ABEO US Equity☆

Item 1A. Risk Factors 25

Item 1B. Unresolved Staff Comments 54

Item 2. Properties 54

Item 3. Legal Proceedings 54

Item 4. Mine Safety Disclosures 54

Part II

Item 7A. Quantitative and Qualitative Disclosures About Market Risk 65

Item 8. Financial Statements and Supplementary Data 65

Item 9A. Controls and Procedures 65

Item 9B. Other Information 66

Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections 66

Part III

Item 10. Directors, Executive Officers and Corporate Governance 67

Item 11. Executive Compensation 67

Item 14. Principal Accounting Fees and Services 67

Part IV

Item 15. Exhibits, Financial Statement Schedules 68

Signatures 70

FORWARD-LOOKING

STATEMENTS

This

Form 10-K (including information incorporated by reference) contains statements that express management’s opinions, expectations,

beliefs, plans, objectives, assumptions or projections regarding future events or future results and therefore are, or may be deemed

to be, “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section

21E of the Securities Exchange Act of 1934, as amended. Words such as “expects,” “anticipates,” “intends,”

“plans,” “believes,” “could,” “would,” “seeks,” “estimates,”

and variations of such words and similar expressions, and the negatives thereof, are intended to identify such forward-looking statements.

Such “forward-looking statements” speak only as of the date made and are not guarantees of future performance and involve

certain risks, uncertainties, estimates, and assumptions by management that are difficult to predict. Various factors, some of which

are beyond the Company’s control, could cause actual results to differ materially from those expressed in, or implied by, such

forward-looking statements. In addition, we disclaim any obligation to update any forward-looking statements to reflect events or circumstances

after the date of this report, except as may otherwise be required by the federal securities laws.

Forward-looking

statements necessarily involve risks and uncertainties, and our actual results could differ materially from those anticipated in forward-looking

statements due to a number of factors. These statements include statements about: our plans to submit a Biologics License Application

for EB-101 and the timing thereof; the expected benefits of EB-101 receiving Orphan Drug and Rare Pediatric Disease designations by the

U.S. Food and Drug Administration (“FDA”); our plans to continue development of AAV-based gene therapies designed to treat

ophthalmic and next-generation AAV-based gene therapies; the achievement of or expected timing, progress and results of clinical development,

clinical trials and potential regulatory approvals; our pipeline of product candidates; our belief that EB-101 could potentially benefit

patients with RDEB; development of our novel AAV-based gene therapy platform technology; our belief in the adequacy of the clinical trial

data from our VIITALTM clinical trial, together with the data generated in the program to date, to support regulatory approvals;

our dependence upon our third-party and related-party customers and vendors and their compliance with regulatory bodies; our estimates

regarding expenses, future revenues, capital requirements, and needs for additional financing; our intellectual property position and

our ability to obtain, maintain and enforce intellectual property protection and exclusivity for our proprietary assets; our estimates

regarding the size of the potential markets for our product candidates, the strength of our commercialization strategies and our ability

to serve and supply those markets; and future economic conditions or performance.

Important

factors that could affect performance and cause results to differ materially from management’s expectations are described in the

sections entitled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results

of Operations” in this Form 10-K. These factors include: our ability to successfully submit a Biologics License Application for

EB-101 and the outcome thereof; our ability to commercialize EB101 either independently or with a potential commercial partner; our ability

to access our existing at-the-market sale agreement; our ability to access additional financial resources and/or our financial flexibility

to reduce operating expenses if required; our ability to obtain additional equity funding from current or new stockholders; the potential

impacts of global healthcare emergencies, such as pandemics, on our business, operations, and financial condition; our ability to out-license

technology and/or other assets, deferring and/or eliminating planned expenditures, restructuring operations and/or reducing headcount,

and sales of assets; the dilutive effect that raising additional funds by selling additional equity securities would have on the relative

equity ownership of our existing investors, including under our existing at-the-market sale agreement; the outcome of any interactions

with the FDA or other regulatory agencies relating to any of our products or product candidates; our ability to continue to secure and

maintain regulatory designations for our product candidates; our ability to develop manufacturing capabilities compliant with current

good manufacturing practices for our product candidates; our ability to manufacture cell and gene therapy products and produce an adequate

product supply to support clinical trials and potentially future commercialization; the rate and degree of market acceptance of our product

candidates for any indication once approved; and our ability to meet our obligations contained in license agreements to which we are

party.

PART

I

ITEM

1. BUSINESS

Business

Abeona

Therapeutics Inc., a Delaware corporation (together with our subsidiaries, “we,” “our,” “Abeona”

or the “Company”), is a clinical-stage biopharmaceutical company developing cell and gene therapies for life-threatening

diseases. Our lead clinical program is EB-101, an autologous, engineered cell therapy currently in development for recessive dystrophic

epidermolysis bullosa (“RDEB”). EB-101 has been granted Orphan Drug and Rare Pediatric Disease (“RPD”) designations

by the U.S. Food and Drug Administration (“FDA”) and Orphan Drug Designation by the European Medicines Agency (“EMA”).

We

plan to continue development of AAV-based gene therapies designed to treat ophthalmic diseases with high unmet medical need using

the novel AIMTM capsid platform that we have exclusively licensed from the University of North Carolina at Chapel Hill

(“UNC”), and internal AAV vector research programs. Abeona’s novel, next-generation AAV capsids are being evaluated to improve tropism profiles for a variety of

devastating diseases.

