美國
證券 交易委員會
華盛頓, DC 20549
表格
(標記 一個)
截至季度期末的報告
或
過渡期從到
佣金
文件編號
(註冊人名稱應與其章程中列明的相符)
| （註冊或組織的州 或其他司法管轄區） | （I.R.S. 僱主識別號碼） |
(主要執行辦公室的地址，郵政編碼)
(註冊人 電話，包括區號)
根據1934年證券交易法第12（b）條註冊的證券：
| 每個類別的標題 | 交易 標的 | 註冊的每個交易所名稱 | ||
請通過勾選方式指明登記人是否：（1）在過去12個月內（或登記人被要求提交此類報告的較短期間內）根據1934年證券交易法第13條或第15(d)條提交了所有要求提交的報告，以及（2）在過去90天內是否一直受到此類提交要求的約束。
請通過勾選的方式指明註冊人是否在過去12個月（或註冊人被要求提交此類文件的較短期間）內，電子提交了根據規則405（本章第232.405條）要求提交的每個互動數據文件。
請勾選以下選項，指明掛牌者是否為大型快速申報掛牌者、快速申報掛牌者、非快速申報掛牌者、較小型的報告公司或新興成長型公司。關於Exchange Act第1202條中「大型快速申報掛牌者」、「快速申報掛牌者」、「較小型報告公司」和「新興成長型公司」的定義，請參閱。
| 大型 加速報告人 ☐ | 加速報告人 ☐ |
| 較小的
報告公司 | |
| 新興
增長公司 |
如果 是一家新興成長公司，請以勾選標記表示註冊人是否選擇不使用根據《交易所法》第13(a)條款提供的任何新的或修訂的財務標準的延長過渡期。 ☒
請勾選是否登記者為外殼公司（依照交易所法規120億2的定義）。是 ☐ 否
截至2024年11月12日，註冊人的普通股已發行股份總數爲 股。
阿比歐娜 治療公司。
表格 10-Q
截至2024年9月30日的季度
指數
頁面 不。 | |||
| 第一部分 - 財務信息 | |||
| 項目 1. | 財務報表： | 3 | |
| 截至2024年9月30日和2023年12月31日的未經審計的合併資產負債表 | 3 | ||
| 截至2024年和2023年9月30日的三個月和九個月未經審計的簡明合併運營和綜合虧損基本報表 | 4 | ||
| 截至2024年和2023年9月30日的三個月和九個月未經審計的簡明合併股東權益基本報表 | 5 | ||
| 未經審計的凝聚合並現金流量表截至2024年9月30日和2023年9月30日的九個月 | 7 | ||
| 基本報表未經審核簡明合併財務報表註腳 | 8 | ||
| 項目 2. | 管理層對 財務狀況 和 經營成果 的討論與分析 | 24 | |
| 項目 3. | 關於市場風險的定量和定性披露 | 31 | |
| 項目 4. | 控制項和程序 | 31 | |
| 第二部分 - 其他信息 | |||
| 項目 1. | 法律程序 | 32 | |
| 項目 1A. | 風險因素 | 32 | |
| 項目 2. | 未註冊的股權證券銷售及收益使用 | 32 | |
| 項目 5. | 其他資訊 | 32 | |
| 項目 6. | 展品 | 33 | |
| 簽名 | 34 | ||
| 1 |
前瞻性 聲明
本 《10-Q季度報告》(包括引用的信息)包含表達管理層的意見、期望、信念、計劃、目標、假設或關於未來事件或未來結果的預測的陳述，因此這些陳述被視爲證券法1933年修正案第27A節和證券交易法1934年修正案第21E節所定義的「前瞻性陳述」。諸如「期望」、「預期」、「打算」、「計劃」、「相信」、「可能」、「願意」、「尋求」、「估計」等詞彙及其變體，以及它們的否定形式，旨在識別這樣的前瞻性陳述。這樣的「前瞻性陳述」僅在製作之日有效，並不保證未來的表現，並涉及管理層的某些風險、不確定性、估計和假設，這些都是難以預測的。各種因素，其中一些超出了公司的控制範圍，可能會導致實際結果與此類前瞻性陳述中所表達或暗示的結果大相徑庭。此外，我們無義務更新任何前瞻性陳述，以反映本報告之日後發生的事件或情況，除非聯邦證券法另有規定。
前瞻性 聲明必然涉及風險和不確定性，我們的實際結果可能因多種因素與前瞻性 聲明中預期的結果有實質性差異。這些聲明包括關於以下方面的陳述：FDA對我們重提的生物製品許可證申請的審查的時間和結果；我們繼續開發旨在治療眼科疾病的AAV基因療法的計劃；臨床開發、臨床試驗和潛在監管批准的實現或預期時間、進展和結果；我們的產品候選者管道；我們相信pz-cel可能有利於RDEB患者；我們相信VIITAL™臨床試驗的臨床試驗數據加上迄今爲止生成的數據足以支持監管批准；我們依賴於第三方客戶和供應商及其遵守監管機構的規定；我們對費用、未來收入、資本需求和額外融資需求的估計；我們的知識產權狀況以及我們獲得、維持和執行知識產權保護和專有資產排他性的能力；我們對產品候選者潛在市場規模的估計、我們商業化策略的有效性以及我們服務和供應這些市場的能力；以及未來的經濟條件或表現。
重要 可能影響業績並導致結果與管理層預期大相徑庭的重要因素在公司2023財年截至12月31日的10-K表年度報告中的「風險因素」和「管理層對財務狀況和經營成果的討論與分析」部分中描述，並會不時在公司向SEC提交的文件中進行更新，包括本季度10-Q報告。這些因素包括： FDA對我們重新提交的生物製品許可申請的審查的時間和結果；我們獲取現有市場銷售協議的能力；我們獲取額外金融資源和/或降低營業費用的財務靈活性；我們從現有或新股東那裏獲得額外股權融資的能力；全球醫療緊急情況，如大流行，對我們的業務、運營和財務狀況的潛在影響；我們技術和/或其他資產的外許可能力，推遲和/或取消計劃支出，重組運營和/或減少員工，以及資產的銷售；通過出售額外股權證券籌集額外資金對我們現有投資者相對股權所有權的稀釋影響，包括在我們現有的市場銷售協議下；與美國食品和藥物管理局（「FDA」）或其他監管機構關於我們任何產品或產品候選者的互動結果；我們繼續獲得監管指定的能力以便獲得產品候選者的資格；我們能夠開發符合當前良好製造規範的製造能力以支持我們的產品候選者；我們能夠製造細胞和基因治療產品，並提供足夠的產品供應以支持臨床試驗和潛在的未來商業化；一旦獲得批准，我們的產品候選者的市場接受率和程度；以及我們滿足我們參與的許可協議中的義務的能力。
| 2 |
部分 一 - 財務信息
項目 1. 基本報表
阿比奧納 治療公司及其子公司
合併 合併資產負債表
（$ 以千計，除分享和每分享金額外）
（未經審計）
| 2024年9月30日 | 2023年12月31日 | |||||||
| 資產 | ||||||||
| 流動資產： | ||||||||
| 現金及現金等價物 | $ | $ | ||||||
| 短期投資 | ||||||||
| 受限現金 | ||||||||
| 其他應收款 | ||||||||
| 預付費用及其他流動資產 | ||||||||
| 總流動資產 | ||||||||
| 物業和設備，淨值 | ||||||||
| 經營租賃使用權資產 | ||||||||
| 其他資產 | ||||||||
| 總資產 | $ | $ | ||||||
| 負債和股東權益 | ||||||||
| 流動負債： | ||||||||
| 應付賬款 | $ | $ | ||||||
| 應計費用 | ||||||||
| 長期債務的當前部分 | ||||||||
| 經營租賃負債的流動部分 | ||||||||
| 當前應付給許可方的部分 | ||||||||
| 其他流動負債 | ||||||||
| 總流動負債 | ||||||||
| 長期經營租賃負債 | ||||||||
| 長期債務 | ||||||||
| 權證負債 | ||||||||
| 總負債 | ||||||||
| 承諾和或有事項 | ||||||||
| 股東權益： | ||||||||
| 優先股 - $ 面值；授權 股票； 截至2024年9月30日和2023年12月31日已發行和流通的股份 | ||||||||
| 普通股 - $ 面值；授權 股票; 和 截至2024年9月30日和2023年12月31日已發行和流通的股份 | ||||||||
| 額外支付的資本 | ||||||||
| 累計負債 | ( | ) | ( | ) | ||||
| 累計其他綜合損失 | ( | ) | ( | ) | ||||
| 總股東權益 | ||||||||
| 總負債和股東權益 | $ | $ | ||||||
附帶的說明是這些未經審計的簡要合併財務報表的一個組成部分。
| 3 |
阿比奧納 治療公司及其子公司
簡化版 合併經營報表及綜合虧損
（$ 以千計，除分享和每分享金額外）
（未經審計）
| 截至9月30日的三個月內， | 截至九個月，至九月三十日 | |||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||
| 營業收入： | ||||||||||||||||
| 許可和其他收入 | $ | $ | $ | $ | ||||||||||||
| 費用: | ||||||||||||||||
| 版稅 | ||||||||||||||||
| 研究與開發 | ||||||||||||||||
| 一般和管理費用 | ||||||||||||||||
| 經營租賃使用權資產的收益 | ( | ) | ||||||||||||||
| 總支出 | ||||||||||||||||
| 營業虧損 | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| 利息收入 | ||||||||||||||||
| 利息費用 | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| 期權和衍生負債公允價值的變動 | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| 其他收入 | ||||||||||||||||
| 淨虧損 | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| 基本和稀釋後每普通股損失 | $ | ) | $ | ) | $ | ) | $ | ) | ||||||||
| 在外流通的普通股加權平均數 - 基本和稀釋後 | ||||||||||||||||
| 其他綜合損益： | ||||||||||||||||
| 可供出售債務證券相關的未實現收益（損失）的變動 | ( | ) | ( | ) | ||||||||||||
| 外幣翻譯調整 | ||||||||||||||||
| 綜合虧損 | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
附帶的說明是這些未經審計的簡要合併財務報表的一個組成部分。
| 4 |
阿比奧納 治療公司及其子公司
壓縮 合併股東權益表
（$ 以千爲單位，除分享金額外）
（未經審計）
| 截至2024年9月30日的三個月 | ||||||||||||||||||||||||
| 累計 | ||||||||||||||||||||||||
| 其他 | 其他 | 總計 | ||||||||||||||||||||||
| 普通股 | 實收資本 | 累計 | 綜合 | Stockholders’ | ||||||||||||||||||||
| Shares | 金額 | 資本 | Deficit | 損失 | Equity | |||||||||||||||||||
| 截至2024年6月30日的餘額 | $ | $ | $ | ( | ) | $ | ( | ) | $ | | ||||||||||||||
| 基於股票的薪酬費用 | — | |||||||||||||||||||||||
| 與限制性股票獎勵相關的普通股發行，在扣除取消和用於稅務代扣結算的股份後 | ( | ) | ( | ) | ||||||||||||||||||||
| 衍生負債的重新分類 | — | |||||||||||||||||||||||
| 淨虧損 | — | ( | ) | ( | ) | |||||||||||||||||||
| 其他綜合收益 | — | |||||||||||||||||||||||
| 截至2024年9月30日的餘額 | $ | $ | $ | ( | ) | $ | ( | ) | $ | |||||||||||||||
| 截至2024年9月30日的九個月 | ||||||||||||||||||||||||
| 累計 | ||||||||||||||||||||||||
| 其他 | 其他 | 總計 | ||||||||||||||||||||||
| 普通股 | 實收資本 | 累計 | 綜合 | Stockholders’ | ||||||||||||||||||||
| Shares | 金額 | 資本 | Deficit | 損失 | Equity | |||||||||||||||||||
| 截至2023年12月31日的餘額 | $ | $ | $ | ( | ) | $ | ( | ) | $ | | ||||||||||||||
| 基於股票的薪酬費用 | — | |||||||||||||||||||||||
| 與限制性股票獎勵相關的普通股發行，在扣除取消和用於稅務代扣結算的股份後 | ( | ) | ( | ) | ||||||||||||||||||||
| 根據公開市場銷售協議（ATM）發行普通股，扣除發行成本 | ||||||||||||||||||||||||
| 與承銷發行相關的普通股發行，扣除發行成本 | ||||||||||||||||||||||||
| 根據預先資助的Warrants行使普通股發行，扣除已結算的股份 | ( | ) | ||||||||||||||||||||||
| 衍生負債的重新分類 | — | |||||||||||||||||||||||
| 淨虧損 | — | ( | ) | ( | ) | |||||||||||||||||||
| 其他綜合損失 | — | ( | ) | ( | ) | |||||||||||||||||||
| 截至2024年9月30日的餘額 | $ | $ | $ | ( | ) | $ | ( | ) | $ | |||||||||||||||
