Q3 2025 Abeona Therapeutics Inc Earnings Call
Good morning, everyone and welcome to the I'll be honest therapeutics third quarter 'twenty 'twenty five conference call.
Operator: Good morning, everyone, and welcome to the Abeona Therapeutics Q3 2025 Conference Call. I will now turn the conference over to your host, Greg Gin, VP of Investor Relations and Corporate Communications at Abeona. Greg, the floor is yours.
At this time all participants are in a listen only mode and the floor will be opened for questions. Following the presentation.
If anyone should require operator assistance. During this conference. Please press star zero on your phone keypad. Please note. This conference is being recorded.
I will now turn the conference over to your host Gregory Gen V. P of Investor Relations and corporate communications at IPO now Greg the floor is yours.
Thank you Jenny.
Greg Gin: Thank you, Jenny. Good morning, and thank you for joining us on our Q3 2025 results conference call. During this call, we will refer to the press release issued this morning announcing the financial results, which is available on our corporate website at www.abeonatherapeutics.com. We anticipate making projections and forward-looking statements during today's call, which are made pursuant to the safe harbor provisions of the federal securities laws. These forward-looking statements are based on current expectations and are subject to change. Actual results may differ materially from those expressed or implied in the forward-looking statements due to various factors, including, but not limited to, those outlined in our Form 10-K and periodic reports filed with the Securities and Exchange Commission. These documents are available on our website at www.abeonatherapeutics.com.
Good morning, and thank you for joining us on our third quarter 2025 results conference call.
During this call we will refer to the press release issued this morning announcing the financial results, which is available on our corporate what website at www dot maybe around therapeutics Dot com.
Anticipating making projections and forward looking statements during todays call, which are made pursuant to the safe Harbor provisions of the federal Securities laws. These forward looking statements are based on current expectations and are subject to change.
Actual results may differ materially from those expressed or implied in the forward looking statements due to various factors, including but not limited to those outlined in our Form 10-K, and periodic reports filed with the Securities and Exchange Commission.
Documents are available on our website at www Dot ABR therapeutics Dot com.
Greg Gin: Now, joining me today with prepared remarks are Dr. Vish Seshadri, Chief Executive Officer; Dr. Brian Kevany, Chief Technical Officer; Dr. Madhav Vasanthavada, Chief Commercial Officer; and Joseph Vazzano, Chief Financial Officer. After the prepared remarks, we will conduct a Q&A session. With that, I will now turn the call over to Vish Seshadri to lead us off. Vish.
Joining me today.
With prepared.
Remarks are Dr. Vish, Seshadri, Chief Executive Officer, Dr. Brian, Kevin <unk>, Chief Technical Officer Dr.
Dr Mato, Nevada, Chief commercial officer, and Joe <unk> Chief.
<unk> financial officer.
After the prepared remarks, we will conduct a Q&A session.
With that I will now turn the call over to vision Seshadri leaves off.
<unk>.
Thank you Greg.
Vishwas Seshadri: Thank you, Greg. The Q3 of 2025 was marked by significant operational progress as we continue to scale the ZEVASKYN commercial launch to meet growing patient demand. While our first patient treated has shifted to the Q4 of 2025 due to optimization of a product release assay, our conviction in our ability to achieve our 2026 launch goals remains steadfast based on trends in patient demand, treatment center expansion, and market access. We're seeing growing patient demand for ZEVASKYN, the first and only autologous cell-based gene therapy for the treatment of adult and pediatric patients with recessive dystrophic EB or RDEB. We also continue to strategically expand our qualified treatment center, or QTC network.
In the third quarter of 2025 was marked by significant operational progress as we continue to scale. The <unk> commercial launch to meet growing patient demand, while our first patient treated has shifted to the fourth quarter of 2025 due to optimization of our product release assay, our conviction and our ability to achieve our 2000.
26 launch goals remain steadfast based on trends in patient demand treatment center expansion and market access we're seeing growing patient demand for <unk>. The first and only autologous cell based gene therapy for the treatment of adult and pediatric patients with recessive dystrophic E. B are our debt. We also continue to strategically expand our.
The qualified treatment center acute DC network the activation of our highly recognized EV Center Children's Hospital, Colorado brings our total activated centers to three for the mall. We have established a strong foundation with broad market access which is essential for sustained commercial success in summary, despite the temporary delay in.
Vishwas Seshadri: The activation of a highly recognized EB center, Children's Hospital Colorado, brings our total activated centers to 3. Furthermore, we have established a strong foundation with broad market access, which is essential for sustained commercial success. In summary, despite the temporary delay in the first patient treatment, we are well-positioned for launch success in 2026. Before we dive deeper into our commercial launch progress and momentum, I now hand the call to our Chief Technical Officer & Chief Scientific Officer, Dr. Brian Kevany, to briefly highlight the release assay optimization. Brian.
First patient treatment, we are well positioned for long success in 2026 before we dive deeper into our commercial launch progress and momentum I'll now hand, the call to our chief Technical and scientific officer, Dr. Brian Kennedy to briefly highlight the release assay optimization Brian.
Thanks, Mitch and Hello, everyone.
Brian Kevany: Thanks, Vish, and hello, everyone. As we continue the ZEVASKYN's launch, we remain dedicated to maintaining the highest standards of quality in the manufacturing of personalized drug products for each patient. During Q3, a full batch of drug product was manufactured following a patient biopsy but could not be released due to a performance issue in one of our release assays. Specifically, a rapid sterility assay delivered false positive results, which required us to reject the lot. The rapid sterility assay was not part of our clinical trials and was an FDA requirement that was added during the BLA review. Retesting using established gold standard USP sterility methods confirmed the sterility of the product, unfortunately, those test results were not available until after the lot's expiration date, so they could not be used to release the lot.