Our

Mission and Strategy

Abeona

is a fully-integrated cell and gene therapy company featuring research and clinical development programs, in-house manufacturing facilities,

and scientific and clinical leadership. Our mission is to create, develop, manufacture, and deliver cell and gene therapies to transform

the lives of people impacted by life-threatening diseases. In 2022, we continued to make progress toward fulfilling our goal of harnessing

the promise of genetic medicine and redefining the standard of care through cell and gene therapies. In November 2022, we announced positive

topline data from the VIITALTM Phase 3 study evaluating the efficacy, safety and tolerability of EB-101.

We

partner with leading academic researchers, patient advocacy organizations, caregivers and other biotechnology companies to develop therapies

that address the underlying cause of a broad spectrum of rare genetic diseases for which no effective treatment options exist today.

Our

strategy consists of:

Advancing

and Commercializing our Late-Stage Clinical Cell and Gene Therapy Programs with a Focus on Life-Threatening Diseases.

Through

our cell and gene therapy expertise in research and development, we believe we are positioned to introduce efficacious and safe therapeutics

to transform the standard of care in devastating diseases and establish our leadership position in the field. We intend to commercialize

our assets either by ourselves or through strategic partnerships, subject to FDA approval.

Developing

Novel In-Vivo Gene Therapies Using AIMTM Capsid Technology.

We

are researching and developing AAV-based gene therapy using our novel capsids developed from the AIMTM Capsid Technology Platform

and additional Company-invented AAV capsids. We plan to continue to develop our chimeric AAV capsids capable of improved tissue targeting

for various indications and potentially evading immunity to wildtype AAV vectors.

Leveraging

our Leadership Position in Commercial-Scale Cell and Gene Therapy Manufacturing.

We

established current Good Manufacturing Practice (“cGMP”), clinical-scale manufacturing capabilities for engineered cell therapy

and AAV-based gene therapies in our state-of-the-art Cleveland, Ohio facility. We believe that our platform provides us with distinct

advantages, including flexibility, scale, reliability, and the potential for reduced development risk, reduced cost, and faster times

to market. We have focused on establishing internal Chemistry, Manufacturing and Controls (“CMC”) capabilities that drive

value for our organization through process development, assay development and manufacturing. We have also deployed robust quality systems

governing all aspects of product lifecycle from preclinical through commercial stage.

Establishing

Additional Cell and Gene Therapy Franchises and Adjacencies through In-Licensing and Strategic Partnerships.

We

seek to be the partner of choice in cell and gene therapy treatment and have closely collaborated with leading academic institutions,

key opinion leaders, patient foundations, and industry partners to accelerate research and development, understand the needs of patients

and their families, and generate novel intellectual property.

Maintaining

and Growing our IP Portfolio.

We

seek patent rights for various aspects of our programs, including vector engineering and construct design, our production process, and

all features of our clinical products including composition of matter and method of administration and delivery. We expect to continue

to expand our intellectual property portfolio by aggressively seeking patent rights for promising aspects of our product engine and product

candidates.

Developing

Next-Generation Cell and Gene Therapy

EB-101

for the Treatment of RDEB

Disease

Overview

RDEB

belongs to a broad group of genetic skin disorders known as epidermolysis bullosa. Patients with RDEB have a defect in the COL7A1 gene,

resulting in the inability to produce Type VII collagen, which plays a vital role in anchoring the skin’s dermal and epidermal

layers.

As

a result of the genetic defect, RDEB patients have fragile skin, which can easily damage to produce open and blistering wounds, disfiguring

scars throughout the body, fused fingers and toes, limits in range of motion at joints (e.g., arms and legs), and an abnormal narrowing

of the esophagus. Long-term RDEB patients can suffer from anemia, are at high risk of developing aggressive squamous cell carcinomas,

infections, and premature death. The most severe patients are approximately 20 times more likely to die by 30 years of age than the general

population.

Similar

to other rare diseases, the incidence and prevalence of RDEB are not well defined. Incidence of 0.2 to 3.05 per million births and prevalence

of 0.14 to 1.35 per million people have been observed across different geographies, primarily estimated by limited population analyses

of clinical databases or registries (Eichstadt et al.; Clinical, Cosmetic and Investigational Dermatology, 2019). Using genetic modeling

of COL7A1 variants, which is believed to cause RDEB, Stanford University estimated the incidence of RDEB to be approximately 63 per million

births, and prevalence could be up to 3,850 patients in the U.S., whose wounds may benefit from COL7A1-mediated treatments such as EB-101.

RDEB

patients have, on average, 11 active wounds on their bodies, with the majority > 20 cm2 (Stanford University; Solis, D.,

et al., 2017). In 2020, a survey of RDEB patients reported that approximately 60% have active wounds covering greater than 30% of their

bodies (Bruckner et al.; Orphanet Journal of Rare Diseases, 2020). Wounds covering up to approximately 80% of body surface area have

been recorded in some EB patients (Hirsch et al.; Nature Research, 2017).

We

expect EB-101 could be a treatment option for toughest to treat RDEB wounds. EB-101 has shown durable healing and associated pain reduction

in our VIITALTM phase 3 trial in large and/or chronic wounds that carry the highest burden, including the need for frequent dressing

changes, pain, pruritus, risk of infection, and developing skin cancer.

Current

Management of RDEB

At

present, there are no approved treatments for RDEB in the U.S. or Europe.

Wound

management currently consists of time and labor-intensive supportive care to limit contamination and infection, and reduction in mechanical

forces that produce new blisters. Care usually includes treatment of new blisters by lancing and draining. Wounds are then dressed with

a non-adherent material, covered with padding for stability and protection, and secured with an elastic wrap for integrity. The annual

costs of wound dressings alone for an RDEB patient can amount to as high as $996,000 per year.

RDEB

patients also have periodic surgeries to relieve disease related issues such as narrowing of their esophagus, fusing of fingers, and

corneal abrasions.

