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ATOSSA THERAPEUTICS, INC.

ATOS
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Business Summary

Atossa Therapeutics, Inc. is a clinical-stage biopharmaceutical company focused on developing innovative medicines for oncology, specifically breast cancer and other breast conditions, and certain rare diseases. The company's core business model revolves around advancing its drug candidates through clinical studies, with potential partners, and strategically expanding its pipeline through acquisitions, minority investments, collaborations, or internal development. The company generates revenue through the development and potential commercialization of its pharmaceutical programs, as it is currently in the research and development phase and does not market any products or services .

The company's lead drug candidate is oral (Z)-endoxifen, a selective estrogen receptor modulator (SERM)/selective estrogen receptor degrader (SERM/D) currently in Phase 2 clinical development. (Z)-endoxifen is the most active metabolite of Tamoxifen and is significantly more potent as an estrogen receptor antagonist. Unlike Tamoxifen, it does not require metabolic activation, making its activity independent of patient-specific metabolic variability. It is designed to directly inhibit estrogen receptor signaling, induce estrogen receptor degradation, and promote apoptosis in estrogen receptor positive (ER+) breast cancer cells. Preclinical and clinical data suggest its potential to inhibit ESR1 mutations associated with aromatase inhibitor resistance and PKCβ1, downregulating the AKT signaling pathway. The company is evaluating (Z)-endoxifen for neoadjuvant, adjuvant, and breast density reduction indications within the ER+/HER2- breast cancer treatment continuum . Beyond breast cancer, (Z)-endoxifen is being explored for gynecological cancers, endocrine resistance driven by ESR1 mutations, and rare diseases such as Duchenne Muscular Dystrophy (DMD), women carriers of DMD, and McCune-Albright Syndrome (MAS) in girls .

In terms of product and service line breakdown, the company's primary focus is on (Z)-endoxifen, which is being investigated in four Phase 2 trials. The Karisma-(Z)-endoxifen study, a Phase 2, randomized, double-blind, placebo-controlled, dose-response study, evaluated low-dose (Z)-endoxifen on mammographic breast density (MBD) in healthy premenopausal women. The study, which fully enrolled 240 participants in November 2023 and concluded in June 2024, demonstrated that the 1 mg dose reduced MBD by 17.3% (p<0.01) and the 2 mg dose by 23.5% (p<0.01), compared to a 0.27% change in the placebo group . The I-SPY 2 Endocrine Optimization Pilot (I-SPY) is evaluating (Z)-endoxifen as a neoadjuvant therapy for ER+/HER2- early breast cancer, both as monotherapy and in combination with CDK4/6 inhibitors and ovarian function suppression medications. The 10 mg daily dose showed excellent tolerability, with approximately 95% of patients completing at least 75% of planned therapy, and biologic activity including a median MRI functional tumor volume reduction of approximately 72% . The RECAST DCIS (RECAST) study is a multicenter platform trial investigating (Z)-endoxifen as a short-term endocrine therapy for women with ductal carcinoma in situ (DCIS) to identify those who may safely avoid surgery. Approximately 100 patients are expected to be treated with (Z)-endoxifen in this ongoing study . The EVANGELINE study is a Phase 2 trial comparing (Z)-endoxifen plus ovarian function suppression (OFS) to exemestane plus OFS as a neoadjuvant therapy in premenopausal women with ER+/HER2- breast cancer. Pharmacodynamic data showed approximately 86% of patients achieved a Ki-67 value of 10% or less at Week 4 .

For the fiscal year ended December 31, 2025, Atossa Therapeutics reported no revenue . Total operating expenses were $37.1 million , resulting in an operating loss of $37.1 million . The net loss for the year was $34.8 million , leading to a basic and diluted EPS of $(4.04) . The company had cash and cash equivalents of $41.3 million and restricted cash of $0.1 million as of December 31, 2025. Total liabilities were $8.3 million , and total stockholders' equity was $39.4 million .

