $7.1 million in Q3 2023, while general and administrative expenses rose to $6.4 million from $4.2 million in the same period [6]. - The net loss for Q3 2024 was $30.3 million, compared to a net loss of $11.8 million in Q3 2023 [6][10]. Pipeline and Partnerships - In July 2024, Abeona entered a non-exclusive agreement with Beacon Therapeutics to evaluate its AAV204 capsid for potential use in ophthalmology gene therapies [3]. - Ultragenyx participated in a pre-BLA meeting with the FDA regarding its partnered program UX111 AAV gene therapy for Sanfilippo syndrome type A, expected to be filed by the end of 2024 [3].

Core Viewpoint - Abeona Therapeutics Inc. has announced the acceptance of its Biologics License Application (BLA) resubmission for prademagene zamikeracel (pz-cel) by the FDA, targeting a decision date of April 29, 2025, for its investigational gene therapy for recessive dystrophic epidermolysis bullosa (RDEB) [1][2] Company Overview - Abeona Therapeutics is a clinical-stage biopharmaceutical company focused on developing cell and gene therapies for serious diseases, with pz-cel being a key investigational product for RDEB [5] - The company operates a fully integrated cGMP manufacturing facility capable of supporting commercial production of pz-cel upon FDA approval [5] Product Details - Prademagene zamikeracel (pz-cel) is an autologous, COL7A1 gene therapy designed to treat RDEB, a rare genetic skin disease caused by mutations in the COL7A1 gene, leading to a lack of functional collagen VII [4] - Pz-cel is derived from patients' own skin cells, which are genetically corrected to express collagen VII, and expanded into keratinocyte sheets for wound coverage in a single surgical application [4] - The BLA resubmission is backed by clinical efficacy and safety data from the pivotal Phase 3 VIITAL™ study and a Phase 1/2a study, with follow-up data extending up to 8 years [2] Regulatory Status - The FDA had previously accepted the BLA for pz-cel for Priority Review, and the company may be eligible for a Priority Review Voucher if pz-cel is approved [3]

Company Overview - Abeona Therapeutics Inc. is a clinical-stage biopharmaceutical company focused on developing cell and gene therapies for serious diseases [3] - The company is developing an investigational autologous, COL7A1 gene-corrected epidermal sheet, prademagene zamikeracel (pz-cel), for recessive dystrophic epidermolysis bullosa [3] - Abeona has a fully integrated cell and gene therapy cGMP manufacturing facility that supports the production of pz-cel for its Phase 3 VIITAL™ trial and is capable of commercial production upon FDA approval [3] - The company is also working on AAV-based gene therapies for ophthalmic diseases with high unmet medical needs, utilizing next-generation AAV capsids to improve tropism profiles for various diseases [3] Upcoming Events - Members of Abeona's management team will participate in the Truist Securities BioPharma Symposium on November 7, 2024, for investor meetings [1] - A fireside chat at the Stifel 2024 Healthcare Conference is scheduled for November 18, 2024, at 4:10 p.m. ET, along with additional investor meetings [1][2] - A live webcast of the fireside chat will be available on the Investors section of the Abeona website, with a replay accessible for a limited time [2]

Core Viewpoint - Abeona Therapeutics has resubmitted its Biologics License Application (BLA) for prademagene zamikeracel (pz-cel) to the FDA as a potential treatment for recessive dystrophic epidermolysis bullosa (RDEB) [1][2] Group 1: BLA Resubmission Details - The resubmission follows a Type A meeting with the FDA in August 2024, where the company aligned on the content required for the resubmission [2] - The FDA's Complete Response Letter (CRL) from April 2024 did not identify deficiencies related to clinical efficacy or safety data, nor did it request new clinical trials [2][3] - The BLA resubmission is supported by clinical efficacy and safety data from the pivotal Phase 3 VIITAL™ study and a Phase 1/2a study [2] Group 2: Regulatory Process and Expectations - Upon acceptance of the BLA resubmission, the FDA will set a new Prescription Drug User Fee Act (PDUFA) target action date for pz-cel [3] - The review period for a resubmitted BLA can be either two or six months, depending on the classification as Class 1 or Class 2 [3] Group 3: Product Information - Prademagene zamikeracel (pz-cel) is an investigational autologous gene therapy targeting the COL7A1 gene, aimed at treating RDEB, a rare genetic skin disease [4] - The therapy involves genetically correcting patients' skin cells to express collagen VII, which is essential for skin integrity [4] - Pz-cel has received multiple designations from the FDA, including Regenerative Medicine Advanced Therapy and Breakthrough Therapy [4] Group 4: Company Overview - Abeona Therapeutics is a clinical-stage biopharmaceutical company focused on developing cell and gene therapies for serious diseases [5] - The company has a fully integrated cGMP manufacturing facility capable of supporting commercial production of pz-cel upon FDA approval [5] - Abeona's development portfolio also includes AAV-based gene therapies for ophthalmic diseases [5]