Program

Status and Positive Topline Data

EB-101

is an autologous, engineered cell therapy in which a functioning COL7A1 gene is inserted into a patient’s own skin cells (keratinocytes)

using a retrovirus. The keratinocytes are then transplanted back to the patient to restore Type VII collagen expression and skin function.

Results

from a completed Phase 1⁄2 study that enrolled 7 patients with large and chronic RDEB wounds at Stanford University showed that

EB-101 was well-tolerated and resulted in significant and durable wound healing (Siprashvili, Z., et al., 2016), with up to eight years

of follow-up (So. Y, Nazaraoff, et al., Orphanet Journal Rare Disease 2022). To date, there have been no reported serious adverse events.

On

November 3, 2022, we announced positive topline data from VIITALTM study. The pivotal Phase 3 VIITALTM study evaluated the

efficacy, safety and tolerability of EB-101 in 43 large chronic wound pairs in 11 subjects with RDEB. The large chronic wounds randomized

and treated in VIITALTM measured greater than 20 cm2 of surface area and had remained open for a minimum of six months

and a maximum of 21 years (mean 6.2 years). The co-primary endpoints of the study were: (1) the proportion of RDEB wound sites with greater

than or equal to 50% healing from baseline, comparing randomized treated with matched untreated (control) wound sites at the six-month

timepoint, as determined by direct investigator assessment; and (2) pain reduction associated with wound dressing change assessed by

the mean differences in scores of the Wong-Baker FACES scale between randomized treated and matched untreated (control) wounds at the

six-month timepoint.

The

VIITALTM study met its two co-primary efficacy endpoints demonstrating statistically significant, clinically meaningful improvements

in wound healing and pain reduction in large chronic RDEB wounds. EB-101 was shown to be well-tolerated with no serious treatment-related

adverse events observed, consistent with past clinical experience. There were no deaths or instances of positive replication-competent

retrovirus results, and no systemic immunologic responses were reported during the study, as well as no squamous cell carcinoma at treatment

sites after application of EB-101. Two subjects reported at least one serious adverse event unrelated to EB-101. Four subjects reported

related treatment emergent adverse events, including procedural pain, muscle spasms and pruritis. Infections unrelated to EB-101 were

observed in eight patients.

Based

on these positive topline results, we intend to submit a Biologics License Application (“BLA”) for EB-101 to the FDA by mid-2023.

EB-101 has been granted Regenerative Medicine Advanced Therapy (“RMAT”), Breakthrough Therapy, Orphan Drug and RPD designations

by the by the FDA as well as Orphan Drug designation by the EMA.

Among

the potential benefits of Orphan Drug designation are a potential seven years of market exclusivity following FDA approval, potentially

preventing FDA approval of another product deemed to be the same as the approved product for the same indication, waiver of application

fees, and tax credits for qualified clinical testing expenses conducted after orphan designation is received. A sponsor who receives

an approval for a BLA with RPD designation may qualify for a Priority Review Voucher (“PRV”), subject to final determination

by the FDA. A PRV may be used to receive expedited review of a subsequent marketing application for a different product or sold to another

company.

We

have continued to prepare our cGMP commercial facility in Cleveland for manufacturing EB-101 to support our planned BLA filing. EB-101

study drug product for all our VIITALTM study participants has been manufactured at our Cleveland facility.

ABO-503

for the treatment of X-linked Retinoschisis (“XLRS”).

Disease

Overview and Program Overview

XLRS is a rare, monogenic retinal disease that results in the irreversible

loss of photoreceptor cells and severe visual impairment. XLRS is caused by mutations in the RS1 protein, which is normally secreted by

retinal photoreceptors and bipolar neurons and functions to mediate cell-cell adhesion. XLRS is characterized by abnormal splitting of

the layers of the retina, resulting in poor visual acuity, which can progress to legal blindness. The incidence of XLRS is estimated to

be between 1 in 5,000 and 1 in 20,000 in males, with an estimated prevalence of 35,000 in the United States and Europe combined. There

are currently no disease modifying therapies approved for XLRS, but because the genetics of the disease are well understood, early intervention

via gene therapy has significant potential to reverse or stabilize disease progression at early stages and prevent vision loss.

ABO-503, composed of a functional human RS1 packaged

in the novel AIMTM capsid AAV204, has shown preclinical efficacy following delivery to the retina in a mouse model of XLRS. Preclinical

studies have demonstrated robust RS1 expression in the retina, improved cone photoreceptor density and overall photoreceptor cell survival,

as well as a restoration of outer retina architecture. We submitted a pre-IND meeting request with the FDA in March 2023.

ABO-504

for the Treatment of Stargardt Disease

Disease

Overview and Program Overview

Autosomal recessive Stargardt disease, the most common form of juvenile

macular degeneration with estimated incidence of 1 in 8,000 to 10,000 people, causes vision loss in children and young adults. The most

common form of Stargardt disease is caused by mutations in the ABCA4 gene, which prevent removal of toxic compounds from photoreceptor

cells that results in photoreceptor cell death and progressive vision loss. There are currently no FDA approved treatments available,

and to date, development of investigational gene modifying therapies has remained challenging in part due to the large size of the ABCA4

gene, which exceeds the encapsidation capacity of a single AAV vector.

Abeona’s internal research and development team developed ABO-504,

which is designed to efficiently reconstitute the full-length ABCA4 gene by implementing a dual AAV vector strategy using the Cre-LoxP

recombinase system. In May 2021, at the Association for Research in Vision and Ophthalmology (ARVO) Annual Meeting, Abeona reported preclinical

data demonstrating the ability of the dual AAV vector system to produce full length ABCA4 protein in cell culture. Recent proof-of-concept

studies have extended these findings by showing expression of ABCA4 mRNA and full-length ABCA4 protein in the retina of subretinally dosed

abca4-/- knockout mice, at levels similar to endogenous ABCA4 in wild-type animals.