Comparing the fiscal year ended December 31, 2025, to the prior year, total operating expenses increased by $9.5 million from $27.6 million in 2024. Research and development expenses increased by $7.1 million to $21.2 million in 2025 from $14.1 million in 2024, primarily due to increased spending for (Z)-endoxifen trials and drug development costs . General and administrative expenses increased by $2.5 million to $16.0 million in 2025 from $13.5 million in 2024, mainly driven by a $1.8 million increase in legal fees for ongoing litigation and patent defense . Interest income decreased by $1.7 million to $2.4 million in 2025 from $4.1 million in 2024, due to a decrease in average funds invested in money market accounts . The net loss increased from $25.5 million in 2024 to $34.8 million in 2025. Cash and cash equivalents decreased from $71.1 million in 2024 to $41.3 million in 2025.

Significant operational developments during the period include the conclusion of the Karisma-(Z)-endoxifen study's primary objective in September 2024, with initial data demonstrating significant MBD reduction . The I-SPY 2 EOP study reported updated results in May 2025, showing 95% of participants completed at least 75% of planned dosing and a median Ki-67 reduction from 10.5% at baseline to 5% by Week 3 . In April and June 2024, the company announced participation in two new I-SPY 2 EOP study arms to evaluate (Z)-endoxifen in combination with abemaciclib and elagolix . The EVANGELINE study design was amended in 2025 to a single-arm, open-label Phase 2 study, reducing enrollment totals to 40-65 patients . In December 2025 and early 2026, (Z)-endoxifen received Rare Pediatric Disease Designation and Orphan Drug Designation from the FDA for the treatment of DMD . On February 2, 2026, the company effected a 1-for-15 reverse stock split of its common stock .

Business Outlook

The company expects to report top-line data from the Karisma-(Z)-endoxifen study in the first half of 2026 , with further development contingent on regulatory guidance, study outcomes, and available resources. Durability data from the 24-month mammographic record review of participants in the Karisma study is expected by the end of Q2 2026 . For the expanded arms of the I-SPY 2 EOP study, which involve (Z)-endoxifen in combination with abemaciclib and elagolix, the company expects to begin receiving data early in the second half of 2026 . Enrollment for the ongoing arms of the I-SPY 2 EOP study involving premenopausal women in combination with elagolix or GnRH Agonist is nearly complete, with data expected in the second half of 2026 . Enrollment in the EVANGELINE study is ongoing and expected to be complete in the second quarter of 2026 . The company expects to seek both Rare Pediatric Disease and Orphan Drug designations for McCune-Albright Syndrome (MAS) in the first half of 2026 . Additionally, the company intends to pursue Orphan Drug Designation for women carriers of DMD in the first half of 2026 .

The company's operational outlook includes continued efforts to characterize clinical activity, optimize endocrine therapy strategies, and inform future regulatory pathways through collaborative and investigator-sponsored clinical studies . Future efforts within the RECAST study are expected to focus on integrating advanced imaging modalities with molecular and transcriptomic biomarkers to better predict progression risk, refine patient selection, and evaluate long-term outcomes . The company's proprietary manufacturing process for (Z)-endoxifen, including defined processes for the active pharmaceutical ingredient and drug product, is supported by qualified suppliers and manufacturing redundancies . The company employs two executive officers and 14 full-time employees and may hire additional employees as current and future programs develop .

The company's planned capital allocation includes using its capital resources to execute its business plan, which may involve acquiring or in-licensing additional programs . It may also invest directly or indirectly in business opportunities in healthcare or other industries, including through purchases of equity in other companies . The company has entered into an At the Market Offering Agreement on February 20, 2026, to sell up to $50,000,000 of shares of its common stock through Rodman & Renshaw LLC . Research and development costs are generally expensed as incurred , and R&D expenses for the years ended December 31, 2025 and 2024 were approximately $21.2 million and $14.1 million , respectively. The company has a defined contribution plan for employees, with employer matching contributions up to 6% of deferrals , and discretionary matches over 6% . Employer matching contributions were $0.4 million and $0.3 million for the years ended December 31, 2025 and 2024, respectively.

