UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2025 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-37746 APTEVO THERAPEUTICS INC. (Exact Name of Registrant as Specified in its Charter) Delaware 81-1567056 (State or other jurisdic ...

Exhibit 99.1 Mr. White continued "We're pleased to report that our lead asset, mipletamig, continues to perform as designed in the clinic. In frontline acute myeloid leukemia (AML), 85% of evaluable patients Aptevo Therapeutics Reports 2Q25 Financial Results And Provides A Business Update Mipletamig's 85% frontline AML remission rate and favorable safety profile drive APVO's differentiated CD3 portfolio expansion with APVO455, a Nectin-4 x CD3 bispecific for multiple solid tumor types CD3 bispecific portfol ...

Group 1 - U.S. stock futures are lower, with Dow futures down approximately 0.2% [1] - Smith & Wesson Brands reported fourth-quarter revenue of $140.8 million, missing analyst estimates of $152.41 million [2] - The company reported adjusted earnings of 20 cents per share, falling short of estimates of 23 cents per share [2] Group 2 - Smith & Wesson Brands shares fell 12.6% to $9.51 in pre-market trading [2] - Regencell Bioscience Holdings Ltd shares dropped 16.2% to $52.96 in pre-market trading [4] - QuantaSing Group Ltd- ADR shares fell 12.1% to $11.86 in pre-market trading [4] - Aptevo Therapeutics Inc shares decreased by 11.9% to $4.52 in pre-market trading [4] - Capricor Therapeutics Inc shares fell 7.4% to $11.04 in pre-market trading [4] - Mesoblast Ltd shares declined 6.5% to $10.94 in pre-market trading [4] - Diginex Limited shares dropped 6.5% to $43.51 in pre-market trading [4] - Himalaya Shipping Ltd. shares decreased 6.3% to $6.22 in pre-market trading [4] - AIRO Group Holdings, Inc. shares fell 5.3% to $24.88 in pre-market trading [4]

Core Viewpoint - The article highlights significant movements in the Hong Kong and US stock markets, focusing on various companies' performances and the impact of regulatory changes on specific sectors. Group 1: Hong Kong Stock Market Highlights - Haitian Flavoring (03288) debuted with over a 3% increase, raising HKD 10 billion and holding a 6.2% global market share in soy sauce, leading the Chinese seasoning market with a 4.8% share [1] - Stablecoin concept stocks surged, with Lianlian Digital up 11%, Yika up 9%, and Zhong An Online up 8%, driven by the implementation of Hong Kong's stablecoin regulations [1] - Hezhima Intelligent (02533) rose over 3% as it plans to acquire an AI chip company to expand its automotive and edge AI product lines [1] - Delin Holdings (01709) increased over 3% with an expected annual profit growth of 10%-30% (to HKD 110-130 million) and its subsidiary Synaptic Technology securing tens of millions in A-round financing [1] - Jingtai Technology (02228) saw over a 4% rise, producing its first clinical candidate drug, PRMT5 inhibitor PE-0260, with clinical trials set to start in the second half of 2025 [1] - Gold stocks collectively fell, with Lingbao Gold and Zhu Feng Gold both down 4%, affected by a pullback in spot gold prices [1] - Innovent Biologics (01801) rose over 4% after obtaining global rights for GlycoT's ADC technology, with positive outlooks for IBI363/343's international potential [1] - Longpan Technology (02465) increased over 6% due to policy support accelerating solid-state battery industrialization, with the Ministry of Industry and Information Technology allocating HKD 6 billion for special research [1] Group 2: Other Notable Movements - Simor International (06969) fell over 5% as shareholder Yiwei Lithium Energy announced a third reduction of 3.5% in its stake, dropping to 27% and losing control [2] - Fubo Group (03738) rose over 4% due to favorable policies for data asset REITs, with the company targeting annual AI business revenue in the million-dollar range [2] - Yadea Holdings (01585) increased over 4% with a projected 55% rise in H1 net profit to HKD 1.6 billion, driven by new national standards enhancing industry concentration [2] - Perfect Medical (01830) fell over 6% as medical beauty consumption shifted to Shenzhen and South Korea, with an expected 35% decline in annual profit [2] - Yunbai International (00030) surged over 15% after acquiring global distribution rights from its parent company Yunnan Baiyao, covering a full range of products including medicines and personal care [2] - Luk Fook Holdings (00590) dropped over 4% due to increased gold hedging losses from rising gold prices and high base effects from last year's acquisition of King of Gold [2] Group 3: US Stock Market Highlights - Brain Regen Technologies (RGC.US) fell over 18% after a 400% increase in the previous two days, as profit-taking occurred; the company focuses on liquid formulations for ADHD and autism [3] - Marvell Technology (MRVL.US) rose over 7% after announcing a collaboration to develop AI power solutions and launching a 2nm custom SRAM chip with leading bandwidth and energy efficiency [3] - Circle (CRCL.US) surged over 33% after the US Senate passed a stablecoin bill, boosting the stock's value by 410% since its listing [3] - The rare earth sector continued to rise, with MP Materials up 4.9% and USA Rare Earth up 5.58%, driven by policy support for strategic resource demand [3] - Wolfspeed (WOLF.US) fell over 30% amid reports of a potential bankruptcy agreement, despite the silicon carbide market projected to reach USD 29 billion by 2030 [3] - Odyssey Marine (OMEX.US) rose over 11% after Trump signed an executive order to expedite deep-sea mining permits, with a 93% increase year-to-date [3] - Huya (HUYA.US) increased over 3% as the "HYPER eSports Carnival" is set to open in Chengdu, boosting platform traffic and commercialization expectations [3] Group 4: Additional Notable Movements - AST SpaceMobile (ASTS.US) rose over 10%, with an 85% increase in June, partnering with Vodafone India to provide satellite connectivity to unconnected areas [4] - Arqit Quantum (ARQQ.US) surged over 22% after being selected for Oracle's defense ecosystem, highlighting the strategic value of quantum encryption technology [4] - Aptevo (APVO.US) skyrocketed over 81% due to a new leukemia drug showing an 85% response rate in frontline treatment [4] - Upstart (UPST.US) rose over 10% after Bank of America raised its target price to USD 56, maintaining a "hold" rating as the credit tech platform's valuation recovers [4] - Coinbase (COIN.US) increased over 16% as it plans to apply to the SEC for "tokenized stocks," opening new growth opportunities in traditional equity on-chain [5]

