ABEONA THERAPEUTICS INC.

Abeona Therapeutics Inc. is a commercial-stage biopharmaceutical company focused on developing cell and gene therapies for life-threatening diseases ¹. The company's core business model revolves around the commercialization of its FDA-approved product, ZEVASKYN® (prademagene zamikeracel), and the advancement of its pipeline of adeno-associated virus (AAV)-based gene therapies for ophthalmic diseases ¹. Revenue generation is a mix of product sales and license/other revenues, with ZEVASKYN® being the primary commercial product ¹. The company targets adult and pediatric patients with recessive dystrophic epidermolysis bullosa (RDEB) for ZEVASKYN®, a serious and debilitating genetic skin disease for which there is no cure and ZEVASKYN® is the only FDA-approved product to treat RDEB wounds with a single surgical application ¹. The estimated prevalence of RDEB could be up to 3,850 patients in the U.S., with approximately 750 moderate to severe RDEB patients in the U.S. estimated to be ZEVASKYN® eligible ⁴.

Abeona's product and service line breakdown includes ZEVASKYN® for RDEB and a preclinical pipeline of AAV-based gene therapies. ZEVASKYN® is an autologous cell-based gene therapy that involves inserting a functioning COL7A1 gene into a patient's own skin cells, which are then grown into sheets and surgically applied to wounds to restore Type VII collagen expression and skin function ⁵. This product is manufactured at the company's cGMP facility in Cleveland, Ohio ¹. The preclinical pipeline features ABO-503 for X-linked Retinoschisis (XLRS), ABO-504 for Stargardt Disease, and ABO-505 for Autosomal Dominant Optic Atrophy (ADOA), all utilizing novel AIM™ capsids designed to improve tropism profiles for ophthalmic diseases ¹. The company also leverages its AIM™ Capsid Technology Platform, licensed from UNC, for developing chimeric AAV capsids capable of improved tissue targeting and potential evasion of immunity to wild-type AAV vectors ⁶.

For the fiscal year ended December 31, 2025, Abeona Therapeutics reported total revenues of $5.820 million ⁷, a significant increase from nil in 2024 ⁷. This was comprised of product revenue, net, of $2.420 million ⁸ from the sale of ZEVASKYN®, and license and other revenues of $3.400 million ⁹. The company achieved a net income of $71.183 million ¹⁰ for 2025, a substantial improvement from a net loss of $63.734 million in 2024 ¹⁰. This net income was primarily driven by a gain from the sale of a Priority Review Voucher (PRV) of $152.366 million, net of transaction costs ¹¹. Excluding this gain, the net loss for 2025 would have been $81.2 million ¹². Basic income per common share was $1.34 ¹³, and diluted income per common share was $1.01 ¹⁴ for 2025, compared to a basic and diluted loss per common share of $1.55 ¹⁵ in 2024.

Comparing year-over-year, total revenues increased from nil in 2024 to $5.820 million in 2025, primarily due to the FDA approval and initial commercialization of ZEVASKYN® and the achievement of a clinical development milestone under a sublicense agreement ⁷. Cost of sales was $1.532 million in 2025, up from nil in 2024, directly correlating with the commencement of product sales ¹⁶. Royalties also increased from nil in 2024 to $1.893 million in 2025, driven by the milestone payment from Taysha related to Rett syndrome ¹⁷. Research and development expenses decreased by $7.548 million, or 22%, from $34.360 million in 2024 to $26.812 million in 2025, mainly due to costs being capitalized into inventory and engineering runs no longer considered R&D after ZEVASKYN®'s FDA approval ¹⁸. Selling, general and administrative expenses significantly increased by $35.180 million, or 118%, from $29.851 million in 2024 to $65.031 million in 2025, reflecting increased commercialization efforts, new hires, and engineering run costs ¹⁹. Interest income rose by $1.310 million, or 31%, to $5.556 million in 2025 from $4.246 million in 2024, due to higher earnings on short-term investments ²⁰. Interest expense decreased by $0.468 million, or 11%, to $3.740 million in 2025 from $4.208 million in 2024, following an amendment to the credit facility that reduced the interest rate ²¹. The change in fair value of warrant and derivative liabilities resulted in a gain of $6.139 million in 2025, compared to a loss of $0.755 million in 2024 ²².