ABO-505

for the Treatment of Autosomal Dominant Optic Atrophy (“ADOA”)

Disease

Overview and Program Overview

ADOA, a form of hereditary vision loss associated with RGC death, is predominantly

caused by mutations in the Opa1 gene. Opa1, a dynamin-related GTPase, acts to stabilize the inner mitochondrial membrane and acts in mitochondrial

fusion and inner membrane remodeling. Mutant phenotypes present with a progressive loss of RGCs that results in optic nerve degeneration

and legal blindness with a loss of visual acuity, optic disc pallor, and color vision deficits. ADOA affects approximately 1 in 30,000

people worldwide. Currently, there is no approved treatment for people living with ADOA.

ABO-505 is designed to express a functional copy of human Opa1 in the retina

following para-retinal injection. ABO-505 aims to take advantage of the robust optic nerve and retinal ganglion cell (RGC) transduction

ability of AAV204 to deliver its genetic payload to the cells most affected by ADOA. Preclinical studies have confirmed expression of

Opa1 in both cell culture and the retinas of dosed wild-type and disease model animals. Initial efficacy results suggest an improvement

in retinal signaling to the brain, and improved visual acuity in treated mutant mice.

New

preclinical data with ABO-503, ABO-504 and ABO-505 have been submitted for presentation at a future medical meeting in the second quarter of 2023.

Gene

Therapy Treatments anchored in AIMTM Vector Platform

In

2016, we licensed a library of novel AAV capsids from UNC. The AIMTM vector system is a platform of AAV capsids capable of widespread

central nervous system gene transfer and can be used to confer high transduction efficiency for various therapeutic indications. In partnership

with academic institutions, our own scientific research teams have identified vectors within the AIMTM capsid library showing strong

potential to successfully target and reach the central nervous system as well as ocular, lung, muscle, liver, and other tissues. Based

on continuing research by Abeona and our research partners, we have observed improvements in gene delivery to specific tissues compared

to currently available AAV technology. We believe AIMTM vectors also have the potential for redosing subjects who previously received

certain AAV gene therapy or subjects who have pre-existing antibodies to naturally occurring AAV serotypes.

Strategic

Licensing Agreements

We

have out-licensed certain clinical and research programs, including for the treatment of Sanfilippo syndrome type A (MPS IIIA) to Ultragenyx

Pharmaceutical Inc. (“Ultragenyx”), and for CLN1 disease (infantile Batten disease) and Rett syndrome to Taysha Gene Therapies,

Inc. (“Taysha”). Under the terms of our agreement with Ultragenyx, we are eligible to receive payments based on the achievement

of certain sales milestones and royalties on net sales. Under our agreements with Taysha, we are eligible to receive payments based on

certain clinical, regulatory, and sales milestones and royalties on net sales.

Leveraging

Leadership Position in Commercial-Scale Cell and Gene-Therapy Manufacturing

We

have established a cGMP manufacturing facility, the Elisa Linton Center located in Cleveland, Ohio, which enables us to enhance supply

chain control, establish tighter quality control testing, increase supply capacity, reduce production costs and gain manufacturing efficiency

for clinical trials related to our product candidates and ensure commercial demand is met in the event our therapies receive marketing

approval. Our facility is led by a team of highly-skilled production, process/assay development and QC scientists with expertise in cell

and gene therapy, particularly in cell culture, upstream manufacturing, downstream purification, assay development and wet lab techniques.

We

have completed our 16,000+ square foot manufacturing build-out in Cleveland, Ohio. The first phase, completed in 2018, was a 6,000 square

foot state-of-the-art cGMP production facility for the manufacturing of cell and gene therapies. The facility is designed to initially

manufacture clinical drug products with later intent of manufacturing commercial grade cGMP drug product. The second phase, completed

in 2019, was the completion of an additional 8,000 square feet of state-of-the-art laboratory space to support our expanding quality

control, process development, and assay development teams. The second phase also included nearly 2,000 square feet of cGMP Inventory

Control space.

We

have advanced our in-house manufacturing capabilities for EB-101. The product is manufactured as a multilayer cellular sheet containing

corrected keratinocytes that is fastened to a petrolatum gauze backing with surgical hemoclips. Engineered sheets are applied over wound

areas, where they are expected to produce keratinocytes with functioning Type VII collagen, providing immediate wound coverage and allowing

for long-term wound healing. A key component to the EB-101 drug product manufacturing process is the retroviral vector, which delivers

the functional copy of the Collagen VII Alpha 1 cDNA to the autologous patient cells. Initially developed at the Indiana University Vector

Production Facility, we have transferred the cGMP manufacturing process for the LZRSE-Col7A1 retroviral vector to our Cleveland facility

and have produced three cGMP lots for analytical and clinical comparability. We have also created and characterized a cGMP master cell

bank and a working cell bank to support the cGMP production of the retroviral vector.

We

have established AAV vector manufacturing capabilities that use the triple plasmid transient transfection method. We insert, or transfect,

many copies of three DNA plasmids encoding the specific therapeutic gene sequence, or transgene, the capsid coding sequence, and helper

sequences into AAV-293 cells using a serum-free, suspension-based bioreactor vector production technology. During an incubation period

following transfection, each cell produces AAV vectors through biosynthesis using the cells’ natural machinery. At the end of the

incubation period, the newly generated AAV vectors are harvested, purified and filtered in a multi-step process. We continue to maintain

focus on cGMP compliance and ensuring adequate supply to support our future clinical activity.

