Conference Transcript - ABEO 2026-06-04

Maury Raycroft, Analyst — Jefferies

Hi, everyone. My name is Maury Raycroft, and I'm one of the biotech analysts here at Jefferies. I'm happy to introduce and welcome Vish Shashrageri, CEO, and Madhav Hassan Vada, the Chief Commercial Officer of Abiona Therapeutics. Thanks so much for joining us today.

Vishwas Seshadri, CEO

Thank you for having us, Maury.

Maury Raycroft, Analyst — Jefferies

And we're going to do fireside chat format, so maybe for those who are new to the story and the company, maybe provide an overview of where you're at with the launch today and talk about the key priorities across the pipeline over the next 12 to 18 months.

Vishwas Seshadri, CEO

Sure. Abiona is a cell and gene therapy company. Our focus is autologous ex vivo engineered cell therapy, and our lead product is Zivaskin. This was approved by the FDA for treating patients with wounds in patients with recessive dystrophic EB, and that approval happened in April 2025. We really launched the product more towards the end of the year. as we were optimizing some assays while onboarding sites of treatment. And we're very encouraged by the momentum that we've built in this launch. To date, we've activated six qualified treatment sites, centers, or QTCs in short. And we're seeing a good growth quarter over quarter, as we had shared in the most recent quarterly call. Starting with quarter four, we treated a patient, And then there's been a steady growth of patient treatments in quarter one. And we also gave a little bit of, you know, preview to how quarter two is going on in terms of having treated a patient. And one patient was in biopsy at that time and four more scheduled and a couple others in the process of getting scheduled. So that momentum is building and all this activity happening from the first two activated So as we see even more recently activated sites also bringing up patients for treatment, I think this is off to a good place right now.

Maury Raycroft, Analyst — Jefferies

Off to a good start. And can you talk about how the demand is shaping up to date? And just based on the 2Q trajectory, how are you thinking about expectations for third quarter and fourth quarter, both in terms of number of patients and pace of ramp?

Vishwas Seshadri, CEO

Yeah, the short answer is we expect to see continued growth in third and fourth quarter, but I think I'll let Madhav do the nuances there.

Madhav Vasanthavada, Other

Yeah, no, I mean, demand is strong. We continue to see patients getting identified, not just within the QTCs, but also out in the community setting. And as we see patients receiving to get more treatments and some of the recently activated centers, as they start putting patients on treatment, then we see more of the layering of the patients into the third and fourth quarter. So we are only seeing, we have increasing visibility to patients that are in the funnel and we think that this is going to climb up.

Maury Raycroft, Analyst — Jefferies

Okay. And on the first quarter call, you cited greater than 100 identified patients across QTCs and community physicians. Operationally, what does identified mean? Identified plus eligible versus actively pursuing treatment? I guess, how should we think about that?

Madhav Vasanthavada, Other

Yeah. So identified patients, these are physicians out in the community and qualified centers who can actively think of patients that they want to prioritize based on the clinical, you know really clinical parameters so these are patients with large chronic wounds that the doctors think are immediate candidates it's not to say that those are the only patients that they have there are other patients that are in their practice but these would be the immediate set of patients so the next step is referring those patients into the into the qualified centers so far we have about roughly 20 percent of those identified patients that are actively pursuing ziva skin treatments and as these patients clear through the treatment process, then we expect more of the patients continue to funnel in into the QTC.

Maury Raycroft, Analyst — Jefferies

Got it. You said 20% or 25? 20. 20%. Got it. And from identification to treatment, where's the biggest bottleneck in the funnel today? Is it payer approval versus, I guess, and how do you think about referrals, QTC intake, and biopsy or surgery?