Significant operational developments during the period include the FDA approval of ZEVASKYN® on April 28, 2025, as the first and only autologous cell-based gene therapy for RDEB wounds ¹. The company treated its first commercial ZEVASKYN® patient in the fourth quarter of 2025 ²³. A Priority Review Voucher (PRV) was received upon ZEVASKYN®'s approval and subsequently sold in May 2025 for gross proceeds of $155.0 million, resulting in a net gain of $152.366 million ²⁴. The company has activated 4 qualified treatment centers as of March 2026 and has secured broad insurance coverage for ZEVASKYN® from multiple national and regional commercial insurers, as well as from CMS, including all Medicaid programs across 50 US states and Puerto Rico ²⁵. Effective January 1, 2026, CMS issued a permanent J-code for ZEVASKYN® ²⁶. In July 2024, Abeona entered into a non-exclusive agreement with Beacon Therapeutics to evaluate its AAV204 capsid, with Beacon exercising its option for a worldwide, non-exclusive license in July 2025 ²⁷.

Management expects research and development activities to continue as the company works towards advancing its product candidates towards potential regulatory approval, reflecting costs associated with 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 ²⁸. Selling, general, and administrative costs are also expected to continue to increase as the company expands its commercialization of ZEVASKYN® and advances other product candidates toward potential regulatory approval ²⁹.

A major growth area for Abeona is the continued commercialization of ZEVASKYN® for RDEB. The company's strategy involves establishing and expanding a network of qualified treatment centers, with 4 centers activated as of March 2026 and discussions ongoing with additional centers ³⁰. The company has secured broad insurance coverage for ZEVASKYN® from multiple national and regional commercial insurers and all Medicaid programs across 50 US states and Puerto Rico ³¹. The issuance of a permanent J-code for ZEVASKYN® by CMS, effective January 1, 2026, is expected to simplify claims and reimbursement processing ³².

Another key growth vector is the development of novel in-vivo gene therapies using the AIM™ Capsid Technology Platform. The preclinical pipeline includes ABO-503 for X-linked Retinoschisis (XLRS), ABO-504 for Stargardt Disease, and ABO-505 for Autosomal Dominant Optic Atrophy (ADOA) ³³. Pre-IND meetings for ABO-503 and ABO-504 have been conducted with the FDA, providing comprehensive feedback for future IND submissions ³⁴. However, animal efficacy and toxicology studies and cGMP manufacturing of clinical grade material for ABO-503 have been postponed to 2026 due to focus on ZEVASKYN® commercialization efforts ³⁵. The company also has a non-exclusive license agreement with Beacon Therapeutics for its AAV204 capsid for up to five gene or disease targets in ophthalmology, with potential for additional payments upon achievement of certain development, regulatory, and sales milestones, along with tiered royalties on worldwide net sales ³⁶.

Operationally, the company has made significant investments in developing optimized manufacturing processes for ZEVASKYN® and AAV-based vector therapies at its Cleveland, Ohio facility ³⁷. These investments aim to provide sufficient scale for commercial manufacturing, robust processes for biopsy, cell collection, storage, transportation, and product release testing for ZEVASKYN®, as well as proprietary AAV vector manufacturing processes for highly purified product candidates using serum-free suspension technology ³⁷. The company also focuses on multiple assays for process and AAV vector characterization and purification processes adaptable for different AAV capsids ³⁷.