附帶的說明是這些未經審計的簡要合併財務報表的一個組成部分。
| 5 |
阿比奧納 治療公司及其子公司
合併 股東權益變化表，續
（$ 以千爲單位，除分享金額外）
（未經審計）
| 截至2023年9月30日的三個月 | ||||||||||||||||||||||||
| 累計 | ||||||||||||||||||||||||
| 其他 | 其他 | 總計 | ||||||||||||||||||||||
| 普通股 | 實收資本 | 累計 | 綜合 | Stockholders’ | ||||||||||||||||||||
| Shares | 金額 | 資本 | Deficit | 損失 | Equity | |||||||||||||||||||
| 截至2023年6月30日的餘額 | $ | $ | $ | ( | ) | $ | ( | ) | $ | | ||||||||||||||
| 基於股票的薪酬費用 | — | |||||||||||||||||||||||
| 與限制性股票獎勵相關的普通股發行，在扣除取消和用於稅務代扣結算的股份後 | ( | ) | ( | ) | ( | ) | ||||||||||||||||||
| 直接配售發行的普通股，扣除發行成本後的淨額 | ||||||||||||||||||||||||
| 淨虧損 | — | ( | ) | ( | ) | |||||||||||||||||||
| 其他綜合損失 | — | ( | ) | ( | ) | |||||||||||||||||||
| 截至2023年9月30日的餘額 | $ | $ | $ | ( | ) | $ | ( | ) | $ | |||||||||||||||
| Nine months ended September 30, 2023 | ||||||||||||||||||||||||
| Accumulated | ||||||||||||||||||||||||
| Additional | Other | Total | ||||||||||||||||||||||
| Common Stock | Paid-in | Accumulated | Comprehensive | Stockholders’ | ||||||||||||||||||||
| Shares | Amount | Capital | Deficit | Loss | Equity | |||||||||||||||||||
| Balance at December 31, 2022 | $ | $ | $ | ( | ) | $ | ( | ) | $ | | ||||||||||||||
| Stock-based compensation expense | — | |||||||||||||||||||||||
| Issuance of common stock in connection with restricted share awards, net of cancellations and shares settled for tax withholding settlement | ( | ) | ( | ) | ||||||||||||||||||||
| Issuance of common stock, net of offering costs under open market sale agreement (ATM) | ||||||||||||||||||||||||
| Issuance of common stock, net of offering costs under direct placement offering | ||||||||||||||||||||||||
| Net loss | — | ( | ) | ( | ) | |||||||||||||||||||
| Other comprehensive income | — | |||||||||||||||||||||||
| Balance at September 30, 2023 | $ | $ | $ | ( | ) | $ | ( | ) | $ | |||||||||||||||
The accompanying notes are an integral part of these unaudited condensed consolidated statements.
| 6 |
Abeona Therapeutics Inc. and Subsidiaries
合併 合併現金流量表
（$ 以千爲單位）
（未經審計）
| 截至九個月，至九月三十日 | ||||||||
| 2024 | 2023 | |||||||
| 來自經營活動的現金流： | ||||||||
| 淨虧損 | $ | ( | ) | $ | ( | ) | ||
| 調整淨虧損與用於經營活動的現金之間的差異： | ||||||||
| 折舊和攤銷 | ||||||||
| 基於股票的薪酬費用 | ||||||||
| 權證和衍生負債公允價值的變動 | ||||||||
| 使用權租賃資產的收益 | ( | ) | ||||||
| 短期投資的增值和利息 | ||||||||
| 使用權租賃資產的攤銷 | ||||||||
| 非現金利息 | ||||||||
| 處置固定資產的（收益）損失 | ( | ) | ||||||
| 經營資產和負債變動： | ||||||||
| 其他應收款 | ( | ) | ||||||
| 預付費用及其他流動資產 | ( | ) | ( | ) | ||||
| 其他資產 | ( | ) | ||||||
| 應付賬款和應計費用 | ( | ) | ||||||
| 租賃負債 | ( | ) | ( | ) | ||||
| 其他流動負債 | ( | ) | ||||||
| 用於經營活動的淨現金 | ( | ) | ( | ) | ||||
| 投資活動產生的現金流： | ||||||||
| 資本支出 | ( | ) | ( | ) | ||||
| 處置物業和設備所得 | ||||||||
| 短期投資的購買 | ( | ) | ( | ) | ||||
| 短期投資到期的收益 | ||||||||
| 投資活動使用的淨現金 | ( | ) | ( | ) | ||||
| 融資活動產生的現金流： | ||||||||
| 普通股ATM銷售收入，扣除發行費用後淨額 | ||||||||
| 通過直接配售發行的普通股銷售收入，扣除發行費用後淨額 | ||||||||
| 與限制性股票獎勵的淨結算相關的支付 | ( | ) | ( | ) | ||||
| 承銷的普通股銷售收入，扣除發行費用後淨額 | ||||||||
| 長期債務發行的收入 | ||||||||
| 支付債務發行成本 | ( | ) | ||||||
| 融資活動提供的淨現金 | ||||||||
| 現金、現金等價物及受限現金的淨增加（減少） | ( | ) | ||||||
| 期初的現金、現金等價物及受限現金 | ||||||||
| 期末的現金、現金等價物及受限現金 | $ | $ | ||||||
| 補充現金流信息: | ||||||||
| 現金及現金等價物 | $ | $ | ||||||
| 受限現金 | ||||||||
| 現金、現金等價物和限制性現金的總額 | $ | $ | ||||||
| 補充非現金流信息: | ||||||||
| 因新經營租賃負債獲得的使用權資產 | $ | $ | ||||||
| 與貸款和安防-半導體協議相關的衍生品和權證增加 | $ | $ | ||||||
| 衍生負債重新分類爲權益 | $ | $ | ||||||
| 應計物業和設備的變化 | $ | $ | ||||||
| 支付的利息 | $ | $ | ||||||
| 支付的稅款 | $ | $ | ||||||
附帶的說明是這些未經審計的簡要合併財務報表的一個組成部分。
| 7 |
ABEONA 生物醫藥公司及其子公司
註解 至未經審計的簡明合併財務報表
注意 1 – 經營性質和重要會計政策
背景
Abeona Therapeutics Inc.（與公司的子公司統稱爲「Abeona」或「公司」），是一家特拉華州公司， 是一家臨床階段的生物製藥公司，開發用於危及生命的疾病的電芯和基因療法。公司的主要 臨床項目是pz-cel，這是一種自體電芯基因療法，目前正在開發用於隱性營養性大皰性表皮剝脫症（「RDEB」）。公司的開發組合還包括腺病毒相關病毒（「AAV」）爲基礎的 基因療法，旨在利用公司獨家從北卡羅來納大學教堂山分校許可並通過其AAV載體研究程序內部開發的新型AIM™衣殼治療滿足需求高的眼科疾病。
呈現基礎
公司的未經審計的中期合併財務報表已按照美國公認會計原則（"U.S. GAAP"）編制。所有的公司間餘額和交易在合併時已被消除。在管理層看來，除非另有披露，爲了公允呈現財務狀況、經營成果和財務狀況的變化，對該期間所需的所有調整，均僅由正常的經常性調整組成，已被做出。這些未經審計的中期合併財務報表的結果不一定能代表整個財政年度或任何未來期間的預期結果。根據美國證券交易委員會（"SEC"）的規章和條例，一些根據U.S. GAAP通常需要的信息已被簡化或省略。2023年12月31日的合併資產負債表是從已審計的報表中提取的，但未包含U.S. GAAP要求的所有披露。
因此， 這些未經審計的中期簡要合併基本報表應與我們截至2023年12月31日的年度報告中包含的經審計合併基本報表及其附註一併閱讀，該報告已於2024年3月18日提交給美國證券交易委員會。
流動性
根據會計標準彙編（「ASC」）205-40，持續經營，本公司已評估是否存在條件和事件的綜合考慮，令本公司在發佈附帶未經審計的中期壓縮合並基本報表後的一年內持續經營的能力存在實質性疑慮。
作爲一家生物製藥組織，公司自成立以來幾乎將所有資源都用於pz-cel和其他產品候選者的研究與開發活動、業務規劃、籌集資本、建立知識產權組合、獲取或發現產品候選者，以及爲這些運營提供一般和行政支持。因此，公司自成立以來已產生了顯著的運營虧損和負現金流，並預計這種虧損和負現金流在可預見的未來仍將持續。
由於
公司成立之初，主要通過出售股票的收益爲其運營提供資金。該公司產生了
自成立以來的經常性虧損，包括淨虧損美元
| 8 |
儘管公司相信其資本資源足以支持公司在本未經審計的簡明合併基本報表刊發之日起的12個月內持續運營，但在此期間公司的流動性可能會受到以下因素的重大影響： (1) 通過股權發行、債務融資或其他非稀釋性第三方基金籌集額外資本的能力； (2) 與新或現有戰略聯盟、許可和合作安排相關的成本； (3) 與pz-cel相關的負面監管事件或意外成本； (4) 任何其他意想不到的重大負面事件或成本。這些事件或成本中的任何一個都可能對公司的流動性產生重大影響。如果公司未能在到期時履行義務，可能會不得不推遲支出，縮減研發項目的範圍，或對其運營計劃進行重大修改。隨附的未經審計的臨時簡明合併基本報表未包含可能由於此不確定性結果而產生的任何調整。
使用估計
按照美國通用會計準則編制未經審計的中期簡明合併基本報表，要求管理層做出估計和假設，這些估計和假設影響未經審計的中期簡明合併基本報表日期的資產報告金額以及或有資產和負債的披露，以及報告期內營業收入和費用的報告金額。實際結果可能與這些估計和假設有所不同。
其他 應收款項
其他
應收款包括員工留存信用（"ERC"）、分租租金應收款和其他雜項應收款。截至2024年9月30日和2023年12月31日，公司有ERC應收款$
重要會計政策摘要
截至2023年12月31日的會計年度，公司的10-K年報中討論的重大會計政策沒有發生新變化或重要變化，這些變動對公司沒有重大或潛在的重大意義。
信用 損失
公司根據主要安防-半導體類型及與公司投資政策一致的方式，集體審核其可供出售投資的信用損失。截至2024年9月30日，公司可供出售投資包括聯儲局及美國聯邦機構發行的、評級較高且有零信用損失歷史的存款證和證券。公司通過監測應收賬款的賬齡、不可收回帳戶的歷史註銷情況、主要客戶的信用質量以及當前經濟環境/宏觀經濟趨勢、可支持的預測和其他相關因素來審核其應收賬款的信用質量。公司的應收賬款來自沒有不可收回歷史或顯著賬齡歷史的客戶。截至2024年9月30日，公司未爲其投資或應收賬款確認信用損失準備金。
基本的 和稀釋後的每股淨虧損是通過將歸屬於普通股股東的淨虧損除以在此期間流通的普通股加權平均數量來計算的。普通股的加權平均數量包括尚未行權的購買普通股預先融資Warrants的加權平均影響，其剩餘未融資行權價爲$ 或每股更低。公司不包括稀釋性證券在稀釋後的每股淨虧損中的潛在影響，因爲這些項目的影響是反稀釋的。潛在稀釋性證券來自未行使的限制性股票、股票期權、貸款協議的轉化特徵以及股票購買Warrants。
| 9 |
以下表格列出了可能會在未來稀釋每股基本損失的證券，這些證券未被納入稀釋每股淨損失的計算中，因爲這樣做在所呈現的期間會產生反稀釋的效果：
| 截至9月30日的三個月和九個月 | ||||||||
| 2024 | 2023 | |||||||
| 可通過行使期權獲得的普通股 | ||||||||
| 受限股票所對應的普通股 | ||||||||
| 根據貸款協議的轉化條款可獲得的普通股 | ||||||||
| 可通過行使Warrants獲得的普通股 | ||||||||
| 總計 | ||||||||
在2024年1月作爲貸款和安防-半導體協議的一部分，請參見注釋8，公司發行了可購買$的Warrants
Recently Adopted Accounting Pronouncements
The Company did not adopt any new accounting pronouncements during the three and nine months ended September 30, 2024.
Recently Issued Accounting Pronouncements