Madhav Vasanthavada, Other

Right. I mean, since this is not an off-the-shelf product, it's an autologous, so downstream there are steps that need to take place, but upstream with any other cell and gene therapy, there are a lot of administrative steps that need to take place, right, especially payer interactions is one of the biggest bottlenecks still, the rate-limiting step, and we expect that to continue even with the new center as they come on board because they'll have to work with insurance, especially if it's an out-of-state, like, you know, patient. traveling from a different state, and if it's a Medicaid patient, then there are additional, you know, steps that take longer lead time. Most of these are usually one-time administrative steps, including, you know, physician getting enrolled in a different state program so as to treat their patients. But as these patients get treated, then, you know, we expect that that process also to streamline and get better. Got it. The only thing I'd like to add to that is,

Vishwas Seshadri, CEO

I mean, short answer is a QTC is the current bottleneck, but our livers are maximizing the number of QTCs that can be active. So we had communicated a goal of 5 to 7, and that could even go up beyond this year and maybe get to about a 10 QTCs by early next year. But also, as QTCs are learning the process of moving these patients, the flow rate within a QTC also is improving so both are levers that are going to cross cause growth and they will we will reach a time where the qtc is no longer kind of a bottleneck and as they clear more patients more referral uh can be you know accommodated at the qtc so that's really how we look at flow right now

Madhav Vasanthavada, Other

yeah and just one last thing i'd add is we are seeing like we mentioned treatments from lury children's in stanford right in some ways we are happy to see that luries and stanford are treating more patients, as opposed to all of the other centers treating one or two patients and kind of, you know, taking a pause, that just tells us that the experience, the end-to-end experience within these centers is getting better and better, and they are already treating and identifying more patients, which is always, you know, which is a positive sign there.

Maury Raycroft, Analyst — Jefferies

Yeah, and Vish, when would you get to that point to where you feel like there's not that much friction there, the bottleneck is gone with the QTCs?

Vishwas Seshadri, CEO

I think it's a little bit of a TBD because the QTCs are themselves learning. These are doctors that have not put patients through an autologous therapy in their practice in the past, right? So they're working with multiple stakeholders within their own organizations. There is a P&T committee. There are people that determine the payer pathways and how paperwork moves and things like that. So they're learning. We believe that some sites where you've seen a gap of being active but not yet produced to patients, it's really the initial starting trouble. Once they get that process going and they know how it moves, we believe that's going to be setting the ball in motion. So we feel strongly, we're very well positioned by start of 2027 that our first activated QTCs should be firing, you know, at cruise control rate. Got it. Got it. It makes sense. And

Maury Raycroft, Analyst — Jefferies

you mentioned prior that you're in active dialogue with about 45 physicians. What's the mix there? Maybe talk about the EB centers versus community derm, pediatric derms. And what are the top one to two objections that you hear before referral happens? These physicians are mainly out in the

Madhav Vasanthavada, Other

community setting and we have a field team in place that are actively engaging in dialogue with these physicians and you know the level of interest from community physicians is very strong and when the dialogue is happening between the physician and patients we are not seeing patients saying no I am not interested in ziva skin this is not a therapy for me so that's a pretty strong indicator of the interest and the level of interest out in the patients some of Actually, some of the physicians out in the community want to become a center to treat. And we know that there is some infrastructure that is required, so we have to essentially say that no referral. And they are open to referring the patients, because oftentimes in this setting, patients are traveling like hundreds of miles to go to a specialty center for other procedures. So that referral mechanics is going to get better. In fact, some of the patients that we have treated and actually they are in the funnel are already referred in into the QTCs. So, as their referred patients get treated, then referring physicians also want to funnel more patients into the QTC.

Maury Raycroft, Analyst — Jefferies

And you mentioned the travel distance, and you said that that hasn't really been a barrier. I guess in the real world, what's the practical limiter for travel cases? Is it logistics, timing, payer, caregiver burden? And how do you expect the patient mix to evolve between the local QTC patients versus out-of-state travelers over time?

Madhav Vasanthavada, Other

The mix will always remain that way. You will have a lot of out-of-state patients coming in because just sheer number of QTCs we have and the number of states. We expect to have about seven maybe this year and then hope to get around to about 10 number. So that mix will always remain. There are logistical aspects with travel and such, but again, like I said, these patients are used to traveling out-of-state. They trust EB centers. they would rather fly hundreds of miles to go to a doctor and the institution that they trust for other procedures versus anywhere else. And we have great support programs in place. You know, our AB&I assist program has been well-received, and we have patients who have gone through our clinical trials, especially long-distance travel, strong together network, also really, you know, helping future patients explain what the process is like. Got it. And for launch parameters,

Maury Raycroft, Analyst — Jefferies

There's multiple launch parameters that you're closely watching at this point. What's the single most important leading indicator you track that best reflects true demand right now?