We continue the deepest skin launch we remain dedicated to maintaining the highest standards of quality in the manufacturing of personalized drug product for each patient.
During the third quarter, a full batch of drug product was manufactured following a patient biopsy could not be released due to a performance issue in one of our release assays.
Specifically, our rapid sterility assay delivered false positive results, which required us to reject a lot.
The rapid sterility assay was not part of our clinical trials and was an FDA requirement that was added during the BLA review.
Retesting using established gold standard USP sterility methods confirmed the sterility of the product, but unfortunately those test results were not available until after the lots expiration date. So they could not be used released a lot.
Brian Kevany: As a proactive measure to ensure product quality, we temporarily paused collecting additional patient biopsies so that we could conduct a thorough investigation, run additional tests, and further optimize the new release assay. Following successful completion of optimization, validation, and the necessary regulatory submissions, we resumed biopsy collection in November 2025. We now anticipate patient treatment starting in Q4 2025. I will now hand the call over to Chief Commercial Officer, Madhav Vasanthavada, to discuss our commercial launch progress. Madhav.
As a proactive measure to ensure product quality, we temporarily pause collecting additional patient biopsies. So that we can conduct a thorough investigation run additional test and further optimize the new release assay.
Following successful completion of optimization validation and the necessary regulatory submissions, we resumed biopsy collection in November 2025.
We now anticipate patient treatment starting in the fourth quarter of 2025.
I will now hand, the call over to Chief commercial officer, Manav methodical thought of antibiotics to discuss our commercial launch progress Manav.
Thanks, Brian.
Madhav Vasanthavada: Thanks, Brian. Hello, everyone. Our launch momentum continues to accelerate on multiple fronts. Patient demand continues to build, our relationships and trust with qualified treatment centers have grown stronger, and patient access to ZEVASKYN across all payer types has continued to broaden. On our Q2 call, we mentioned more than 12 initial patients were identified at the first 2 qualified treatment centers. Of these patients, we have already received ZEVASKYN product order forms or ZPOFs for 12 patients. A ZPOF is an informed consent generated by the QTC physician after the patient has been consulted, a treatment decision has been made, and the patients and their families have decided to move forward. Insurance prior authorizations have been obtained for several patients already, and we expect these patients to be biopsied over the coming months as and when full financial clearance is in place.
Hello, everyone.
Our launch momentum.
<unk> accelerates.
On multiple fronts.
Patient demand continues to build.
Our relationships and trust with qualified treatment centers have grown stronger.
And patient access to zebra scan across all payer types has continued to broaden.
On our second quarter call, we mentioned more than a dozen initial patients were identified and the first to quantify treatment centers.
All these patients who have already received zebra skin product order forms audit Z Pos for 12 patients.
Z path.
Form content generated by the <unk> physician after the patient has been consulted.
A treatment decision has been made.
And the patients and their families have decided to move forward.
Insurance prior authorizations have been obtained for several patients already and.
And we expect these patients to be biopsied over the coming months as and when full financial cadence is in place.
We are happy to also report that demand for zebra skin continuous to grow.
Madhav Vasanthavada: We are happy to also report that demand for ZEVASKYN continues to grow. The number of identified eligible patients at our QTCs who are motivated to initiate the treatment process has now more than doubled to approximately 30 patients, up from the 12 plus mentioned on the Q2 call. At the same time, the broader pool of potential ZEVASKYN candidates at non-QTC referral sites continues to increase as our field force and promotional activities generate more ZEVASKYN awareness in the marketplace, and many of these referral sites have initiated patient referrals to the qualified treatment centers, which is exactly what we were hoping for. Regarding QTC activations, we are delighted that Children's Hospital Colorado is our newest ZEVASKYN qualified treatment center.
The number of identified eligible patients at our <unk>, who are motivated to initiate the treatment process has now more than doubled to approximately 30 patients.
The 12, plus mentioned on our second quarter call.
At the same time, the broader pool of potential <unk> candidates at non QBC reference sites.
Continues to increase as our field force and promotional activities generate modest leave us getting awareness in the marketplace and many of these <unk> sites have initiated patient referrals to the qualified treatment centers.
Which is exactly what we were hoping for.
Regarding QVC activations.
We're delighted that children's hospital, Colorado is our newest ziv us getting qualified treatment center.
Children's Hospital, Colorado has an expert.
Madhav Vasanthavada: Children's Hospital Colorado has an expert multidisciplinary team with years of EB experience. Their commitment to onboarding ZEVASKYN speaks to their belief in the benefits this therapy can bring to our patients. Activation of Children's Colorado brings the number of ZEVASKYN qualified treatment centers to three, alongside Lurie Children's Hospital of Chicago and Lucile Packard Children's Hospital Stanford. We are also in active discussions with several EB centers across the US to strategically expand geographic footprint of ZEVASKYN even further. These centers are advancing through the various stages of site onboarding and will continue to announce new centers as they are activated. Regarding market access, we have seen a steady cadence of positive coverage decisions from both national and regional commercial health plans in the six months since approval.
Disciplinary team.
With years of experience and their commitment to Onboarding Zelus, Ken speaks to their belief in the benefits. This therapy can bring to our net patients.
Activation of children's Colorado brings the number of zebra skin qualified treatment centers to three.
Alongside Laurie Children's hospital of Chicago, and Lucile Packard Children's hospital at Stanford.
We are also in active discussions with several EV centers across the U S to strategically expand geographic footprint gave us gain even further.
These centers are advancing through the various stages outside onboarding and will continue to announce new centers as they are activated.
Finally regarding market access.
We have seen a steady cadence of positive coverage decisions from both national and regional commercial health plans in the six months since approval.
Importantly policies covering zebra skin has been published by all major commercial payers, including Unitedhealthcare.
