ABEONA THERAPEUTICS INC
For the period ended Sep 30, 2024. Filed Nov 14, 2024.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2024 · Filed Nov 14, 2024
ABEO$4.17+6.6%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-06-30; filed 2024-08-12.
0001493152-24-031150
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-09-30; filed 2024-11-14.
0001493152-24-045340
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 82 previous paragraphs and 78 current paragraphs.
49 unchanged; 26 reworded; 3 added; 3 removed; 4 previous and 0 current paragraphs rearranged.
Tables are not compared: 10 previous and 10 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (3)
Current report
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.
Current report
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.
Current report
Comparison of Nine Months Ended September 30, 2024 and September 30, 2023
Removed paragraphs (3)
Previous report
On May 7, 2024, we sold 12,285,056 shares of our common stock and, in lieu of common stock, pre-funded warrants to purchase 6,142,656 shares of our common stock (the “2024 Pre-Funded Warrants”), for an aggregate purchase price of $75.0 million gross, or $70.2 million net of related costs. The offering price for each share of common stock was $4.07, and the offering price for the 2024 Pre-Funded Warrants was $4.0699, which represents the per share offering price for our common stock less a $0.0001 per share exercise price for each 2024 Pre-Funded Warrant. The 2024 Pre-Funded Warrants are immediately exercisable at a nominal exercise price of $0.0001 per share and may be exercised at any time until the pre-funded warrants are exercised in full. On June 24, 2024, 700,000 of the 2024 Pre-Funded Warrants were exercised, leaving 5,442,656 2024 Pre-Funded Warrants outstanding as of June 30, 2024.
Previous report
Comparison of Six Months Ended June 30, 2024 and June 30, 2023
Previous report
License and other revenues
Reworded paragraphs (26)
Previous wording
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. We expect to receive the FDA’s meeting minutes within the next few weeks and are on track to resubmit our BLA in the second half of 2024. Upon acceptance of the BLA, we expect the FDA to set a PDUFA date of six months from the date of submission.
Current wording
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.
Previous wording
Total royalty expenses for the six months ended June 30, 2024 was nil as compared to $1.6 million for the same period of 2023. The increase in expense was due to royalties owed to our licensors resulting from the milestones due from Taysha related to Rett.
Current wording
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.
Previous wording
Total research and development spending for the three months ended June 30, 2024 was $9.2 million, as compared to $8.5 million for the same period of 2023, an increase of $0.7 million. The increase in expenses was primarily due to:
Current wording
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:
Previous wording
Total general and administrative expenses were $8.6 million for the three months ended June 30, 2024, as compared to $5.0 million for the same period of 2023, an increase of $3.6 million. The increase in expenses was primarily due to:
Current wording
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:
Previous wording
Interest income was $1.2 million for the three months ended June 30, 2024, as compared to $0.4 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.
Current wording
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.
Previous wording
The change in fair value of warrant and derivative liabilities was a gain of $24.9 million for the three months ended June 30, 2024, as compared to a loss of $8.6 million for the same period in 2023.
Current wording
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.
Previous wording
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 decrease in our stock price year over the year and a reduced term of each of the warrants and derivative liabilities.
Current wording
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.
Previous wording
License and other revenues for the three months ended June 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.
Current wording
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.
Previous wording
Total royalty expenses for the three months ended June 30, 2024 was nil as compared to $1.6 million for the same period of 2023. The decrease in expense was due to royalties owed to our licensors resulting from the milestones due from Taysha related to Rett.
Current wording
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.
Previous wording
Total research and development spending for the six months ended June 30, 2024 was $16.4 million, as compared to $16.5 million for the same period of 2023, a decrease of $0.1 million. The decrease in expenses was primarily due to:
Current wording
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:
Previous wording
Total general and administrative expenses were $15.8 million for the six months ended June 30, 2024, as compared to $9.0 million for the same period of 2023, an increase of $6.8 million. The increase in expenses was primarily due to:
Current wording
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:
Previous wording
The gain on right-of-use lease assets was $1.1 million for the three months ended June 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 three months ended June 30, 2024.
Current wording
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.
Previous wording
Interest income was $2.0 million for the six months ended June 30, 2024, as compared to $0.8 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.
Current wording
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.
Previous wording
Interest expense was $2.0 million for the six months ended June 30, 2024, as compared to $0.2 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 $1.8 million.
Current wording
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.
Previous wording
The change in fair value of warrant and derivative liabilities was a gain of $7.6 million for the six months ended June 30, 2024, as compared to a loss of $6.4 million for the same period in 2023.
Current wording
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.
Previous wording
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 decrease in our stock price year over the year and a reduced term of each of the warrants and derivative liabilities.
Current wording
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.
Previous wording
Other income was $0.2 million for the three months ended June 30, 2024, as compared to $2.2 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 retentional credit that was recorded in 2023.
Current wording
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.
Previous wording
Cash Flows for the Six Months Ended June 30, 2024 and 2023
Current wording
Cash Flows for the Nine Months Ended September 30, 2024 and 2023
Previous wording
Net cash used in operating activities was $27.2 million for the six months ended June 30, 2024, primarily comprised of our net loss of $24.2 million and decreases in operating assets and liabilities of $0.4 million and net non-cash charges of $2.6 million. Non-cash charges consisted primarily of $(7.6) million of the change in fair value of warrant and derivative liabilities, $2.9 million of stock-based compensation and $1.0 million of depreciation and amortization.
Current wording
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.
Previous wording
Net cash used in operating activities was $22.0 million for the six months ended June 30, 2023, primarily comprised of our net loss of $25.8 million, increases in operating assets and liabilities of $5.1 million and net non-cash charges of $8.9 million.
Current wording
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.
Previous wording
Net cash used in investing activities was $51.9 million for the six months ended June 30, 2024, primarily comprised of proceeds from maturities of short-term investments of $39.4 million, offset by purchases of short-term investments of $89.9 million and capital expenditures of $1.4 million.
Current wording
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.
Previous wording
Net cash provided by investing activities was $7.4 million for the six months ended June 30, 2023, primarily comprised of proceeds from maturities of short-term investments of $21.6 million, partially offset by purchases of short-term investments of $14.2 million.
Current wording
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.
Previous wording
Net cash provided by financing activities was $99.1 million for the six months ended June 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.
Current wording
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.
Previous wording
Net cash provided by financing activities was $6.6 million for the six months ended June 30, 2023, primarily comprised of $6.6 million in net proceeds from ATM sales of common stock.
Current wording
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).
Previous wording
Our principal source of liquidity is cash, cash equivalents, restricted cash and short-term investments, collectively referred to as our cash resources. As of June 30, 2024, our cash resources were $123.0 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.
Current wording
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.
Previous wording
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 six months ended June 30, 2024.
Current wording
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.
Rearranged previous paragraphs (4)
Previous report — wording carried elsewhere
License and other revenues for the six months ended June 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.
Previous report — wording carried elsewhere
Gain of right-of-use lease assets
Previous report — wording carried elsewhere
The gain on right-of-use lease assets was $1.1 million for the six months ended June 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 six months ended June 30, 2024.
Previous report — wording carried elsewhere
Other income was $0.4 million for the six months ended June 30, 2024, as compared to $2.6 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 retentional credit that was recorded in 2023.