We

have established and maintained strong and collaborative relationships with third-party companies specializing in the testing of cell

and gene therapy material to complement our process and assay development needs.

We

have made significant investments in developing optimized manufacturing processes and believe that our processes and methods developed

to date provide a comprehensive manufacturing process for EB-101 and AAV-based vector therapies, including:

● sufficient scale to support commercial manufacturing requirements for EB-101

● processes related to product release testing for EB-101

● AAV serum-free suspension technology that is readily scalable

We

believe that these improvements will enable us to develop best-in-class, next-generation cell and gene therapy products. As we look to

commercialize EB-101 (subject to FDA approval), we are working towards filing a BLA to support commercial manufacturing of EB-101 from

our Cleveland facility. Based on feedback from the FDA, we believe that we have alignment with the FDA on the CMC requirements for EB-101,

including characterization and validation plans.

Maintain

Strong Intellectual Property Protection

We

strive to protect our commercially important proprietary technology, inventions, and know-how, including by seeking, maintaining, and

defending patent rights, both for inventions developed internally and for inventions licensed from third parties. We also rely on trade

secrets and know-how relating to our proprietary technology platforms, continuing technological innovation, and in-licensing opportunities

to develop, strengthen and maintain our position in the field of cell and gene therapy. We may also rely on the additional protections

afforded by data exclusivity (currently 12 years for biologics), other market exclusivities such as orphan drug exclusivity, and patent

term extensions, where applicable.

Our

success may depend in part on our ability to obtain and maintain patent and other protections for commercially important technology,

inventions and know-how related to our business; defend and enforce our patents; preserve the confidentiality of our trade secrets; and

operate without infringing the valid enforceable patents and intellectual property rights of third parties. Our ability to stop third

parties from making, having made, using, selling, offering to sell, or importing our products may depend on the extent to which we have

rights under valid and enforceable licenses, patents or trade secrets that cover these activities. In some cases, these rights may need

to be enforced by third-party licensors. With respect to both licensed and company-owned intellectual property, we may not be granted

patents with respect to any of our pending patent applications or with respect to any patent applications filed by us in the future,

nor can we be sure that any of our existing patents or any patents that may be granted to us in the future will be commercially useful

in protecting our commercial products and methods of manufacturing the same.

We

are actively seeking U.S. and international patent protection for a variety of technologies, including the following: research tools

and methods, methods for transferring genetic material into cells, AAV-based biological products, methods of designing novel AAV constructs,

methods for treating diseases of interest and methods for manufacturing, packaging, and transporting our product candidates. We also

intend to seek patent protection or rely upon trade secret rights to protect other technologies that may be used to discover and validate

targets and that may be used to identify and develop novel biological products. We seek protection, in part, through confidentiality

and proprietary information agreements. We are a party to various license agreements that give us rights to use specific technologies

in our research and development, and future commercialization.

Licensed

Technologies and Intellectual Property

1. Recessive Dystrophic Epidermolysis Bullosa

To

support our EB franchise, we have licensed a patent family from Stanford University covering EB-101 and its use in the treatment of RDEB.

Patents covering our investigational EB-101 product have been granted by the European Patent Office (EP3400287B1) and in other geographical

regions, and are expected to expire in early 2037. Patent applications remain pending in the United States which, if granted, would be

expected to expire in 2037. We have also filed United States patent applications directed to the packaging and transport of EB-101, which,

if granted, are not expected to expire before 2040.

We

may also rely on the additional protection afforded by data exclusivity (currently 12 years for biologics like EB-101), other market

exclusivity such as orphan drug exclusivity, and patent term extensions, where applicable.

2. AIMTM Capsids

We

have an exclusive license to an international patent family from UNC covering novel AAV capsids (“AIMTM capsids”) that

may potentially be used to deliver a wide variety of therapeutic transgenes to human cells to treat genetic diseases. National stage

applications directed to the AIMTM capsids have been filed in the United States, Europe and other geographical regions. The first

U.S. patent in this patent family, U.S. Patent No. 10,532,110 (the “’110 Patent”), was issued to UNC on January 14,

2020. The ’110 Patent is entitled to 352 days of patent term adjustment, making its projected expiration date November 6, 2036.

The second U.S. patent in this patent family, U.S. Patent No. 10,561,743 (the “’743 Patent”), was issued to UNC on

February 18, 2020. The ‘743 Patent is expected to expire on November 20, 2035. A third U.S. patent in this patent family, U.S.

Patent No. 11,491,242 (the “’242 Patent”) issued on November 8, 2022. The ‘242 Patent is entitled to 429 days

of patent term adjustment and will not expire before January 22, 2037. We have exclusive rights to these patents under our license with

UNC.

We

also own a second patent family directed to certain AAV capsids and have filed national stage applications in the United States, Europe

and other geographical regions. Patents issuing from these applications are not expected to expire before 2039.

3. CLN1 Disease (Infantile Batten Disease)

We

have also licensed from UNC rights to two patent families directed to treating CLN1 disease (also known as infantile Batten disease).

The first patent family is directed to optimized CLN1 genes and expression cassettes for use in treating CLN1 disease, which has applications

pending in the United States, Europe, and other geographical regions. One U.S. patent in the first patent family, U.S. Patent No. 11,504,435

(the “’435 Patent”), was issued to UNC on November 22, 2022. The ’435 Patent is entitled to 578 days of patent

term adjustment, making its projected expiration date January 12, 2039. The second patent family is directed to treating CLN1 disease

using a combination of intrathecal and intravenous administrations, which has applications pending in the United States, Europe and other

geographical regions. Patents issuing from applications in the second patent family are not expected to expire before 2040. We have entered

into agreements exclusively sublicensing these two CLN1 patent families to Taysha Gene Therapies.

