Avalo Therapeutics Reports Second Quarter 2026 Financial Results and Recent Business Updates
06 Aug 2026
- 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.
| Consolidated Balance Sheets | ||||||||
| (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.
| Consolidated Statements of Operations | ||||||||||||||||
| (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 |
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