Company Overview - Abeona Therapeutics Inc. (NASDAQ: ABEO) specializes in developing gene and cell therapies aimed at treating serious genetic disorders [1] - The company utilizes its AIM platform, which employs adeno-associated virus (AAV) vectors for the targeted delivery of genetic material, facilitating the correction of functions across multiple body organs [1] Technology and Innovation - The AIM platform represents a significant technological advancement in the field of gene therapy, allowing for precise targeting and delivery of therapeutic genes [1]

Group 1 - Abeona Therapeutics Inc. will participate in several investor conferences in September 2024, including the Wells Fargo Healthcare Conference, H.C. Wainwright Annual Global Investment Conference, and Cantor Global Healthcare Conference [1] - The company will present its investigational autologous, COL7A1 gene-corrected epidermal sheets, known as prademagene zamikeracel (pz-cel), which is currently in development for recessive dystrophic epidermolysis bullosa [2] - Abeona's manufacturing facility is fully integrated and capable of supporting commercial production of pz-cel upon FDA approval, and it has a portfolio of AAV-based gene therapies for ophthalmic diseases [2]

Core Insights - Abeona Therapeutics Inc. has appointed Bernhardt G. Zeiher, MD, FCCP, FACP, and Eric Crombez, MD as new independent members of its Board of Directors, enhancing its leadership team during a critical period for the company [1][2] Group 1: Board Appointments - Dr. Zeiher has over 20 years of drug development experience and has overseen the approval of 15 new treatments for serious diseases with limited treatment options [1][2] - Dr. Crombez is currently the Chief Medical Officer at Ultragenyx Pharmaceutical Inc. and has extensive expertise in clinical development for rare genetic disorders [1][3] Group 2: Leadership Background - Dr. Zeiher previously held multiple roles at Astellas Pharma, culminating in his position as Chief Medical Officer, where he led drug development and regulatory affairs [2] - Dr. Crombez has a background in academia as an assistant professor at UCLA and has led clinical development efforts for gene therapy programs at Dimension Therapeutics [3] Group 3: Company Overview - Abeona Therapeutics is a clinical-stage biopharmaceutical company focused on developing cell and gene therapies for serious diseases, including its investigational therapy pz-cel for recessive dystrophic epidermolysis bullosa [4] - The company operates a fully integrated cGMP manufacturing facility capable of supporting commercial production of pz-cel upon FDA approval [4]