4. Rett Syndrome

We

have licensed rights to patent families from both UNC and the University of Edinburgh relating to gene therapy for the treatment of Rett

Syndrome. The patent family licensed from UNC at Chapel Hill are directed to viral genomes designed to regulate expression of the MeCP2

gene, which is mutated in patients with Rett Syndrome. This family has pending applications in the United States, Europe and other geographical

regions. Patents issuing from these applications are not expected to expire before 2039. The patent families licensed from the University

of Edinburgh are directed to expression cassettes for MeCP2 polypeptides and to synthetic MeCP2 polypeptides. The patent family directed

to MeCP2 expression cassettes has pending applications in the United States, Europe and other geographical regions. The patent family

directed to synthetic MeCP2 polypeptides has pending applications in the United States and other geographical regions. Patents issuing

from applications in the Edinburgh patent families are not expected to expire before 2038. In October 2020, we entered into an agreement

exclusively sublicensing these UNC and University of Edinburgh patent rights to Taysha Gene Therapies.

5. Multipartite AAV Delivery of Large Transgenes

We

have filed a PCT application (PCT/US2021/041527) directed to multipartite delivery of large transgenes using AAV vectors. We are filing

national stage applications in the United States, Europe and other geographical regions. Patents issuing from these applications are

not expected to expire before 2041.

We

own a pending PCT application (PCT/US2022/029797) directed to (i) novel AAV capsid proteins and (ii) treating ophthalmic diseases via

para-retinal administration of AAV vectors. Patents issuing from future national stage applications of this PCT application are not expected

to expire before 2042.

7. Treatment of Dominant Optic Atrophy and X-linked Retinoschisis

We

own a pending U.S. provisional application directed to compositions and methods for treating dominant optic atrophy and x-linked retinoschisis.

We

expect to explore in due course strategies to support patent term extensions for all of our patent portfolios.

U.S.

Biologic Products Development Process

In

the United States, the FDA regulates biologic products including gene therapy products under the Federal Food, Drug, and Cosmetic Act

(“FDCA”), the Public Health Service Act (“PHSA”), and regulations implementing these laws. The FDCA, PHSA and

their corresponding regulations govern, among other things, the testing, manufacturing, safety, efficacy, labeling, packaging, storage,

record keeping, distribution, advertising, and promotion of biologic products. Applications to the FDA are required before conducting

human clinical testing of biologic products. FDA approval also must be obtained before marketing of biologic products. Gene therapy studies

may also need to comply with the National Institutes of Health (“NIH”) Guidelines for Research Involving Recombinant or Synthetic

Nucleic Acid Molecules (“NIH Guidelines”), which includes additional requirements, such as the review and approval of the

study by an Institutional Biosafety Committee.

Within

the FDA, the Center for Biologics Evaluation and Research (“CBER”) regulates gene therapy products. Within CBER, the review

of gene therapy and related products is consolidated in the Office of Tissues and Advanced Therapies (“OTAT”) and the FDA

has established the Cellular, Tissue and Gene Therapies Advisory Committee (“CTGTAC”), a panel of medical and scientific

experts and consumer representatives, to advise CBER on its reviews. The FDA has issued a growing body of guidance documents on CMC,

clinical investigations and other areas of gene therapy development, all of which are intended to facilitate the industry’s development

of gene therapy products.

The

process required by the FDA before a biologic product candidate may be marketed in the United States generally involves the following:

Before

testing any biologic product candidate on humans, including a gene therapy product candidate, the product candidate must undergo preclinical

testing. Preclinical tests, also referred to as nonclinical studies, include laboratory evaluations of product chemistry, toxicity, and

formulation, as well as in vivo studies to assess the potential safety and activity of the product candidate. The conduct of the preclinical

tests must comply with federal regulations and requirements including GLPs.

If

a gene therapy trial is conducted at, or sponsored by, institutions receiving NIH funding for recombinant DNA research, the study must

also comply with the NIH Guidelines. Compliance with the NIH Guidelines is mandatory for investigators at institutions receiving NIH

funds for research involving recombinant DNA. However, many companies and other institutions, not otherwise subject to the NIH Guidelines,

voluntarily follow them.

The

clinical trial sponsor must submit the results of the preclinical tests, together with manufacturing information, analytical data, any

available clinical data or literature and a proposed clinical protocol, to the FDA as part of the IND. Some preclinical testing may continue

even after the IND is submitted. The IND automatically becomes effective 30 days after receipt by the FDA, unless the FDA places the

clinical trial on a clinical hold. In such a case, the IND sponsor and the FDA must resolve any outstanding concerns before the clinical

trial can begin. The FDA also may impose clinical holds on a biologic product candidate at any time before or during clinical trials

due to safety concerns or non-compliance. If the FDA imposes a clinical hold, trials may not commence or recommence without FDA authorization

and then only under terms authorized by the FDA.

Human

clinical trials under an IND

Clinical

trials involve the administration of the biologic product candidate to healthy volunteers or patients under the supervision of qualified

investigators, which generally are physicians not employed by, or under the control of, the trial sponsor. Investigators must also provide

certain information to the clinical trial sponsors to allow the sponsors to make certain financial disclosures to the FDA. Clinical trials

are conducted under protocols detailing, among other things, the objectives of the clinical trial, dosing procedures, subject selection

and exclusion criteria and the parameters to be used to monitor subject safety, including stopping rules that assure a clinical trial

will be stopped if certain adverse events should occur. Each protocol and any amendments to the protocol must be submitted to the FDA

as part of the IND. Clinical trials must be conducted and monitored in accordance with the FDA’s regulations comprising the GCP

requirements, including the requirement that all research subjects provide informed consent.

