Good day, and welcome to the Abeona Therapeutics Fourth Quarter and Full Year 2020 Conference Call. At this time, all participants have been placed on a listen-only mode and the floor will be open for your questions and comments after the presentation. As a reminder, today's conference call is being recorded. I'll now introduce you to today's conference host, Greg Gin, Vice President of Investor Relations and Corporate Communications at Abeona. Please go ahead.

Thank you, Holly. Good morning everyone. I'd like to welcome you and thank you for joining us on our fourth quarter and full year 2020 conference call. Yesterday, after the close of financial market, we issued a press release announcing the fourth quarter and full year results and recent operational progress. The press release is posted on our website at www.abeonatherapeutics.com. On the call today with prepared remarks are Michael Amoroso, Chief Executive Officer of Abeona; and Ed Carr, Chief Accounting Officer. After the prepared remarks, we will host Q&A session and joining us for the Q&A today will be joined by Jay Bircher, Chief Technical Officer and Dr. Juan Ruiz, Vice President of European Medical Affairs at Abeona, who also heads Clinical Development for our MPS programs. Before we start, I will review your Safe Harbor statement. Remarks made during today's call may contain projections and forward-looking statements regarding future events. Forward-looking statements 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, and the actual results may differ materially from those expressed or implied in the forward-looking statements. Various factors that could cause actual results to differ include, but are not limited to those identified under the section entitled risk factors in the Company's Annual Report on Form 10-K and quarterly reports on Form 10-Q, filed by the Company with the SEC. These documents are available on our website at www.abeonatherapeutics.com. And with that, I will now turn the call over to Michael. Michael?

Thank you, Greg, and good morning to our investor community. It's my pleasure to be with you again today for our Q4 and full year call. We're excited that Abeona developing our novel and gene cell therapies for underserved patient populations and we remain focused on execution, 2021 is a year of execution delivering. On today's call, I'll start with a brief review of some of our key accomplishments over the past year 2020 and I'll talk to you about our fast start 2021. In '20 and '21, I'm very proud of the team. Despite the macro disruptions caused by the pandemic, we continue to advance all three clinical programs for bringing urgent needed treatments to patients with recessive dystrophic epidermolysis bullosa, as I'll refer to as RDEB on our call our lead program, as well as Sanfilippo syndrome types A and B, referred to as MPS IIIA and MPS IIIB, respectively. First, let's start with our lead pivotal program, EB-101 and look at a brief overview of 2020. Earlier in the year, we initiated our pivotal Phase 3 VIITAL study for EB-101 as you'll remember in RDEB at Stanford University, a world renowned EB treatment center. In July of '20, we presented our Phase 1/2 data at the Society for Pediatric Dermatology showing the EB-101 treatment of large and chronic wounds resulted in substantial and durable wound healing for patients, also associated with long-term improvement in pain relief for up to five years. As a reminder, large wounds characterized at our trial as 20 centimeters or greater, some going up to 100 plus centimeters, 200 centimeter wounds; and chronic wounds, wounds that are open six months and longer and can no longer heal themselves like recurrent blistering wounds start in EB or RDEB. These are the most problematic wounds…

Thank you, Michael. I would like to remind everyone that we have recently filed the form 10-K, which is available on our website and where you can get the details on our financial results. In summary, our cash, cash equivalents and short-term investments as of December 31, 2020 totaled 95 million compared to 129.3 million as of December 31, 2019. We did not use our $150 million at the market or ATM program during the fourth quarter of 2020. We believe, we have sufficient cash resources to build on our momentum and fund our current development and operating plan to the achievement of key anticipated milestones including multiple potential regulatory submissions. For the full year of 2020, net cash used in operating activities, which $35 million compared to $62.8 million for this whole year of 2019. And with that, I will now turn it over to the operator for Q&A. Holly?

[Operator Instructions] First question for today is coming from Maury Raycroft. Please announce our affiliation then pose your question.

Good morning everyone. Congrats on the progress. And thanks for taking my questions. This is more from Maury from Jefferies. First question is just on MPS IIIB. So just wondering if you can book and how long it will take to do the product stability testing and wondering, if that was requested by FDA? Was it something observed with a product or was it just the right time to do this stability test?