Core Viewpoint - Aptevo Therapeutics Inc's stock is experiencing a significant surge due to promising clinical data from its RAINIER trial for mipletamig, a bispecific antibody for treating acute myeloid leukemia (AML) [1][2][6]. Group 1: Clinical Trial Results - The RAINIER trial showed that the mipletamig triplet therapy achieved remissions in 85% of evaluable frontline AML patients, outperforming competitor studies [3]. - Updated results indicate a strong efficacy advantage and a favorable safety profile, with no cases of cytokine release syndrome (CRS) reported in the trial cohorts [4][5]. - The trial is nearing full enrollment for Cohort 3 at the highest dose level evaluated to date [5]. Group 2: Market Impact and Financials - Following the positive trial results, Aptevo's stock price increased by 137.2%, reaching $6.69 [7]. - The company announced a registered direct offering of $8 million, involving 2.465 million shares and pre-funded warrants at an exercise price of $3.25 per share [6].

PART I. FINANCIAL INFORMATION [Financial Statements (Unaudited)](index=4&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) The unaudited financial statements reveal a significant decrease in cash, a net loss for the quarter, and a shift to a stockholders' deficit, raising substantial doubt about the company's ability to continue as a going concern [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of March 31, 2025, total assets decreased to $8.3 million from $15.6 million, driven by a drop in cash, shifting the company from stockholders' equity to a deficit of $1.5 million Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $2,139 | $8,714 | | Total current assets | $3,607 | $10,659 | | Total assets | $8,342 | $15,591 | | **Liabilities & Equity** | | | | Total current liabilities | $5,393 | $6,207 | | Total liabilities | $9,815 | $10,836 | | Total stockholders' (deficit) equity | $(1,473) | $4,755 | | Total liabilities and stockholders' (deficit) equity | $8,342 | $15,591 | [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) For Q1 2025, the company reported a net loss of $6.4 million, a slight improvement from the $6.8 million loss in Q1 2024 due to lower operating expenses and a significant change in per-share loss after reverse stock splits Condensed Consolidated Statements of Operations (in thousands, except per share data) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Research and development | $(3,633) | $(3,752) | | General and administrative | $(2,847) | $(3,231) | | Loss from operations | $(6,480) | $(6,983) | | Net loss | $(6,408) | $(6,834) | | Basic and diluted net loss per share | $(4.39) | $(368.21) | | Weighted average shares outstanding | 1,458,458 | 18,560 | [Condensed Consolidated Statements of Cash Flows](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash used in operating activities was $6.6 million for Q1 2025, leading to a decrease in cash and cash equivalents to $2.1 million by the end of the period Condensed Consolidated Statements of Cash Flows (in thousands) | Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(6,575) | $(6,651) | | Net cash from investing activities | — | — | | Net cash used in financing activities | — | $(3) | | **Decrease in cash and cash equivalents** | **$(6,575)** | **$(6,654)** | | Cash and cash equivalents at end of period | $2,139 | $10,250 | [Condensed Consolidated Statements of Changes in Stockholders' (Deficit) Equity](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Changes%20in%20Stockholders'%20(Deficit)%20Equity) Stockholders' equity decreased from $4.8 million to a deficit of $1.5 million in Q1 2025, primarily driven by the period's net loss of $6.4 million - The company's equity position deteriorated from a positive **$4.76 million** at the end of 2024 to a **deficit of $1.47 million** by March 31, 2025, mainly due to the **$6.41 million net loss** incurred during the quarter[20](index=20&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) The notes detail the company's clinical-stage status and highlight substantial doubt about its going concern status due to recurring losses, also covering reverse stock splits and financing activities - The company has suffered recurring losses, with a **net loss of $6.4 million for Q1 2025** and an **accumulated deficit of $254.0 million**, raising substantial doubt about its ability to continue as a going concern[24](index=24&type=chunk) - The company will need to raise additional funds to support operations, as existing cash and potential milestone payments are insufficient; without new funding, it may be forced to delay or scale back R&D[24](index=24&type=chunk)[25](index=25&type=chunk) - In 2024, the company executed two reverse stock splits: a **1-for-44 split** and a **1-for-37 split**, with all share and per-share amounts retroactively adjusted[44](index=44&type=chunk) - In April 2025, the company completed two offerings and a private placement, raising **$3.7 million** after expenses, and entered an ATM offering agreement for up to **$50 million**[74](index=74&type=chunk)[75](index=75&type=chunk)[76](index=76&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=21&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses its focus on cancer immunotherapies, recent financing, positive clinical updates for mipletamig, and the critical liquidity situation reinforcing the going concern risk [Recent Developments](index=22&type=section&id=Recent%20Developments) The company secured $4.1 million in financing in April 2025 and reports promising clinical data for its mipletamig RAINIER trial, with no observed cytokine release syndrome - In April 2025, Aptevo secured **$4.1 million in gross proceeds** from two registered direct offerings and entered an 'At The Market' agreement to sell up to **$50 million** in common stock[86](index=86&type=chunk) - The RAINIER Phase 1b/2 trial for mipletamig in frontline AML is advancing, with **9 out of 10 (90%) frontline patients** treated in combination with standard of care achieving remission[86](index=86&type=chunk) - Mipletamig has