Madhav Vasanthavada: Importantly, policies covering ZEVASKYN have been published by all major commercial payers, including UnitedHealthcare, Cigna, Aetna, Anthem, and the majority of Blue Cross Blue Shield plans, all collectively covering more than 80% of all commercially insured lives. Now on the government payer front for Medicaid. We are happy to report that ZEVASKYN now has received baseline coverage across all 51 state Medicaid programs in Puerto Rico, effective 1 October 2025. Multiple state Medicaid programs have already published policies covering ZEVASKYN, signaling that payers recognize the value ZEVASKYN brings to their patients and the healthcare system. As another major highlight, CMS has established a permanent product J-code for ZEVASKYN that will go into effect on 1 January 2026. We believe that this product code will simplify claims and reimbursement processing between our QTCs and all payer types and will further support hospital adoption for ZEVASKYN.
Cigna, Aetna anthem, and the majority of Bluecross Blueshield plans, all collectively covering more than 80% of all commercially insured lives.
Now on the government payer front for Medicaid we are.
We're happy to report that Zebra skin now has received baseline coverage across all 50 state Medicaid programs in Puerto Rico effective October one 2025.
Moreover, multiple state Medicaid programs have already published policies covering veeva skin signaling that payers recognize the value <unk> brings to their patients and the healthcare system.
Another major highlight CMS has established a permanent <unk> J code for.
Zero skin, that's really go into effect on January one 2026.
We believe that this protocol will simplify claims and reimbursement processing between our acute disease and all payer types and will further support hospital adoption foreseeable skin.
In summary, we are very encouraged by the growing patient demand.
Madhav Vasanthavada: In summary, we are very encouraged by the growing patient demand, patients actively progressing toward treatment, continued growth of the QTC site network, and a favorable market access landscape for ZEVASKYN. We are looking forward to a strong start in 2026. With that, I'll now pass the call over to our Chief Financial Officer, Joseph Vazzano, to discuss our financial results. Joe.
Patients actively progressing toward treatment.
Continued growth of the <unk> site network.
And a favorable market access landscape for zero skin and we're looking forward to a strong start in 2026.
With that I'll now pass the call over to our Chief Financial Officer, Joe <unk> to discuss our financial results.
Sure.
Thanks Manav.
Joseph Vazzano: Thanks, Manoj. I would like to remind everyone that you could find additional details on our financial results for the 3 and 9 months ended 30 September 2025 in our most recent Form 10-Q. Starting with our financial resources, we had cash equivalents, restricted cash, and short-term investments totaling $207.5 million as of 30 September 2025. This robust cash position provides us with significant financial flexibility as we execute on the ZEVASKYN commercial launch. The current cash position, without accounting for anticipated revenue from ZEVASKYN, is expected to be sufficient to fund current and planned operations for over 2 years. Turning to the statements of operations. Research and development, or R&D spending for the 3 months ended 30 September 2025 was $4.2 million, compared to $8.9 million for the same period of 2024.
I would like to remind everyone that you can find additional details on our financial results for the three and nine months ended September 32025, and our most recent Form 10-Q.
Yeah.
Starting with our financial resources, we had cash cash equivalents restricted cash and short term investments totaling $207 $5 million as of September.
Timber 32025.
This robust cash position provides us with significant financial flexibility as we execute on the <unk> commercial launch.
The current cash position without accounting for anticipated revenue from zebra skin.
As expected to be sufficient to fund current and planned operations for over two years.
Turning to the statement of operations.
Research and development or R&D spending for the three months ended September 32025 was $4 $2 million.
Compared to $8 $9 million for the same period of 2024.
This reduction was primarily due to costs capitalized into inventory and the reclassification of selected costs, such as engineering runs and other production costs to selling general and administrative expense or SG&A. Following ziv, it's gains FDA approval.
Joseph Vazzano: This reduction was primarily due to costs capitalized into inventory and the reclassification of selected costs such as engineering runs and other production costs to selling, general, and administrative expense, or SG&A, following ZEVASKYN's FDA approval. SG&A expense were $19.3 million for the 3 months ended 30 September 2025, compared to $6.4 million for the same period of 2024. This increase reflects the reclassification of R&D expenses as noted, along with increased headcount and professional costs associated with the commercial launch of ZEVASKYN. Our net loss was $5.2 million for Q3 2025, or -$0.10 per basic and diluted common share, compared to a net loss of $30.3 million in Q3 2024, or -$0.63 per basic and diluted common share.
SG&A expense.
Were $19 $3 million for the three months ended September 32025, compared to $6 $4 million for the same period of 2024.
This increase reflects the reclassification of R&D expenses as noted.
Along with increased head count and professional costs associated with the commercial launch of <unk>.
Our net loss was $5 $2 million for the third quarter of 2025, or a negative <unk> 10 per basic and diluted common share.
Compared to a net loss of $33 million in the third quarter of 2024 were negative.
63 cents per basic and diluted common share.
In terms of upcoming Investor Relations activities, we plan to participate in the Stifel 2025 Health Care Conference Tomorrow.
Joseph Vazzano: In terms of upcoming investor relations activities, we plan to participate in the Stifel 2025 Healthcare Conference tomorrow. With that, I'll pass the call back to Vish for additional remarks before opening the call for Q&A.
With that I'll pass the call back to vish for additional remarks before opening the call for Q&A.
Thank you Joe.