Further,

each clinical trial must be reviewed and approved by an IRB at or servicing each institution at which the clinical trial will be conducted.

An IRB is charged with protecting the welfare and rights of trial participants and considers items such as whether the risks to individuals

participating in the clinical trials are minimized and are reasonable in relation to anticipated benefits. The IRB also approves communications

to study subjects before a study commences at that site and the form and content of the informed consent that must be signed by each

clinical trial subject, or his or her legal representative, and must monitor the clinical trial until completed. Clinical trials involving

recombinant DNA also must be reviewed by an institutional biosafety committee (“IBC”), a local institutional committee that

reviews and oversees basic and clinical research that utilizes recombinant DNA at that institution. The IBC assesses the safety of the

research and identifies any potential risk to public health or the environment.

Information

about certain clinical trials, including a description of the study and study results, must be submitted within specific timeframes to

NIH for public dissemination on their clinicaltrials.gov website. Sponsors or distributors of investigational products for the diagnosis,

monitoring, or treatment of one or more serious diseases or conditions must also have a publicly available policy on evaluating and responding

to requests for expanded access requests.

Investigational

biologics and therapeutic substances imported into the United States are also subject to regulation by the FDA. Further, the export of

investigational products outside of the United States is subject to regulatory requirements of the receiving country as well as U.S.

export requirements under the FDCA.

Human

clinical trials typically are conducted in three sequential phases that may overlap or be combined:

Additional

kinds of data may also help to support a BLA, such as patient experience data. Real world evidence may also support a BLA, and, for appropriate

indications sought through supplemental BLAs, data summaries may provide marketing application support. For genetically targeted products

and variant protein targeted products intended to address an unmet medical need in one or more patient subgroups with a serious or life

threatening rare disease or condition, the FDA may allow a sponsor to rely upon data and information previously developed by the sponsor

or for which the sponsor has a right of reference, that was submitted previously to support an approved application for a product that

incorporates or utilizes the same or similar genetically targeted technology or a product that is the same or utilizes the same variant

protein targeted drug as the product that is the subject of the application.

Post-approval

clinical trials, sometimes referred to as Phase IV clinical trials, may be conducted or may be required by FDA after initial approval.

These clinical trials are used to gain additional experience from the treatment of patients in the intended therapeutic indication, particularly

for long-term safety follow-up.

During

all phases of clinical development, regulatory agencies require extensive monitoring and auditing of all clinical activities, clinical

data, and clinical trial investigators. Annual progress reports detailing the results of the clinical trials must be submitted to the

FDA.

Written

IND safety reports must be promptly submitted to the FDA, IRBs, IBCs, and the investigators for serious and unexpected adverse events;

any findings from other trials, in vivo laboratory tests or in vitro testing that suggest a significant risk for human subjects; any

clinically important increase in the rate of a serious suspected adverse reaction over that listed in the protocol or investigator brochure,

or other safety information. The sponsor must submit an IND safety report within 15 calendar days after the sponsor determines that the

information qualifies for reporting. The sponsor also must notify the FDA of any unexpected fatal or life-threatening suspected adverse

reaction within seven calendar days after the sponsor’s initial receipt of the information.

The

FDA, the sponsor or its data safety monitoring board may suspend a clinical trial at any time on various grounds, including a finding

that the research subjects or patients are being exposed to an unacceptable health risk. Similarly, an IRB can suspend or terminate approval

of a clinical trial at its institution if the clinical trial is not being conducted in accordance with the IRB’s requirements or

if the biologic product candidate has been associated with unexpected serious harm to patients. The FDA or an IRB may also impose conditions

on the conduct of a clinical trial.

Additional

regulation for gene therapy clinical trials

In

addition to the regulations discussed above, there are a number of additional standards that apply to clinical trials involving the use

of gene therapy. The FDA has issued various guidance documents regarding gene therapies, which outline additional factors that the FDA

will consider at each of the above stages of development and relate to, among other things: the proper preclinical assessment of gene

therapies; the CMC information that should be included in an IND application; the proper design of tests to measure product efficacy

in support of an IND or BLA application; and long term patient and clinical study subject follow up and reporting requirements. The FDA

has also issued draft guidance specific to the development of gene therapy products for neurodegenerative diseases as such products may

face special challenges related to CMCs and clinical and preclinical development, due to the nature of the products and potential patient

population (e.g., children), the heterogeneity of neurodegenerative disorders, the route of administration, the volume of the product

that can be administered, the delivery device, and the study population size.

Compliance

with cGMP requirements

Manufacturers

of biologics must comply with applicable cGMP regulations for both clinical and commercial supply. Manufacturers and others involved

in the manufacture and distribution of such products at the commercial stage also must register their establishments with the FDA and

certain state agencies and list the manufactured products. Recently, the information that must be submitted to FDA regarding manufactured

products was expanded through the Coronavirus Aid, Relief, and Economic Security, or CARES, Act to include the volume of drugs produced

during the prior year. Both domestic and foreign manufacturing establishments must register and provide additional information to the

FDA upon their initial participation in the manufacturing process. Establishments may be subject to periodic, unannounced inspections

by government authorities to ensure compliance with cGMP requirements and other laws. Discovery of problems may result in a government

entity placing restrictions on a product, manufacturer, or holder of an approved BLA, and may extend to requiring withdrawal of the product

from the market. The FDA will not approve an application unless it determines that the manufacturing processes and facilities comply

with cGMP requirements and are adequate to assure consistent production of the product within required specification.