Madhav Vasanthavada, Other

So right now, since we are in this initial sort of stages of launch since December we launched, there's a short term, then there is a midterm and a long term kind of a way I would look at it. So short term is what we are communicating, number of treatments, number of biopsies in that particular quarter. So we'll continue to give that kind of an outlook in every quarter for maybe a couple of quarters, and then we'll look to retire those kinds of KPIs. We have said 100-plus patients that have been identified that are out in the community. So that is a pretty strong indication of the level of interest, and our work is sort of cut out for 2026 and 2027 to convert those patients into treatments. And then in the long term, we know that there are about 750 patients, based on our claims data that are recessive, you know, patients phenotypically would have got large and chronic wounds. And, you know, coming again with other treatments such as Y-Juvec and Filsubes that are already in the market that have been identifying patients, many of these patients we believe will also be candidates for ZivaSkin. So coming in as a second to market gene therapy offers a lot of advantages. And just being able to target, and we know the types of physicians who actually have patients, right? So it's a way that we can actively engage with those physicians to convert

Vishwas Seshadri, CEO

those patients onto treatments. So when you say one true parameter that best predicts or something like that, right, it's really what Madhav was saying is that it's a viewpoint. Are you looking at it myopically versus are you looking at it strategically? And myopically, of course, how many biopsies are already scheduled? That's probably the best indicator of what's coming in next month or something whereas if you're looking at next year and the year after I think you know our conviction in the number of RDEV patients that have severe to moderate disease we believe that is our TAM and the 750 patients on average they're going to need two patients two treatments per patient and so there's a close to more than a thousand treatment opportunities right there And I think clearing that is going to be a question of when these sites will attain their best flow rates, you know?

Maury Raycroft, Analyst — Jefferies

Yeah, that makes sense. And kind of the next question I was going to ask just on prior comments from you guys where you said approximately one patient per month per QTC is achievable at steady state. What assumptions drive that, and are those assumptions informed by the two sites currently treating patients?

Madhav Vasanthavada, Other

Yeah, I think this is what the physicians at the hospitals, at the QTCs have told us, that treating one patient a month is doable within their facilities. There are some centers that can certainly treat more. They have the bed capacity. They have the patient volume, while others may not be as active because some of them are not EB centers. They're relying on inbound referrals. So on average, one patient per QTC per month is quite doable and realistic.

Maury Raycroft, Analyst — Jefferies

Got it. And getting to the point where all cylinders are firing, is that early 2027? Is that where, like you mentioned earlier, the QTCs are fully functioning? Would that be the point where you're at the one patient per month rate?

Vishwas Seshadri, CEO

I think the activated QTCs that we have today, right? I mean, if you even take the last activated QTC that we announced, that's a good time frame for them to have achieved their, you know, cadence, regular cadence. And, of course, those that get activated subsequently will have, you know, varying degrees of lead time to get to that. So that's a pretty good assumption.

Maury Raycroft, Analyst — Jefferies

Okay, and for new sites, you framed approximately four to five months from activation to first biopsy. What are you doing to compress the ramp with training, process standardization, and scheduling?

Madhav Vasanthavada, Other

Yeah, I mean, we are actively engaging with these centers now, even as they are getting, signing the master service agreement and activation to identify their patients, possibly start, you know, patient identification, prior auth process, if they can even initiate that. So these are some of the things that we are actively, you know, looking to do. And every institution is different in terms of the subsequent steps that they have to There is oftentimes a P&T review committee that takes place after the site is activated. There is a high-cost drug committee that's looking at it. But these are all institutional one-time steps, which we think is actually a good thing because that just means even at the leadership level, there is visibility that, okay, once we have onboarded this therapy, then we want to actually see patients getting treated at these centers.

Maury Raycroft, Analyst — Jefferies

Yeah, it makes sense. And for sites active for months but still slow to first biopsy, what is typically the gating factor for those sites?