demonstrated a favorable safety profile, with **no cytokine release syndrome (CRS)** observed in the ongoing RAINIER trial, a key differentiator[86](index=86&type=chunk) [Results of Operations](index=23&type=section&id=Results%20of%20Operations) Total operating expenses for Q1 2025 decreased to $6.48 million from $6.98 million in Q1 2024, driven by lower research and development and general and administrative spending Research and Development Expenses by Program (in thousands) | Program | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Mipletamig | $1,622 | $684 | | ALG.APV-527 | $178 | $827 | | **Total clinical programs** | **$1,800** | **$1,511** | | Preclinical & general research | $1,833 | $2,241 | | **Total R&D** | **$3,633** | **$3,752** | - The decrease in R&D spending was primarily due to the ALG.APV-527 escalation phase ramping down and lower preclinical costs, offset by increased patient enrollment costs for the mipletamig trial[91](index=91&type=chunk) - General and administrative expenses **decreased by $0.4 million** year-over-year, from $3.2 million to $2.8 million, mainly due to reduced stock-based compensation costs[94](index=94&type=chunk) [Liquidity and Capital Resources](index=25&type=section&id=Liquidity%20and%20Capital%20Resources) The company's liquidity is critical with only $2.1 million in cash, an accumulated deficit of $254.0 million, and a dependency on raising additional capital to continue operations - As of March 31, 2025, the company had **cash and cash equivalents of $2.1 million** and an **accumulated deficit of $254.0 million**[104](index=104&type=chunk) - The company has an 'At The Market' (ATM) sales agreement to sell up to **$50 million** in common stock, though sales are currently limited by SEC rules; as of May 14, 2025, it had sold approximately **$1.2 million**[100](index=100&type=chunk)[102](index=102&type=chunk) - The company has **5.2 million common warrants outstanding**, which, if exercised, could provide up to an additional **$6.8 million** in gross proceeds[103](index=103&type=chunk) - A significant contractual obligation is a potential **$2.0 million milestone payment** to OMT upon dosing the first patient in a Phase 2 clinical trial of mipletamig[113](index=113&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=32&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company states that there have been no material changes to its market risk disclosures since its Annual Report on Form 10-K for the year ended December 31, 2024 - There were no material changes to the information regarding market risk as of March 31, 2025, compared to what was disclosed in the 2024 Annual Report on Form 10-K[116](index=116&type=chunk) [Controls and Procedures](index=32&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of March 31, 2025, with no material changes to internal control over financial reporting during the quarter - Based on an evaluation as of March 31, 2025, the CEO and CFO concluded that the company's **disclosure controls and procedures were effective**[117](index=117&type=chunk) - **No changes in internal control over financial reporting** occurred during the quarter ended March 31, 2025, that have materially affected or are likely to materially affect internal controls[118](index=118&type=chunk) PART II. OTHER INFORMATION [Legal Proceedings](index=33&type=section&id=Item%201.%20Legal%20Proceedings) The company reports that it is not currently a party to any legal claims or actions that its management believes would have a material adverse effect on its financial condition or operations - Management believes there are **currently no pending legal claims** or actions against the company that would have a material adverse effect on its business[121](index=121&type=chunk) [Risk Factors](index=33&type=section&id=Item%201A.%20Risk%20Factors) This section outlines significant risks including precarious financial condition, dependence on clinical success, reliance on third parties, intense competition, and common stock volatility [Financial Risks](index=34&type=section&id=Financial%20Risks) The company faces severe financial risks, including a history of significant operating losses, a $254.0 million accumulated deficit, and substantial doubt about its ability to continue as a going concern - The company has a history of significant losses, with a **net loss of $6.4 million for Q1 2025** and an **accumulated deficit of $254.0 million** as of March 31, 2025[124](index=124&type=chunk) - Management has concluded that **substantial doubt exists about the company's ability to continue as a going concern**, which may adversely affect its stock price and ability to raise capital[125](index=125&type=chunk) - The company requires additional funding to continue operations; **failure to secure funding** may force reductions in spending, suspension of programs, or unfavorable licensing deals[126](index=126&type=chunk) [Product Development and Commercialization Risks](index=50&type=section&id=Product%20Development%20and%20Commercialization%20Risks) The company's success hinges on its ability to develop and commercialize its product candidates, a process fraught with risk, reliance on its ADAPTIR platforms, and substantial competition - **Success in early preclinical and clinical trials does not guarantee success** in later-stage trials, as product candidates may fail to demonstrate sufficient safety and efficacy[182](index=182&type=chunk) - The company's **open-label clinical trial for mipletamig is subject to potential patient and investigator bias**, and results may not be predictive of future trial outcomes[184](index=184&type=chunk) - The company faces **substantial competition** from numerous well-established pharmaceutical and biotechnology companies with greater resources, including AbbVie, Amgen, and Johnson & Johnson[236](index=236&type=chunk) - The company's long-term success depends on its ability to successfully use and develop its **ADAPTIR and ADAPTIR-FLEX platforms**, which is not guaranteed[234](index=234&type=chunk) [Regulatory, Compliance, and Manufacturing Risks](index=57&type=section&id=Regulatory%2C%20Compliance%2C%20and%20Manufacturing%20Risks) The company is subject to extensive regulations, depends entirely on third-party manufacturers, and must comply with stringent healthcare laws, with