The company explicitly flagged several structural headwinds and execution risks. It has a history of operating losses and expects to continue incurring losses , with an accumulated deficit of $246.6 million as of December 31, 2025. The company has not established ongoing revenue sources to cover operating costs and anticipates liquidity issues after the next twelve months if additional capital is not raised . Macroeconomic factors such as high interest rates, inflation, recessionary fears, foreign exchange rate volatility, and geopolitical instability could adversely impact the business and ability to raise capital . The company will need to raise substantial additional capital in the future , and these financing arrangements may not be available on acceptable terms, if at all . The company's ability to use net operating loss carryforwards and research tax credits to reduce future tax payments may be limited or restricted due to ownership changes . There is also a risk that the company or its Australian subsidiary could lose the ability to operate in Australia or be unable to benefit from R&D tax rebates , with an estimated accrued current liability of $1.1 million and $1.5 million as of December 31, 2025 and 2024, respectively, due to uncertainty regarding the full tax position under audit .

Risk Factors

The company faces material risks including a history of operating losses and the expectation of continued losses, with a net loss of $34.8 million for the year ended December 31, 2025, and an accumulated deficit of $246.6 million . There is substantial doubt about the company's ability to continue as a going concern due to the lack of ongoing revenue to cover operating costs . Macroeconomic factors such as high interest rates, inflation, and geopolitical instability, including the conflict in Ukraine, the Middle East, and tensions between China and Taiwan, could adversely impact the business and capital-raising efforts . The company will need to raise substantial additional capital, which may not be available on acceptable terms, if at all, potentially leading to dilution for stockholders or restrictive debt covenants . The company's ability to use net operating loss carryforwards and research tax credits may be limited by Sections 382 and 383 of the Internal Revenue Code . Intellectual property protection is critical, and the company faces risks from potential challenges to its patents, as evidenced by Intas Pharmaceuticals Ltd. filing petitions to invalidate U.S. Patent No. 12,071,391 and U.S. Patent No. 11,261,151 , with final written decisions expected by November 3, 2026 . Legislative or regulatory reforms, including changes in FDA policies or the potential for new tariffs on imported pharmaceuticals, could increase costs or delay approvals . Disruptions at government agencies, such as the FDA, could negatively affect the review of regulatory submissions . Non-compliance with complex government regulations concerning patient privacy, including GDPR and UK GDPR, could result in significant fines, with potential fines up to the greater of 4% of total worldwide annual turnover or €20 million under GDPR, and £17.5 million or 4% of global turnover under UK GDPR. Significant disruptions in information technology systems or data security breaches could adversely affect the business . The company faces intense competition from other biotechnology and pharmaceutical companies, many with greater financial resources and experience .

Management Priorities

Management's message to shareholders emphasizes the company's focus as a clinical-stage biopharmaceutical company developing proprietary innovative medicines in oncology, particularly breast cancer, and other rare diseases, with oral (Z)-endoxifen as the lead drug candidate in Phase 2 clinical development. They highlight the strategic benefits of recent FDA designations for (Z)-endoxifen for DMD, including Rare Pediatric Disease Designation and Orphan Drug Designation, which provide incentives such as a potential Priority Review Voucher (PRV) for future FDA applications, regulatory support, and potential market exclusivity. Management explicitly states that existing resources are expected to be sufficient to fund planned operations for the next 12 months , but acknowledges that additional capital resources will be needed for longer-term funding. The three strategic priorities emphasized for the period ahead include advancing existing programs through clinical studies, opportunistically adding programs in areas of high unmet medical need through acquisition, minority investment, collaboration, or internal development, and exploring the broader utility of (Z)-endoxifen as a therapeutic platform in serious and rare diseases.