Vishwas Seshadri: Thank you, Joe. Turning briefly to our pipeline, we have two key updates. First, our gene therapy program for X-linked retinoschisis, ABO-503, has been selected to participate in the FDA Rare Disease Endpoint Advancement, RDEA, pilot program. This selection will provide opportunities for enhanced communication with the FDA to accelerate the development and validation of product-specific novel efficacy endpoints for the program. Second, we have strengthened our management team with the appointment of Dr. James A. Gow as the Senior Vice President, Head of Clinical Development & Medical Affairs. Dr. Gow brings over 20 years of industry experience and is a recognized expert in gene therapy, especially in ophthalmology, which will be valuable as we advance our pipeline.
Turning briefly to our pipeline we have two key update first.
Our gene therapy program for X linked Retinoschisis or <unk> zero III has been selected to participate in the FDA rare disease endpoint advancement are they a pilot program. This election will provide opportunities for enhanced communication with the FDA to accelerate the development and validation of products.
Perfect novel efficacy endpoints for the program.
Second we have strengthened our management team with the appointment of Dr. James Gow as the senior Vice President head of clinical development and Medical Affairs. Dr. Gao brings over 20 years of industry experience and is a recognized expert in gene therapy, especially in ophthalmology, which will be valuable as we advance our pipeline.
In closing when the first patient treatment has shifted to the fourth quarter of 2025, we are encouraged by the doubling of identified patients 10 product order from 12th product art forms the expansion to a third PTC and the broad and rapid payer coverage across commercial and government plans. This progress.
Madhav Vasanthavada: In closing, while the first patient treatment has shifted to the Q4 of 2025, we are encouraged by the doubling of identified patients, 12 product order forms, the expansion to a 3rd QTC, and the broad and rapid payer coverage across commercial and government plans. This progress underscores the high-value proposition of ZEVASKYN for the RD community. With that, I will now open the call for Q&A. Jenny, please open the Q&A session.
Underscores the high value proposition of Siemens skin for the artist community with that I will now open the call for Q&A Jenny. Please open the Q&A session.
Operator: Thank you very much. At this time, we will be conducting our question and answer session. If you would like to ask a question, please press star one on your phone keypad. A confirmation tone will indicate that your line is in the queue. You may press star two if you would like to remove your question from the queue. For anyone using speaker equipment, it might be necessary to pick up your handset before you press the keys. Please wait a moment whilst we poll for questions. Thank you. Our first question is coming from Maury Raycroft of Jefferies. Maury, your line is live.
Thank you very much at this time, we will be conducting a question and answer session. If you'd like to ask a question. Please press star one on your phone keypad confirmation tone will indicate that your line is Nicky you May press star two if you would like to remove your question from Nicky if anyone using speaker equipment it might be necessary.
I need to pick up your handset before pressing keys. Please wait a moment, whilst we poll for questions.
Thank you. Our first question is coming from Maury Raycroft of Jefferies. Your line is live.
Hi, Thank you for taking our questions. This is on for Maury a couple of questions from us.
[Analyst] (Jefferies): Hi. Thank you for taking our questions. This is Amin on for Maury. A couple of questions from us. You mentioned receiving ZEVASKYN Product Order Forms for 12 patients. What's the expected timeline for these patients to receive treatment at this point? I have a follow-up.
Hi, you mentioned receiving zero skin a.
Product order from.
Order forms for 12 patients what's the expected timeline for these patients to receive treatment at this point.
And I have a follow up yes. Thank you for that question.
Vishwas Seshadri: Yeah. Thank you for that question, Amin. I'll request Madhav to take that one.
Request module to take that one.
Hey, Thanks for the question. So these patients as I mentioned the product order for them is the first step and after that date or insurance discussions that have been ongoing between the qualified centers and the payers for many of these patients already we have a prior off some of them.
Madhav Vasanthavada: Hey, thanks, Amin, for the question. These patients, as I mentioned, the Product Order Form is the first step. After that, there are insurance discussions that have been ongoing between the qualified centers and the payers. For many of these patients already, we have a prior auth. Some of them have already been scheduled for biopsy in November this year, as well as in early part of 2026. We expect that this all paperwork goes through administrative process in the coming months to treat these patients.
Yes.
Have already been scheduled for biopsy.
In November this year as well as in early part of 2026. So we expect that this all paperwork goes through had been stated process in the coming months.
These patients.
Okay helpful. Thanks, So thanks, Manav, the only point I wanted to add.
[Analyst] (Jefferies): Okay. Helpful. Thank you.
Vishwas Seshadri: Thanks, Madhav. The only point I want to add there, Amin, is that as Madhav mentioned, these 12 patients are at various points in their journey. To generalize how much time it'll take for these 12 patients to come all the way through the funnel into a treatment, it's a hard thing to do at this point in time. What we believe is as we start to treat patients, this is gonna normalize. Metrics in terms of time taken from a Z-POF to various time points in the journey, we'll have better idea having been through that process for a bunch of patients, which we should have in Q1 2026.
There I mean is that at.
As Martin mentioned these 12 patients are at various points in their journey to generalize how much time. It would take for these 12 patients to come all the way through the funnel into a treatment. It's a hard thing to do at this point in time, but what we believe is as we start to treat patients. This is going to normalize so metrics in terms of in terms of time taken from a zip off.
To various time points in the journey.
We'll have better idea, having been through that process for a bunch of patients, which we should have in the first quarter of 2026.
Okay. Thanks, and after 12 years of his skin product order for <unk>.
[Analyst] (Jefferies): Okay. Thanks. Of the 12 ZEVASKYN Product Order Forms, how many are from patients referred to QTCs versus patients already being treated in these sites? What's your timeline estimate for achieving profitability at this point? Is that bumped by a quarter based on the current delay?
How many are from patients who are referred to Q T six versus patients already being treated then decides and what's your timeline estimate for achieving profitability. At this point is that bumped by quarter based on the current delay.
Yeah.
Yes.
Vishwas Seshadri: Yeah. Madhav, you can take the first question.
Madhav Vasanthavada: On the topic of the first question.
