By John Vandermosten, CFA

NYSE:AZTR

READ THE FULL AZTR RESEARCH REPORT

Azitra, Inc. (NYSE:AZTR) reported 2024 results in a February press release highlighting several achievements and company goals. The Phase Ib clinical trial for ATR-12 in Netherton syndrome has started and is expected to produce initial safety data in the next few months. Activity is robust for the ATR-04 program in EGFRi skin rash with Fast Track status and FDA clinical study clearance granted for a Phase I/II study. The ATR-04 trial is slated to begin this spring. Other activity includes capital raises to support the clinical trial work and new patents granted and allowed. Azitra management has been busy participating in several investor and industry conferences including the Microcap Conference, Biotech Showcase, BIO-CEO and the European Academy of Dermatology meetings.

Operational and Financial Results

Azitra reported 2024 results in a press release and Form 10-K filing with the SEC on February 24^th. For the year ending December 31^st, 2024 and versus the prior year’s comparable period, revenues of $7,500 were reported compared with $686,000 in the prior year. Net loss for the year totaled ($9.0) million or ($2.37) per share. Operational expenses rose 44% as increases in both research and development (R&D) expenses and general and administrative (G&A) expenses were recognized. Below, we detail financial results for 2024, compared to the same prior year period:

• Revenues were $7,500, compared to $686,000 with amounts in both periods related to the Bayer joint development agreement (JDA);
• Research and development expenses totaled $4.7 million, up from $3.8 million with the increase attributable to moving ATR-12 into the clinic and the use of clinical consultants. Greater spending was also due to advancing the ATR-04 program and higher salaries and benefits partially offset by lower other costs;
• General & Administrative expenses were $6.3 million, up from $4.5 million due to greater public company costs, salaries and benefits in part related to the hiring of the Chief Financial Officer, costs related to the CEO’s performance-based options and public relations costs among other miscellaneous expense inflation;
• Net interest income was $110,000 compared to net interest expense of ($166,000);
• Other income was $1.9 million due to an increase in fair value of warrants related to a stock price decline partially offset by a loss on issuance of common stock;
• Net loss was ($9.0) million vs. the prior year’s ($11.3) million or ($2.37) in 2024;

As of December 31^st, 2024, cash totaled $4.6 million. This amount compares to the $1.8 million balance in cash held at the end of 2023. No debt was held on the balance sheet. 2024 cash burn was ($10.6) million versus ($7.7) million in 2023. Cash from financing was $13.3 million representing the gross $5 million raise in February and the gross $10 million raise in July.

Following the end of the reporting period, Azitra raised an additional $2.2 million in a public offering and direct offering in January and February respectively. The public offering sold 4.9 million shares at $0.30 per share and the direct offering sold 3.3 million shares at $0.2785 per share.

ATR-12 Clinical Trials

Azitra received investigational new drug (IND) clearance for its Netherton Syndrome candidate, ATR-12, in January 2023. The company has since launched a Phase Ib clinical trial under the identifier NCT06137157 and expects to enroll 12 patients. Primary endpoints will examine safety and tolerability while secondary and exploratory endpoints will assess efficacy signals and biomarkers. ATR-12 will be topically administered using twice-daily treatment. A clinical site at Yale University has been established and other sites including one at Stanford are being sought.

The ongoing Phase I study for ATR-12 may evolve into a proof-of-concept trial that could enroll up to 20 patients including those in the Phase I portion. If supportive, the Phase II could lead to a larger pivotal trial acceptable to the FDA for BLA submission and approval.

First Patient Screened and Dosed

Azitra screened its first patient in the ATR-12 trial in August as reported in a press release. By the end of the month, the patient had been dosed. Since then, we believe at least one more patient has been enrolled. Interim safety data are expected to be available in 2Q:25 with full results available by year-end.

ATR-04

Epidermal growth factor receptor inhibitors (EGFRi) are targeted cancer therapies that have been effective in breast, colon, lung and pancreatic cancer. EGFR is a protein found on the surface of cells, and it plays a role in cell growth and division. In some cancers, such as certain types of lung cancer and colorectal cancer, the EGFR gene is mutated or overexpressed, leading to uncontrolled cell growth. EGFR inhibitors work by blocking the activity of this protein, thereby slowing down or stopping cancer cell growth.

Preclinical work for ATR-04 was completed and assembled with other required data into an investigational new drug (IND) application submitted last summer to the FDA. In an August 22^nd press release, Azitra announced that the IND had been cleared which allows the company to begin its Phase I/II study of ATR-04 for moderate to severe EGFRi associated dermal toxicity. In September, the FDA granted Fast Track Designation to ATR-04 for Azitra’s indication.

A Phase I/II is now planned to start later this year that will enroll eight patients in a single ascending dose Phase I study over 28 days. The Phase II portion will target 24 patients for this segment of the study. A contract research organization (CRO) is in place and four sites across the US are being identified for use. Azitra anticipates a rapid enrollment as these are high volume cancer centers with many potential candidates receiving EGFRi treatment.

Milestones

• Dosing of first patient for ATR-12 – August 2024
• IND clearance by FDA for ATR-04 – August 2024
• Presentation at European Academy of Dermatology & Venereology Congress – September 2024
• Presentations at BIO CEO – 1Q:25
• First patient dosed with ATR-04 for EGFRi rash (Phase I/II) – 1H:25
• Initial safety data from Phase Ib ATR-12 – 2Q:25
• Topline from Phase Ib ATR-12 trial – 4Q:25

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