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 September 30, 2020 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 | --- | --- | |-------------------------------------------------------------------------------------------------------- ...

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, 2020 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 ...

Financial Performance - For the three months ended March 31, 2020, the company reported a net income of $2.9 million, a significant improvement compared to a net loss of $12.0 million for the same period in 2019[80]. - The company recognized net income from discontinued operations totaling $12.9 million, which included a gain on the sale of Aptevo BioTherapeutics of $14.3 million[94]. - For the three months ended March 31, 2020, the company reported a net income of $2.9 million, compared to a net loss of $12.0 million for the same period in 2019[108]. Accumulated Deficit and Cash Position - The company had an accumulated deficit of $165.0 million as of March 31, 2020[80]. - Cash and cash equivalents amounted to $12.3 million, with restricted cash of $2.5 million as of March 31, 2020[98]. - Cash and cash equivalents as of March 31, 2020, were $12.3 million, with restricted cash of $2.5 million and an accumulated deficit of $165.0 million[108]. Operating Expenses - Research and development expenses decreased by $2.6 million to $4.0 million for the three months ended March 31, 2020, down from $6.6 million for the same period in 2019[89]. - General and administrative expenses decreased by $0.9 million, or 20%, to $3.6 million for the three months ended March 31, 2020, compared to $4.5 million for the same period in 2019[91]. Cash Flow and Debt Management - Net cash used in operating activities was $11.2 million for the three months ended March 31, 2020, primarily due to changes in working capital accounts[100]. - Net cash used in operating activities for the three months ended March 31, 2020, was $11.2 million[109]. - The company used $22.1 million from the proceeds of the sale of Aptevo BioTherapeutics to fully repay its term debt facility, relieving it of a $5 million cash restriction[99]. Clinical Development and Partnerships - The company is currently enrolling patients in a Phase 1/1b clinical study of APVO436 for Acute Myeloid Leukemia (AML) and has been selected for inclusion in the Beat AML Master Clinical Trial[85]. - The company has a purchase obligation of $8.1 million over the next four years for participation in the Beat AML Master Clinical Trial[118]. - The company sold worldwide rights to IXINITY to Medexus for an upfront payment of $30 million and potential milestone payments totaling up to $11 million[85]. Future Outlook and Funding - The company anticipates significant operating losses for the next several years as it continues to execute its development strategy[116]. - The company is exploring options to secure additional funding, including potential sales of common stock and establishing credit lines[111]. - The company has a commitment to purchase up to $35.0 million worth of common stock over a 36-month period under the Purchase Agreement with Lincoln Park[105]. - The company has the ability to sell up to an additional $17.3 million of common stock under the Equity Distribution Agreement with Piper Sandler[103]. - The company has not issued any additional shares under the Equity Distribution Agreement in the first quarter of 2020[103]. - The company may experience delays in partnering product candidates due to COVID-19, impacting future deferred payments from Medexus[110].

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2019 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 | --- | --- | --- | |-----------------------------------------------------------------------------|------------------|--------- ...

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 September 30, 2019 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 Delaware 81-1567056 (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.) ...