In November 2024, the FASB issued Accounting Standards Update (“ASU”) No. 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses. The amendments in ASU 2024-03 address investor requests for more detailed expense information and require additional disaggregated disclosures in the notes to financial statements for certain categories of expenses that are included on the face of the income statement. This guidance is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating this guidance to determine the impact it may have on its consolidated financial statements.
In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. ASU 2023-09 is intended to enhance the transparency and decision usefulness of income tax information through improvements to income tax disclosures primarily related to the rate reconciliation and income taxes paid information. The standard is effective for annual reporting periods beginning after December 15, 2024, with early adoption permitted. The requirements of this ASU are disclosure related and will not have an impact on the Company’s financial condition, results of operations, or cash flows. The Company is currently evaluating the impact of adopting this ASU on its income tax disclosures.
In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which expands disclosures about a public entity’s reportable segments and requires more enhanced information about a reportable segment’s expenses, interim segment profit or loss, and how a public entity’s chief operating decision maker uses reported segment profit or loss information in assessing segment performance and allocating resources. The standard is effective for annual reporting periods beginning after December 15, 2023, and interim periods within years beginning after December 15, 2024, with early adoption permitted. The requirements of this ASU are disclosure related and will not have an impact on the Company’s financial condition, results of operations, or cash flows. The Company is currently evaluating the impact of adopting this ASU on its reportable segment disclosures.
| 10 |
NOTE 2 – SHORT-TERM INVESTMENTS
The following table provides a summary of the short-term investments (in thousands):
| September 30, 2024 | ||||||||||||||||
| Amortized Cost | Gross Unrealized | Gross Unrealized | Fair Value | |||||||||||||
| Available-for-sale, short-term investments: | ||||||||||||||||
| U.S. treasury securities | $ | $ | ||||||||||||||
| U.S. federal agency securities | ( | ) | ||||||||||||||
| Certificates of deposit | ||||||||||||||||
| Total available-for-sale, short-term investments | $ | ( | ) | $ | ||||||||||||
| December 31, 2023 | ||||||||||||||||
| Amortized Cost | Gross Unrealized | Gross Unrealized | Fair Value | |||||||||||||
| Available-for-sale, short-term investments: | ||||||||||||||||
| U.S. treasury securities | $ | ( | ) | $ | ||||||||||||
| U.S. federal agency securities | ( | ) | ||||||||||||||
| Total available-for-sale, short-term investments | $ | ( | ) | $ | ||||||||||||
As of September 30, 2024, the available-for-sale securities classified as short-term investments mature in one year or less. The Company carries its available-for-sale securities at fair value in the unaudited condensed consolidated balance sheets. Unrealized losses on available-for-sale securities as of September 30, 2024, were not significant and were primarily due to changes in interest rates, including market credit spreads, and not due to increased credit risks associated with specific securities. None of the short-term investments have been in a continuous unrealized loss position for more than 12 months. Accordingly, no other-than-temporary impairment was recorded for the three and nine months ended September 30, 2024.
There
were
NOTE 3 – PROPERTY AND EQUIPMENT, NET
Property and equipment are stated at cost and depreciated or amortized using the straight-line method based on useful lives as follows (in thousands):
| Useful lives (years) | September 30, 2024 | December 31, 2023 | ||||||||
| Laboratory equipment | $ | $ | ||||||||
| Furniture, software and office equipment | ||||||||||
| Leasehold improvements | ||||||||||
| Subtotal | ||||||||||
| Less: accumulated depreciation | ( |
) | ( |
) | ||||||
| Total property and equipment, net | $ | $ | ||||||||
| 11 |
Depreciation
and amortization are reflected in research and development and general and administrative expenses in the consolidated statements of
operations and comprehensive loss, as determined by the underlying activities. Depreciation and amortization on property and equipment
was $
NOTE 4 – FAIR VALUE MEASUREMENTS
The Company calculates the fair value of the Company’s assets and liabilities that qualify as financial instruments and includes additional information in the notes to the consolidated financial statements when the fair value is different than the carrying value of these financial instruments. The estimated fair value of other receivables, prepaid expenses and other current assets, other assets, accounts payable, accrued expenses, and payables to licensor approximate their carrying amounts due to the relatively short maturity of these instruments.
U.S. GAAP defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. This guidance establishes a three-level fair value hierarchy that prioritizes the inputs used to measure fair value. The hierarchy requires entities to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows:
| ● | Level 1 - Quoted prices in active markets for identical assets or liabilities. | |
| ● | Level 2 - Observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data. | |
| ● | Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets and liabilities. This includes certain pricing models, discounted cash flow methodologies and similar valuation techniques that use significant unobservable inputs. |
The Company has segregated all financial assets and liabilities that are measured at fair value on a recurring basis (at least annually) into the most appropriate level within the fair value hierarchy based on the inputs used to determine the fair value at the measurement date in the table below.