Yes, Maury, I'll take that one in the lead any smart science talk. I'll definitely turn it over to Jay. No IIB as plan nationwide product expert on it. So, we have to make sure that we're doing our stability planning. This has not been asked for by the regulators specifically, but of course, it's part of our plans, part of our stability protocols and our IND. So, the nationwide product last lot, late last year hit x point. So what we're doing is, we're testing stability, making sure our product still has the appropriate integrity and we're looking at some final patients for Transpher B. So that's the impetus for that. As far as timing, that's more eminent than long-term. I didn't put timing out exactly today because I don't want to have to take it back anymore. Right now, we're looking at some tests in house versus out, and we should have some timelines very, very soon here. Jay is working quickly on that because we know we've got some patients waiting. So, I predict that will be more eminent than longer term but as soon as we know, we'll update you.

And then second question is just checking for EB-101. If that second site comes on board second half, could adding that side of accelerate timeline some? And would any patients or data from that site be included in the violence submission? Or do you want all the data to come from Stanford? I guess, how are you guys thinking about that?

Yes, Maury, great questions, so absolutely on both. The answer is as we said all alone, really excited we're almost at, I don't want to say it out loud, right. I'm a superstitious guy, but we almost in quarter one, have as many patients on board as we've had in all of 2020. And to be fair to team we know '20 with a tough deal with the pandemic. So, we think we can finish out of Stanford, but remember. We can be done as early as 10 patients, and we'll think about leaving it opened a little bit, if there's someone sitting on the bench. We want to get all patients in meeting. Right now, we think we're projecting somewhere depends on how many wounds we get per patient. So I won't project right away, but we could be done as early as 10 patients, so five takes us halfway there. No doubt that the second site which I'll announce as soon as that through IRB for disclosure purposes of university, that will get us definitely expedite time to fulfill accrual. And yes, those results will be as important and part of the BLA filing. Any patient under VIITAL treated, they're part of idle will be part of the BLA. All correct.

Your next question is coming from Ron Selvaraju. Please announce our affiliation then pose your question.

This is Ron Selvaraju from H.C. Wainwright. Can you hear me?

Yes, Ron. We got you.

So, thank you very much for taking my question. So firstly, relating to the EB-101 program, I was wondering if you could confirm that you are effectively going to stop enrollment once you have 35 chronic wounds to effect, in other words, it's not specifically dependent on patient number. And once you have 35 acceptable chronic wounds, you would help enrollments at that time or if there is a possibility that you could continue to enroll additional patients after getting that number of wound?

Yes, I'll take that one. Ron, great question. So, the answer is, we use the word approximate for a reason. 35 wounds important for our stats plan, right, as part of our pivotal. So yes, that's the target, give or take probably in a direction. We think we've got to hit 35, but we could go a little more. What we want to be mindful of is to make sure if they're going to have a patient in the queue, we're not going to refuse them. But it is you're exactly right. It's not a specific number of patients. The stats plan is based on number of wounds. So, that's why we have a range of patients because knowing what our range is we will be able to get there between 10 and 15. So, you're right, it is 35 wounds, it's approximate, I won't say will definitively stop the 35. That depends on the other patient in the queue, but we will do 50, for example, we will be close to that number.

And just to clarify, I think this is following up on Maury's question earlier. Can you kind of give us some more granularity on how many patients are kind of in the screening or prescreening meeting knowing where they are start at the process, but they're not all the way through to being able to actually enter the study? Just give us a sense of how many patients we're looking at there?

Yes, sure, guys. And I know this came up in the past and I appreciate that you're asking it Ron. I'm going to just address these to the teams to be fair to assume prior to me. Stanford has a pre-screening study open where it filters many patients into different studies they have opened based on genetic testing, okay. So, we did have some patients on the bench guys in 2020 in fairness to our prior team, who based on pandemic were unwilling to travel, move on to different studies that potentially are open. So, we did lose some people along that line. Right now, Ron, we've got, I get nervous saying the numbers because I don't like to jinx it, but we do have a handful of patients that could potentially be patient six. I only look at the next patient. Right now, we're screening, potentially two to three, if we can get them to the site. Whether they're all willing to travel, we've contacted them, we're in communication. We've got five biopsies, so I like to talk about definitive five is on their way to treatment. But right now, patient six, we're looking at three different individuals. And that's obviously again, at Stanford before we have the second site up and running. But we're always adding every month patient seminars, I hired a Chief Patient Officer, Jodie Gillon, where full court press, we're doing this all the time. So next week, we could find two or three more we're going to get. So there's even some international allowances now since Stanford IRB is opened up on that. So we're looking at patients even out of Mexico, potentially Canada, Germany. So exact numbers tough to give you, but I can tell you right now in the U.S. there's two to three we're assessing. It could go three for three, it could go over three. I don't know what that pre-screening will look like. I hope that gives you clarity, Ron.