Good question, yes. So the first question the vast majority on an acute disease.
Vishwas Seshadri: Yeah.
Madhav Vasanthavada: Yeah. The first question, the vast majority are at the QTCs, Amin. There are patient referrals that already have been initiated, and those patients will go through the consult process as well. For the 12 patients that we've talked about, the vast majority are, you know, the patients at the QTCs.
And in our patient referrals that already have been initiated and those patients will go through the console process as well.
For the 12 patients and we've talked about the vast majority are homegrown all the patients have acute disease.
Yeah, and also I mean.
Vishwas Seshadri: Yeah. Also, Amin, to your second part question, which is how does it impact the time to profitability? We don't see a significant impact. I think in the past we've guided that in H1 2026, we should be a profitable business, and that continues to be our projection. We do not see the first patient treatment shifting to Q4 significantly impacting that timeframe.
<unk> Park question, which is how does it impact the time to profitability, we don't see a significant impact I think in the past we've guided that in the first half of 2026, we should be a profitable business in that.
Continues to be our projections. So we do not see the first patient treatment shifting to quarter for Cigna.
Significantly impacting that timeframe.
Thanks.
[Analyst] (Jefferies): Thanks.
Okay. Thank you very much. Our next question is coming from Christian. Please go <unk> of Cantor Fitzgerald Christian Your line is live.
Operator: Okay. Thank you very much. Our next question is coming from Kristen Kluka of Cantor Fitzgerald. Kristen, your line is live.
Hi, This is Rick on for Chris and Thanks for taking our questions to start out or are you still planning on shutting the plant down in December for the routine maintenance and if so whats the timeline around reopening there.
[Analyst] (Cantor Fitzgerald): Hi, this is Rick on for Kristen. Thanks for taking our questions. To start out, are you still planning on shutting the plant down in December for the routine maintenance? If so, what's the timeline around reopening there?
Yes, Thanks for that question and it's a great question, Yes, we do have a shutdown which starts approximately.
Vishwas Seshadri: Yeah. No, thanks for that question, and it's a great question. Yes, we do have a shutdown which starts approximately, you know, second week or mid-December and takes about a month. Brian, you can add some color if I missed the timing or anything else to add there.
Second week or mid December and it takes about a month.
Brian you can add some color.
If I missed the timing or.
Any anything else to add there.
Brian Kevany: No. No, Vish, that's accurate. Yeah. This is really a mandated FDA requirement to have this type of shutdown at the end of the year for general maintenance and recalibrations of equipment. Yeah, mid-December to early January is the current schedule for the shutdown.
No.
That's accurate, yes, and this is really a mandated FDA requirement to have this type of shutdown at the end of the year for general maintenance and Recalibration of equipment, but yes mid December to early January is the is the current schedule for the shutdowns.
Okay and on the temporary pause, while you're working on the optimization, where there any biopsies that were collected but not yet center manufacturing before the temporary pause in re optimization and if so will you be able to just sort of move into manufacturing with these or will you.
[Analyst] (Cantor Fitzgerald): Okay. On the temporary pause, while you were working on the optimization, were there any biopsies that were collected but not yet sent to manufacturing before the temporary pause and re-optimization? If so, will you be able to just sort of move into manufacturing with these, or will you need to re-biopsy any patients?
Need to re biopsy any patients.
Yes, the answer is no we.
Vishwas Seshadri: Yeah. The answer is no. We paused on collecting any further biopsies when this happened. Not from any regulatory action or anything, but our own abundance of caution to avoid patients giving their biopsies and especially until we solved this problem, we didn't know what exactly the problem was, how long it'll take for us to resolve it. We didn't take any chances there.
We paused on collecting any further biopsies when this.
Happened.
Not from any regulatory action or anything but our own.
Abundance of caution to avoid patients.
Sure.
Giving their biopsies and especially until we solved.
This problem, we were not we didn't know what exactly the problem was how long it'll take for us to resolve it so.
Take any chances there.
Okay. Thank you.
[Analyst] (Cantor Fitzgerald): Okay. Thank you.
Thank you very much. Our next question is coming from Robert <unk>.
Operator: Thank you very much. Oh, apologies. Our next question is coming from Stephen Willey of Stifel. Steven, your line is live.
Apologies. Our next question is coming from Stephen Willey of Stifel. Steven Your line is live.
Hey, good morning, Thanks for taking the question. This is Josh on for Steve.
[Analyst] (Stifel): Hey, good morning. Thanks for taking our question. This is Josh. I'm for Steve. Is there maybe any color you can share related to the current lead time between receiving these, ZEVASKYN Product Order Forms following initial patient identification efforts? Do you anticipate this to maybe come down over time as patient demand continues to increase?
Is there maybe any color you can share related to the current lead time between receiving these skin.
Skin product order forms following initial patient identification efforts.
Do you anticipate that maybe come down over time as well.
Asian demand continues to increase.
Yes.
Madhav Vasanthavada: Yeah. I can take that, Josh. Yes, we do expect this will reduce, decrease over a period of time. Like I mentioned earlier, some of these patients, even though the Z-POFs we received a couple of months ago, they're already scheduled for biopsy collection starting next year, and we have resumed biopsies already. As more and more patients come through and the processes at the qualified centers and the payer policies coming through nicely, we expect this overall time to reduce. At this point, when we mentioned on our Q2 call, it's about a 3-month process is what it takes, you know, from the time that you have a patient identified, consulted, prior auth, you know, from a clinical standpoint and any agreements that take place.
I can take that Josh.
So yes, we do expect this bill.
Reduced decrease over a period of time.
Like I mentioned earlier some of these patients even though the Z boss rig.
Steve.
A couple of months ago.
They are already scheduled for.
<unk> biopsy collection.
