"During the quarter, we made meaningful progress advancing our (Z)-endoxifen development strategy across both oncology and rare disease indications," stated Dr. Steven Quay, M.D., Ph.D., Atossa Therapeutics' President and Chief Executive Officer. "We continued to advance (Z)-endoxifen in the clinic for the treatment of breast cancer, while also generating data to support its potential in rare diseases, including Duchenne Muscular Dystrophy (DMD) and McCune-Albright Syndrome. Importantly, we secured both Orphan Drug and Rare Pediatric Disease designations from the FDA for (Z)-endoxifen in DMD, and subsequently we've received Rare Pediatric Disease designation from the FDA for McCune-Albright Syndrome, reinforcing the potential of our programs in areas of high unmet need. Building on this momentum, we remain focused on identifying additional indications where our platform can deliver meaningful therapeutic benefit to patients with limited treatment options."
Dr. Quay continued, "Our balance sheet remains strong, positioning us to continue to execute across our strategic plans, and deliver value to shareholders in upcoming quarters."
First Quarter 2026 & Recent Highlights
Atossa Therapeutics Presented Encouraging Pre-clinical data for (Z)-Endoxifen in DMD at the MDA Clinical & Scientific Conference - In an oral presentation on March 11, 2026, the Company demonstrated that (Z)-endoxifen improved muscle strength, increased lean mass, and reduced biochemical markers of muscle damage in dystrophic mouse models. We believe these data support advancement into the clinical setting.
Atossa Therapeutics Received FDA Orphan Drug Designation for (Z)-Endoxifen for the Treatment of DMD - In January 2026, Atossa announced that the U.S. Food and Drug Administration (FDA) Office of Orphan Products Development (OOPD) granted Orphan Drug Designation to (Z)-endoxifen for the treatment of DMD. Orphan Drug Designation is granted by the FDA to therapies intended to treat rare diseases or conditions. The designation is designed to encourage drug development by offering certain potential incentives, such as regulatory support and, if the product ultimately receives marketing approval for the designated indication, eligibility for a period of market exclusivity. The Company previously received Rare Pediatric Disease (RPD) designation for (Z)-endoxifen for the treatment of DMD.
Atossa Therapeutics Received FDA RPD Designation for (Z)-Endoxifen for McCune-Albright Syndrome - In early May 2026, Atossa announced that the FDA had granted RPD for (Z)-Endoxifen for McCune-Albright Syndrome, which is the Company's second of such designations received in the last 6 months for rare diseases with currently unmet need. Upon approval of a qualifying marketing application, drugs with RPD designation may be eligible for a Priority Review Voucher (PRV), which can be used to obtain priority review for a future application or may be sold or transferred to another sponsor. In the last 18 to 24 months, disclosed PRV sales have ranged from $100–$205 million.
Atossa Therapeutics Strengthened Clinical Leadership Team with the Addition of Two Experienced Biopharma Executives - Atossa announced the engagement of Kathy Puyana Theall, M.D. as Medical Director - Breast Oncology, and Adebola Giwa, M.D. as Medical Director - Rare Diseases. We believe the addition of these two highly experienced physicians and clinical leaders meaningfully strengthens Atossa's ability to execute on its (Z)-endoxifen development strategy across both breast cancer and rare disease programs, including DMD and McCune-Albright Syndrome, as the Company advances toward key clinical and regulatory milestones.
Financial Results for the First Quarter Ended March 31, 2026
Operating Expenses. Total operating expenses were $9.9 million for the three months ended March 31, 2026, which was an increase of $2.5 million, from total operating expenses for the three months ended March 31, 2025 of $7.4 million. Factors contributing to the increased operating expenses in the three months ended March 31, 2026 are explained below.
Research & Development (R&D) Expenses. The following table provides a breakdown of major categories within R&D expenses for the three months ended March 31, 2026 and 2025, together with the dollar change and percentage change in those categories (dollars in thousands):
For the Three Months Ended March 31,
2026
2025
Increase (Decrease)
% Increase (Decrease)
Research and Development Expenses
Clinical and pre-clinical trials
$
3,718
$
2,747
$
971
35 %
Compensation
934
880
54
6 %
Professional fees and other
127
530
(403)
(76) %
Research and Development Expenses Total
$
4,779
$
4,157
$
622
15 %
As (Z)-endoxifen is our only product candidate for which we currently incur R&D expenses, we have not further disaggregated R&D expenses by product candidate:
Clinical and non-clinical trial expenses increased $1.0 million for the three ended March 31, 2026, compared to the three months ended March 31, 2025, due to increases in spend related to our (Z)-endoxifen trials, including drug development costs.
The increase in R&D compensation expenses of $0.1 million for the three months ended March 31, 2026 compared to the three months ended March 31, 2025, was due primarily to increases in non-cash stock-based compensation expense of $0.1 million.
The decreases in R&D professional fees and other of $0.4 million for the three months ended March 31, 2026, compared to the three months ended March 31, 2025, were primarily attributable to lower regulatory consulting fees in the first quarter of 2026 related to our (Z)-endoxifen program as compared to the same quarter in the prior year.
General and Administrative (G&A) Expenses. The following table provides a breakdown of major categories within G&A expenses for the quarter ended March 31, 2026 and 2025, together with the dollar ...