The following table provides a summary of financial assets measured at fair value on a recurring basis as of September 30, 2024 and December 31, 2023 (in thousands):
| Description | Fair Value at September 30, 2024 | Level 1 | Level 2 | Level 3 | ||||||||||||
| Recurring Assets | ||||||||||||||||
| Cash equivalents | ||||||||||||||||
| Money market funds | $ | $ | $ | $ | ||||||||||||
| Short-term investments | ||||||||||||||||
| U.S. treasury securities | ||||||||||||||||
| U.S. federal agency securities | ||||||||||||||||
| Certificates of deposit | ||||||||||||||||
| Total assets measured at fair value | $ | $ | $ | $ | ||||||||||||
| Liabilities | ||||||||||||||||
| Payable to licensor | $ | $ | $ | $ | ||||||||||||
| Warrant liabilities | ||||||||||||||||
| Total liabilities measured at fair value | $ | $ | ||||||||||||||
| 12 |
| Description | Fair Value at December 31, 2023 | Level 1 | Level 2 | Level 3 | ||||||||||||
| Recurring Assets | ||||||||||||||||
| Cash equivalents | ||||||||||||||||
| Money market fund | $ | $ | $ | $ | ||||||||||||
| Short-term investments | ||||||||||||||||
| U.S. treasury securities | ||||||||||||||||
| U.S. federal agency securities | ||||||||||||||||
| Total assets measured at fair value | $ | $ | $ | $ | ||||||||||||
| Liabilities | ||||||||||||||||
| Payable to licensor | $ | $ | $ | $ | ||||||||||||
| Warrant liabilities | ||||||||||||||||
| Total liabilities measured at fair value | $ | $ | $ | $ | ||||||||||||
Warrant Liabilities
As of September 30, 2024 and December 31, 2023, the Company had the following outstanding warrant liabilities:
| September 30, 2024 | December 31, 2023 | |||||||
| Warrants issued as part of the 2021 public offering, expiration date | ||||||||
| Warrants issued as part of the 2022 Private Placement Offering, expiration date | ||||||||
| Warrants issued as part of the 2024 Loan Agreement, expiration date | ||||||||
The common stock warrants related to the 2021 Public Offering and the 2022 Private Placement are not indexed to the Company’s own stock and therefore have been classified as liabilities at their estimated fair value. The common stock warrants issued in connection with the Loan Agreement issuance were determined to be liability classified under ASC 815 as the common stock warrants were not considered indexed to the Company’s stock. Changes in the estimated fair value of the warrant liabilities is recorded as changes in fair value of warrant liabilities in the consolidated statement of operations and comprehensive loss.
In
January 2024 as part of the Loan and Security Agreement, see Note 8, the Company issued warrants to purchase $
The following table provides a summary of the activity on the warrant liabilities (in thousands):
| Warrant liabilities as of December 31, 2023 | $ | |||
| Fair value of warrants issued in connection with the Loan Agreement | ||||
| Loss recognized in earnings from change in fair value | ||||
| Warrant liabilities as of September 30, 2024 | $ |
| 13 |
The warrant liabilities are valued using significant inputs not observable in the market. Accordingly, the warrant liability is measured at fair value on a recurring basis using unobservable inputs and are classified as Level 3 inputs within the fair value hierarchy. Fair value measurements categorized within Level 3 are sensitive to changes in the assumptions or methodology used to determine fair value and such changes could result in a significant increase or decrease in the fair value. The Company’s valuation of the common stock warrants utilized the Black-Scholes option-pricing model, which incorporated assumptions and estimates to value the common stock warrants. The Company assessed these assumptions and estimates at the end of each reporting period.
The following table outlines the key inputs for the Black-Scholes option-pricing model:
| September 30, 2024 | December 31, 2023 | |||||||
| Common share price | $ | $ | ||||||
| Expected term (years) | ||||||||
| Risk-free interest rate (%) | ||||||||
| Volatility (%) | ||||||||
| Expected dividend yield (%) | ||||||||
Derivative Liabilities
The Conversion Right embedded within the Loan Agreement (see Note 8 below) required bifurcation as certain adjustments to the conversion price were not indexed to the Company’s own stock and therefore the Conversion Right was recorded as a derivative liability. The derivative liability is remeasured at each reporting period with the change in fair value recorded to changes in fair value of warrants and derivative liabilities in the condensed consolidated statement of operations until the derivative is exercised, expired, reclassified, or otherwise settled.
On
September 30, 2024, pursuant to the Loan Agreement, the conversion price was fixed at $
The following table provides a summary of the activity on the derivative liabilities (in thousands):
| Derivative liabilities as of December 31, 2023 | $ | |||
| Fair value of derivatives issued in connection with Loan Agreement | ||||
| Loss recognized in earnings from change in fair value | ||||
| Reclassification of derivative liability in connection with the Loan Agreement | ( | ) | ||
| Derivative liabilities as of September 30, 2024 | $ |
The derivative liabilities are valued using significant inputs not observable in the market. Accordingly, the derivative liability is measured at fair value on a recurring basis using unobservable inputs and are classified as Level 3 inputs within the fair value hierarchy. Fair value measurements categorized within Level 3 are sensitive to changes in the assumptions or methodology used to determine fair value and such changes could result in a significant increase or decrease in the fair value. The Company’s valuation of the derivatives utilized the Monte Carlo simulation model, which incorporated assumptions and estimates to value the derivatives. The Company assessed these assumptions and estimates at the end of each reporting period.
| 14 |
The following table outlines the key inputs for the Monte Carlo simulation model:
| September 30, 2024 | December 31, 2023 | |||||||
| Common share price | $ | |||||||
| Expected term (years) | — | |||||||
| Risk-free interest rate (%) | ||||||||
| Volatility (%) | ||||||||
NOTE 5 – SETTLEMENT LIABILITY
On
November 12, 2021, the Company entered into a settlement agreement (“Settlement Agreement”) with the Company’s prior
licensor REGENXBIO Inc. (“REGENXBIO”) to resolve all existing disputes between the parties. In accordance with the Settlement
Agreement, the Company agreed to pay REGENXBIO a total of $
As
of September 30, 2024, the Company recorded the payable due to REGENXBIO in the condensed consolidated balance sheets based on the present
value of the remaining payments due to REGENXBIO under the Settlement Agreement using an effective interest rate of
NOTE 6 – ACCRUED EXPENSES
The following table provides a summary of the components of accrued expenses (in thousands):
| September 30, 2024 | December 31, 2023 | |||||||
| Accrued employee compensation | $ | $ | ||||||
| Accrued contracted services and other | ||||||||
| Total accrued expenses | $ | $ | ||||||
NOTE 7 – LEASES
The Company leases space under operating leases for administrative, manufacturing and laboratory facilities in Cleveland, Ohio. The Company also leases office space in New York, New York, that the Company sublets. The Company also leases certain office equipment under operating leases, which have a non-cancelable lease term of less than one year and the Company has elected the practical expedient to exclude these short-term leases from the Company’s right-of-use assets and lease liabilities.