Concurrent

with clinical trials, companies usually complete additional preclinical studies and must also develop additional information about the

physical characteristics of the biologic product candidate as well as finalize a process for manufacturing the product candidate in commercial

quantities in accordance with cGMP requirements. To help reduce the risk of the introduction of adventitious agents or of causing other

adverse events with the use of biologic products, the PHSA emphasizes the importance of manufacturing control for products whose attributes

cannot be precisely defined. The manufacturing process must be capable of consistently producing quality batches of the product candidate

and, among other requirements, the sponsor must develop methods for testing the identity, strength, quality, potency and purity of the

final biologic product. Additionally, appropriate packaging must be selected and tested, and stability studies must be conducted to demonstrate

that the biologic product candidate does not undergo unacceptable deterioration over its shelf life.

U.S.

review and approval processes

The

results of the preclinical tests and clinical trials, together with detailed information relating to the product’s CMC and proposed

labeling, among other things, are submitted to the FDA as part of a BLA requesting approval to market the product for one or more indications.

For

gene therapies, selecting patients with applicable genetic defects is a necessary condition to effective treatment. For the therapies

we are currently developing, we believe that diagnoses based on symptoms, in conjunction with existing genetic tests developed and administered

by laboratories certified under the Clinical Laboratory Improvement Amendments, are sufficient to select appropriate patients and will

be permitted by the FDA. For future therapies, however, it may be necessary to use FDA-cleared or FDA-approved diagnostic tests to select

patients or to assure the safe and effective use of therapies in appropriate patients. The FDA refers to such tests as in vitro companion

diagnostic devices and the combination of the in vitro companion diagnostic device and the therapeutic would be considered to be a combination

product.

The

use of the two products together must be shown to be safe and effective for the proposed intended use and the labeling of the two products

must reflect their combined use. In some cases, the device component may require a separate premarket submission; for example, when the

device component is intended for use with multiple drug products. Sponsors of clinical studies using investigational devices are required

to comply with FDA’s investigational device exemption regulations. Once approved or cleared, the sponsor of the device component

submission (or the combination product submission, if both components are covered by one premarket submission) would need to comply with

FDA’s post-market device requirements, including establishment registration, device listing, device labeling, unique device identifier,

quality system regulation, medical device reporting, and reporting of corrections and removals requirements.

The

FDA has a policy position that, when safe and effective use of a therapeutic product depends on a diagnostic device, the FDA generally

will require approval or clearance of the diagnostic device at the same time that the FDA approves the therapeutic product. The type

of premarket submission required for a companion diagnostic device will depend on the FDA classification of the device. A premarket approval,

or PMA, application is required for high risk devices classified as Class III; a 510(k) premarket notification is required for moderate

risk devices classified as Class II; and a de novo request may be used for novel devices not previously classified by the FDA

that are low or moderate risk.

The

FDA may, however, approve a therapeutic product without the concurrent approval or clearance of a diagnostic device when the therapeutic

product is intended to treat serious and life-threatening conditions for which no alternative exists and the FDA determines that the

benefits from the use of the drug/biologic outweigh the risks from the lack of an approved/cleared companion diagnostic. The FDA would

also consider whether additional protections, such as risk evaluation and mitigation strategies, or REMS, or post-approval requirements,

are necessary. At this point, it is unclear how the FDA will apply this policy to our gene therapy candidates. Should the FDA deem genetic

tests used for selecting appropriate patients for our therapies to be in vitro companion diagnostics requiring FDA clearance or approval,

we may face significant delays or obstacles in obtaining approval for a BLA. In addition, under the Pediatric Research Equity Act (“PREA”),

a BLA or supplement to a BLA must contain data to assess the safety and effectiveness of the biologic product candidate for the claimed

indications in all relevant pediatric subpopulations and to support dosing and administration for each pediatric subpopulation for which

the product candidate is safe and effective. The FDA may grant deferrals for submission of data or full or partial waivers. Unless otherwise

required by regulation, PREA does not apply to any biologic product candidate for an indication for which orphan designation has been

granted.

Under

the Prescription Drug User Fee Act , as amended (“PDUFA”), each BLA must be accompanied by a substantial user fee that must

be paid at the time of the first submission of the application, even if the application is being submitted on a rolling basis. The FDA

adjusts the PDUFA user fees on an annual basis. Fee waivers or reductions are available in certain circumstances, including a waiver

of the application fee for the first application filed by a small business. Additionally, no user fees are assessed on BLAs for product

candidates designated as orphan drugs, unless the product candidate also includes a non-orphan indication.

The

FDA reviews a BLA within 60 days of submission to determine if it is substantially complete before the agency accepts it for filing.

The FDA may refuse to accept for filing any BLA that it deems incomplete or not properly reviewable at the time of submission and may

request additional information. In that event, the BLA must be resubmitted with the additional information. The resubmitted application

also is subject to review before the FDA accepts it for filing. Once the submission is accepted for filing, the FDA begins an in-depth,

substantive review of the BLA.

The

FDA reviews the BLA to determine, among other things, whether the proposed product candidate is safe and potent, or effective, for its

intended use, has an acceptable purity profile and whether the product candidate is being manufactured in accordance with cGMP to assure

and preserve the product candidate’s identity, safety, strength, quality, potency, and purity. The FDA may refer applications for

novel biologic products or biologic products that present difficult questions of safety or efficacy to an advisory committee, typically

a panel that includes clinicians and other experts, for review, evaluation, and a recommendation as to whether the application should

be approved and under what conditions. The FDA is not bound by the recommendations of an advisory committee, but it considers such recommendations