- Plans to initiate a registrational Phase 3 program evaluating abdakibart in hidradenitis suppurativa (HS) in the first half of 2027
- Expanded pipeline with AVTX-010, a long-acting next-generation anti-IL-1β antibody, with IND submission planned for the first half of 2027
- Appointed Ron Philip to the Board of Directors
- Cash, cash equivalents and investments of $472.2 million as of June 30, 2026, expected to provide runway into 2029
WAYNE, Pa., Aug. 06, 2026 (GLOBE NEWSWIRE) -- Avalo Therapeutics, Inc. (Nasdaq: AVTX), a clinical stage biotechnology company dedicated to developing therapeutics targeting the IL-1β pathway for immune-mediated inflammatory diseases, today announced business updates and financial results for the second quarter of 2026.
“In the second quarter, we achieved the key objectives that positioned Avalo for its next phase of growth,” said Garry Neil, MD, Chief Executive Officer of Avalo. “We delivered positive topline Phase 2 LOTUS results for abdakibart in HS, secured the capital to take it into a registrational Phase 3 program in HS, and expanded our pipeline with AVTX-010, a long-acting next-generation anti-IL-1β antibody. Our focus now is execution – starting with advancing abdakibart, which we believe has the potential to offer best in disease efficacy, safety and dosing convenience, toward Phase 3 initiation in HS as well as building a broader IL-1β franchise.”
Recent Corporate Highlights and Upcoming Anticipated Milestones
- Avalo plans to initiate a registrational Phase 3 program evaluating abdakibart in HS in the first half of 2027.
- Announced the advancement of AVTX-010, a long-acting next-generation anti-IL-1β monoclonal antibody with the potential for development in HS as well as other inflammatory disorders. The Company expects to submit an Investigational New Drug (IND) application in the first half of 2027.
- Appointed Ron Philip to its Board of Directors. Ron contributes deep strategic and commercial expertise, with a proven track record of bringing novel therapies to market.
- Added to the Russell 2000® and Russell 3000® Indexes as part of the FTSE Russell annual reconstitution.
Second Quarter 2026 Financial Update
- Cash, cash equivalents and investments were $472.2 million as of June 30, 2026. Net cash used in operating activities was $37.7 million for the six months ended June 30, 2026. Avalo’s current cash, cash equivalents, and investments are expected to fund operations into 2029.
- Research and development expenses were $23.4 million for the second quarter of 2026, an increase of $9.3 million from the second quarter of 2025, driven by the recognition of a $10.0 million development milestone for abdakibart, as well as costs related to and supporting the development of abdakibart in HS.
- General and administrative expenses were $8.1 million for the second quarter of 2026, an increase of $2.9 million from the second quarter of 2025, primarily driven by stock-based compensation expense.
- Net loss was $36.4 million for the second quarter of 2026, an increase of $15.6 million from the second quarter of 2025. The difference was mainly driven by a $12.2 million increase in operating expenses due to the $9.3 million increase in research and development expenses and $2.9 million increase in general and administrative expenses, as discussed above. Basic and diluted net loss per share was $0.83 and $1.92 for the second quarters of 2026 and 2025, based on 43,602,044 and 10,829,760 weighted average common shares outstanding, respectively.