View Source Annual Report on SEC.gov ↗

References

  1. [1] Item 1, Business — Overview
  2. [2] Item 1, Business — Overview
  3. [3] Item 1, Business — Overview
  4. [4] Item 1, Business — Summary of Leading Oncology Programs
  5. [5] Item 1, Business — Summary of Leading Oncology Programs
  6. [6] Item 1, Business — Summary of Leading Oncology Programs
  7. [7] Item 1, Business — Summary of Leading Oncology Programs
  8. [8] Item 7, MD&A — Revenue and Cost of Revenue
  9. [9] Item 7, MD&A — Operating Expenses
  10. [10] Item 7, MD&A — Operating Loss
  11. [11] Item 7, MD&A — Net Loss
  12. [12] Item 7, MD&A — Net loss per share of common stock - basic and diluted
  13. [13] Item 7, MD&A — Liquidity and Capital Resources
  14. [14] Item 7, MD&A — Liquidity and Capital Resources
  15. [15] Item 8, Consolidated Balance Sheets — Total liabilities
  16. [16] Item 8, Consolidated Balance Sheets — Total stockholders' equity
  17. [17] Item 7, MD&A — Operating Expenses
  18. [18] Item 7, MD&A — Operating Expenses
  19. [19] Item 7, MD&A — Research & Development Expenses
  20. [20] Item 7, MD&A — Research & Development Expense Total
  21. [21] Item 7, MD&A — Research & Development Expense Total
  22. [22] Item 7, MD&A — Research & Development Expenses
  23. [23] Item 7, MD&A — General and Administrative (G&A) Expenses
  24. [24] Item 7, MD&A — General and Administrative Expense Total
  25. [25] Item 7, MD&A — General and Administrative Expense Total
  26. [26] Item 7, MD&A — General and Administrative (G&A) Expenses
  27. [27] Item 7, MD&A — General and Administrative (G&A) Expenses
  28. [28] Item 7, MD&A — Interest Income
  29. [29] Item 7, MD&A — Interest Income
  30. [30] Item 7, MD&A — Interest Income
  31. [31] Item 7, MD&A — Interest Income
  32. [32] Item 7, MD&A — Net loss
  33. [33] Item 7, MD&A — Net loss
  34. [34] Item 7, MD&A — Liquidity and Capital Resources
  35. [35] Item 7, MD&A — Liquidity and Capital Resources
  36. [36] Item 1, Business — Summary of Leading Oncology Programs
  37. [37] Item 1, Business — Summary of Leading Oncology Programs
  38. [38] Item 1, Business — Summary of Leading Oncology Programs
  39. [39] Item 7, MD&A — EVANGELINE Study
  40. [40] Item 1, Business — (Z)-Endoxifen in rare diseases
  41. [41] Item 1, Business — Nasdaq Notice
  42. [42] Item 1, Business — Summary of Leading Oncology Programs
  43. [43] Item 1, Business — Summary of Leading Oncology Programs
  44. [44] Item 1, Business — Summary of Leading Oncology Programs
  45. [45] Item 1, Business — Summary of Leading Oncology Programs
  46. [46] Item 7, MD&A — EVANGELINE Study
  47. [47] Item 1, Business — (Z)-Endoxifen in rare diseases
  48. [48] Item 1, Business — (Z)-Endoxifen in rare diseases
  49. [49] Item 1, Business — Overview
  50. [50] Item 1, Business — Summary of Leading Oncology Programs
  51. [51] Item 1, Business — Overview
  52. [52] Item 1, Business — Employees
  53. [53] Item 1, Business — Employees
  54. [54] Item 1, Business — Potential Uses of Capital Resources
  55. [55] Item 1, Business — Potential Uses of Capital Resources
  56. [56] Item 1, Business — Our Capital Resources
  57. [57] Item 1, Business — Our Capital Resources
  58. [58] Item 1, Business — Research and Development Phase
  59. [59] Item 1, Business — Research and Development
  60. [60] Item 1, Business — Research and Development
  61. [61] Item 15, Note 15 — Defined Contribution Plan
  62. [62] Item 15, Note 15 — Defined Contribution Plan
  63. [63] Item 15, Note 15 — Defined Contribution Plan
  64. [64] Item 15, Note 15 — Defined Contribution Plan
  65. [65] Item 1A, Risk Factors — Risks Related to our Business
  66. [66] Item 1A, Risk Factors — Risks Related to our Business
  67. [67] Item 1A, Risk Factors — Risks Related to our Business
  68. [68] Item 1A, Risk Factors — Macroeconomic factors could adversely impact our business and our ability to raise additional capital.
  69. [69] Item 1A, Risk Factors — We will need to raise substantial additional capital in the future to fund our operations and we may be unable to raise such funds when needed and on acceptable terms.
  70. [70] Item 1A, Risk Factors — We will need to raise substantial additional capital in the future to fund our operations and we may be unable to raise such funds when needed and on acceptable terms.
