By John Vandermosten, CFA
NYSE:AZTR
READ THE FULL AZTR RESEARCH REPORT
Azitra, Inc. (NYSE:AZTR) reported first quarter 2026 financial and operational results on May 13th and provided a business update. For 2026 to date, Azitra has raised over $10 million in capital that will support the launch of a new indication in cosmetics and cosmeceuticals along with its other clinical programs. It has also presented a poster at the Annual Meeting of the American Society of Gene & Cell Therapy (ASGCT), added a new site for the ATR-04 trial and secured a new patent for ATR-12.
Operational and Financial Results
Azitra’s first quarter 2026 results were presented in a press release and Form 10-Q filing with the SEC on May 13th. For the quarter ending March 31st, 2026 and versus the prior year’s comparable period, no revenues were reported. Net loss for the three-month period totaled $3.9 million or $0.25 per share.[1] Operating expenses increased year over year due to an increase in General and Administrative expenses related to patent write-off costs. Below, we detail 1Q:26 financial results compared to the same prior year period:
- Research and Development expenses increased by 25% to $1.6 million from $1.3 million stemming from greater chemistry, manufacturing and controls (CMC) expense partially offset by declines in preclinical and clinical research and personnel and consultant related expense. By program, ATR-01 costs increased by $484,000 over the prior year, and a $54,000 increase in ATR-04 expenses offset by declines in spending for the ATR-12 program;
- General & Administrative expenses totaled $2.4 million, up 28% from $1.9 million primarily related to the write-off of approximately $624,000 in certain deferred patent costs, an increase in approximately $47,000 in legal fees, an increase of approximately $63,000 in the use of business consultants. These amounts were offset by lower payroll and benefits, accounting and auditing financing costs and insurance costs;
- Net interest income was $11,000 compared to $36,000 due to lower average cash balances during the quarter;
- Other expense was $5,000 compared with $4,000;
- Net loss was $3.9 million or $0.25 per share vs. $3.1 million or $1.55 per share;[2]
As of March 31st, 2026, cash and equivalents totaled $10.1 million. This compares with the $2.1 million at the end of 2024. There is no debt. Cash burn for 1Q:26 was $2.5 million, lower than the $3.1 million consumed in 1Q:25. Cash from financing was $10.5 million representing proceeds from a private placement. Preferred stock is carried on the balance sheet as Additional Paid-In Capital and does not yet appear in the share count or as debt. There are 85.2 million shares that will eventually convert into equity shares that will later be added to shares outstanding.
ASGCT Poster Featuring ATR-01
Azitra presented its poster entitled An Engineered Human Filaggrin Secreting Staphylococcus epidermidis Strain for the Topical Treatment of Ichthyosis Vulgaris at the 2026 Annual Meeting of the American Society of Gene & Cell Therapy (ASGCT 2026). Roger Léger, Ph.D., Azitra’s Vice President of Chemistry, Formulation and Development delivered the address.
The poster highlighted Azitra's engineered live biotherapeutic ATR-01. The candidate is designed to treat ichthyosis vulgaris (IV) by delivering recombinant human filaggrin directly into the skin using a modified Staphylococcus epidermidis strain. IV is a common genetic skin disorder caused by filaggrin deficiency, leading to impaired skin barrier function and increased trans-epidermal water loss.
The data presented at ASGCT 2026 highlighted ATR-01's mechanism of action and translational potential, including its ability to elicit robust secretion of a recombinant human filaggrin domain. The bacteria achieve peak production 6 to 8 hours following application. In an ex vivo pig skin model, ATR-01 significantly reduced transepidermal water loss across all dose levels (p < 0.001), with levels returning near baseline within 20 hours. In parallel, studies in reconstructed human epidermis showed restoration of key structural features such as increased filaggrin levels and co-localization with keratin proteins, supporting functional integration into the skin barrier.
ATR-01 Cosmeceutical Derivatives
At the March 2026 BIO conference, COO Travis Whitfill introduced a new opportunity in cosmeceutical indications. Azitra’s new product, now designated ATR-COSF, is produced by inserting a gene fragment that encodes filaggrin into S. epidermidis to be later used in skin applications. The filaggrin is a byproduct of ATR-01 and may free amino acids and natural moisturizing factors that could improve the appearance of fine lines and wrinkles. One of the advantages of a cosmeceutical application is that the regulatory pathway is shorter and less costly. Additionally, there is substantial demand from cosmetics companies, especially in Asia, for new products that show benefits. This is an early-stage initiative, but merits further review as it evolves.
Azitra expects to report results from synthesized filaggrin ingredients and its repeat application study on cosmetic surgery skin in mid-2026. This is anticipated to be followed by a Human Cosmetic Application study slated for 3Q:26.
Filaggrin Background for Skin Smoothing Treatment
Filaggrin’s role in reducing the appearance of lines and wrinkles is mostly indirect. It helps keep the stratum corneum hydrated, compact and mechanically resilient, so skin looks smoother and less creased. As filaggrin is broken down, it generates a natural moisturizing factor, which helps retain water and maintain the skin barrier. Loss of filaggrin is associated with dry, scaly, more visibly lined skin.[3],[4]
The protein accumulates keratin filaments in the outer epidermis, helping corneocytes flatten and pack tightly, which supports barrier strength and the physical smoothness of skin. Its degradation products become natural moisturizing factors, which help hold water in the stratum corneum and support an optimal skin pH. When filaggrin is reduced, water loss rises and the skin tends to look drier and more lined, especially in chronically dry or aging skin.[5]
Filaggrin is not a collagen or elastin replacement, so it does not directly rebuild the dermis or erase established wrinkles. Rather, it can improve the appearance of fine lines by improving hydration, barrier integrity and surface texture, which makes them less noticeable. Filaggrin-supportive approaches emphasize smoothing and moisture retention as opposed to true wrinkle reversal.[6]
Private Placement Financing
Azitra entered into a securities purchase agreement on March 18th, 2026 where the company sold 10,485 shares of Series A convertible, non-redeemable preferred stock, along with warrants to purchase common stock. When authorized shares are increased in accordance with NYSE American rules, the preferred stock may convert into 85,223,126 shares of common stock. The financing raised $10.5 million and has the potential to contribute another $20.9 million if the attached warrants are exercised. Two series of warrants were issued: Series B and Series C. 85,223,126 were issued for each series with an exercise price of $0.123. Series B warrants have an 18-month life while the Series C warrants will expire 30 days after data is reported from the cosmetic filaggrin study. Details of the arrangement were provided in a Form 8-K filing. The Series C warrants have an anti-dilution provision that reduces the exercise price if the stock closes below $0.123 on the series C termination date.
Participating investors include institutional healthcare focused funds, Stonepine Capital and Nantahala Capital along with other institutional funds and individual healthcare professionals. Azitra’s CEO and other company insiders also participated.
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[1] We update per share amounts in this report to reflect the 1:6.66 reverse stock split that took place on August 21st, 2025.
[2] We use financial statement data as originally reported and apply a 1:6.66 reverse stock split ratio for periods prior to August 21st, 2025. Prior year numbers in our reporting may not match Azitra’s current period comparisons.
[3] Murphy, G.F. Aging Skin: A Dermatitis To Which All Flesh Is Heir? Journal of Cutaneous Pathology. January 2026.
[4] Medline Plus. FLG Gene, Filaggrin. Accessed May 2026.
[5] Kim, Y., Lim, K.M. Skin barrier dysfunction and filaggrin. Archives of Pharmaceutical Research. January 2021.
[6] Harding, C.R. et al. Filaggrin – Revisited. International Journal of Cosmetic Science. March 2013.