Starting next year, and we have resumed biopsies already so as more and more patients come through in the processes and the quantified centers and the payer policies with payer policies coming through nicely. We expect this overall time to reduce at this point when we mentioned on our second quarter call.
It's about three months process is what it takes from the time that you have a patient identified consulted prior off from.
From a clinical standpoint and.
Any agreements that take place.
Madhav Vasanthavada: As more and more patients go through the queue, we should expect that process to come down, and we'll guide more in terms of what we are seeing over a period of next quarter or so.
And as more and more patients go through the Q, we should expect that process to come down and we'll guide more in terms of what we're seeing.
Over a period of the next quarter or so.
Yes, the only other thing I would add there Josh is that the very first few patients at the time when their prior art and letters of agreements we're going through.
Vishwas Seshadri: Yeah. The only other thing I would add there, Josh, is that the very first few patients at the time when their prior auth and letters of agreements were going through, the policies were not published by some of these payers. They have come in more recently. That's the basis why we believe that for the future patients coming through the funnel, that time should reduce because the policy is already in place, and we don't need exceptions for the patients.
The policies were not published by some of these payers they have come in more recently, so that's the basis why we believe that.
For the future patients coming through the funnel that time should reduce because of policy is already in place and we don't need exceptions for the patients right.
[Analyst] (Stifel): Right.
Madhav Vasanthavada: I'll just say that this is nothing new about ZEVASKYN. Any cell and gene therapy that has launched goes through these kinds of process. The centers that we are working with are super experienced about working with cell and gene therapies. We've got a good team in place. We've got a good market access team on our side in place. The receptivity that we are getting from insurance companies and the willingness for the payers to work with centers to expedite this process is there. As more and more patients go through for a given payer, that time for agreements will also we expect that to come down.
I would just say that this is nothing new about Veeva scans.
Cell and gene therapy that has launched goes through these kinds of process and the centers that we are working with our super experienced about working with LNG and therapies. So we've got a good team in place we've got a good market access team and our site in place.
And the receptivity that we're getting from insurance companies and the willingness for the payers to work with centers to expedite. This process is there so as more and more patients go through for a given payer that time four agreements will also we expect that to come down.
Okay I appreciate the color. Thank you.
[Analyst] (Stifel): Okay. Appreciate the color. Thank you.
Thank you very much. Our next question is coming from Ram Silverado <unk> of HC Wainwright, Rob Your line is live.
Operator: Thank you very much. Our next question is coming from Ram Selvaraju of H.C. Wainwright & Co. Ram, your line is live.
Thanks, so much for taking my questions. Firstly I was wondering if you could give us some additional granularity on what you expect the attrition rate if any to be among those patients for whom the path has been received.
Ram Selvaraju: Thanks so much for taking my questions. Firstly, I was wondering if you could give us some additional granularity on what you expect the attrition rate, if any, to be among those patients for whom Z-POFs have been received, you know, before you go through the entire biopsy, cell graft engineer, and subsequently administration of the graft. You know, just give us a sense of, you know, of those initial 12 patients, just taking that number as an example, how many do you anticipate are going to go successfully through the entire treatment process?
Before you go through the entire buy.
Biopsy.
So draft engineer.
And subsequently administration of the graph can you just give us a sense of you know all of those initial 12 patients that's taking that number as an example, how many do you anticipate are going to go successfully through the entire treatment process.
Madhav Vasanthavada: I would say it's a pretty high level of conversion, Ram, for these patients. 'Cause these are the patients that the physicians, obviously, you know, these are motivated patients, they want to move forward, which is why we have the Z-POF already come through. Insurance clearances and those processes we are working through those. So we expect, you know, now with this release assay optimization also behind us, we expect as biopsies come through to be able to treat, you know, these patients. Of course, these are engineered cell therapies, right, that we are talking about, but our success rate has been, from clinical trials perspective, has been pretty high.
I would say, it's a pretty high level of conversion.
For these patients.
These are the patients that physicians. Obviously these are motivated patients they want to move forward, which is which is why we have <unk> already come through and insurance clearances and those processes are work, we're working through those.
So we expect now now with this release assay optimization also behind us.
We expect as biopsies come through to be able to treat.
These patients of course these are.
Engineered cell therapies that we are talking about but our success rate has been from clinical trials perspective has been pretty pretty high. So for those reasons. We expect that these patients pretty pretty high level of conversion rate now that we have these deep ups already in place for these patients.
Madhav Vasanthavada: For those reasons, we expect that these patients pretty high level of conversion rate, now that we have these Z-POFs already in place for these patients. The fact that when we mentioned a little over 12 patients identified at these QTCs, for us to get 12 Z-POFs already shows that none of the patients that were identified, almost none of the patients that were identified early on actually said that, No, I'm not interested in getting Z-POF. I think that to me is a pretty strong metric. As more patients get into these funnel, and as patients get treated, you can already see the word of mouth and the data, you know, percolating, which only motivates additional patients to come through the process.
And the fact that when we mentioned a little over 1000 patients identified in <unk> for us to get 12 Z bus already shows that none of the patients echoed identified almost none of the patients that could identify early on actually said that no I am not interested in getting sequel, I think that to me is a pretty pretty strong metric.
And as more patients get into this funnel.
And as patients get treated you can already see the word of mouth and the data percolating was only motivates additional patients.
To conclude the process and I just wanted to add one more color to that Ron.
Vishwas Seshadri: I just wanted to add one more color to that, Ram. If you look at the number of patients that have been identified just organically within the QTCs that Madhav mentioned has more than doubled to about 30 patients or so. We're not even adding the referred patients. If you add that, the last call we had mentioned close to 50, and that number has gone way north, and we are not even talking about that right now. In some ways, from that big pool of identified patients, the QTCs are acting as kind of gatekeepers in giving us the Z-POFs because they also want to regulate how much they can treat. You know, these first 12 patients are earmarked as the, you know, the highest priority.