violations carrying substantial penalties - The company **depends on third parties (CROs, investigators) to conduct its clinical trials** and does not have day-to-day control over their activities[198](index=198&type=chunk)[199](index=199&type=chunk) - The company **has no manufacturing capabilities** and relies on a limited number of third-party suppliers, where production problems could halt development[205](index=205&type=chunk) - The company is subject to numerous healthcare laws, including the Anti-Kickback Statute and False Claims Act; **violations can lead to significant penalties** and exclusion from federal programs[265](index=265&type=chunk)[266](index=266&type=chunk)[270](index=270&type=chunk) - The company's information technology systems are **vulnerable to cybersecurity breaches**, which could lead to the loss of trade secrets and significant legal and financial liability[276](index=276&type=chunk)[280](index=280&type=chunk)[281](index=281&type=chunk) [Risks Related to Our Common Stock and General Risks](index=43&type=section&id=Risks%20Related%20to%20Our%20Common%20Stock%20and%20General%20Risks) Ownership of the company's common stock involves significant risk due to extreme price volatility and a substantial risk of delisting from Nasdaq for failing to meet the minimum bid price - The company's common stock is at **risk for delisting from Nasdaq** if it fails to maintain a minimum closing bid price of $1.00 per share[166](index=166&type=chunk) - The **stock price is highly volatile**, having fluctuated between $1.12 and $182,290.42 per share (split-adjusted) since 2016[157](index=157&type=chunk) - Future equity issuances for capital raising or other purposes will result in the **dilution of existing stockholders' ownership** percentage[170](index=170&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=88&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This item is not applicable for the reporting period - Not applicable[309](index=309&type=chunk) [Defaults Upon Senior Securities](index=88&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) This item is not applicable for the reporting period - Not applicable[310](index=310&type=chunk) [Mine Safety Disclosures](index=88&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable for the reporting period - Not applicable[311](index=311&type=chunk) [Other Information](index=88&type=section&id=Item%205.%20Other%20Information) Stockholders approved proposals for a stock issuance, a potential reverse stock split, and meeting adjournment at the Special Meeting of Stockholders held on May 14, 2025 Proposal 1: Approval of Stock Issuance and Warrant Proposal | FOR | AGAINST | ABSTAIN | BROKER NON-VOTES | | :--- | :--- | :--- | :--- | | 174,107 | 120,876 | 20,950 | 826,918 | Proposal 2: Approval of Reverse Stock Split | FOR | AGAINST | ABSTAIN | BROKER NON-VOTES | | :--- | :--- | :--- | :--- | | 804,924 | 311,563 | 26,364 | 0 | Proposal 3: Authorization to Adjourn the Special Meeting | FOR | AGAINST | ABSTAIN | BROKER NON-VOTES | | :--- | :--- | :--- | :--- | | 791,430 | 299,950 | 51,471 | 0 | [Exhibits](index=91&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including CEO and CFO certifications pursuant to the Sarbanes-Oxley Act and Inline XBRL data files - The exhibits include **certifications from the Principal Executive Officer and Principal Financial Officer** as required by the Sarbanes-Oxley Act, as well as XBRL data files[320](index=320&type=chunk)

[At The Market Offering Agreement](index=1&type=section&id=AT%20THE%20MARKET%20OFFERING%20AGREEMENT) This agreement outlines the terms for Aptevo Therapeutics Inc. to sell common stock through Roth Capital Partners, LLC via an at-the-market offering [Agreement Overview](index=1&type=section&id=Agreement%20Overview) This section introduces the At The Market Offering Agreement between Aptevo Therapeutics Inc. and Roth Capital Partners, detailing terms for common stock sales - Parties to the agreement are **Aptevo Therapeutics Inc.** and **Roth Capital Partners, LLC**[1](index=1&type=chunk) - The agreement was executed on **April 28, 2025**[1](index=1&type=chunk) [Definitions](index=1&type=section&id=1.%20Definitions) This section defines key terms like "Act," "Commission," and "Common Stock" to ensure consistent interpretation throughout the agreement [Sale and Delivery of Shares](index=4&type=section&id=2.%20Sale%20and%20Delivery%20of%20Shares) This section outlines the mechanics of the at-the-market offering, including maximum size, sales process, Manager's compensation, and settlement procedures Offering Details | Parameter | Detail | | :--- | :--- | | **Maximum Offering Size** | Up to **$50,000,000** aggregate gross offering price | | **Security** | Common Stock, **$0.0001** par value per share | | **Manager's Compensation** | A placement fee of **3.0%** of the gross sales price ("Broker Fee") | | **Trading Market** | The Nasdaq Capital Market | - Roth Capital Partners is appointed as the Company's exclusive agent for share sales on a commercially reasonable efforts basis[22](index=22&type=chunk) - Sales are initiated by the Company through a "Sales Notice" specifying maximum shares and minimum acceptable price[24](index=24&type=chunk) - Settlement for sales will occur on the first Trading Day (T+1) following the sale date[30](index=30&type=chunk) [Representations and Warranties](index=7&type=section&id=3.%20Representations%20and%20Warranties) The Company provides extensive representations and warranties to the Manager regarding its corporate structure, financial reporting, legal compliance, and intellectual property - The Company confirms compliance with Form S-3 requirements and the effectiveness of its Registration Statement[47](index=47&type=chunk) - All SEC reports are affirmed as accurate, complete, and Exchange Act compliant, with financial statements prepared under GAAP[53](index=53&type=chunk)[54](index=54&type=chunk) - The Company represents no undisclosed material litigation and compliance with Sarbanes-Oxley, FDA, environmental, and anti-corruption laws[56](index=56&type=chunk)[68](index=68&type=chunk)[82](index=82&type=chunk) - The Company confirms no other at-the-market sales agency agreements have been executed[70](index=70&type=chunk) [Agreements (Covenants)](index=23&type=section&id=4.