Yes, that's very helpful. And then lastly, on EB-101, I was wondering if you could provide some commentary regarding the correlation between wound closure, degree of wound healing, and the extent of pain relief that you anticipate seeing, based on the prior data. How tight is that correlation is complete wound closure accompanied by like a 50% reduction in pain relief, or significantly greater than 50% reduction in pain relief? Just give us a sense of what you're expecting to see with regard to the correlation between wound closure, wound healing and pain relief?

Yes, another good question, Ron. So, look, I think they're highly correlative. Can I give you a perfect number? The answer is no, but I'll use data to tell you what was the backbone of why we drove such endpoints with the FDA and had these conversations, first and foremost, commend the FDA on saying, hey, look, we understand that Abeona, you're not treating the same moons as maybe non-EB diseases or even other EB diseases. You're treating the most problematic rooms, large and chronic wounds that can no longer heal themselves lead to significant opioid use, quality of life issues and ultimately, mortality. So if you look at our Phase 1/2 all the evidence base in my decision to look at our Phase 1/2, that's not exactly how we're measuring pain in the Phase 3. In the Phase 3, we're measuring it in a much more specific objective way. Remember, the Phase 1/2 study was an academic study. But if you look just a patient at baseline, I'll tell you the difference. From the Phase 1/2, 59, I think the number was in the 50s off the top of my head, and Greg can correct me 59% or 53%, had pain at baseline. But that was a global impression of pain, not specific to just one wound being treated. What we're testing is an actual wound that we treat, versus the control wound in VIITALs. So when the patients were enrolled in the Phase 1/2 50% to 75% wound closure, which we had in a lot of patients, we were over 90% and 50% wound closure. It was highly correlated. If you look at the results, you can see it in our investor deck, we're taking pain down to zero in a lot of people. Some had some trickle…

That's very, very helpful. Just two other very quick ones for me. With respect to the Transpher A study, can you comment on what you expect ultimately the average age of patients to be at time of enrollment in cohort 3? And then lastly, do you have any updates on the situation with REGENXBIO?

Yes, what I'll do is I'll take the second question first on REGENXBIO and then I'm going to turn it over to some of the muscle I have on the phone because I'm super proud of this management team. I'll turn the MPS question over to Juan, he could tell you about the age for the enrollment. So from a REGENXBIO standpoint guys, not a tremendous amount more I can give you. We will continue to update you but the arbitration is ongoing. Obviously, it's an ongoing legal proceedings, the status is included in our 10-K. We had an arbitration hearing held earlier this month. The tribunal has not yet issued its opinion. For overall overview of the proceeding and the extent to comment, please refer to the 10-K. Also, it will be on our website. So, again, guys still ongoing. I can't tell you about the results. But I can tell you that the arbitration hearing is held earlier this month. Juan, why don't I turn the age question for MPS IIIA over to you, please?

Thank you, Michael. Yes, in cohort 3, we have enrolled so far 13 children. Since we modify amended protocols and all younger children, younger than two years, or with an EQ higher than 60. We have eight patients with these criteria and the age is range from 8 months to 33 months in that particular group. So, we expect in the future and the children that we are still enrolled and treated in the trial will be within this age range.

[Operator Instructions] Your next question is coming from Mani Foroohar. Please announce our affiliation then pose your question.

This is Mani Foroohar from SVB Leerink. I missed the detail owner circle back on track on the Transpher B question. Can you give us a little sense? Is this an asset development challenge? Is it like a question data management sort of SLP development? Give us exactly sort of what needs to happen to put your foot back on the accelerator there?

Yes, so Mani, I'll remind you of the couple of things. Transpher B, we are four patients shy of our cohort 3 targets. So, we have patients in the queue, and the most important thing for us is to get those patients treated. That being said, no, not an assay development, we have product -- the nationwide product is the product being used in Transpher B as well as Transpher A. Jay and team will be making our own Abeona product for MPS IIIA second after this year, another major milestone for us. But the product has patient expiry dates and our last lot expired later into Q4. So what we're doing is we're joining a next stability test to look at our options to move forward. So, it's not an assay development. We're just looking at a stability testing of a lot of product that was expired at a nationwide, and we're going to see what our options are for the final few patients to be treated.

Your next question is coming from Kristen Kluska. Please announce our affiliation then pose your question.

