Breast Cancer Focused Atossa Therapeutics Provides Company Update, Q4 & Year End 2019 Financial Results

By John Heerdink LinkedIn Disclaimer

Seattle-based Atossa Therapeutics, Inc. (ATOS), a clinical-stage biopharmaceutical company developing novel therapeutics and delivery methods to treat breast cancer and other breast conditions, announced their financial results for Q4 and year ended December 31, 2019, and provided an update on recent company developments.

Atossa’s key strategic highlights for 2019 provided were as follows:

  • Completed additional Phase 1 work with our proprietary oral Endoxifen.
  • Contracted with South General Hospital in Stockholm, Sweden to conduct a Phase 2 study with oral Endoxifen to reduce MBD.
  • Continued Phase 2 study underway in Australia administering our oral Endoxifen to newly diagnosed breast cancer patients in the “window of opportunity.”
  • In developing topical Endoxifen, Phase 2 studies showed a significant and rapid reduction of MBD.
  • Received favorable results from our single-patient expanded access program: the Ki-67 activity decreased by 50%, and the estrogen receptor content decreased by more than 20% with no safety or tolerability issues, including vasomotor symptoms such as hot flashes and night sweats.
  • Received IRB approval for a Phase 2 clinical study using our intraductal microcatheter technology to administer fulvestrant in patients with early-stage breast cancer or ductal carcinoma in situ (DCIS) at a major institution.

Atossa’s recent developments included the following:

  • Changed the name of the company from Atossa Genetics to Atossa Therapeutics, which we believe more clearly reflects our focus on developing therapies and continues to honor Princess Atossa, the great queen of the Achaemenid Empire who reigned in the fifth century BCE and who is the earliest recorded woman with breast cancer.
  • Submitted an application to initiate a Phase 2 study of our oral Endoxifen for the reduction of MBD to the Swedish Medical Product Agency and the Institutional Review Board.
  • Announced that we will meet with the U.S. F.D.A. on April 30, 2020. The objective of this meeting is to discuss the clinical development of oral Endoxifen to reduce MBD.

Summarized financials provided by Atossa’s announcement were as follows:

Operating Expenses: Total operating expenses were $17.3 million for the year ended December 31, 2019, which is an increase of $5.8 million, or 51%, from the year ended December 31, 2018. Operating expenses for 2019 consisted of research and development (R&D) expenses of $6.6 million and general and administrative (G&A) expenses of $10.6 million. Operating expenses for 2018 consisted of R&D expenses of $4.2 million, and G&A expenses of $7.2 million.
    
Research and Development Expenses: R&D expenses for the year ended December 31, 2019, were $6.6 million, an increase of $2.4 million, or 58%, from total R&D expenses in 2018 of $4.2 million. The increase in R&D expense is attributed to non-cash stock-based compensation, salaries and clinical trial expenses associated with our Endoxifen program. R&D stock-based compensation expense, which is a non-cash charge, increased approximately $2.3 million during 2019 resulting from the cancellation of certain 2018 options and the 2019 replacement grant of options that were 75% vested and that were granted at fair market value on the date approved by the Board of Directors but were in-the-money on the date they were subsequently approved by the stockholders. There were no option cancellations or in-the-money option grants in the comparable period of 2018. Clinical trial expenses also increased by approximately $250,000 over the same period in 2018. 

General and Administrative Expenses: G&A expenses were $10.6 million for the year ended December 31, 2019, an increase of $3.4 million, or 47% from the total G&A expenses for the year ended December 31, 2018, of $7.2 million. G&A expenses consist primarily of personnel and related benefit costs, facilities, professional services, insurance, and public company-related expenses. The increase in G&A expenses for the year ended December 31, 2019, is attributed to non-cash stock-based compensation. G&A stock-based compensation expense, which is a non-cash charge, increased approximately $4.0 million during 2019 resulting from the cancellation of certain 2018 options and the 2019 replacement grant of options that were 75% vested and that were granted at fair market value on the date of approval by the Board of Directors but were in-the-money on the date they were subsequently approved by the stockholders. There were no option cancellations or in-the-money option grants in the comparable period of 2018. The increase in 2019 expense G&A expense was offset by a reduction in bonus compensation expense of approximately $350,000 as a one-time 2018 bonus was not paid in 2019. For the years ended December 31, 2019, and 2018, they had no source of sustainable revenue and no associated cost of revenue.

As of December 31, 2019, the Company had approximately $12.6 million in cash and cash equivalents and working capital of approximately $13.0 million.

“We are very proud of our 2019 accomplishments, as we focused on developing our proprietary drug Endoxifen to reduce mammographic breast density (MBD) and to treat breast cancer in the ‘window of opportunity’ – after a patient is diagnosed but before her surgery. We have received positive data from the expanded access (or, ‘compassionate-use’) patient taking our oral Endoxifen and from our Phase 2 study of our topical Endoxifen to reduce MBD, all while minimizing costs and managing our cash position,” stated Dr. Steven Quay, Atossa’s President, and Chief Executive Officer.

Recently, Atossa also announced that it will meet with the U.S. FDA on April 30, 2020. The objective of this meeting is to discuss the clinical development of oral Endoxifen to reduce mammographic breast density (MBD). MBD is an emerging public health issue affecting over 10 million women in the U.S. MBD is a recognized risk factor for future breast cancer and there is no approved therapy to reduce MBD. High-risk women are usually advised to have more frequent or sophisticated mammograms and to make lifestyle changes. Read Complete Story.

Please visit the Atossa Therapeutics (ATOS) page at Vista Partners to keep up with their progress and to learn more daily about their work and developments in diagnosing and treating breast cancer. Shares of Atossa are trading up ~+10.19% currently today.

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(Read Original Story: Atossa Therapeutics Announces Fourth Quarter and Year End 2019 Financial Results and Provides Company Update in Atossa Therapeutics (NASDAQ: ATOS))


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