The
Company has entered into two sublease agreements with unrelated third parties to occupy the Company’s administrative offices in
New York, New York. The Company expects to receive $
The following table provides a summary of the Company’s operating lease liabilities (in thousands):
| September 30, 2024 | December 31, 2023 | |||||||
| Current operating lease liability | $ | $ | ||||||
| Non-current operating lease liability | ||||||||
| Total operating lease liability | $ | $ | ||||||
Lease costs and rent are reflected in general and administrative expenses and research and development expenses in the consolidated statements of operations and comprehensive loss, as determined by the underlying activities. The following table provides a summary of the components of lease costs and rent (in thousands):
| For the three months ended September 30, | For the nine months ended September 30, | |||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||
| Operating lease cost | $ | $ | $ | $ | ||||||||||||
| Variable lease cost | ||||||||||||||||
| Short-term lease cost | ||||||||||||||||
| Total operating lease costs | $ | $ | $ | $ | ||||||||||||
Cash
paid for amounts included in the measurement of operating lease liabilities was $
| 15 |
Future minimum lease payments and obligations, which do not include short-term leases, related to the Company’s operating lease liabilities as of September 30, 2024 were as follows (in thousands):
| Future minimum lease payments and obligations | Operating Leases | |||
| 2024, remainder | $ | |||
| 2025 | ||||
| 2026 | ||||
| 2027 | ||||
| 2028 | ||||
| Thereafter | ||||
| Total undiscounted operating lease payments | ||||
| Less: imputed interest | ||||
| Present value of operating lease liabilities | $ | |||
The
weighted-average remaining term of the Company’s operating leases was
The
Company received sublease income, which is recorded in other income on the condensed consolidated statement of operations and comprehensive
loss, of $
| Operating | ||||
| Future cash receipts | Subleases | |||
| 2024, remainder | $ | |||
| 2025 | ||||
| Total future cash receipts | $ | |||
NOTE 8 – DEBT
The following table provides a summary of the Company’s debt, net of debt issuance costs and discounts (in thousands):
| September 30, 2024 | December 31, 2023 | |||||||
| Loan Agreement Principal | $ | $ | ||||||
| Accreted final payment fee | ||||||||
| Unamortized debt issuance costs and discounts | ( | ) | ||||||
| Total long-term debt | ||||||||
| Less: current maturities | ||||||||
| Long-term debt, net of current maturities | $ | $ | ||||||
Loan and Security Agreement
On
January 8, 2024 (the “Closing Date”), the Company entered into a Loan and Security Agreement (the
“Agreement”) with Avenue Venture Opportunities Fund, L.P., a Delaware limited partnership, as administrative agent and
collateral agent (“Avenue” and the “Agent”) and Avenue Venture Opportunities Fund II, L.P., a Delaware
limited partnership (“Avenue 2” and, together with Avenue, the “Lenders”). Also on January 8, 2024, the
Company entered into a Supplement to the Agreement (collectively with the Agreement, the “Loan Agreement”) with the
Agent and the Lenders. The Loan Agreement provides for senior secured term loans (the “Loans”) in an aggregate principal
amount up to $
| 16 |
The
Loan principal is repayable in equal monthly installments beginning on April 8, 2025, with the possibility of deferring principal payments
an additional nine to fifteen months contingent upon (i) the Company obtaining FDA approval of pz-cel in recessive dystrophic epidermolysis
bullosa, with the issuance of a Priority Review Voucher and (ii) the Company raising $
The
Company may, subject to certain parameters, voluntarily prepay the Loans, in whole, at any time. If prepayment occurs on or before the
one-year anniversary of the Closing Date,
The
Company’s obligations under the Loan Agreement are secured by a pledge of substantially all of the Company’s assets. Pursuant
to the Loan Agreement, the Company is subject to a financial covenant requiring the Company to maintain at all times $
Pursuant
to the Supplement to the Loan and Security Agreement, Avenue also has the right to convert up to $
In
addition, subject to applicable law and specified provisions set forth in the Supplement to the Loan and Security Agreement and solely
to the extent permitted under applicable stock exchange rules without requiring stockholder approval, the Lenders may participate in
certain equity financing transactions of the Company in an aggregate amount of up to $
On
the Closing Date and pursuant to the funding of Tranche 1 of the Loan Agreement, the Company issued to each of Avenue and Avenue 2 (collectively,
the “Warrantholders”) warrants to purchase up to $
| 17 |
The future payment obligations of the principal are as follows (in thousands):
| 2024, remainder | $ | |||
| 2025 | ||||
| 2026 | ||||
| 2027 | ||||
| Total principal | $ |
NOTE 9 – EQUITY
Public Offerings
On
December 21, 2021, the Company closed an underwritten public offering of shares of common stock at a public offering price
of $ per share and stock purchase warrants to purchase
As
of September 30, 2024, there were
Open Market Sale Agreement
On
August 17, 2018, the Company entered into an open market sale agreement (as amended, the “ATM Agreement”) with Jefferies
LLC (“Jefferies”) pursuant to which, the Company may sell from time to time, through Jefferies, shares of its common stock
for an aggregate sales price of up to $
The
Company sold and shares of its common stock under the ATM Agreement during the nine months ended September 30, 2024
and 2023, respectively, resulting in net proceeds of $
Private Placement Offerings
On
November 3, 2022, the Company sold shares of its common stock, and in lieu of shares of common stock, pre-funded warrants exercisable
for shares of common stock and accompanying warrants to purchase
| 18 |
In
the event of certain fundamental transactions involving the Company, the holders of the stock purchase warrants may require the Company
to make a payment based on a Black-Scholes valuation, using specific inputs that are not considered indexed to the Company’s stock
in accordance with ASC 815. Therefore, the Company is accounting for the stock purchase warrants as liabilities. On November 3, 2022,
the stock purchase warrants were recorded at the closing date fair value of $
As
of September 30, 2024, there were
Direct Placement Offering
On
July 6, 2023, the Company sold shares of its common stock, and in lieu of shares of common stock, pre-funded warrants exercisable
for shares of common stock (the “2023 Pre-Funded Warrants”), to a group of existing institutional investors for
an aggregate purchase price of $
Underwritten Offering
On
May 7, 2024, the Company sold shares of its common stock and, in lieu of common stock, pre-funded warrants to purchase
shares of its common stock (the “2024 Pre-Funded Warrants”), for an aggregate purchase price of $
| 19 |
Common Stock Warrants related to the Loan and Security Agreement
On
January 8, 2024, in connection with entering into the Loan and Security Agreement, the Company issued to each of Avenue and Avenue 2
(collectively, the “Warrantholders”) warrants to purchase up to $
The Warrantholders may exercise the January Warrants at any time, or from time to time up to and including the Expiration Date, by making a cash payment equal to the exercise price multiplied by the quantity of shares. The Warrantholders may also exercise the January Warrants on a cashless basis by receiving a net number of shares calculated pursuant to the formula set forth in the January Warrants. The January Warrants are subject to anti-dilution adjustments for stock dividends, stock splits, and reverse stock splits.
The Company previously granted stock options under its 2005 Equity Incentive Plan (the “2005 Incentive Plan”), under which no further grants can be made. In addition, prior to May 17, 2023, the Company had previously granted stock options and stock awards under the Abeona Therapeutics Inc. 2015 Equity Incentive Plan (the “2015 Incentive Plan”). As of May 17, 2023, no further grants can be made under the 2015 Incentive Plan. The Company now grants stock options and stock awards under the Amended and Restated Abeona Therapeutics Inc. 2023 Equity Incentive Plan (the “2023 Incentive Plan”) which was initially approved by stockholders on May 17, 2023 and amended and restated to increase the number of shares of Common Stock reserved for issuance thereunder, which amendment and restatement was approved by stockholders on April 24, 2024. As of September 30, 2024, there were shares available to be granted under the 2023 Incentive Plan. In addition, in 2023, the Company’s board of directors approved various restricted stock awards granted to certain new hires as inducement grants. On October 10, 2023, the Company’s board of directors approved the Abeona Therapeutics Inc. 2023 Employment Inducement Equity Incentive Plan (the “Inducement Plan”). As of September 30, 2024, there were shares available to be granted under the Inducement Plan.
| For the three months ended September 30, 2024 | For the nine months ended September 30, | |||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||
| Research and development | $ | $ | $ | $ | ||||||||||||
| General and administrative | ||||||||||||||||
| Total stock-based compensation expense | $ | $ | $ | $ | ||||||||||||
| 20 |
Stock Options
The Company estimates the fair value of each option award on the date of grant using the Black-Scholes option-pricing model. The Company then recognize the grant date fair value of each option as compensation expense ratably using the straight-line attribution method over the service period (generally the vesting period). The Black-Scholes model incorporates the following assumptions:
| ● | Expected volatility – the Company estimates the volatility of the share price at the date of grant using a “look-back” period which coincides with the expected term, defined below. The Company believes using a “look-back” period which coincides with the expected term is the most appropriate measure for determining expected volatility. | |
| ● | Expected term – the Company estimates the expected term using the “simplified” method, as outlined in SEC Staff Accounting Bulletin No. 107, “Share-Based Payment.” | |
| ● | Risk-free interest rate – the Company estimates the risk-free interest rate using the U.S. Treasury yield curve for periods equal to the expected term of the options in effect at the time of grant. | |
| ● | Dividends – the Company uses an expected dividend yield of zero because the Company has not declared nor paid a cash dividend, nor are there any plans to declare a dividend. |
The Company did not grant any stock options in the nine months ended September 30, 2024 and 2023.
The Company accounts for forfeitures as they occur, which may result in the reversal of compensation costs in subsequent periods as the forfeitures arise.
| Number of Options | Weighted Average Exercise Price | Weighted Average Remaining Contractual Term (years) | Aggregate Intrinsic Value (in thousands) | |||||||||||||
| Outstanding at December 31, 2023 | $ | $ | ||||||||||||||
| Granted | $ | — | $ | — | ||||||||||||
| Cancelled/forfeited | ( | ) | $ | — | $ | — | ||||||||||
| Exercised | $ | — | $ | — | ||||||||||||
| Outstanding at September 30, 2024 | $ | $ | ||||||||||||||
| Exercisable | $ | $ | ||||||||||||||
| Unvested | $ | $ | ||||||||||||||
The aggregate intrinsic value of options is calculated as the difference between the exercise price of the underlying options and the fair value of the Company’s common stock for those options that had exercise prices lower than the fair value of the Company’s common stock. As of September 30, 2024, the total compensation cost related to non-vested option awards not yet recognized was approximately $ million with a weighted average remaining vesting period of years.
Restricted Stock
| Number of Awards | Weighted Average Grant Date Fair Value Per Unit | |||||||
| Outstanding at December 31, 2023 | $ | |||||||
| Granted | $ | |||||||
| Cancelled/forfeited | ( | ) | $ | |||||
| Vested | ( | ) | $ | |||||
| Outstanding at September 30, 2024 | $ | |||||||
As of September 30, 2024, there was $ million of total unrecognized compensation expense related to unvested restricted stock awards, which is expected to be recognized over a weighted average vesting period of years. The total fair value of restricted stock awards that vested during the nine months ended September 30, 2024 was $ million.
| 21 |
NOTE 11 – LICENSE/SUPPLIER AGREEMENT
Sublicense and Inventory Purchase Agreements Relating to CLN1 Disease
In August 2020, the Company entered into sublicense and inventory purchase agreements with Taysha Gene Therapies (“Taysha”) relating to a potential gene therapy for CLN1 disease. Under the sublicense agreement, Taysha received worldwide exclusive rights to intellectual property and know-how relating to the research, development, and manufacture of the potential gene therapy, which the Company had referred to as ABO-202. Under the inventory purchase agreement, the Company sold to Taysha certain inventory and other items related to ABO-202. The Company assessed the nature of the promised license to determine whether the license has significant stand-alone functionality and evaluated whether such functionality can be retained without ongoing activities by the Company and determined that the license has significant stand-alone functionality. Furthermore, the Company has no ongoing activities associated with the license to support or maintain the license’s utility. Based on this, the Company determined that the pattern of transfer of control of the license to Taysha was at a point in time.
The
transaction price of the contract includes (i) $
Under
this arrangement, the Company recognized
Sublicense Agreement Relating to Rett Syndrome
In October 2020, the Company entered into a sublicense agreement with Taysha for a gene therapy for Rett syndrome, including intellectual property related to MECP2 gene constructs and regulation of their expression. The agreement grants Taysha worldwide exclusive rights to intellectual property developed by scientists at the University of North Carolina at Chapel Hill, the University of Edinburgh and the Company, and the Company’s know-how relating to the research, development, and manufacture of the gene therapy for Rett syndrome and MECP2 gene constructs and regulation of their expression.
