ATOSSA THERAPEUTICS, INC. Material Event - Investor's Guide

This guide cuts through the corporate jargon, offering a clear, concise briefing on recent developments at ATOSSA THERAPEUTICS, INC.

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The Big News: Atossa's 2026 Shareholder Letter Reveals Strategic Shift & Key Milestones

ATOSSA THERAPEUTICS, INC. just released its 2026 Letter to Shareholders, a critical update from CEO Steven Quay. The letter outlines the company's 2025 accomplishments and ambitious plans for 2026, signaling a significant strategic shift. Atossa will now emphasize the potential of its lead drug, (Z)-endoxifen, beyond its initial focus on breast cancer, while also highlighting crucial clinical progress and financial stability.

Key Takeaways at a Glance:

• Positive Clinical Data: Preliminary results from the I-SPY 2 trial show (Z)-endoxifen was well-tolerated and demonstrated promising tumor activity reduction in early-stage breast cancer.
• Rare Disease Expansion: The company aggressively pursues (Z)-endoxifen for Duchenne Muscular Dystrophy (DMD) and McCune-Albright Syndrome (MAS). It secured Rare Pediatric Disease Designation and Orphan Drug Designation for DMD. These designations could lead to a Priority Review Voucher (PRV), a valuable asset potentially worth tens to hundreds of millions of dollars.
• Strategic Re-prioritization: Atossa is pausing investment in metastatic breast cancer. Instead, it will focus resources on early-stage breast cancer and rare diseases, areas where it sees a higher probability of success and a faster path to market.
• Strong Financial Footing: The company ended 2025 with over $40 million in cash, expected to fund operations for more than a year, providing a solid runway for development.
• Nasdaq Compliance: A recent reverse stock split secured the company's continued listing on Nasdaq.

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When Did This Happen & Why Does It Matter?

Atossa announced this important news today, February 11, 2026, through an 8-K filing with the SEC. An 8-K filing is a report companies must file to announce major events shareholders should know about.

For a biotech company like Atossa, which develops new medicines primarily for breast cancer and now rare diseases, these annual letters are vital. They offer investors a direct line to the company's strategy, clinical trial progress, financial health, and future outlook. The letter's content directly influences the company's future trajectory and, consequently, its stock performance.

The strategic decisions outlined, particularly the expansion into rare diseases and the re-prioritization of oncology efforts, stem from a Type C meeting with the FDA in November 2025. This formal meeting provided critical feedback, guiding Atossa to focus on areas with clearer regulatory pathways and potentially higher returns.

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A Deeper Dive: What's Inside the Letter?

1. Progress with (Z)-endoxifen:

   • Early-Stage Breast Cancer: Preliminary data from the ongoing I-SPY 2 study indicates (Z)-endoxifen is well-tolerated and shows encouraging signs of reducing tumor activity. This marks a crucial step forward for its potential as a treatment.
   • EVANGELINE Study: Enrollment for this additional breast cancer study (in collaboration with the Mayo Clinic) should conclude by mid-2026, with initial data anticipated in late 2026.

2. Bold Expansion into Rare Diseases:

   • Atossa actively explores (Z)-endoxifen for Duchenne Muscular Dystrophy (DMD) and McCune-Albright Syndrome (MAS).
   • For DMD, the FDA granted the drug both Rare Pediatric Disease Designation and Orphan Drug Designation. These designations can fast-track development, offer tax credits, and, most significantly, make the drug eligible for a Priority Review Voucher (PRV) upon approval. A PRV can be sold to another company for a substantial sum, offering a valuable source of funding without issuing new shares.

3. Strategic Re-prioritization in Oncology:

   • Atossa made the calculated decision to pause investment in metastatic breast cancer. The company believes focusing resources on early-stage breast cancer and the newly targeted rare diseases offers a higher probability of clinical and commercial success. This could lead to a faster path to market and better returns on investment. This move represents a strategic reallocation of capital, not a failure.

4. Financial Health & Corporate Strength:

   • Atossa's strong cash position of over $40 million at the end of 2025 provides financial stability, expected to fund operations for more than 12 months.
   • The company successfully completed a reverse stock split in early February 2026 to maintain its Nasdaq listing, ensuring continued visibility and liquidity for investors.
   • Strengthened leadership and new patent grants further reinforce the company's foundation and intellectual property portfolio.

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What Are the Risks?

While the letter highlights positive developments, investors should be aware of inherent risks:

• Clinical Trial Uncertainty: Preliminary data, while promising, does not guarantee success in larger or later-stage trials. Future trial results could be negative or inconclusive.
• Regulatory Hurdles: Despite FDA designations, no guarantee exists for eventual drug approval. The regulatory path for rare diseases, while potentially faster, still involves significant challenges.
• Competition: The therapeutic landscape for breast cancer and rare diseases is competitive. Other companies may develop more effective treatments.
• Funding Beyond Current Runway: While current cash is sufficient for over a year, future funding will be required for continued development, especially for new clinical trials in rare diseases. Securing partnerships or selling a PRV is not guaranteed.
• IP Litigation Outcome: The ongoing patent dispute with Intas Pharmaceuticals Ltd. carries legal and financial risks, with an uncertain outcome.

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Who's Affected & What Happens Next?

• Investors (like you!): This news directly impacts your investment. Expect stock price volatility as the market processes these details.
• ATOSSA THERAPEUTICS, INC.: The company has now clearly defined its future direction, with a strong emphasis on rare diseases and early-stage breast cancer.
• Patients: Progress in drug development means potential new treatment options for those suffering from breast cancer, DMD, and MAS.

What to Watch For in 2026:

• Q2 2026: Expect preliminary data from the I-SPY 2 combination therapy trials (with partners Eli Lilly and AbbVie).
• Mid-2026: Enrollment for the EVANGELINE study should conclude.
• Second Half of 2026: Look for more comprehensive data from the I-SPY 2 combination therapy trials.
• Late 2026: Anticipate preliminary data from the EVANGELINE study.
• First Half of 2026: Updates on the IP litigation with Intas Pharmaceuticals Ltd.
• Ongoing: Atossa will actively seek partnerships for (Z)-endoxifen, particularly for combination therapies and rare disease development, and plan clinical trials for DMD to leverage its new FDA designations.

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Your Action Plan as an Investor:

• Read the Full Letter: The 8-K is just the announcement. The real insights lie in the Letter to Shareholders itself (available on Atossa's investor relations website).
• Prepare for Volatility: Biotech stocks, especially those with significant clinical and strategic news, can experience dramatic price swings.
• Do Your Due Diligence: Understand the specifics of the I-SPY 2 data, the implications of the PRV potential for DMD, and the rationale behind the strategic shifts.
• Assess Your Risk Tolerance: Biotech investing is inherently high-risk, high-reward. Consider how these developments align with your personal investment strategy and time horizon.
• Don't React Hasty: Take time to digest the information. Initial market reactions don't always reflect long-term value.

This is a pivotal moment for Atossa. Your understanding of these details will be key to navigating its future performance.