Avalo Therapeutics — Third Quarter 2026 Earnings Summary

Financial Performance:

• Cash, cash equivalents, and investments totaled $462.8 million as of September 30, 2026.
• Net cash used in operating activities was $49.2 million for the nine months ended September 30, 2026.
• Research and development expenses were $15.0 million for the third quarter of 2026, an increase of $1.4 million from $13.6 million in the third quarter of 2025.
• General and administrative expenses were $8.4 million for the third quarter of 2026, an increase of $2.8 million from $5.6 million in the third quarter of 2025.
• Net loss was $18.9 million for the third quarter of 2026, a decrease of $11.7 million from $30.6 million in the third quarter of 2025.
• Basic and diluted net loss per share was $0.34 for the third quarter of 2026, compared to $2.19 for the third quarter of 2025.
• Total assets were $481.4 million as of September 30, 2026, compared to $116.5 million as of December 31, 2025.
• Total liabilities were $44.9 million as of September 30, 2026, compared to $33.4 million as of December 31, 2025.
• Total stockholders' equity was $436.5 million as of September 30, 2026, compared to $83.0 million as of December 31, 2025.
• Weighted average common shares outstanding were 55,060,404 for the third quarter of 2026, compared to 14,000,451 for the third quarter of 2025.

Guidance and Future Outlook:

• Cash, cash equivalents, and investments are expected to fund operations into 2029.
• The company expects feedback from the U.S. Food and Drug Administration on its proposed development plan for abdakibart by year-end 2026.
• Initiation of the registrational Phase 3 program for abdakibart in hidradenitis suppurativa is planned for the first half of 2027.
• An Investigational New Drug (IND) submission for AVTX-010 is anticipated in the first half of 2027.

Business Segments and Product Lines:

• Abdakibart (AVTX-009): Advancing toward a registrational Phase 3 program in hidradenitis suppurativa (HS) following positive efficacy and safety results from the Phase 2 LOTUS trial across both dosing regimens.
• AVTX-010: Developing a next-generation, Fc-engineered, long-acting anti-IL-1β monoclonal antibody for potential use in HS and other inflammatory diseases.
• LOTUS Data: Presented late-breaking oral presentation and poster data at the 2026 European Academy of Dermatology and Venereology (EADV) Congress.
• R&D expense increases were driven by increased CMC expenses related to manufacturing activities for AVTX-010 and abdakibart, partially offset by lower clinical expenses following the LOTUS trial topline data readout in May 2026.

Other Key Points:

• The company has a strong financial position allowing for disciplined capital allocation tied to clear development milestones.
• The net loss decrease was partially offset by the impact of the change in fair value related to the derivative liability, which resulted in a $210 million gain in the third quarter of 2026 versus a $12.5 million loss in the same period of 2025.
• Interest income, net was $4.2 million for the third quarter of 2026, compared to $1.1 million in the third quarter of 2025.
• The company is a clinical-stage biotechnology focused on therapies targeting the IL-1β pathway for immune-mediated inflammatory diseases.