The Company assessed the nature of the promised license to determine whether the license has significant stand-alone functionality and evaluated whether such functionality can be retained without ongoing activities by the Company and determined that the license has significant stand-alone functionality. Furthermore, the Company has no ongoing activities associated with the license to support or maintain the license’s utility. Based on this, the Company determined that the pattern of transfer of control of the license to Taysha was at a point in time.
The
transaction price of the contract includes (i) $
| 22 |
Under
this arrangement, the Company recognized and $
Ultragenyx License Agreement
On
May 16, 2022, the Company and Ultragenyx Pharmaceutical Inc. (“Ultragenyx”) entered into an exclusive license agreement (the
“License Agreement”) for AAV gene therapy, ABO-102, for the treatment of Sanfilippo syndrome type A (“MPS IIIA”).
Under the License Agreement, Ultragenyx assumed responsibility for the ABO-102 program from the Company, with the exclusive right to
develop, manufacture, and commercialize ABO-102 worldwide. Also pursuant to the License Agreement, following regulatory approval, the
Company is eligible to receive tiered royalties from mid-single-digit up to 10% on net sales and up to $
Additionally, pursuant to the License Agreement, Ultragenyx will reimburse the Company for certain development and transition costs actually incurred by the Company. These costs are passed through to Ultragenyx without mark-up. The Company has determined that these costs are not incurred for the purpose of satisfying any performance obligation under the License Agreement. Accordingly, the reimbursement of these costs is recognized as a reduction of research and development costs. As of September 30, 2024 and December 31, 2023, the Company does not have any contract assets or contract liabilities as a result of this transaction.
NOTE 12 – SUBSEQUENT EVENTS
Biologic License Application
On October 28, 2024, the Company resubmitted its Biologics License Application (“BLA”) to the U.S. Food and Drug Administration (“FDA”) for pz-cel, the Company’s investigational autologous cell-based gene therapy, as a potential new treatment for patients with RDEB. The FDA notified the Company on November 8, 2024 that the BLA was accepted for review, with an assigned Prescription Drug User Fee Act (“PDUFA”) target action date of April 29, 2025.
The BLA resubmission follows the Company’s Type A meeting in August 2024, where the Company aligned with the FDA on the content of the resubmission, including additional information to satisfy all Chemistry Manufacturing and Controls (“CMC”) requirements outlined in the Complete Response Letter (CRL) received in April 2024. In the CRL, the FDA required that certain additional information needed to satisfy CMC requirements be provided before the application could be approved. The CRL did not identify any deficiencies related to the clinical efficacy or clinical safety data in the BLA, and the FDA did not request any new clinical trials or clinical data to support the approval of pz-cel. The BLA resubmission is supported by clinical efficacy and safety data from the pivotal Phase 3 VIITAL™ study (NCT04227106) and a Phase 1/2a study (NCT01263379).
Lease Agreement
On October 18, 2024, the Company signed a lease for
| 23 |
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
You should read the following discussion and analysis together with our unaudited condensed consolidated financial statements and accompanying notes included elsewhere in this Quarterly Report on Form 10-Q and our audited consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2023 (the “Annual Report”). This discussion and analysis contains forward-looking statements, which involve risks and uncertainties. As a result of many factors, such as those described under “Forward-Looking Statements,” “Risk Factors” and elsewhere in this Quarterly Report on Form 10-Q and in our Annual Report, our actual results may differ materially from those anticipated in these forward-looking statements.
OVERVIEW
Abeona is a clinical-stage biopharmaceutical company developing cell and gene therapies for life-threatening diseases. Our lead clinical program is pz-cel, investigational autologous, COL7A1 gene-corrected epidermal sheets, currently in development for recessive dystrophic epidermolysis bullosa (“RDEB”). In 2022, we announced positive data from the VIITAL™ study evaluating the efficacy, safety and tolerability of pz-cel. The VIITAL™ study met both its two co-primary efficacy endpoints demonstrating statistically significant, clinically meaningful improvements in wound healing and pain reduction in large chronic RDEB wounds. On September 25, 2023, we submitted a Biologics License Application (“BLA”) for pz-cel to the U.S. Food and Drug Administration (“FDA”).
In November 2023, the FDA accepted and granted priority review for our BLA for pz-cel, and subsequently, under the Prescription Drug User Fee Act (“PDUFA”), the FDA set a target action date of May 25, 2024. In April 2024, the FDA issued a Complete Response Letter (“CRL”) in response to the BLA. The CRL noted that certain additional information needed to satisfy the Chemistry Manufacturing and Controls (“CMC”) requirements of the pz-cel BLA must be satisfactorily resolved before the application can be approved. The CRL did not identify any deficiencies related to the clinical efficacy or clinical safety data in the BLA, and the FDA did not request any new clinical trials or clinical data to support the approval of pz-cel. On August 8, 2024, we completed a Type A Meeting with the FDA to discuss our forthcoming resubmission of our BLA and on October 28, 2024, we resubmitted our BLA. The FDA notified the Company on November 8, 2024 that the BLA was accepted for review, with an assigned Prescription Drug User Fee Act (“PDUFA”) target action date of April 29, 2025.
We have continued to prepare our current Good Manufacturing Practices (“cGMP”) commercial facility in Cleveland, Ohio for manufacturing pz-cel drug product to support our planned commercial launch of pz-cel, if approved. Pz-cel study drug product for all our VIITAL™ study participants has been manufactured at our Cleveland facility. As part of our commercial planning, we continue to engage with stakeholders across the healthcare system, including public and private payors, and healthcare providers to better understand market access and potential pricing for pz-cel. We have also begun discussions with high volume treatment centers of excellence to onboard them for pz-cel application upon potential FDA approval.
Our development portfolio also features adeno-associated virus (“AAV”) based gene therapies designed to treat ophthalmic diseases using the novel AIM™ capsids that we have exclusively licensed from the University of North Carolina at Chapel Hill and developed internally through our AAV vector research programs.
Preclinical Pipeline
Our preclinical programs are investigating the use of novel AAV capsids in AAV-based therapies for serious genetic eye diseases, including ABO-504 for Stargardt disease, ABO-503 for X-linked retinoschisis (“XLRS”) and ABO-505 for autosomal dominant optic atrophy (“ADOA”). We completed pre-Investigational New Drug Application (“pre-IND”) meetings with the FDA regarding the preclinical development plans and regulatory requirements to support first-in-human trials.
| 24 |
Other Recent Developments
On October 18, 2024, we signed a lease for 16,566 square feet of office space at 6700 Euclid Avenue, Cleveland, Ohio. The lease commences on January 1, 2025 and the lease term matches the term for our existing 6555 Carnegie Avenue facility. The additional space at the 6700 Euclid Avenue facility will allow us to convert office space at the 6555 Carnegie Avenue facility into additional manufacturing space to increase pz-cel manufacturing capacity.
RESULTS OF OPERATIONS
Comparison of Three Months Ended September 30, 2024 and September 30, 2023
| For the three months ended September 30, | Change | |||||||||||||||
| ($ in thousands) | 2024 | 2023 | $ | % | ||||||||||||
| Expenses: | ||||||||||||||||
| Royalties | $ | — | $ | 30 | $ | (30 | ) | (100 | )% | |||||||
| Research and development | 8,941 | 7,148 | 1,793 | 25 | % | |||||||||||
| General and administrative | 6,404 | 4,156 | 2,248 | 54 | % | |||||||||||
| Total expenses | 15,345 | 11,334 | 4,011 | 35 | % | |||||||||||
| Loss from operations | (15,345 | ) | (11,334 | ) | (4,011 | ) | 35 | % | ||||||||
| Interest income | 1,189 | 593 | 596 | 101 | % | |||||||||||
| Interest expense | (1,102 | ) | (105 | ) | (997 | ) | 950 | % | ||||||||
| Change in fair value of warrant and derivative liabilities | (15,156 | ) | (1,101 | ) | (14,055 | ) | 1,277 | % | ||||||||
| Other income | 145 | 111 | 34 | 31 | % | |||||||||||
| Net loss | $ | (30,269 | ) | $ | (11,836 | ) | $ | (18,433 | ) | 156 | % | |||||
Royalties
Total royalty expenses for the three months ended September 30, 2024 was nil as compared to $30,000 for the same period of 2023. The decrease in expense was due to royalties owed to our licensors.
Research and development
Research and development expenses include, but are not limited to, payroll and personnel expense, lab supplies, preclinical and development costs, clinical trial costs, manufacturing and manufacturing facility costs, costs associated with regulatory approvals, depreciation on lab supplies and manufacturing facilities, and consultant-related expenses.
Total research and development spending for the three months ended September 30, 2024 was $8.9 million, as compared to $7.1 million for the same period of 2023, an increase of $1.8 million. The increase in expenses was primarily due to:
| ● | increased salary and related costs of $0.7 million; | |
| ● | increased clinical and development work for our cell and gene therapy product candidates of $0.7 million which was due to the work on our BLA resubmission; and | |
| ● | increased other costs of $0.4 million. |
We expect our research and development activities to continue as we work towards advancing our product candidates towards potential regulatory approval, reflecting costs associated with the following:
| ● | employee and consultant-related expenses; | |
| ● | preclinical and developmental costs; | |
| ● | clinical trial costs; | |
| ● | the cost of acquiring and manufacturing clinical trial materials; and | |
| ● | costs associated with regulatory approvals. |
| 25 |
General and administrative
General and administrative expenses primarily consist of payroll and personnel costs, office facility costs, public reporting company related costs, professional fees (e.g., legal expenses), pre-commercial launch activity costs and other general operating expenses not otherwise included in research and development expenses.
