ATOS
Biotech

Atossa Genetics Inc (NASDAQ:ATOS) Squeezes The Shorts

Atossa Genetics Inc (NASDAQ:ATOS) is a name that we have covered quite a bit in the past here at Insider Financial. However, the last time we covered the stock was back in 2017. Since our last coverage, it’s been a steady downhill descent for ATOS. The stock traded all the way down from $7 in 2018 to under $1. But last week’s big announcement got the shorts scrambling and the stock exploded to just over $7. Curious investors and traders alike are now asking what’s next for ATOS?

ATOS Daily Chart

ATOS Background

First up, a little background info for those that are not familiar with ATOS. Atossa Genetics Inc. is a clinical-stage biopharmaceutical company developing novel therapeutics and delivery methods to treat breast cancer and other breast conditions.

Endoxifen

Atossa is developing oral and topical forms of Endoxifen. Endoxifen is an active metabolite of tamoxifen, which is an FDA-approved drug to prevent new as well as recurrent disease in breast cancer patients. Tamoxifen itself must be broken down by the liver into active compounds (metabolites), of which Endoxifen is the most active. Studies by others have shown that breast cancer patients with endoxifen levels of 30 nM and above have a lower risk for developing future breast cancer. Up to half of the patients taking tamoxifen do not produce therapeutic levels of endoxifen, frequently because of limited liver metabolism capability.

Studies by others indicate that endoxifen’s molecular mechanisms of action are concentration dependent and different than that of other anti-estrogens, including fulvestrant. Pathway analysis of differentially regulated genes revealed substantial differences related to endoxifen concentrations including significant induction of cell cycle arrest and markers of apoptosis following treatment with high, but not low, concentrations of endoxifen.

Many patients taking tamoxifen eventually stop responding, becoming tamoxifen refractory. In a small study by others of oral endoxifen use by tamoxifen-refractory patients, endoxifen provided an acceptable safety profile and promising antitumor activity. Another class of drugs called aromatase inhibitors are also frequently used to treat breast cancer; however, they are not FDA-approved for use in pre-menopausal women and can only be given to pre-menopausal women in conjunction with drugs for ovarian suppression/oblation, which can cause cardiovascular and other toxicities. Additionally, 20-30 percent of those taking aromatase inhibitors may experience fractures, bone pain or osteoporosis.

FDA Approval

The FDA has issued a “Safe to Proceed” letter under their “expanded access” program permitting the use of Atossa’s oral Endoxifen as a post-mastectomy treatment in a pre-menopausal, estrogen-receptor positive (ER+) breast cancer patient. This patient completed a 3-week course of Atossa’s oral Endoxifen prior to her surgery under an FDA-approved expanded access program.

The tumor activity from the initial biopsy was compared to the tumor activity at surgery, finding that the cancer cell biological activity was reduced by two measures: the Ki-67 activity decreased by 50 percent, and the estrogen receptor content decreased by over 20 percent. There were no safety or tolerability issues, including vasomotor symptoms such as hot flashes and night sweats. The latter symptoms are often a tolerability challenge for patients on tamoxifen.

Under the FDA expanded access IND program, the use of Atossa’s proprietary oral Endoxifen is restricted solely to this patient. Approval from the Institutional Review Board (IRB) must be obtained prior to providing oral Endoxifen to this patient.

Shorts scramble

On the back of this news, shorts were sent scrambling. Prior to this news, 18% of the float was short. The influx of new buyers sent the shorts covering, furthering propelling the stock higher.

Bottom line

After the news was digested about the “expanded access” program, the stock has taken a breather. Expanded access is a potential pathway for a patient with serious disease or condition, or an immediately life-threatening condition, to gain access to an investigational medical product (drug, biologic, or medical device) for treatment outside of clinical trials when no comparable or satisfactory alternative therapy options are available. In this case, it was only for this one patient. For ATOS to really get running and break out to new highs, its Endoxifen treatment must be expanded to a broader patient group. However, considering the FDA’s willingness to grant “expanded access,” it won’t be long before we see full commercialization.

We will be updating our subscribers as soon as we know more. For the latest updates on ATOS, sign up below!

Disclosure: We have no position in ATOS and have not been compensated for this article.

Photo by Fancycrave.com from Pexels

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Atossa Genetics Inc (NASDAQ:ATOS) Squeezes The Shorts
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