%20Agreements) This section outlines the Company's ongoing obligations, including maintaining an effective registration statement, providing timely disclosures, and facilitating due diligence - The Company must notify the Manager and amend the Prospectus for any material misstatement or omission[94](index=94&type=chunk)[97](index=97&type=chunk) - The Company will provide officer's certificates, legal opinions, and auditor comfort letters at the offering's start and on Representation Dates[104](index=104&type=chunk)[106](index=106&type=chunk)[107](index=107&type=chunk) - The Company will disclose shares sold, net proceeds, and commissions in its quarterly and annual reports[111](index=111&type=chunk) - The Company agrees to conduct due diligence sessions with management, counsel, and accountants upon Manager's request at commencement and each Representation Date[109](index=109&type=chunk) [Payment of Expenses](index=31&type=section&id=5.%20Payment%20of%20Expenses) This section stipulates the Company's responsibility for all offering-related expenses, including filing fees, printing, and legal and accounting costs, regardless of transaction completion - The Company agrees to pay all offering expenses, including SEC and FINRA filing fees, printing, and legal/accounting fees[120](index=120&type=chunk)[121](index=121&type=chunk) - The Company will reimburse Manager's counsel fees up to **$50,000**, plus additional fees for periodic due diligence[121](index=121&type=chunk)[109](index=109&type=chunk) [Conditions to the Obligations of the Manager](index=32&type=section&id=6.%20Conditions%20to%20the%20Obligations%20of%20the%20Manager) This section outlines conditions precedent for the Manager's obligation to sell shares, serving as a protective measure against unmet requirements or adverse events - The Manager's obligation to sell shares is conditional upon the continued accuracy of the Company's representations and warranties[121](index=121&type=chunk) - The Company must deliver required documents, including legal opinions, officer's certificates, and auditor comfort letters[122](index=122&type=chunk)[123](index=123&type=chunk)[124](index=124&type=chunk) - No stop order from the SEC must be in effect suspending the Registration Statement's effectiveness[121](index=121&type=chunk) - The Manager can cancel obligations if a Material Adverse Effect impacts the Company's business or financial condition[123](index=123&type=chunk)[126](index=126&type=chunk) [Indemnification and Contribution](index=35&type=section&id=7.%20Indemnification%20and%20Contribution) This section defines each party's legal and financial responsibilities for losses or claims arising from misstatements or omissions in offering documents, with the Company providing broad indemnification - The Company agrees to indemnify the Manager from losses arising from material misstatements or omissions in offering documents[132](index=132&type=chunk) - The Manager's indemnification is limited to losses from Manager-furnished written information, capped at total broker fees paid[133](index=133&type=chunk)[134](index=134&type=chunk) - If indemnification is unavailable, parties will contribute to losses based on relative benefits and fault[137](index=137&type=chunk) [Termination](index=37&type=section&id=8.%20Termination) This section defines termination rights for both the Company and Manager, specifying notice periods and outlining surviving obligations like expenses and indemnification - The Company may terminate the agreement with **ten (10) business days'** prior written notice[138](index=138&type=chunk) - The Manager may terminate the agreement at any time by giving written notice[140](index=140&type=chunk) - Key provisions, including payment of expenses (Section 5), indemnification (Section 7), and governing law (Section 15), survive termination[139](index=139&type=chunk)[140](index=140&type=chunk)[141](index=141&type=chunk) [Miscellaneous Provisions](index=38&type=section&id=9-18.%20Miscellaneous%20Provisions) This section includes standard boilerplate clauses governing the contract, such as survival of representations, notice procedures, governing law, and waiver of jury trial - The agreement explicitly states the Manager acts as an independent contractor, not a fiduciary, to the Company[146](index=146&type=chunk)[147](index=147&type=chunk) - The agreement is governed by New York State laws, with legal proceedings instituted in New York courts[150](index=150&type=chunk) - Both parties irrevocably waive their right to a jury trial for any related legal proceeding[152](index=152&type=chunk)

Clinical Development and Trials - Clinical candidate mipletamig shows a 100% complete remission (CR) rate in the first cohort of the RAINIER trial for frontline acute myelogenous leukemia (AML) patients [19]. - In the Phase 1b dose expansion trial, mipletamig demonstrated an 82% composite clinical remission rate and a 73% complete remission rate in venetoclax naïve patients [33]. - The current product candidate pipeline includes mipletamig in Phase 1b/2, ALG.APV-527 in Phase 1, and APVO711 in preclinical studies [25]. - Mipletamig is designed to engage CD3 and CD123, redirecting T cells to destroy leukemia cells, with a focus on reducing the likelihood of cytokine release syndrome (CRS) [27][38]. - In the RAINIER frontline AML Phase 1b trial, 100% of patients achieved remission within 30 days, including one patient with complete remission and MRD-negative status [42]. - ALG.APV-527 demonstrated positive safety and tolerability across all cohorts, with no serious liver toxicity observed, and a maximum tolerated dose has not been identified [49]. - The ALG.APV-527 Phase 1 dose escalation trial is currently assessing safety, tolerability, pharmacokinetics, pharmacodynamics, and preliminary anti-tumor activity [47]. - The company completed its Phase 1b dose expansion clinical trial with mipletamig in 2023 and initiated a dose optimization Phase 1b/2 study in August 2024 [191]. - Clinical trials may produce inconsistent or negative results, and success in early trials does not guarantee success in later-stage trials [192]. - Serious adverse events or undesirable side effects may arise during clinical trials, potentially leading to regulatory delays or the abandonment of product candidates [201]. Product Pipeline and Technology - The company has two clinical candidates and three preclinical candidates currently in development, utilizing its proprietary ADAPTIR and ADAPTIR-FLEX platforms [15][16]. - The ADAPTIR platform allows for the generation of bispecific and multi-specific antibody candidates, with 16 new bispecific agents approved by the FDA in the last three years [22]. - The ADAPTIR and ADAPTIR-FLEX platform technologies allow for the development of monospecific, bispecific, and multi-specific immunotherapeutic proteins targeting various tumor cells [56]. - The ADAPTIR platform technology enables the design of both monospecific and bispecific bi-valent protein therapeutics, enhancing the potential for innovative cancer treatments [62]. - APVO603, a preclinical dual agonist bispecific candidate, is designed to target both 4-1BB and OX40, potentially amplifying anti-tumor responses [49]. Competitive Landscape - The company anticipates significant competition in the oncology market from various producers, including Affimed, AstraZeneca, and Bristol Myers Squibb, among others [72]. - Mipletamig is expected to compete with other agents targeting CD123 and non-CD123 for AML treatment, with competitors including Affimed and ImmunoGen [70]. - ALG.APV-527 targets 4-1BB and is anticipated to compete with bispecifics currently in preclinical development, such as those by Crescendo Biologics [71]. Intellectual Property and Collaboration - The company has a collaboration agreement with Alligator Bioscience for the development of ALG.APV-527, with joint ownership of intellectual property generated [74]. - The collaboration agreement includes revenue sharing from commercialization partners, with terms based on development costs borne by each party [75]. - The company relies on a combination of patents, trademarks, and trade secrets to protect its intellectual property, particularly for the ADAPTIR-FLEX platform [79]. - The ADAPTIR platform technology is protected through patents and trade secrets, with pending applications in various countries, including the United States and China [88]. - The company has nationalized its core patent family for mipletamig in multiple countries, including the United States and Australia [90]. - The company co-owns a patent family for ALG.APV-527 with Alligator, which has been nationalized in various countries [91]. - The company routinely files provisional patent applications for its preclinical therapeutic candidates, including APVO603, APVO442, and APVO711 [93]. Regulatory Environment - The FDA requires two Phase 3 clinical trials for product approval, although under certain circumstances, a single trial may suffice [105]. - The Prescription Drug User Fee Act (PDUFA) establishes a six-month review goal for Priority Review applications, compared to ten months for Standard Review [114]. - The FDA may issue a Complete Response Letter (CRL) if an application does not meet approval standards, detailing specific deficiencies [117]. - The FDA may impose conditions on approval, such as requiring a Risk Evaluation and Mitigation Strategy (REMS) to ensure product safety [118]. - The FDA has a two-month timeframe to review applications for acceptability for filing [113]. - The FDA may require post-marketing studies to confirm product effectiveness and safety after approval [105]. - The FDA's review process may be extended if substantial additional information is provided by the sponsor [114]. - Biologics License Applications (BLAs) are subject to substantial user fees, which must be paid upon initial submission [111]. - The FDA may refer applications to an advisory committee for expert evaluation before approval [115]. - The FDA conducts Pre-Approval Inspections to ensure compliance with manufacturing standards before granting approval [116]. - The company is eligible for designated platform technology status under the Food and Drug Omnibus Reform Act of 2022, which may expedite the development and review of subsequent original BLAs [122]. - The FDA can designate a product as a breakthrough therapy if it shows substantial improvement over existing therapies, with a determination required within 60 days of the request [123]. - Orphan drug designation can be requested for products intended to treat rare diseases affecting fewer than 200,000 people in the U.S., providing benefits such as seven years of market exclusivity after approval [124]. - The first applicant to receive orphan drug approval is granted exclusivity, preventing FDA approval of similar applications unless certain conditions are met [125]. - Post-approval, biologics are subject to ongoing FDA regulation, including record-keeping and reporting of adverse experiences [127]. - Facilities involved in manufacturing approved products must register with the FDA and comply with cGMP, facing inspections and potential penalties for non-compliance [128]. - The FDA monitors advertising and promotional materials for compliance, with significant penalties for off-label promotion violations [129]. - The Biologics Price Competition and Innovation Act allows for an abbreviated approval pathway for biosimilars, requiring high similarity to reference products [130]. - Reference biologics receive 12 years of exclusivity from the first licensure, with no biosimilar applications allowed for four years [131]. Financial Performance and Funding - For the year ended December 31, 2024, the company reported a net loss of $24.1 million, an increase from a net loss of $17.4 million for the same period in 2023 [160]. - As of December 31, 2024, the company had an accumulated deficit of $247.6 million [160]. - The company had cash and cash equivalents amounting to $8.7 million as of December 31, 2024, indicating a need for additional funding to support ongoing clinical development and operations [162]. - The company has a history of operating losses and may not achieve profitability in the future, which raises substantial doubt about its ability to continue as a going concern [161]. - The company is focused on developing immunotherapeutic candidates and will require substantial resources for commercialization efforts [160]. - The company completed a public offering on August 4, 2023, issuing 4,959 shares and receiving net proceeds of $4.3 million [165]. - On November 9, 2023, the company entered into a warrant