Total general and administrative expenses were $6.4 million for the three months ended September 30, 2024, as compared to $4.2 million for the same period of 2023, an increase of $2.2 million. The increase in expenses was primarily due to:
| ● | increased salary and related costs of $0.9 million; | |
| ● | increased pre-commercial preparation costs of $0.6 million; | |
| ● | increased non-cash stock-based compensation of $0.1 million; and | |
| ● | increased other costs such as professional fees and recruiting of $0.6 million. |
Interest income
Interest income was $1.2 million for the three months ended September 30, 2024, as compared to $0.6 million in the same period of 2023. The increase resulted from higher earnings on short-term investments driven by higher interest rates and increased average short-term investment balances.
Interest expense
Interest expense was $1.1 million for the three months ended September 30, 2024, as compared to $0.1 million in the same period of 2023. The increase was primarily due to the credit facility entered into by the Company in January 2024, resulting in recognized interest expense of $1.0 million.
Change in fair value of warrant and derivative liabilities
The change in fair value of warrant and derivative liabilities was a loss of $15.2 million for the three months ended September 30, 2024, as compared to a loss of $1.1 million for the same period in 2023.
We issued stock purchase warrants that are required to be classified as a liability and valued at fair market value at each reporting period. In addition, the conversion feature in our loan agreement is required to be classified as a liability and valued at fair market value at each reporting period. The change in the fair value of warrant and derivative liabilities was primarily due to the increase in our stock price year over the year offset by a reduced term of each of the warrants and derivative liabilities.
Other income
Other income was $0.1 million for the three months ended September 30, 2024, as compared to $0.1 million in the same period of 2023. There was no change in period over period.
| 26 |
Comparison of Nine Months Ended September 30, 2024 and September 30, 2023
| For the nine months ended September 30, | Change | |||||||||||||||
| ($ in thousands) | 2024 | 2023 | $ | % | ||||||||||||
| Revenues: | ||||||||||||||||
| License and other revenues | $ | — | $ | 3,500 | $ | (3,500 | ) | (100 | )% | |||||||
| Expenses: | ||||||||||||||||
| Royalties | — | 1,605 | (1,605 | ) | (100 | )% | ||||||||||
| Research and development | 25,366 | 23,712 | 1,654 | 7 | % | |||||||||||
| General and administrative | 22,173 | 13,174 | 8,999 | 68 | % | |||||||||||
| Gain on right-of-use lease assets | — | (1,065 | ) | 1,065 | (100 | )% | ||||||||||
| Total expenses | 47,539 | 37,426 | 10,113 | 27 | % | |||||||||||
| Loss from operations | (47,539 | ) | (33,926 | ) | (13,613 | ) | 40 | % | ||||||||
| Interest income | 3,223 | 1,374 | 1,849 | 135 | % | |||||||||||
| Interest expense | (3,126 | ) | (309 | ) | (2,817 | ) | 912 | % | ||||||||
| Change in fair value of warrant and derivative liabilities | (7,530 | ) | (7,465 | ) | (65 | ) | 1 | % | ||||||||
| Other income | 531 | 2,729 | (2,198 | ) | (81 | )% | ||||||||||
| Net loss | $ | (54,441 | ) | $ | (37,597 | ) | $ | (16,844 | ) | 45 | % | |||||
License and other revenues
License and other revenues for the nine months ended September 30, 2024 was nil as compared to $3.5 million for the same period of 2023. The revenue in 2023 consists of revenue resulting from achieving clinical milestones under a sublicense agreement we entered into with Taysha in October 2020 relating to an investigational AAV-based gene therapy for Rett syndrome.
Royalties
Total royalty expenses for the nine months ended September 30, 2024 was nil as compared to $1.6 million for the same period of 2023. The royalty expense in 2023 was due to royalties owed to our licensors resulting from the milestones due from Taysha related to Rett.
Research and development
Total research and development spending for the nine months ended September 30, 2024 was $25.4 million, as compared to $23.7 million for the same period of 2023, an increase of $1.7 million. The increase in expenses was primarily due to:
| ● | increased salary and related costs of $3.6 million, partially offset by: | |
| ● | decreased costs of clinical, development and regulatory work for our pz-cel product candidate and its associated BLA submission and resubmission and other related costs of $1.9 million. |
General and administrative
Total general and administrative expenses were $22.2 million for the nine months ended September 30, 2024, as compared to $13.2 million for the same period of 2023, an increase of $9.0 million. The increase in expenses was primarily due to:
| ● | increased salary and related costs of $2.9 million; | |
| ● | increased pre-commercial preparation costs of $3.1 million; | |
| ● | increased non-cash stock-based compensation of $1.1 million; and | |
| ● | increased other costs such as professional fees, legal and recruiting of $1.9 million. |
| 27 |
Gain of right-of-use lease assets
The gain on right-of-use lease assets was $1.1 million for the nine months ended September 30, 2023. The gain on right-of-use assets for 2023 was related to the termination of our operating leases for office space that we no longer use, resulting in a gain from the difference of the right-of-use lease assets and the lease liabilities. There was no such gain during the nine months ended September 30, 2024.
Interest income
Interest income was $3.2 million for the nine months ended September 30, 2024, as compared to $1.4 million in the same period of 2023. The increase resulted from higher earnings on short-term investments driven by higher interest rates and increased average short-term investment balances.
Interest expense
Interest expense was $3.1 million for the nine months ended September 30, 2024, as compared to $0.3 million in the same period of 2023. The increase was primarily due to the credit facility entered into by the Company in January 2024, resulting in recognized interest expense of $2.7 million.
Change in fair value of warrant and derivative liabilities
The change in fair value of warrant and derivative liabilities was a loss of $7.5 million for the nine months ended September 30, 2024 and 2023.
We issued stock purchase warrants that are required to be classified as a liability and valued at fair market value at each reporting period. In addition, the conversion feature in our loan agreement is required to be classified as a liability and valued at fair market value at each reporting period. The change in the fair value of warrant and derivative liabilities was primarily due to the increase in our stock price year over the year offset by a reduced term of each of the warrants and derivative liabilities.
Other income
Other income was $0.5 million for the nine months ended September 30, 2024, as compared to $2.7 million in the same period of 2023. The change was primarily a result of $2.1 million in other income related to the impact of the employee retention tax credit that was recorded in 2023.
LIQUIDITY AND CAPITAL RESOURCES
Cash Flows for the Nine Months Ended September 30, 2024 and 2023
| For the nine months ended September 30, | ||||||||
| ($ in thousands) | 2024 | 2023 | ||||||
| Total cash, cash equivalents and restricted cash (used in) provided by: | ||||||||
| Operating activities | $ | (39,456 | ) | $ | (27,774 | ) | ||
| Investing activities | (58,116 | ) | (11,321 | ) | ||||
| Financing activities | 98,825 | 29,590 | ||||||
| Net increase (decrease) in cash, cash equivalents and restricted cash | $ | 1,253 | $ | (9,505 | ) | |||
Operating activities
Net cash used in operating activities was $39.5 million for the nine months ended September 30, 2024, primarily comprised of our net loss of $54.4 million and decreases in operating assets and liabilities of $0.5 million and net non-cash charges of $15.5 million. Non-cash charges consisted primarily of $7.5 million of the change in fair value of warrant and derivative liabilities, $4.7 million of stock-based compensation, $1.1 million of non-cash interest expense and $1.5 million of depreciation and amortization.
Net cash used in operating activities was $27.8 million for the nine months ended September 30, 2023, primarily comprised of our net loss of $37.6 million, decreases in operating assets and liabilities of $2.8 million and net non-cash charges of $12.6 million.
| 28 |
Investing activities
Net cash used in investing activities was $58.1 million for the nine months ended September 30, 2024, primarily comprised of proceeds from maturities of short-term investments of $90.2 million, offset by purchases of short-term investments of $146.5 million and capital expenditures of $1.8 million.
Net cash used in investing activities was $11.3 million for the nine months ended September 30, 2023, primarily comprised of proceeds from maturities of short-term investments of $37.0 million and proceeds from disposal of property and equipment of $0.2 million, offset by purchases of short-term investments of $48.2 million and capital expenditures of $0.3 million.
Financing activities
Net cash provided by financing activities was $98.8 million for the nine months ended September 30, 2024, primarily comprised of $70.2 million in net proceeds from sales of common stock, $10.0 million from open market sales of common stock pursuant to the ATM Agreement (as defined below) and net proceeds of $19.0 million from our January 2024 Loan Agreement.
Net cash provided by financing activities was $29.6 million for the nine months ended September 30, 2023, primarily comprised of proceeds of $23.0 million from our direct placement offering and $6.6 million from open market sales of common stock pursuant to the ATM Agreement (as defined below).
We have historically funded our operations primarily through sales of common stock.
Our principal source of liquidity is cash, cash equivalents, restricted cash and short-term investments, collectively referred to as our cash resources. As of September 30, 2024, our cash resources were $110.0 million. We believe that our current cash and cash equivalents, restricted cash and short-term investments are sufficient to fund operations through at least the next 12 months from the date of this report on Form 10-Q. We may need to secure additional funding to carry out all of our planned research and development and potential commercialization activities. If we are unable to obtain additional financing or generate license or product revenue, the lack of liquidity and sufficient capital resources could have a material adverse effect on our future prospects.
We have an open market sale agreement with Jefferies LLC (as amended, the “ATM Agreement”) pursuant to which, we may sell from time to time, through Jefferies LLC, shares of our common stock for an aggregate sales price of up to $75.0 million. Any sales of shares pursuant to this agreement are made under our effective “shelf” registration statement on Form S-3 that is on file with and has been declared effective by the SEC. We sold 1,902,376 shares of our common stock under the ATM Agreement and received $10.0 million of net proceeds during the nine months ended September 30, 2024.
Since our inception, we have incurred negative cash flows from operations and have expended, and expect to continue to expend, substantial funds to complete our planned product development and potential commercialization efforts. We have not been profitable since inception and to date have received limited revenues from the sale of products or licenses. We expect to incur losses for the next several years as we continue to invest in commercialization, product research and development, preclinical studies, clinical trials, and regulatory compliance and cannot provide assurance that we will ever be able to generate sufficient product sales or royalty revenue to achieve profitability on a sustained basis, or at all.
