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Atossa Therapeutics, Inc. (Nasdaq: ATOS), a clinical-stage biopharmaceutical company that develops innovative proprietary medicines to address significant unmet needs in cancer, today announces the issuance of the following Letter to Shareholders from Steven C. Quay, MD, Ph.D. , CEO and President of the Company:
TO OUR VALUED SHAREHOLDERS:
2022 was a year of significant progress for Atossa. We have focused our development efforts on advancing our breast cancer program with our patented (Z)-endoxifene, the highest potency Selective Estrogen Receptor Modifier (SERM). We currently have ongoing Phase 2 studies in prevention and treatment settings, both of which are focused on areas of unmet medical need. Our goal is to help reduce the incidence of breast cancer and change the treatment paradigm for patients who are not benefiting from currently approved drugs.
In October 2022, the US Food and Drug Administration (FDA) cleared initiation of our EVANGELINE trial, a Phase 2 trial of (Z)-endoxifene and Exemestane + Goserelin as a neoadjuvant treatment in premenopausal women with breast cancer. breast ER+/HER2-. While there are several FDA-approved neoadjuvant therapies for ER- breast cancers, few exist for ER+ patients, who account for approximately 78% of breast cancers. We expect to enroll approximately 175 patients at up to 25 sites across the United States.
The EVANGELINE study marks the first time our proprietary endoxifene (Z) is being investigated in the United States and builds on the Phase 2 “window of opportunity” study we conducted in Australia. In this study, we showed that (Z)-endoxifene treatment reduced Ki-67, a commonly used measure of cell proliferation and growth in breast cancer tissue, from an average of 25.6% at screening to 6% on the day of surgery, a 65.1% reduction. This is clinically significant because several studies from other groups have shown that a reduction in Ki-67 below 25% improves long-term survival for patients with ER+ breast cancer.
The EVANGELINE study will help us better understand what happens to tumors when patients are treated with (Z)-endoxifene. For example, is there a pathological response or tumor shrinkage? Even a partial response in the neoadjuvant setting can change the primary treatment approach and potentially prevent patients from undergoing a radical mastectomy or systemic therapies including chemotherapy, hormone therapy, and/or targeted therapy.
We are also testing the hypothesis that treatment with (Z)-endoxifene could provide clinical benefits without the need for ovarian suppression. Current treatment approaches for premenopausal women diagnosed with ER+ breast cancer include using drug therapy or surgery to stop the ovaries from producing estrogen. ER+ tumors need estrogen to grow, so lowering hormone levels can restrict growth. However, patients also experience menopausal symptoms and in some cases, the treatment induces natural menopause, which can drastically affect the patient’s quality of life. There is a critical need for new treatment approaches that provide clinical benefit without ovarian suppression.
We are also continuing to enroll patients in our Phase 2 study investigating (Z)-endoxifene in premenopausal women with high mammographic breast density (MBD). We announced last fall that the trial was approximately 40% enrolled, which, assuming enrollment continues at its current rate, means we should enroll all 240 trial participants by the end of this year.
MBD is an emerging public health problem that affects more than 10 million women in the United States and many millions worldwide. It is well understood that increasing MBD reduces the ability of mammograms to detect cancer, but studies have also shown that women with MBD have an increased risk of developing breast cancer and that the higher the MBD, the greater the incidence of breast cancer. Importantly, we also know that lowering MBD can lead to a reduction in the incidence of breast cancer.
Our MBD study, known as the Karisma-Endoxifen study, is a randomized, double-blind, placebo-controlled study of healthy premenopausal women with increased breast density. The treatment cohort receives daily doses of (Z)-endoxifene for six months, during which time mammograms will be performed to measure reduction in MBD. Patients will also have a mammogram at 24 months to assess the durability of MBD changes. We believe that (Z)-endoxifene may provide an option for women to proactively reduce the density of their breasts, which could improve mammography accuracy and patient care by unmasking cancerous tumors that would otherwise be hidden by density. from the breast.
Given the importance of (Z)-endoxifene to Atossa’s future and the significant impact it could have on breast cancer prevention and treatment, it is critical that we protect the intellectual property that covers our proprietary drug formulation. Our position was further strengthened in March of last year, when the US Patent and Trademark Office issued US Patent #11,261,151 (the ‘151 patent). Entitled “Methods for Making and Using Endoxifen,” the ‘151 Patent is directed to storage-stable endoxifen (Z) compositions and methods of treating hormone-dependent breast disorders using storage-stable endoxifen (Z). The ‘151 patent is estimated to expire in 2038.
Another key development in 2022 is our investment in Dynamic Cell Therapies, Inc. (DCT), a privately held developer of CAR-T therapies backed by venture capital. DCT is in the preclinical phase of developing controllable CAR-T cells to treat hard-to-treat cancers. Its engineered T-cell dynamic control platform technology is designed to improve the safety, efficacy and durability of CAR-T cell therapies. Although its initial focus is on hematological malignancies, its innovative approach may also have broad applicability in solid tumors and autoimmune diseases. Our investment, which totaled US$4.7 million and resulted in Atossa owning approximately 19% of the outstanding share capital of DCT, closed in December 2022.
Last year, we also made the decision to discontinue our COVID-19 programs due to the rapidly changing treatment landscape and the introduction of effective vaccines, which have greatly reduced hospitalizations. In line with our focus on oncology, we look forward to revisiting the development of AT-H201 as an inhalation therapy for cancer patients with compromised lung function resulting from radiation treatment in the future. This indication may fill an unmet medical need because radiation-induced lung injury, which can limit the overall success of lung cancer treatment, is often irreversible and poorly treated with current therapies.
As we look forward to 2023, we are well positioned to continue accelerating the development of (Z)-endoxifene. Both Phase 2 trials are ongoing, and we will provide signups and other updates as developments warrant throughout the year. We also have a strong balance sheet without debt and cash, cash equivalents and restricted cash of approximately $117 million as of September 30, 2022.
On behalf of the Board, Management and Employees of Atossa Therapeutics, we thank you for your investment and continued support of our company.
Steven C. Quay, MD, Ph.D. Chairman of the Board of Directors and CEO