inducement agreement, receiving net proceeds of $3.0 million from the exercise of 8,725 existing common warrants [165]. - The company raised $4.0 million in net proceeds from a public offering of 91,891 shares on April 15, 2024 [165]. - A registered direct offering on July 1, 2024, resulted in net proceeds of $2.3 million from the sale of 144,318 shares [165]. - The company received $2.5 million in net proceeds from a registered direct offering on September 18, 2024, involving 245,699 shares [165]. - On December 12, 2024, the company entered into a warrant inducement agreement, generating net proceeds of $5.6 million from the exercise of 823,544 common warrants [165]. - Future issuances of common stock could result in gross proceeds of $16.5 million from outstanding warrants [165]. - The company is susceptible to macroeconomic conditions, including inflation and interest rate fluctuations, which could adversely affect its capital raising ability [168]. - The company faces potential product liability exposure, which could lead to substantial liabilities and negatively impact its financial condition [178]. Workforce and Diversity - As of December 31, 2024, 49% of the workforce and 46% of leadership positions were held by females, while 38% of both the workforce and leadership were racially or ethnically diverse [146]. - The company emphasizes the importance of diversity, equity, and inclusion (DEI) in its operations, believing it drives innovation and business growth [146]. - The company maintains a hybrid working environment, with essential employees working onsite and non-essential employees working remotely or in a hybrid model [149]. - The company has implemented an unlimited paid time off policy to provide employees with flexibility in scheduling time away from work [148]. - The ability to attract and retain key personnel is critical for the company's success, as competition for qualified employees is intense in the biotechnology sector [180]. Risks and Challenges - The company faces significant risks, including potential delisting from the Nasdaq Capital Market and challenges in attracting and retaining key personnel [158]. - The company may experience ownership changes in the future due to shifts in stock ownership, which could limit the use of net operating loss carryforwards and other tax attributes [188]. - The realization of deferred income tax assets, including net operating loss carryforwards, depends on generating future income during statutory carryforward periods [186]. - The company is subject to market and credit risks that could adversely impact its financial condition and results of operations, especially during periods of extreme volatility [190]. - The company relies on third-party service providers for clinical trials, and any failure in their performance could significantly harm the company's ability to obtain regulatory approval [205]. - Manufacturing of product candidates is complex and dependent on third-party suppliers, with potential risks of product shortages or delays in clinical development [213]. - Regulatory authorities may require additional clinical trials or impose restrictions based on adverse events, which could increase commercialization costs and delay revenue generation [204]. - The company may face challenges in maintaining agreements with third-party providers, which could lead to delays in product development activities [212]. - Changes in regulatory requirements during the development period could render existing data insufficient for marketing approval [200].

[Business Update](index=1&type=section&id=Business%20Update) [Mipletamig AML Bispecific Highlights](index=1&type=section&id=Mipletamig%20AML%20bispecific%20highlights) The Mipletamig drug candidate showed high remission rates and a favorable safety profile in its RAINIER trial for Acute Myeloid Leukemia (AML) - In the frontline AML RAINIER trial, **100% of patients in Cohort 1 achieved remission** within 30 days[3](index=3&type=chunk) - One patient in Cohort 1 achieved **complete remission with minimal residual disease (MRD)-negative status**, indicating 100% elimination of cancer cells[3](index=3&type=chunk) - Mipletamig showed a **favorable safety profile** with limited incidences of cytokine release syndrome (CRS), a common side effect in similar therapies[3](index=3&type=chunk) - Previous trial results supporting the current findings include a Phase 1b trial where **100% of frontline patients achieved remission** and a Phase 1a monotherapy trial where **36% of patients showed substantial leukemic blast reduction**[6](index=6&type=chunk) [ALG.APV-527 Solid Tumor Bispecific Highlights](index=2&type=section&id=ALG.APV-527%20solid%20tumor%20bispecific%20highlights) The ALG.APV-527 trial for solid tumors demonstrated a 59% stable disease rate and a favorable safety profile without serious liver toxicities | Metric | Result | | :--- | :--- | | Stable Disease Rate | 10 of 17 efficacy evaluable patients (59%) achieved stable disease | | Longest Duration of Stable Disease | A breast cancer patient remained on study for >12 months | | Other Stable Disease Durations | A colon cancer patient for >6 months; a prostate cancer patient for >4 months | - ALG.APV-527 demonstrated a **favorable safety profile** with limited incidence and no severe cases of liver toxicity, a common dose-limiting side effect in similar treatments[7](index=7&type=chunk)[6](index=6&type=chunk) - The data was presented at the **European Society for Medical Oncology (ESMO) Congress** and the **Society for Immunotherapy of Cancer (SITC) Conference** in 2024[7](index=7&type=chunk) [About Mipletamig and RAINIER Trial](index=3&type=section&id=About%20Mipletamig%20and%20RAINIER) Mipletamig is a bispecific antibody targeting CD123 for AML, evaluated in the Phase 1b/2 RAINIER combination therapy trial - Mipletamig is an antibody-like recombinant protein that targets the **CD123 antigen**, which is overexpressed on leukemic stem cells and AML blasts[8](index=8&type=chunk) - It is designed to **reduce the likelihood and severity of Cytokine Release Syndrome (CRS)** by using a unique CD3 binding domain[8](index=8&type=chunk) - The RAINIER trial is a two-part **Phase 1b/2 study**, with part one being a dose optimization study for up to 39 adult patients[9](index=9&type=chunk) [About ALG.APV-527 