Madhav Vasanthavada, Other

This particular one is, like I said, with any cell and gene therapy, it depends on the payer mix is where we are seeing is the deciding factor. There are certain institutions that just seem to have certain patients that are more Medicaid and more out of state, and that has been taking a little longer. But then on the flip side, you've got centers that are producing and they are actively identifying patients and are treating. So I think it's a net-net, and that's why, as we have now identified these four additional centers that are yet to treat, we know that they have patients and initiated that process. So we expect to see patients coming through from those centers as well.

Maury Raycroft, Analyst — Jefferies

And yeah, over the next two to three quarters, how should we think about the volume contribution from the first two centers versus newly activated QTCs?

Madhav Vasanthavada, Other

We should expect to see more patients coming in from the newly activated centers picking up in the subsequent quarters.

Maury Raycroft, Analyst — Jefferies

So by the end of the year?

Madhav Vasanthavada, Other

At the same time, Stanford and Lurie Children's also identifying patients.

Maury Raycroft, Analyst — Jefferies

So by the end of the year, could it be like a 75%, 25% split or a 90-10?

Madhav Vasanthavada, Other

I would say about, yeah, still majority would come from Stanford and, you know, like the early activated centers. And depending on how quickly they can clear up their process, you know, for the first few patients, then you will see first half of 27 is where you should expect more patients coming in from the recently activated centers.

Vishwas Seshadri, CEO

And the other part of that equation, right, with the question you asked, what the split between the first two centers versus the others, it's one of the reasons it's harder to predict is because even for the seventh site, we said five to seven is the goal this year. Even that seventh site, we have a few different sites that are working actively. We don't know which one may be that particular seventh site. Depending on how many patients they have, how aggressive they are with identifying patients, some of them may be identifying patients even before activation is completed and try to cut that time. If they come in with a lot of patients, that equation can change easily, right? Because we're dealing with small numbers right now today. So it's hard to predict, but I think Stanford and Lurie are going to be significant contributors.

Maury Raycroft, Analyst — Jefferies

Yeah, that makes sense. Okay, and maybe let's shift gears. Well, actually, for getting that third QTC, treating patients, what needs to happen there? Do you have an idea of what site that's going to be?

Vishwas Seshadri, CEO

I think the good news is it's not going to take until the year end to see that happening. I think they're all at the edge. It's different things need to happen at different sites. Which one is going to beat the other one? It's, you know, we'll have to just wait and see. But we are seeing some signs that, you know, hopefully by quarter three, you will see third sites, maybe fourth.

Madhav Vasanthavada, Other

Contributing patients. It's not a question of if, it's just a question of when. We know that these centers have patients because we are working with them. and we should expect treatments coming out, yeah.

Maury Raycroft, Analyst — Jefferies

So maybe by the second quarter earnings update, you could have some sort of an update on that?

Vishwas Seshadri, CEO

Possibly, yeah.

Maury Raycroft, Analyst — Jefferies

So shifting gears, you said no final payer denials and no attrition so far. Can you walk through just the Medicaid versus commercial pathways and which tends to be faster to authorization or reimbursement?

Madhav Vasanthavada, Other

Yeah, I mean, that's a really good sign. a sign we are seeing no final payer denials no final we've got like more than 95 percent of coverage uh policies published uh from commercial insurance and that's that's really a good sign medicaid we have coverage established baseline coverage across all 50 states so from a coverage standpoint we are in good shape um it's usually the time that takes between financial agreement, payment rate negotiation between the institution, the QTC and the payer that oftentimes dictate how quickly or how late it might take. Sometimes if you have already a payment rate established, not just for the product, the product part, the gene therapy, that's relatively straightforward because medical policy is in place. But it's usually the procedure, the anesthesia, the surgery and those aspects which for the first time, Those are the rates that takes time to negotiate. Once you have treated a patient, then subsequent patients, it gets better because you already have a pre-agreed contract in the prior. So it really depends on what pathway, you know, and the payer is.

Vishwas Seshadri, CEO

So it appears like in-state Medicaid is quick. The next is commercial. And the slowest would be an out-of-state Medicaid. Just from our so, you know, slim experience we've had in the last few months, this looks like what's happening there.

Maury Raycroft, Analyst — Jefferies

And how do those buckets break out again?

Vishwas Seshadri, CEO

Most patients, 60% of our patients are commercial, and about 30% to 35% may be Medicaid. But because we have such few sites, compared to the number of states you will, just by sheer numbers, there's going to be out-of-state Medicaid's out there.