[PART I. FINANCIAL INFORMATION](index=3&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements (Unaudited)](index=3&type=section&id=Item%201.%20Financial%20Statements%20%28Unaudited%29) Aptevo Therapeutics Inc.'s unaudited condensed consolidated financial statements as of June 30, 2019, encompassing balance sheets, statements of operations, comprehensive loss, cash flows, and changes in stockholders' equity [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) The balance sheet as of June 30, 2019, reflects a decrease in cash and cash equivalents, a slight decrease in total assets, an increase in total liabilities, and a decline in total stockholders' equity Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2019 | Dec 31, 2018 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $20,957 | $30,635 | | Total current assets | $43,672 | $48,689 | | Total assets | $66,127 | $67,494 | | **Liabilities & Equity** | | | | Total current liabilities | $16,598 | $17,610 | | Total liabilities | $39,928 | $37,088 | | Total stockholders' equity | $26,199 | $30,406 | - The company adopted new lease accounting standards (**ASC 842**) in 2019, resulting in the recognition of a **$4.3 million** operating lease right-of-use asset and a corresponding **$3.8 million** long-term operating lease liability, which were not present on the 2018 balance sheet[5](index=5&type=chunk)[22](index=22&type=chunk)[27](index=27&type=chunk) [Condensed Consolidated Statements of Operations](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) For the six months ended June 30, 2019, product sales increased, but a significant rise in the cost of product sales led to a lower gross profit and a net loss Statement of Operations Summary (in thousands, except per share data) | Metric | Six Months Ended June 30, 2019 | Six Months Ended June 30, 2018 | | :--- | :--- | :--- | | Product sales | $14,382 | $10,897 | | Cost of product sales | $9,832 | $4,315 | | Research and development | $15,018 | $17,912 | | Selling, general and administrative | $13,868 | $14,616 | | Loss from operations | $(24,336) | $(25,946) | | Net loss | $(25,350) | $(26,999) | | Basic and diluted net loss per share | $(0.70) | $(1.21) | [Condensed Consolidated Statements of Cash Flows](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) For the six months ended June 30, 2019, net cash used in operating activities was substantial, partially offset by financing activities, resulting in a net decrease in cash and equivalents Cash Flow Summary (in thousands) | Activity | Six Months Ended June 30, 2019 | Six Months Ended June 30, 2018 | | :--- | :--- | :--- | | Net cash used in operating activities | $(29,735) | $(32,984) | | Net cash (used in) provided by investing activities | $(153) | $35,807 | | Net cash provided by (used in) financing activities | $20,260 | $(243) | | (Decrease) Increase in cash | $(9,628) | $2,580 | - The significant cash provided by financing activities in 2019 was due to net proceeds of **$20.3 million** from the issuance of common stock, warrants, and pre-funded warrants[11](index=11&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 business, accounting policies, and financial statement items, including the adoption of ASC 842, collaboration agreements, credit facility terms, and a significant equity offering - The company is a biotechnology firm focused on oncology and hematology, with its core **ADAPTIR platform** and one revenue-generating product, **IXINITY**[14](index=14&type=chunk) - On January 1, 2019, the company adopted the new lease accounting standard (**ASC 842**), resulting in the recognition of a right-of-use asset of **$1.5 million** and an operating lease liability of **$2.2 million**[22](index=22&type=chunk)[27](index=27&type=chunk) - In March 2019, the company completed a public offering of common stock and warrants, receiving net proceeds of **$20.2 million**[66](index=66&type=chunk)[67](index=67&type=chunk) - Subsequent to the quarter end, on August 6, 2019, the company received a **$4.3 million** milestone payment from Saol International Limited related to the 2017 sale of the Hyperimmune Business[89](index=89&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=18&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's financial performance, highlighting increased product sales offset by decreased gross margin, progress in its clinical pipeline, and a sufficient liquidity position [Overview and Pipeline Highlights](index=18&type=section&id=Overview%20and%20Pipeline%20Highlights) Aptevo is a biotechnology company focused on oncology and hematology, leveraging its ADAPTIR platform with IXINITY as its commercial product and a pipeline including APVO436, APVO210, and ALG.APV-527 - The company's core technology is the **ADAPTIR (modular protein technology) platform**, used to develop its investigational product candidates[93](index=93&type=chunk)[95](index=95&type=chunk) - Key clinical programs include: - **APVO436:** Phase 1/1b trial initiated in Dec 2018 for AML and MDS - **APVO210:** Phase 1 trial in healthy volunteers initiated in March 2019; Stage 1 completed in July 2019 - **ALG.APV-527:** Partnered with Alligator Bioscience, with plans to file a clinical trial authorization (CTA) in H2 2019[96](index=96&type=chunk)[97](index=97&type=chunk) - In June 2019, the company launched a new **3,000 IU** assay size for **IXINITY** to provide enhanced convenience for patients[104](index=104&type=chunk) [Results of Operations](index=21&type=section&id=Results%20of%20Operations) For the six months ended June 30, 2019, product sales increased, but a significant surge in cost of sales reduced gross margin, while research and