  71. [71] Item 1A, Risk Factors — Our ability to use net operating loss carryforwards and research tax credits to reduce future tax payments may be limited or restricted.
  72. [72] Item 1A, Risk Factors — If we, or our wholly-owned subsidiary, lose our ability to operate in Australia, or if our subsidiary is unable to benefit from the past or future R&D tax rebates available under current Australian regulations, our business and results of operations could be harmed.
  73. [73] Item 1A, Risk Factors — If we, or our wholly-owned subsidiary, lose our ability to operate in Australia, or if our subsidiary is unable to benefit from the past or future R&D tax rebates available under current Australian regulations, our business and results of operations could be harmed.
  74. [74] Item 1A, Risk Factors — If we, or our wholly-owned subsidiary, lose our ability to operate in Australia, or if our subsidiary is unable to benefit from the past or future R&D tax rebates available under current Australian regulations, our business and results of operations could be harmed.
  75. [75] Item 1A, Risk Factors — If we, or our wholly-owned subsidiary, lose our ability to operate in Australia, or if our subsidiary is unable to benefit from the past or future R&D tax rebates available under current Australian regulations, our business and results of operations could be harmed.
  76. [76] Item 1A, Risk Factors — We have a history of operating losses and expect to continue to incur losses in the future, and, as such, an investor cannot assess our profitability or performance based on past results.
  77. [77] Item 1A, Risk Factors — We have a history of operating losses and expect to continue to incur losses in the future, and, as such, an investor cannot assess our profitability or performance based on past results.
  78. [78] Item 1A, Risk Factors — We have not established sources of ongoing revenue to cover operating costs and allow us to continue as a going concern.
  79. [79] Item 1A, Risk Factors — Macroeconomic factors could adversely impact our business and our ability to raise additional capital.
  80. [80] Item 1A, Risk Factors — We will need to raise substantial additional capital in the future to fund our operations and we may be unable to raise such funds when needed and on acceptable terms.
  81. [81] Item 1A, Risk Factors — Our ability to use net operating loss carryforwards and research tax credits to reduce future tax payments may be limited or restricted.
  82. [82] Item 1A, Risk Factors — Third-party claims alleging intellectual property infringement may prevent or delay our drug discovery and development efforts.
  83. [83] Item 1A, Risk Factors — Third-party claims alleging intellectual property infringement may prevent or delay our drug discovery and development efforts.
  84. [84] Item 1A, Risk Factors — Third-party claims alleging intellectual property infringement may prevent or delay our drug discovery and development efforts.
  85. [85] Item 1A, Risk Factors — Legislative or regulatory reforms may make it more difficult and costly for us to obtain regulatory approval of our product candidates and to manufacture, market and distribute our products after approval is obtained.
  86. [86] Item 1A, Risk Factors — Disruptions at the FDA and other government agencies could negatively affect the review of our regulatory submissions, which could negatively impact our business.
  87. [87] Item 1A, Risk Factors — Our inadvertent or unintentional failure to comply with the complex government regulations concerning patients' privacy, other data subjects, and of medical records could subject us to fines and adversely affect our reputation.
  88. [88] Item 1A, Risk Factors — Our inadvertent or unintentional failure to comply with the complex government regulations concerning patients' privacy, other data subjects, and of medical records could subject us to fines and adversely affect our reputation.
  89. [89] Item 1A, Risk Factors — Significant disruptions in our information technology systems or breaches of data security could adversely affect our business.
  90. [90] Item 1A, Risk Factors — We face significant competition from other biotechnology and pharmaceutical companies.
  91. [91] Item 1, Business — Our Capital Resources

Analysis on 5/22/2026