Maury Raycroft, Analyst — Jefferies

That makes sense. And on retreatment, do you expect payers to view it as a routine continuation or a new high-friction approval each time? and what evidence data will make re-treatment smoother over time?

Madhav Vasanthavada, Other

Yeah, we are not expecting any friction during a re-treatment because, again, the payer has covered it for the first time and there are payment rates, everything established. So we expect the second time around to go smoother.

Maury Raycroft, Analyst — Jefferies

Got it. Okay. And what proportion of patients do you think are going to seek re-treatment? I think you said on average all the patients will get two.

Vishwas Seshadri, CEO

We believe a majority, I mean, almost every patient is going to look for a second treatment for the previously untreated wounds, and it's not just a matter of how much area we can cover in a treatment, it's also the location of these wounds, because in immobilizing the patient after application, you're not going to be able to do like a front and back wounds in the same surgery. So you're going to see patients come back more the rule than the exception that they will seek a second treatment.

Maury Raycroft, Analyst — Jefferies

And for patients who become more active or who are more active, if they disrupt a wound, I guess, how does that work? How do you anticipate that in your projections?

Vishwas Seshadri, CEO

Yeah, I don't know if that particular example itself changes our assumptions because retreatment is anyway something that's going to be driven by wounds that exist that were not treated all at once. But in that process, when they come for second treatment for newer wounds, if a particular sheet had to be applied to a previously treated wound, so be it, right? because the batch was created because you have other open wounded areas. So I don't think from a label perspective that's not restricted or anything, and doctors will prioritize which wounds they should treat with the number of sheets that are available.

Maury Raycroft, Analyst — Jefferies

Got it. Makes sense. And I wanted to talk about manufacturing too. Roughly what share of end-to-end cycle time is manufacturing versus payer administration and scheduling today, and which is the most fixable in the near term?

Vishwas Seshadri, CEO

Yeah, the turnaround time for manufacturing is relatively small compared to the patient journey once they enter the funnel but get to a biopsy, right? I mean, that's probably the most variable as well as longer path. And the turnaround time itself is about 25 days, right, versus we just discussed it can take anywhere between, you know, three to four months or five months for those patients to get to that point of biopsy. So in terms of optimization of turnaround time itself, I think that's relatively kind of fixed because how the product process is developed. But our optimization focuses all on how can we get the upstream journey of the patient up to the point of biopsy further streamline and optimize. And I think that's a matter of practice and experience that site by site you're going to see that improve with more treatments. Got it. And you've discussed ramping internal capacity to

Maury Raycroft, Analyst — Jefferies

approximately 10 by year end and designing additional suites as well. Where are you on the manufacturing ramp and timing to start complete additional suite build out?

Vishwas Seshadri, CEO

Yeah, the current manufacturing is six a month, right? So the number of slots we have. And we have already started making the amendment protocols. We're working with the agency in converting the RVV manufacturing suite into ZivaSkin drug product manufacturing, and that is still going on track to reach this 10 a month by fourth quarter this year. And we have designs for additional GMP space beyond the 10 a month we've already started some long lead activities like you know the right pipes and the carbon dioxide supplies and things like that but I think in terms of actually initiating construction work it's going to we have to do it a little thoughtfully so it doesn't disrupt the current ramp up that we've done in the current half of facility i think to get to a pretty good cadence of treating patients um by end of this year i think we want to get that undisrupted then we can talk because there are personnel that will be uh involved in the expansion part also and we don't want that to be a burden when we're trying to ramp up commercial treatments so we just have to do thoughtfully but we have long lead items

Maury Raycroft, Analyst — Jefferies

already taken care of. Got it. So the plans are definitely in place, but just the timing of when you actually want to do it, it's kind of, you want to optimize that. Correct. Okay. Makes sense. And for ex-US strategy, you said Europe and Japan are interesting, but logistics are tricky. What's the most likely first ex-US route? Is it shipping from Cleveland, regional manufacturing partner and ex-U.S. commercial partner?