If we raise additional funds by selling additional equity securities, the relative equity ownership of our existing investors will be diluted, and the new investors could obtain terms more favorable than previous investors. If we raise additional funds through collaborations, strategic alliances, or licensing arrangements with third parties, we may have to relinquish valuable rights to our technologies, future revenue streams, research programs, or product candidates or grant licenses on terms that may not be favorable to us. If we are unable to raise additional funds through equity or debt financing when needed, we may be required to delay, limit, or terminate our product development programs or any future commercialization efforts or grant rights to develop and market product candidates to third parties that we would otherwise prefer to develop and market ourselves.
| 29 |
Our future capital requirements and adequacy of available funds depend on many factors, including:
| ● | the successful development, regulatory approval and commercialization of our cell and gene therapy and other product candidates; | |
| ● | the ability to establish and maintain collaborative arrangements with corporate partners for the research, development, and commercialization of products; | |
| ● | continued scientific progress in our research and development programs; | |
| ● | the magnitude, scope and results of preclinical testing and clinical trials; | |
| ● | the costs involved in filing, prosecuting, and enforcing patent claims; | |
| ● | the costs involved in conducting clinical trials; | |
| ● | competing technological developments; | |
| ● | the cost of manufacturing and scale-up; | |
| ● | the ability to establish and maintain effective commercialization arrangements and activities; and | |
| ● | the successful outcome of our regulatory filings. |
Due to uncertainties and certain of the risks described above, our ability to successfully commercialize our product candidates, our ability to obtain applicable regulatory approval to market our product candidates, our ability to obtain necessary additional capital to fund operations in the future, our ability to successfully manufacture our products and our product candidates in clinical quantities or for commercial purposes, government regulation to which we are subject, the uncertainty associated with preclinical and clinical testing, intense competition that we face, the potential necessity of licensing technology from third parties and protection of our intellectual property, it is not possible to reliably predict future spending or time to completion by project or product category or the period in which material net cash inflows from significant projects are expected to commence. If we are unable to timely complete a particular project, our research and development efforts could be delayed or reduced, our business could suffer depending on the significance of the project and we might need to raise additional capital to fund operations, as discussed in the risks above.
We plan to continue our policy of investing any available funds in suitable certificates of deposit, money market funds, government securities and investment-grade, interest-bearing securities. We do not invest in derivative financial instruments.
Critical Accounting Estimates
The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts and related disclosures in the financial statements. Management considers an accounting estimate to be critical if:
| ● | it requires assumptions to be made that were uncertain at the time the estimate was made, and | |
| ● | changes in the estimate or different estimates that could have been selected could have a material impact in our results of operations or financial condition. |
While we base our estimates and judgments on our experience and on various other factors that we believe to be reasonable under the circumstances, actual results could differ from those estimates and the differences could be material. For a discussion of the critical accounting estimates that affect the unaudited condensed consolidated financial statements, see “Critical Accounting Estimates” included in Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report as well as the discussion below related to our derivative liability.
See Note 1 to our unaudited condensed consolidated financial statements for a discussion of our significant accounting policies.
Derivative Liability
We account for the fair value of the conversion right embedded within the loan agreement in accordance with the guidance in ASC 815, which requires us to bifurcate and separately account for the conversion feature as an embedded derivative contained in our loan agreement. Accordingly, we account for the conversion feature as a derivative liability in our condensed consolidated balance sheet. Derivatives are measured at their fair value on the balance sheet. In determining the appropriate fair value, we use a Monte Carlo simulation model, which incorporated assumptions and estimates to value the derivatives. The derivative liability is remeasured at each reporting period with the change in fair value recorded to change in fair value of warrant and derivative liabilities in the condensed consolidated statement of operations until the derivative is exercised, expired, reclassified, or otherwise settled.
| 30 |
Recently Issued Accounting Standards Not Yet Effective or Adopted
See Note 1 to our unaudited condensed consolidated financial statements for a discussion of recently issued accounting standards not yet effective or adopted.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Not applicable.
ITEM 4. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
Under the supervision and with the participation of our management and consultants, including the Chief Executive Officer (our principal executive officer) and Chief Financial Officer (our principal financial officer), we have conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures (“Disclosure Controls and Procedures”), as of September 30, 2024, as such term is defined in Rules 13a-15I and 15d-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).
Conclusion of Evaluation — Based on this Disclosure Controls and Procedures evaluation, the Chief Executive Officer and Chief Financial Officer concluded that our Disclosure Controls and Procedures as of September 30, 2024 were effective.
Changes in Internal Control Over Financial Reporting – There were no changes in our internal control over financial reporting that occurred during the quarter ended September 30, 2024 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
| 31 |
PART II — OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None.
ITEM 1A. RISK FACTORS
Our business and financial results are subject to numerous risks and uncertainties. As a result, the risks and uncertainties discussed in Part I, Item 1A. Risk Factors in our Annual Report on Form 10-K for the year ended December 31, 2023 should be carefully considered.
The Complete Response Letter related to our Biologics License Application for pz-cel for the treatment of patients with recessive dystrophic epidermolysis bullosa may impair our ability to successfully commercialize pz-cel.
On April 16, 2024, we received a Complete Response Letter (a “CRL”) related to our Biologics License Application (“BLA”) for pz-cel for the treatment of patients with recessive dystrophic epidermolysis bullosa (“RDEB”). In the CRL, the FDA noted that certain additional information needed to satisfy Chemistry Manufacturing and Controls (“CMC”) requirements must be satisfactorily resolved before the application can be approved. On August 8, 2024, we completed a Type A Meeting with the FDA to discuss our forthcoming resubmission of our BLA and on October 28, 2024, we resubmitted our BLA. The FDA notified the Company on November 8, 2024 that the BLA was accepted for review, with an assigned Prescription Drug User Fee Act (“PDUFA”) target action date of April 29, 2025. A delay in receiving approval of the BLA could shorten any periods during which we may have the exclusive right to commercialize our pz-cel or allow our competitors to bring products to market before we do. This may impair our ability to successfully commercialize pz-cel. If any of the foregoing were to occur, our business, financial condition, results of operations, and prospects will be materially harmed.
Other than as set forth above, there have been no material changes in the assessment of our risk factors from those set forth in our Annual Report on Form 10-K for the year ended December 31, 2023.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
(c) The following table provides information about purchases of equity securities that are registered pursuant to Section 12 of the Exchange Act for the quarter ended September 30, 2024:
| Total number of shares (or units) purchased (a) | Average price paid per share (or unit) | |||||||
| Shares delivered or withheld pursuant to restricted stock awards | ||||||||
| July 1, 2024 - July 31, 2024 | 1,055 | $ | $5.11 | |||||
| August 1, 2024 - August 31, 2024 | — | $ | — | |||||
| September 1, 2024 - September 30, 2024 | 32,261 | $ | $5.89 | |||||
| 33,316 | $ | $5.87 | ||||||
| (a) | Reflects shares of common stock surrendered to the Company for payment of tax withholding obligations in connection with the vesting of restricted stock. |
ITEM 5. OTHER INFORMATION
Securities Trading Arrangements of Directors and Executive Officers
During the fiscal quarter ended September 30, 2024, the following officers, as defined in Rule 16a-1(f) under the Exchange Act, as amended, adopted a “Rule 10b5-1 trading arrangement” as defined in Regulation S-K Item 408, as follows:
On
| 32 |
| ● | The arrangement adopted on August 23, 2024 provides for the sale from time to time of an aggregate of up to 14,979 shares of our common stock. The duration of the trading arrangement is until November 24, 2025, or earlier if all transactions under the trading arrangement are completed. | |
| ● | The arrangement adopted on August 26, 2024 provides for the sale from time to time of an aggregate of up to 5,500 shares of our common stock. The duration of the trading arrangement is until December 31, 2025, or earlier if all transactions under the trading arrangement are completed. |
Each trading arrangement described is intended to satisfy the affirmative defense in Rule 10b5-1(c).
ITEM 6. EXHIBITS
See Exhibit Index below, which is incorporated by reference herein.
Exhibit Index
| Exhibits: | |
| 3.1 | Amended and Restated Bylaws of Abeona Therapeutics Inc. as of July 9, 2024 (incorporated by reference from our Form 8-K filed with the SEC on July 9, 2024). |
| 4.1 | Form of Pre-Funded Warrant to Purchase Common Stock (incorporated by reference from our Form 8-K filed with the SEC on May 3, 2024). |
| 31.1 | Principal Executive Officer Certification Pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934. |
| 31.2 | Principal Financial Officer Certification Pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934. |
| 32* | Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
| 101 | The following materials from Abeona’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2024, formatted in Inline XBRL (Extensible Business Reporting Language): (i) Condensed Consolidated Balance Sheets at September 30, 2024 (unaudited) and December 31, 2023 (unaudited), (ii) Condensed Consolidated Statements of Operations and Comprehensive Loss for the three and nine months ended September 30, 2024 and 2023 (unaudited), (iii) Condensed Consolidated Statements of Stockholders’ Equity for the three and nine months ended September 30, 2024 and 2023 (unaudited), (iv) Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2024 and 2023 (unaudited), and (v) Notes to Condensed Consolidated Financial Statements (unaudited). |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
* Pursuant to Item 601(b)(32)(ii) of Regulation S-K, this exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that Section, nor shall it be deemed incorporated by reference in any filings under the Securities Act of 1933 or the Securities Exchange Act of 1934, whether made before or after the date hereof and irrespective of any general incorporation language in any filing.
| 33 |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| ABEONA THERAPEUTICS INC. | |||
| Date: | November 14, 2024 | By: | /s/ Vishwas Seshadri |
| Vishwas Seshadri | |||
| President and Chief Executive Officer | |||
| (Principal Executive Officer) | |||
| Date: | November 14, 2024 | By: | /s/ Joseph Vazzano |
| Joseph Vazzano | |||
| Chief Financial Officer | |||
| (Principal Financial Officer) | |||
| 34 |