(In thousands, except share and per share data)
June 30, 2026 December 31, 2025 (unaudited) Assets Current assets: Cash and cash equivalents $85,382 $15,858 Short-term investments 314,894 82,478 Prepaid expenses and other current assets 7,607 6,913 Restricted cash, current portion 49 37 Total current assets 407,932 105,286 Long-term investments 71,878 — Property and equipment, net 288 460 Goodwill 10,502 10,502 Restricted cash, net of current portion 183 210 Total assets $490,783 $116,458 Liabilities, mezzanine equity and stockholders’ equity Current liabilities: Accounts payable $3,347 $137 Accrued expenses and other current liabilities 17,783 12,803 Total current liabilities 21,130 12,940 Royalty obligation 2,000 2,000 Deferred tax liability, net 463 434 Derivative liability, non-current 18,530 18,000 Other long-term liabilities — 35 Total liabilities 42,123 33,409 Mezzanine equity: Series D Preferred Stock—$0.001 par value; 0 and 1 share of Series D Preferred Stock authorized at June 30, 2026 and December 31, 2025, respectively; 0 and 1 share of Series D Preferred Stock issued and outstanding at June 30, 2026 and December 31, 2025, respectively — — Series E Preferred Stock—$0.001 par value; 0 and 1 share of Series E Preferred Stock authorized at June 30, 2026 and December 31, 2025, respectively; 0 and 1 share of Series E Preferred Stock issued and outstanding at June 30, 2026 and December 31, 2025, respectively — — Stockholders’ equity: Common stock—$0.001 par value; 200,000,000 shares authorized at June 30, 2026 and December 31, 2025; 52,900,692 and 18,512,757 shares issued and outstanding at June 30, 2026 and December 31, 2025, respectively 53 18 Series C Preferred Stock—$0.001 par value; 4,085 and 34,326 shares of Series C Preferred Stock authorized at June 30, 2026 and December 31, 2025, respectively; 4,085 and 18,792 shares of Series C Preferred Stock issued and outstanding at June 30, 2026 and December 31, 2025, respectively — — Series C-1 Preferred Stock—$0.001 par value; 4,295 and 0 shares of Series C-1 Preferred Stock authorized at June 30, 2026 and December 31, 2025, respectively; 4,295 and 0 shares of Series C-1 Preferred Stock issued and outstanding at June 30, 2026 and December 31, 2025, respectively — — Additional paid-in capital 953,700 531,485 Accumulated other comprehensive (loss) income (583) 68 Accumulated deficit (504,510) (448,522)Total stockholders’ equity 448,660 83,049 Total liabilities, mezzanine equity and stockholders’ equity $490,783 $116,458
The consolidated balance sheets as of June 30, 2026 and December 31, 2025 have been derived from the reviewed and audited financial statements, respectively, but do not include all of the information and footnotes required by accounting principles accepted in the United States for complete financial statements.
(In thousands, except per share data)
Three Months Ended Six Months Ended June 30, June 30, 2026 2025 2026 2025 Operating expenses: Research and development 23,418 14,074 37,466 23,195 General and administrative 8,099 5,242 14,953 10,789 Total operating expenses 31,517 19,316 52,419 33,984 Loss from operations (31,517) (19,316) (52,419) (33,984)Other (expense) income: Change in fair value of derivative liability (1,010) (2,530) (530) (2,150)Change in fair value of contingent consideration (6,574) — (6,574) — Interest income, net 2,761 1,097 3,564 2,244 Total other (expense) income, net (4,823) (1,433) (3,540) 94 Loss before taxes (36,340) (20,749) (55,959) (33,890)Income tax expense 18 16 29 24 Net loss $(36,358) $(20,765) $(55,988) $(33,914) Net loss per share of common stock, basic and diluted $(0.83) $(1.92) $(1.75) $(3.18)Weighted average common shares outstanding 43,602,044 10,829,760 31,919,388 10,673,200 Comprehensive loss: Net loss $(36,358) $(20,765) $(55,988) $(33,914)Other comprehensive loss: Unrealized loss on investments, net (577) (34) (651) (34)Comprehensive loss $(36,935) $(20,799) $(56,639) $(33,948)
The unaudited consolidated statements of operations for the three and six months ended June 30, 2026 and 2025 have been derived from the reviewed financial statements, but do not include all of the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements.
About Avalo Therapeutics
Avalo Therapeutics is a clinical stage biotechnology company dedicated to developing therapeutics targeting the IL-1β pathway for immune-mediated inflammatory diseases. Avalo is advancing its lead anti-IL-1β monoclonal antibody (mAb) drug candidate, abdakibart, into a phase 3 registrational program in hidradenitis suppurativa (HS), a chronic inflammatory skin condition that affects an estimated 1-4% of the population globally. Avalo is pursuing additional development opportunities in IL-1β driven indications. Avalo is also developing AVTX-010, a long-acting next-generation anti-IL-1β mAb. For more information about Avalo, please visit www.avalotx.com.