Vishwas Seshadri, CEO

Yeah, the soonest or earliest ex-U.S. opportunity is definitely the markets that we can supply from Cleveland. We do have some work exploring which those markets could be. I know we discussed Europe, Japan. The challenges in that is also the cold chain biopsy that we have to bring from the patient to our site. It has to be within 24 hours. And our drug product, while it has 84-hour shelf life, it requires QP clearance once we even ship it out of here. And typically, if you look at CAR-T products, the additional time that they will put for turnaround time when you go from a U.S. to an ex-U.S. location from a U.S. supply, standard is one week. We've always had that model, right? So it's somewhat challenging, but as you said, the nearest opportunities would be Cleveland supply. But for those markets like Europe and Japan, we're under exploration for other models that would be a little bit more mid to long term, but like establishing maybe manufacturing outside if there is a partner that could do that. And we're happy to engage with tech transfer and things like that. So we're working that out. But near term, we'll look at Cleveland-based supply.

Maury Raycroft, Analyst — Jefferies

Got it. And now that you've got ZivaSkin on the market for a while, are you getting people from ex-US reaching out about the therapy? And could they potentially come to the US? It'd be very

Vishwas Seshadri, CEO

expensive. Oh, every day there is some email or something from an ex-US country saying we'd like to get ZivaSkin in our country and we'd like to work with you. I think that interest is definitely there. We're selective in how we go about it. I mean, of course, there's a lot of noise. We have to do the right strategy. So yeah, there is a lot of interest. Got it. Okay. Let's shift gears and

Maury Raycroft, Analyst — Jefferies

talk about 701. You're recently in licensed asset. Maybe you provide an intro to that and talk about the mechanism and how it differs from other CAR-T approaches. Yeah, I think the first thing is this

Vishwas Seshadri, CEO

is not a CAR-T, right? So it's, CAR-Ts typically have not produced a lot of, you know, success in solid tumors because of, you know, issues like tonic signaling and exhaustion of the T-cells and things like that. So if you don't have persistence, you won't be able to find the target and, you know, clear tumors effectively. This technology really overcomes that by using more like a physiological signaling structure that a TCR, native TCR, which is nature-made, But at the same time, it retains the binding ability like a CAR-T to directly bind to the antigen without the need for an MHC antigen presentation. So that's really what SIRT technology is. And we've been looking at this asset for two to three years now. And the preclinical studies, the first time I've ever seen that someone in a preclinical study has actually demonstrated the same counterpart control structure, which is a CAR-T with the same binder compared head-to-head with a SIRT with that binder and showing that physiologically as well as clinically in mice, you can see that difference, right? I think that's really exciting and we're not, I mean, this is going to be taking some time. The second half of next year is when we plan to go to clinic, but in the meanwhile, we're having dialogue with the FDA and getting to learn what the regulatory path looks like and we're still on track for that second half of next year to first in human.

Maury Raycroft, Analyst — Jefferies

Got it. And for PSMA, there's the perceptions that there's a lot of competition for that target. Where do you differentiate?

Vishwas Seshadri, CEO

Right. And if you take CARVIC-T many years ago, multiple myeloma would have looked like a crowded market, but it's a $2 billion drug. And the reason is because one-time therapy that gives you, you know, months to years of remission. That is the same kind of play that we're looking for in prostate cancer with RLTs and bispecifics and all those other technologies out there. it's still an unmet need because you have to get meaningful, durable remission, deep and durable remissions. And this is what the target product profile for our PSMA target is. And so, you know, Pluvicto, if you've followed that launch trajectory, that sets the path and we can definitely

Maury Raycroft, Analyst — Jefferies

offer this kind of a target product profile. Got it. And I think we're out of time, maybe just to close out, you've reiterated potential monthly profitability starting in June. What needs to happen operationally for that to be sustainable? And maybe just kind of highlight

Vishwas Seshadri, CEO

the key events ahead investors should be focused on. Yeah. And that is purely volume driven, right? If you have more than three patients treated in a given month, it's a cashflow positive month, right? That's as simple as that. And sustaining that is basically, I think, again, volume driven and with more sites and better flow rate per site. I think this is just an inevitable phenomena.

Maury Raycroft, Analyst — Jefferies

Okay, Vish Madhav, thanks so much for joining us today.

Vishwas Seshadri, CEO

Thank you, Maury. Appreciate it.