If you look at the number of patients that have been identified just organically within the acute tcs that Martin mentioned has more than doubled to about 30 patients or so we're not even adding the referred patients. So if you add that the last call. We had mentioned close to 50 and that number has gone away and we're not even talking about that right now and in some ways.
From that big pool of identified patients with acute tcs are acting as kind of gatekeepers and giving us the pumps because they also want to regulate how much they can treat in.
These the first 12 patients are earmarked as the.
The highest priority and so we do not anticipate.
Vishwas Seshadri: We do not anticipate attrition because for them, it's not easy to get the slot either. This is going to be just a matter of conversion.
Attrition because for them, it's not easy to get the slot either so.
It is going to be just a matter of conversion.
Okay. That's very helpful and then with respect to the prior authorization process for a prior authorization Proto.
Ram Selvaraju: Okay, that's very helpful. With respect to the prior authorization process or prior authorization, you know, protocol that you are seeing with respect to payers, can you maybe describe for us what that looks like? I'm in particular interested in situations involving RDEB patients with large chronic open wounds that have persisted for an extended period of time. What is the prior authorization requirement, if any, specifically in those types of patients, that's being mandated by payers at this time? Thank you.
Protocol that you are seeing with respect to payers can.
Can you maybe describe for us what that looks like and I'm in particular interested in situations involving our that patients with large chronic open wounds that have persisted for an extended period of time what is the prior authorization requirement if any specifically in those type of patients that.
Being mandated by payers at this time thank you.
Yes.
Madhav Vasanthavada: The prior auth process, Ram, essentially I can break it into 2 steps. One is a clinical prior authorization, the other is the financial discussion that takes place after a patient is clinically given a green signal from the insurance company. The prior auth, most payers, especially for these type of therapies, tend to follow the inclusion and exclusion criteria of the clinical trials. There are some payers who also cover it to the label, right? In terms of the requirements, it's often pretty straightforward. Make sure that the patient has recessive dystrophic EB, which means the genetic testing or confirmation of the mutation of the collagen VII A1 gene, that they have recessive DEB wounds.
So the prior auth process around essentially I can break it into two steps one is.
As our clinical prior authorization and the other is the financial.
Discussion that takes place after a patient is clinically.
Given a green signal from the insurance company.
The prior off.
Most payers, especially for these type of therapies tend to follow the inclusion exclusion criteria of the clinical trials.
And then there are some payers who also cover it to the label right.
No.
In terms of speed requirements, it's often pretty straightforward make sure that the patient has a recessive dystrophic ABB, which means the genetic testing are confirmation of the mutation of the <unk> 71 gene.
That they have recessive deb wounds.
Madhav Vasanthavada: You know, in our clinical trial, there were certain, you know, wound size requirements, but we are seeing most of the insurance companies now, for example, UnitedHealthcare covering to label, meaning no real requirement on the size of the wound for these patients. Some payers have age, 6 years and above, but our FDA label is broader, right from birth. Certain payers have those policies in place. When you do have a payer that, let's say it's a 5-year-old patient that requires the treatment, we are seeing that with the letter of medical necessity, you're able to overturn that, because you're able to explain as to what the impact ZEVASKYN is bringing, and we are successfully overturned those initial PA denials that typically happen. That's the process that take place.
In our clinical trial there were certain.
Wound size requirement, but we are seeing most of the insurance companies now for example, United healthcare coverage to label, meaning no real requirement on the side of the world for these patients.
Some payers have age six years and above but our FDA label is broader.
Right from Bert.
So certain payers have those policies in place.
But when you do have a payor that let's say, it's a five year old patient that required the treatment. We are seeing that with the letter of medical necessity youre able to overturn that.
Because you are able to explain as to what the impacts even skinny is bringing and we are successfully.
Overturn those initial denials that typically happen. So that's the process that take place and once you have that clear and then the next step is the financial agreement between the payer and the qualified center.
Madhav Vasanthavada: Once you have that clearance, then the next step is the financial agreement between the payer and the qualified center.
Vishwas Seshadri: No meaningful step edits, correct?
And no meaningful steps edits correct.
Madhav Vasanthavada: No, we have not seen any step edits.
No we have not seen any step edits.
Thank you.
Vishwas Seshadri: Thank you.
Operator: Thank you very much. Our next question is coming from Jeff Jones of Oppenheimer. Jeff, your line is live.
Thank you very much just to remind you that if you have any remaining questions. You can still joined the key by pressing star one on your key pattern.
Our next question is coming from Jeff Jones of Oppenheimer, Jeff Your line is live.
Jeff Jones: Good morning, guys, thanks for taking the questions. Can you comment on, of the 12 patients in process, how many have had their biopsies done today? Have any of those doses passed the revised sterility release criteria or with the new assay, rather?
Good morning, guys and thanks for taking the questions.
Can you comment on of the 12 patients in process. How many have had their biopsy done today and have any of those doses passed the revised sterility release criteria or with the new assay rather.
We wish you want me to take that sure.
Madhav Vasanthavada: Vish, you want me to take that?
Vishwas Seshadri: Sure. Yeah. I think as of this point, we announced that we have resumed biopsy, right? We have biopsied a patient, but we're not guiding how many are going to be biopsied within the time window for this year versus how many will spill over because that's an ongoing process, hasn't settled down. It's too early. We're going to be talking about that in our next quarterly call.
Sure, Yes, I think.
As of this point, we announced that we have resumed biopsy right.
Biopsy, the patient where we're not guiding how many are going to be biopsied within the time window for this year versus how many will spillover because thats an ongoing.