About Abdakibart
Abdakibart is a humanized monoclonal antibody (IgG4) that binds to interleukin-1β (IL-1β) with high affinity and neutralizes its activity. IL-1β is a pro-inflammatory cytokine that plays a central role in the pathogenesis of a wide range of human diseases. It activates immune cells that generate proinflammatory cytokines, including IL-6, TNF-α, and IL-17. Dysregulated IL-1β signaling is a major driver of inflammation, contributing to the progression of autoimmune disorders. IL-1β inhibition has proven effective in multiple immune-mediated inflammatory diseases.
About AVTX-010
AVTX-010 is an Fc-engineered, long-acting anti-IL-1β monoclonal antibody designed to extend half-life while preserving the pharmacology and specificity of abdakibart.
Forward-Looking Statements
This press release includes forward-looking statements made pursuant to the Private Securities Litigation Reform Act of 1995 and other federal securities laws. Forward-looking statements are statements that are not historical facts. Such forward-looking statements are subject to significant risks and uncertainties that are subject to change based on various factors (many of which are beyond our control), which could cause actual results to differ from the forward-looking statements. Such statements may include, without limitation, statements with respect to our plans, objectives, projections, expectations and intentions and other statements identified by words such as “projects,” “may,” “might,” “will,” “could,” “would,” “should,” “continue,” “seeks,” “aims,” “predicts,” “believes,” “expects,” “anticipates,” “estimates,” “intends,” “plans,” “potential,” or similar expressions (including their use in the negative), or by discussions of future matters such as: therapeutic potential, clinical benefits and safety profiles of abdakibart (AVTX-009); plans to advance abdakibart into a registrational phase 3 program; plans to advance AVTX-010 into clinical trials; the timing of an IND submission for AVTX-010 in the first half of 2027; our financial condition and expected cash runway into 2029; expectations regarding timing, success and data announcements of ongoing preclinical studies and clinical trials; drug development costs, reliance on investigators and enrollment of patients in clinical trials; and our plans to develop and commercialize our current and any future product candidates and the implementation of our business model and strategic plans for our business.
Any forward-looking statements are based on management’s current expectations and beliefs and are subject to a number of risks, uncertainties and important factors that may cause actual events or results to differ materially from those expressed or implied by any forward-looking statements including, without limitation, risks associated with: the timing and anticipated results of our current and future preclinical studies and clinical trials, supply chain, strategy and future operations; the delay of any current and future preclinical studies or clinical trials or the development of our product candidates; the risk that the results of prior preclinical studies and clinical trials may not be predictive of future results in connection with current or future preclinical studies and clinical trials, including those for abdakibart and AVTX-010; the timing and outcome of any interactions with regulatory authorities; obtaining, maintaining and protecting our intellectual property; the availability of funding sufficient for our operating expenses and capital expenditure requirements, reliance on key personnel; regulatory risks; general economic and market risks and uncertainties, including those caused by the war in Ukraine and the Middle East; and those other risks detailed in our filings with the Securities and Exchange Commission, available at www.sec.gov. We may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements, and you should not place undue reliance on our forward-looking statements. In addition, any forward-looking statements represent our view only as of today and should not be relied upon as representing its views as of any subsequent date. You should not rely upon forward-looking statements as predictions of future events and actual results or events could differ materially from the plans, intentions and expectations disclosed herein. Except as required by applicable law, we expressly disclaim any obligations or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in our expectations with respect thereto or any change in events, conditions or circumstances on which any statement is based.
For media and investor inquiries
Christopher Sullivan, CFO
Avalo Therapeutics, Inc.
[email protected]
410-803-6793
or
Meru Advisors
Lauren Glaser
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