This is Kristen from Cantor Fitzgerald. Thanks for taking my question. The first is I know that data is the hot off the press here from world, but wondering if you could share any feedback that you heard from physician or the different patient advocacy groups in your presentations, particularly from the youngest patients in the high dose cohort in MPS IIIA?

Kristen good to hear your voice and there's no one better on this phone to do it then maybe the most knowledgeable guy know what MPS and neurocognitive programs. Juan, why don't you please give a little bit of maybe some verbatim and some feedback and some of the KOLs around the world and the reaction to the IIIA and even the IIIB data, please?

Yes, thank you Michael. Thank you, Kristen. The data has been -- the feedback has been very positive, the another data regarding the younger children, some of them those from 30 months to 36 months after treatment, reaching to age where children in network history are declining significantly and getting these children and gaining their skill, have being received very positively by the experts and key opinion leaders in patient community. Yes, from that we've been reviewing these with some physicians [indiscernible] all around the world and yes, we are very happy and we are looking forward for remaining data coming these year only to confirm that these positive development continuous in this children and the other that were recently treated and we're expecting additional data along the year.

And Kristen, I would be remiss if I didn't a lot of trouble if I don't say this my Chief Patient Officer is not on the phone with us today. Jodie Gillon just texted me and said, patient groups are thrilled and encouraged. Those are verbatim. So I'd be in a lot of trouble if I didn't share that with you, so thank you Jodie.

Glad you won't be getting in trouble then. So as you think about the next potential chapter in ophthalmology and I know you haven't disclosed these indications. Maybe could you speak and remind us about the differentiated aspects of your aimed cap is,versus sort of the evidence and results we've seen across the field so far? And I do recall that you shared some initial data, I think at ACC team, maybe two years ago back when we had conferences in person. So if you could remind us about some of the initial findings, and I know more work is ongoing here.

Yes, Chris, and I appreciate the enthusiasm of the question. I'm excited about it too. And my preclinical team, Brian and Linas are teaching me about this all the time. I think that the short answer is. I wish I could I think we're a little early, I don't want to put the cart in front of the horse, which is why we haven't disclosed the indications. We'll have some nonhuman primate data, which my scientists tell me all the time is a very important proxy for, when we're looking at the eye and the eye disorders. We'll have that in the second. I'm expecting to have that second quarter person. So I can promise you a follow-up to talk about that NHP data as soon as we have it, but I think it's a little early to talk about the results. What I can tell you is we are using some of our capsules from our partnerships. We're also using some of our captions from in house. And the goal here is to see, we're also assessing administration, right power retinal, subretinal into vitreal. So we're trying to see, which capsules find the home to the cell best, but I think it'd be a little early if I was to give you a kind of what we're seeing because I think that nonhuman primate data is very important. So, we're enthusiastic. My scientists have some really good proof-of-concept, if you will, but want to wait till we get the nonhuman primate data before we boast about it a little bit, if that's okay.

There are no more questions in queue.

Well, with that said, I want to take a moment here and first thank the investor community for their support their interest. It's always nice to spend some time with you. And I appreciate the questions are very thoughtful, and appropriate. So thank you very much. I'll continue to ask you to hold us accountable. That's important. That's an important thing that we all take very seriously hear in Abeona because we're accountable to deliver to these patients. I want to take a moment to say how excited I am, to have the privilege to be the next Chief Executive Officer here at Abeona. And I want to make sure I think our stakeholders the most important, well, they're all important. So I'll take that back, but super important our patients and the courage they have to be part of these trials. But I want to take a moment and thank my team. People, I won't name everybody who will be here for a while. But my management team, who has really been steadfast. Our employees steadfast to a lot of change that you guys know occurred in 2020 with Abeona, but they stayed mission focused. We had almost productive maybe quarter yet in Q4. We had an incredibly successful Type B meeting. We have worked with the agency, brought increased talented in, and we've got our Type B meeting on the books for MPS IIIA. We continue every day to make milestones and I really model and I'm super impressed by a group of people and their commitment and even the pandemic how it slowed them down. So, again, please hold us accountable. It's a year of operational excellence. We need to bring this science to fruition for patients. And I'll leave it with that just a sincere thank you to my team, to my employees, to my board, to patients, stakeholders, our KOLs and investigators and to you the investor community for your continued support and your open and honest dialogue. Thank you.

Thank you, ladies and gentlemen. This does conclude today's conference call. You may disconnect your phone lines at this time and have a wonderful day. Thank you for your participation.