ABEONA THERAPEUTICS INC. Q2 FY2022 earnings call

• Focused on developing transformational therapies for serious diseases with the highest unmet need.
• In May, announced an exclusive agreement where Ultragenyx assumed financial responsibility for ABO-102's development for Sanfilippo syndrome type A, and Abeona is eligible for tiered royalties and commercial milestone payments; discontinued development of ABO-101 for MPS IIIB, extending cash runway to Q2 2023.
• For RDEB, EB-101's Phase III VITAL study is ongoing, target enrollment achieved in March, final patient visit planned in mid-September, top line results anticipated end of third quarter or early fourth quarter; featured long-term follow-up data from Phase I/II study at SID Annual Meeting.
• At ARVO 2022 Annual Meeting, reported nonhuman primate data for AAV204, a novel AAV capsid from AIM capsid library.
• Ongoing proof-of-concept studies in ophthalmic indications have begun to demonstrate proof of gene expression in target tissues, functional readouts to be reported this quarter, supporting pre-IND meetings with FDA in second half of 2022 to early 2023.

As of June 30, 2022, cash, cash equivalents, restricted cash and short-term investments were $26 million. Net cash used in operating activities was $9 million for the second quarter of 2022 compared to $13.7 million in the first quarter of 2022. License and other revenues for the second quarter of 2022 were $1 million compared to $0 in the second quarter of 2021. Research and development activities spending was $6.7 million for the 3 months ended June 30, 2022, compared to $8.5 million in the second quarter of 2021. General and administrative activities spending was $3.5 million for the 3 months ended June 30, 2022, compared to $5.2 million in the same period of 2021. Net loss attributable to common shareholders was $12.1 million for the second quarter of 2022 or $2.08 loss per common share as compared to $15.2 million or $3.93 loss per common share in the second quarter of 2021.

• Based on current operating plan and assumptions, estimated runway of current financial resources takes into Q2 2023.
• Anticipates reporting top line results from EB-101's VITAL study around end of third quarter or early fourth quarter.
• Ongoing proof-of-concept studies in ophthalmic indications' functional readouts to be reported this quarter, supporting pre-IND meetings with FDA in second half of 2022 to early 2023.

Remarks made during the call may contain forward-looking statements subject to change. Actual results may differ materially from those expressed or implied. Various factors that could cause actual results to differ include those identified in the company's annual report on Form 10-K and other periodic reports filed with the SEC, available on the company's website.

Q: For the pain reduction endpoint, can you remind us how often you measure it? And then what is the delta that you expect to achieve on this standpoint? And can you also remind us what the specified calculations are for the same point?

A: The first measurement of pain is baseline. Subsequently, measuring progression at follow-up time points including week 12 and week 24. While can't tell exact magnitude of pain reduction anticipated in VITAL as past data is on different scale, study is adequately powered to detect meaningful pain reduction. Prespecified calculations is looking at statistical significance of mean pain reduction seen across treated arm compared to untreated controlled wounds.

Q: Could you please remind us how you're viewing the market opportunity for EB-101? And in these estimates, how do you think about wounds that a single treatment might be durable over the long term versus others down the road that may require retreatment? And then based on patient profile, how many sheets do you think that an average patient may require?

A: Anticipate at least 2,500 patients in U.S. with roughly 70% having large chronic wounds treatable with EB-101. Average 2 cycles of treatment per patient. Goal is one-and-done treatment; Phase I/II study shows one-time treatment with follow-up data up to 8 years of wound healing and pain reduction. Almost all RDEB patients will have large and chronic wounds in lifetime.

Q: How early in the process would potential acquirers of a priority voucher reach out to you? Reaching out to you already to say here's what we're looking at if you got to get it through. Or what does that process sort of start? Does it only start once you get it?

A: If get priority review voucher, trend is PRVs selling almost instantaneously due to strong demand. Critical steps are getting BLA approval and securing PRV. Already doing minimally-intensive resources to prepare for BLA package, but capital-intensive parts stage gated upon VITAL Phase III result, with BLA submission timeline in Q2 2023.