PART I [Financial Statements](index=5&type=section&id=Item%201.%20Financial%20Statements) Unaudited financial statements for June 30, 2024, show increased cash from financing, a Q2 2024 net income of $7.4 million driven by warrant gains, and $99.1 million cash inflow from financing activities [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2024, total assets increased to $134.0 million from $64.0 million, driven by cash from financing, with liabilities rising to $60.8 million and equity growing to $73.2 million Condensed Consolidated Balance Sheet Highlights (in thousands) | Balance Sheet Item | June 30, 2024 | December 31, 2023 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $34,426 | $14,473 | | Short-term investments | $88,282 | $37,753 | | Total current assets | $125,904 | $55,737 | | Total assets | $134,003 | $64,002 | | **Liabilities & Equity** | | | | Total current liabilities | $16,843 | $13,422 | | Long-term debt | $16,133 | $0 | | Warrant liabilities | $24,100 | $31,352 | | Total liabilities | $60,762 | $49,176 | | Total stockholders' equity | $73,241 | $14,826 | [Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Income%20%28Loss%29) For Q2 2024, the company reported net income of $7.4 million (vs. $16.7 million loss in Q2 2023), driven by a $24.9 million gain on warrant liabilities, with six-month net loss at $24.2 million and increased operating expenses Statement of Operations Highlights (in thousands, except per share data) | Metric | Q2 2024 | Q2 2023 | Six Months 2024 | Six Months 2023 | | :--- | :--- | :--- | :--- | :--- | | License and other revenues | $0 | $3,500 | $0 | $3,500 | | Research and development | $9,218 | $8,523 | $16,425 | $16,564 | | General and administrative | $8,646 | $5,021 | $15,769 | $9,018 | | Loss from operations | $(17,864) | $(10,554) | $(32,194) | $(22,592) | | Change in fair value of warrant/derivative liabilities | $24,927 | $(8,629) | $7,626 | $(6,364) | | Net Income (Loss) | $7,406 | $(16,654) | $(24,172) | $(25,761) | | Basic EPS | $0.19 | $(0.92) | $(0.72) | $(1.48) | [Condensed Consolidated Statements of Stockholders' Equity (Deficit)](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders%27%20Equity%20%28Deficit%29) Stockholders' equity significantly increased from **$14.8 million** at year-end 2023 to **$73.2 million** by June 30, 2024, driven by **$70.2 million** net proceeds from an underwritten offering and **$10.0 million** from ATM sales - For the six months ended June 30, 2024, the company raised **$70.2 million** (net) from an underwritten offering and **$10.0 million** (net) from its ATM sales agreement[13](index=13&type=chunk)[93](index=93&type=chunk) - Total stockholders' equity increased from **$14.8 million** on December 31, 2023, to **$73.2 million** on June 30, 2024[13](index=13&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) For the six months ended June 30, 2024, net cash used in operations was **$27.2 million**, investing activities used **$51.9 million**, while financing activities provided a substantial **$99.1 million**, resulting in a net cash increase of **$20.0 million** Cash Flow Summary (in thousands) | Cash Flow Activity | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :--- | :--- | :--- | | Net cash used in operating activities | $(27,222) | $(22,028) | | Net cash (used in) provided by investing activities | $(51,949) | $7,422 | | Net cash provided by financing activities | $99,124 | $6,614 | | **Net increase (decrease) in cash** | **$19,953** | **$(7,992)** | - Financing activities in the first half of 2024 included **$70.2 million** net proceeds from an underwritten stock sale, **$10.0 million** from ATM sales, and **$20.0 million** from the issuance of long-term debt[19](index=19&type=chunk)[157](index=157&type=chunk) [Notes to Unaudited Condensed Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) The notes detail the company's clinical-stage biopharmaceutical operations, with pz-cel as its lead program, confirming **$123.0 million** cash is sufficient for 12 months, and cover fair value measurements, a new **$50 million** loan, and **$75 million** equity financing - The company's lead clinical program is pz-cel, an autologous, cell-based gene therapy for recessive dystrophic epidermolysis bullosa (RDEB)[22](index=22&type=chunk) - As of the report's issuance date, the company expects its existing cash, cash equivalents, and short-term investments of **$123.0 million** (as of June 30, 2024) to be sufficient to fund operations for at least the next 12 months[27](index=27&type=chunk) - In January 2024, the company entered into a Loan and Security Agreement for up to **$50 million**, drawing an initial **$20 million** tranche[81](index=81&type=chunk) - In May 2024, the company completed an underwritten offering, raising approximately **$70.2 million** in net