and The Phase 1 Trial](index=3&type=section&id=About%20ALG.APV-527%20and%20The%20Phase%201%20Dose%20Escalation%20Trial) ALG.APV-527 is a conditional 4-1BB agonist targeting the 5T4 tumor antigen, assessed for safety and efficacy in a Phase 1 trial - ALG.APV-527 is a bispecific conditional **4-1BB agonist**, designed to be active only upon simultaneous binding to 4-1BB and the tumor antigen 5T4[10](index=10&type=chunk) - The **5T4 antigen is overexpressed** on numerous solid tumors, including non-small-cell lung, breast, head and neck, and colorectal cancer[10](index=10&type=chunk) - The Phase 1 trial was a multi-center, open-label, dose-escalation study to assess **safety, tolerability, pharmacokinetics, and preliminary anti-tumor activity**[11](index=11&type=chunk) [Financial Results and Statements](index=4&type=section&id=Financial%20Results%20and%20Statements) [2024 Summary Financial Results](index=4&type=section&id=2024%20Summary%20Financial%20Results) The company's 2024 net loss increased to $24.1 million, despite lower operating expenses, due to the absence of a prior-year one-time gain | Financial Metric | 2024 | 2023 | | :--- | :--- | :--- | | Cash and cash equivalents | $8.7 million | $16.9 million | | Research and Development Expenses | $14.4 million | $17.1 million | | General and Administrative Expenses | $10.2 million | $11.8 million | | Net Loss | $24.1 million | $17.4 million | | Net Loss Per Share | $87.38 | $2,316.83 | - The decrease in R&D expenses was mainly due to lower preclinical spending and **reduced costs for the mipletamig trial** as it transitioned between phases[14](index=14&type=chunk) - The 2023 financials included a **$9.7 million gain** from the sale of a non-financial asset to XOMA, which was not repeated in 2024[17](index=17&type=chunk) [Consolidated Balance Sheets](index=5&type=section&id=CONSOLIDATED%20BALANCE%20SHEETS) Total assets decreased to $15.6 million from $24.8 million, driven by a reduction in cash, while total equity fell to $4.8 million | (in thousands) | Dec 31, 2024 | Dec 31, 2023 | | :--- | :--- | :--- | | **ASSETS** | | | | Cash and cash equivalents | $8,714 | $16,904 | | Total current assets | $10,659 | $19,066 | | **Total assets** | **$15,591** | **$24,842** | | **LIABILITIES & EQUITY** | | | | Total current liabilities | $6,207 | $7,224 | | **Total liabilities** | **$10,836** | **$12,621** | | **Total stockholders' equity** | **$4,755** | **$12,221** | | **Total liabilities and stockholders' equity** | **$15,591** | **$24,842** | [Consolidated Statements of Operations](index=6&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20OPERATIONS) Loss from operations improved to $24.6 million, but the net loss widened to $24.1 million due to non-recurring income in the prior year | (in thousands, except per share amounts) | For the Year Ended Dec 31, 2024 | For the Year Ended Dec 31, 2023 | | :--- | :--- | :--- | | Research and development | $(14,378) | $(17,107) | | General and administrative | $(10,224) | $(11,771) | | **Loss from operations** | **$(24,602)** | **$(28,878)** | | Gain related to sale of non-financial asset | — | $9,650 | | Net loss from continuing operations | $(24,130) | $(18,650) | | Income from discontinued operations | — | $1,239 | | **Net loss** | **$(24,130)** | **$(17,411)** | | **Basic and diluted net loss per share** | **$(87.38)** | **$(2,316.83)** | [Corporate Information and Forward-Looking Statements](index=7&type=section&id=Corporate%20Information%20and%20Forward-Looking%20Statements) [About Aptevo Therapeutics](index=7&type=section&id=About%20Aptevo%20Therapeutics) Aptevo Therapeutics is a clinical-stage biotech company developing novel bispecific immunotherapies for cancer using its proprietary platforms - Aptevo is a clinical-stage biotechnology company (Nasdaq: APVO) developing **novel bispecific immunotherapies** for cancer[25](index=25&type=chunk) - Its lead clinical candidates are **Mipletamig for frontline acute myeloid leukemia (AML)** and **ALG.APV-527 for multiple solid tumor types**[25](index=25&type=chunk) - All pipeline candidates are created from the company's proprietary **ADAPTIR® and ADAPTIR-FLEX® platforms**[25](index=25&type=chunk) [Safe Harbor Statement](index=7&type=section&id=Safe%20Harbor%20Statement) This section cautions that forward-looking statements are subject to significant risks and uncertainties that could cause actual results to differ - The press release contains **forward-looking statements** regarding the efficacy, safety, and potential of its therapeutic candidates, clinical milestones, and financial position[26](index=26&type=chunk) - Investors are cautioned **not to place undue reliance on these statements** as actual results could differ materially if underlying assumptions prove inaccurate or risks materialize[26](index=26&type=chunk) - Key risks include **deterioration in business prospects, adverse clinical development events, regulatory changes, competitive products, and macroeconomic conditions**[27](index=27&type=chunk)[28](index=28&type=chunk)

Company Overview - Aptevo Therapeutics Inc. (APVO) is part of the Medical group, which is currently ranked 1 within the Zacks Sector Rank, encompassing 1011 companies [2] - The company has a Zacks Rank of 2 (Buy), indicating a favorable outlook based on earnings estimates and revisions [3] Performance Metrics - Year-to-date, Aptevo Therapeutics Inc. has gained approximately 15.6%, while the average loss in the Medical group is about 3.9%, demonstrating strong relative performance [4] - The Zacks Consensus Estimate for APVO's full-year earnings has increased by 65.1% over the past three months, reflecting improved analyst sentiment [3] Industry Context - Aptevo Therapeutics Inc. operates within the Medical - Biomedical and Genetics industry, which includes 513 companies and is currently ranked 63 in the Zacks Industry Rank [5] - The Medical - Biomedical and Genetics industry has experienced an average loss of 12.6% this year, further highlighting APVO's superior performance [5] Comparison with Peers - Another outperforming stock in the Medical sector is Accuray (ARAY), which has increased by 7.6% year-to-date and also holds a Zacks Rank of 2 (Buy) [4][6] - Accuray's EPS consensus estimate has surged by 200% over the past three months, indicating strong growth potential [5]