development and selling, general and administrative expenses decreased Product Sales and Gross Profit Comparison (Six Months Ended June 30) | Metric | 2019 (in thousands) | 2018 (in thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Product sales | $14,382 | $10,897 | 32% | | Cost of product sales | $9,832 | $4,315 | 128% | | Gross profit | $4,550 | $6,582 | -31% | | Gross margin | 32% | 60% | -28 p.p. | - The increase in cost of product sales was driven by **$0.9 million** in costs for the new **3000 IU** assay size and **$0.5 million** in inventory write-offs in Q2 2019[114](index=114&type=chunk)[115](index=115&type=chunk) Research and Development Expenses by Program (Six Months Ended June 30, in thousands) | Program | 2019 | 2018 | Change | | :--- | :--- | :--- | :--- | | APVO436 | $2,175 | $3,862 | $(1,687) | | APVO210 | $2,119 | $5,062 | $(2,943) | | Preclinical & Discovery | $8,073 | $6,366 | $1,707 | | IXINITY | $2,274 | $427 | $1,847 | | **Total** | **$15,018** | **$17,912** | **$(2,894)** | [Liquidity and Capital Resources](index=24&type=section&id=Liquidity%20and%20Capital%20Resources) As of June 30, 2019, the company had $28.5 million in cash and equivalents, with operations financed by revenue, equity, and debt, and management believes current resources are sufficient for the next twelve months - As of June 30, 2019, the company had cash and cash equivalents of **$21.0 million** and restricted cash of **$7.5 million**[127](index=127&type=chunk)[144](index=144&type=chunk) - A public offering in March 2019 provided net proceeds of **$20.2 million**[132](index=132&type=chunk) - The company has a credit agreement with MidCap, with principal repayments scheduled to begin on February 1, 2020. The restricted cash requirement under this agreement was reduced from **$10 million** to **$5 million**[136](index=136&type=chunk) - Management concluded that existing cash, future product sales, and a **$4.3 million** milestone payment received in August 2019 will be sufficient to meet operating requirements for at least **twelve months** from the filing date[144](index=144&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=27&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) There were no material changes to the company's market risk disclosures since the prior Annual Report on Form 10-K - There were no material changes to the information regarding Quantitative and Qualitative Disclosures About Market Risk since the last Annual Report on Form 10-K[151](index=151&type=chunk) [Controls and Procedures](index=27&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of June 30, 2019, with no material changes in internal control over financial reporting during the quarter - The CEO and CFO concluded that as of June 30, 2019, the company's disclosure controls and procedures were effective[152](index=152&type=chunk) - No changes in internal control over financial reporting occurred during the quarter that have materially affected, or are reasonably likely to materially affect, internal controls[153](index=153&type=chunk) [PART II. OTHER INFORMATION](index=28&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Legal Proceedings](index=28&type=section&id=Item%201.%20Legal%20Proceedings) The company is not currently a party to any legal claims or actions deemed to have a material adverse effect on its financial condition or operations - Management believes there are currently no pending legal claims or actions that could have a material adverse effect on the company's results of operations, financial condition, or cash flows[156](index=156&type=chunk) [Risk Factors](index=28&type=section&id=Item%201A.%20Risk%20Factors) This section details significant risks, including a history of losses, reliance on a single product, substantial competition, regulatory hurdles, manufacturing dependence, and common stock risks like price volatility and potential delisting - The company has a history of net losses, with an accumulated deficit of **$152.8 million** as of June 30, 2019, and will require additional capital to fund operations[158](index=158&type=chunk)[159](index=159&type=chunk) - The company relies on a single product, **IXINITY**, for all of its revenue, making it vulnerable to competition, manufacturing disruptions, and pricing pressures[161](index=161&type=chunk) - The company faces risks from its credit agreement, including restrictive covenants and the potential for acceleration of debt[166](index=166&type=chunk)[167](index=167&type=chunk) - On April 18, 2019, the company received a notice from Nasdaq for failing to maintain a minimum bid price of **$1.00** per share, putting it at risk of delisting[281](index=281&type=chunk) [Other Information](index=55&type=section&id=Item%205.%20Other%20Information) On August 6, 2019, the company amended its purchase agreement with Saol International Limited, receiving a single milestone payment of $4.25 million in lieu of future gross profit-based milestones - On August 6, 2019, the company amended its purchase agreement with Saol International Limited[300](index=300&type=chunk) - Under the amendment, Saol made a milestone payment of **$4,250,000**, which replaced any future milestones that were previously tied to gross profit thresholds[301](index=301&type=chunk) [Exhibits](index=56&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including the Saol International Limited purchase agreement amendment, CEO and CFO certifications, and XBRL data files

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 March 31, 2019 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | |------------------------------------------------------------|--------------------- ...