Regarding capital allocation, the company's principal source of liquidity is cash, cash equivalents, restricted cash, and short-term investments, which totaled $191.4 million as of December 31, 2025 ³⁸. Management believes these resources are sufficient to fund operations through at least the next 12 months from the date of the annual report ³⁹. The company may need to secure additional funding to carry out all planned research and development and potential commercialization activities ⁴⁰. The company has an open market sale agreement with Jefferies LLC (ATM Agreement) under which it may sell up to $75.0 million of common stock, with $51.5 million remaining as of December 31, 2025 ⁴¹. The company plans to continue its policy of investing available funds in suitable certificates of deposit, money market funds, government securities, and investment-grade, interest-bearing securities ⁴².

The company faces structural headwinds and execution risks, including the inherent complexity and uncertainty of cell and gene therapy product development and regulatory approval ⁴³. The commercial success of ZEVASKYN® depends on market acceptance by physicians, patients, and payors, which is influenced by perceived clinical efficacy, safety, convenience, and affordability ⁴⁴. The company's reliance on a single approved product, ZEVASKYN®, increases its exposure to risks such as safety concerns, regulatory actions, supply disruptions, and competitive pressures ⁴⁵. Challenges in engaging and coordinating with qualified treatment centers, managing logistics of patient material and drug product shipment, and potential manufacturing problems (e.g., production costs, yields, quality control, raw material shortages) could impact commercialization ⁴⁶. The company also faces intense competition from other biotechnology and pharmaceutical companies, many of which have greater financial and technical resources ⁴⁷. Changes in healthcare reform measures, including government-adopted reform measures and downward price pressures, could limit the ability to profitably sell products ⁴⁸. The company is also subject to extensive governmental regulation, including fraud and abuse laws, false claims laws, and health information privacy and security laws, with non-compliance potentially leading to substantial penalties ⁴⁹.

The company faces material risks including the potential for limited revenue generation from ZEVASKYN® due to challenges in manufacturing, commercialization, and market acceptance, as well as dependence on a single approved product ⁵⁰. The complex and evolving regulatory landscape for cell and gene therapies, including potential delays in clinical studies, failure to demonstrate safety and efficacy, and difficulties in patient enrollment, poses significant risks to product development and approval ⁵¹. Manufacturing interruptions, quality control failures, and reliance on third-party suppliers for ZEVASKYN® production could disrupt commercialization efforts ⁵². The company's ability to protect and enforce its intellectual property rights is crucial, as challenges to patents or the expiration of exclusivity periods could lead to increased competition ⁵³. Furthermore, the company has a history of losses and expects to incur future losses, necessitating additional capital raises which could dilute existing stockholders or require relinquishing proprietary rights ⁵⁴. Macroeconomic factors such as U.S. trade policy changes, including tariffs and trade restrictions, could increase research and development expenses, disrupt supply chains, and lead to heightened international legal and operational risks ⁵⁵. Breaches of data security or unauthorized disclosures of personal information also present significant risks, potentially leading to legal and financial exposure, reputational damage, and operational disruptions ⁵⁶.

Management emphasizes the company's transition to a commercial-stage biopharmaceutical company, driven by the FDA approval of ZEVASKYN® for RDEB ⁵⁷. The overall tone is focused on the successful commercialization of ZEVASKYN® and the continued advancement of its AAV-based gene therapy pipeline for ophthalmic diseases ⁵⁸. Key strategic priorities include commercializing ZEVASKYN® through an expanding network of qualified treatment centers and securing broad insurance coverage, developing novel in-vivo gene therapies using AIM™ Capsid Technology, leveraging its leadership position in commercial-scale cell and gene therapy manufacturing, establishing additional cell and gene therapy franchises through in-licensing and strategic partnerships, and maintaining and growing its intellectual property portfolio ⁵⁹. Management explicitly states that current cash and cash equivalents, restricted cash, and short-term investments are believed to be sufficient to fund operations through at least the next 12 months from the date of the annual report ³⁹. However, they also acknowledge the need to secure additional funding to fully implement business plans ⁴⁰ and expect selling, general, and administrative costs to continue to increase as commercialization expands and product candidates advance ²⁹.