<unk> Hasnt settled down.
So it's too early we're going to be talking about that in our next.
Quarterly call.
Okay.
Jeff Jones: Okay. Can you remind us then, in terms of revenue recognition from the time that you dose these patients, how long until revenue recognition?
Can you remind us then.
In terms of revenue recognition from the time that you dose these patients.
How long until.
Revenue recognition.
Vishwas Seshadri: The revenue is recognized when the product is applied on the patient from an accounting standpoint. Obviously the cash flow has days to accounts payable that's involved. That's different for different. It's governed more by trade policies with each site. For reporting purposes, the revenue is recognized the day of administration.
The revenue is recognized when the product is applied on the patient.
From an accounting standpoint.
And obviously the cash flow has these two accounts payable that's involved that's different for different.
It's governed more by trade policies with each site, but.
For reporting purposes. The revenue is recognized the dose administration.
Great I appreciate it guys. Thank you.
Jeff Jones: Great. Appreciate it, guys. Thank you.
Thank you very much. Our next question is coming from James Molloy of Alliance Global Partners. James Your line is live.
Operator: Thank you very much. Our next question's coming from James Molloy of Alliance Global Partners. James, your line is live.
Hi, guys. Thank you for taking our questions Matt on for Jim today.
[Analyst] (Alliance Global Partners): Hi, guys. Thank you for taking our questions. Matt on for Jim today. Just one from us. Of the 30 patients that are slated to receive ZEVASKYN, how many are on background VYJUVEK currently or have failed VYJUVEK?
Just one from us.
The 30 patients that are slated to receive <unk>. How many are on background baidu that currently or have failed <unk>.
Madhav Vasanthavada: We, we don't have visibility into that, Matt. We would never have visibility into that, but we expect vast majority would be on VYJUVEK and/or on FILSUVEZ because that's what we hear from the patient community, that these patients require, you know, there's unmet need for multiple, you know, treatment options. We hear that from patients as well as from physicians across the board. We would expect those patients. From an access standpoint, that only helps us, right? Because these patients have their copies of genetic records and other letters and background already in place, so that physicians can provide that information to the payer because they have received prior other gene therapies. We don't know.
We don't have visibility into that.
Matt I don't we would never have visibility into that but we expect.
The vast majority would be on.
Baidu NR until service because that's what we hear from the patient community.
That these patients require.
The unmet need for multiple <unk>.
Treatment options, we hear that from patients as well as from physicians.
Across the board.
So we would expect those those patients and get.
From an access standpoint that only helps us right because these patients have their copies of genetic records and other letters and background already in place.
So that physicians can provide that information to the payer because they have received other gene therapies.
[Analyst] (Alliance Global Partners): Okay.
We don't know the architectural exact count.
Madhav Vasanthavada: the actual, you know, exact count.
[Analyst] (Alliance Global Partners): Got it. Thank you guys for taking our question.
Got it. Thank you guys for taking a question.
Thank you very much and our next question is coming from David pilots of Zacks small cap research David Your line is live.
Operator: Thank you very much. Our next question is coming from David Bautz of Zacks Small Cap Research. David, your line is live.
Hey, good morning, everyone.
David Bautz: Hey, good morning, everyone. Just one for me this morning. UMass was a center in the phase III study, and of course, noticed that they are not signed up as a QTC yet. I'm curious if there's any hold up there or why they are not listed as a QTC or haven't signed on yet.
Just one from me. This morning, So Umass was a center in the Phase III study and of course noticed that they are not signed up as of Q T. C. Yet I'm curious if there's any holdup there or why they are not.
This is as of Q T C H Robinson I don't yet.
Yes, I can I can take that question good morning, David.
Vishwas Seshadri: Yeah, I can take that question. Good morning, David Bautz. Certain different sites have different reasons. I don't wanna call out specific reasons, specific sites. Sometimes sites would intend to onboard and activate with us, there could be financial constraints on how the site is fairing. Sometimes, you know, the types of trade policies that we're willing to accept may not be fitting within their framework, right? There's multiple different reasons why a given site may not be onboarded yet with us as a ZEVASKYN site. We're not gonna be discussing specific sites. You know, hurdle on why they haven't been activated despite the fact that they've got experience with handling ZEVASKYN. I hope that gives some color to the types of reasons.
Different sites have different reasons I don't want to call out specific reasons specific sites. Some sometimes sites would intend to onboard and activate with us, but there could be financial constraints on how the site is ferring sometimes.
The types of trade policies that were willing to accept may not be footing within their framework right. So there's multiple different reasons why a given site.
Not be onboard it yet with us as a zero skin site.
But.
We're not going to be discussing specific sites.
Hurdle on why they havent been activated despite the fact that they've got experience with handling zebra skin.
Hope that gives some color to the types of reasons.
Yes, actually thats great I appreciate it.
David Bautz: Yeah. Actually, that's great. I appreciate it.
Thank you very much well we appear to have reached the end of our question and answer session I would now like to turn the call back over to rich for closing comments.
Operator: Thank you very much.
Vishwas Seshadri: Thank you.
Operator: Well, we appear to have reached the end of our question and answer session. I will now like to turn the call back over to Vish for closing comments.
Thank you very much Jenny and I really appreciate everyone joining us.
Vishwas Seshadri: Thank you very much, Jenny, and I really appreciate everyone joining us today for the call, and we look forward to talking to you soon. Bye-bye.
Today for the call and we look forward to talking to you soon bye bye.
Thank you very much. This does conclude today's conference call. You may disconnect. Your phone lines at this time and have a wonderful day, we thank you for your participation.
Operator: Thank you very much. This does conclude today's conference call. You may disconnect your phone lines at this time and have a wonderful day. We thank you for your participation. Goodbye.
Goodbye.