proceeds[99](index=99&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=28&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses pz-cel development and the FDA's CRL on CMC issues, with BLA resubmission planned for H2 2024; Q2 2024 saw a shift to net income due to warrant gains, increased G&A expenses, and liquidity bolstered by a **$75 million** offering and new loan, with **$123.0 million** cash sufficient for 12 months - The FDA issued a Complete Response Letter (CRL) for the pz-cel BLA in April 2024, citing CMC issues. The company plans to resubmit the BLA in the second half of 2024 and expects a six-month PDUFA review cycle upon acceptance[123](index=123&type=chunk) - General and administrative expenses for Q2 2024 increased by **$3.6 million** (**72%**) compared to Q2 2023, driven by higher salary costs (**$1.1 million**), pre-commercial preparation costs (**$1.1 million**), and other professional fees (**$1.0 million**)[135](index=135&type=chunk) - The company's cash resources were **$123.0 million** as of June 30, 2024, which is believed to be sufficient to fund operations for at least the next 12 months[158](index=158&type=chunk) Results of Operations Comparison (Q2 2024 vs Q2 2023, in thousands) | Line Item | Q2 2024 | Q2 2023 | Change $ | Change % | | :--- | :--- | :--- | :--- | :--- | | License and other revenues | $0 | $3,500 | $(3,500) | (100)% | | Research and development | $9,218 | $8,523 | $695 | 8% | | General and administrative | $8,646 | $5,021 | $3,625 | 72% | | Loss from operations | $(17,864) | $(10,554) | $(7,310) | 69% | | Net income (loss) | $7,406 | $(16,654) | $24,060 | (144)% | [Quantitative and Qualitative Disclosures About Market Risk](index=35&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section is not applicable for the company, as it is a smaller reporting company - The company has indicated that this item is not applicable[169](index=169&type=chunk) [Controls and Procedures](index=35&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, concluded the company's disclosure controls and procedures were effective as of June 30, 2024, with no material changes to internal control over financial reporting during the quarter - The Chief Executive Officer and Chief Financial Officer concluded that the company's Disclosure Controls and Procedures were effective as of June 30, 2024[170](index=170&type=chunk) - No changes in internal control over financial reporting occurred during the quarter ended June 30, 2024, that have materially affected, or are reasonably likely to materially affect, internal controls[171](index=171&type=chunk) PART II - OTHER INFORMATION [Legal Proceedings](index=36&type=section&id=Item%201.%20Legal%20Proceedings) The company reported no legal proceedings during the period - The company has no legal proceedings to report[173](index=173&type=chunk) [Risk Factors](index=36&type=section&id=Item%201A.%20Risk%20Factors) A key risk is the FDA's Complete Response Letter (CRL) for the pz-cel BLA, which could delay or prevent approval, shorten market exclusivity, and allow competitors to enter, with resubmission planned for H2 2024 - A key risk is the Complete Response Letter (CRL) for the pz-cel BLA, which could impair the ability to successfully commercialize the product[173](index=173&type=chunk) - The FDA's CRL cited Chemistry Manufacturing and Controls (CMC) requirements that must be resolved. The company plans to resubmit the BLA in the second half of 2024[174](index=174&type=chunk) - A delay in BLA approval could shorten market exclusivity for pz-cel and allow competitors to launch their products first, materially harming the company's prospects[174](index=174&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=36&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During Q2 2024, 66,683 shares of common stock were surrendered by employees at an average price of **$4.52** per share to cover tax withholding obligations from vesting restricted stock awards - In June 2024, **66,683** shares of common stock were surrendered to the company to satisfy tax withholding obligations from vesting restricted stock at an average price of **$4.52** per share[177](index=177&type=chunk) [Other Information](index=37&type=section&id=Item%205.%20Other%20Information) On April 25, 2024, the company's CEO and CFO terminated their Rule 10b5-1 trading arrangements - On April 25, 2024, the CEO and CFO terminated their Rule 10b5-1 trading arrangements[179](index=179&type=chunk) [Exhibits](index=37&type=section&id=Item%206.%20Exhibits) This section provides an index of exhibits filed with the Form 10-Q, including officer certifications and XBRL data files - The report includes an index of exhibits filed, such as officer certifications and XBRL data[180](index=180&type=chunk)[181](index=181&type=chunk)[182](index=182&type=chunk)