Core Insights - Avalo Therapeutics has initiated the Phase 2 LOTUS trial for AVTX-009, a monoclonal antibody targeting interleukin-1β, in patients with hidradenitis suppurativa (HS) [1][2] - The trial aims to evaluate the efficacy and safety of two dosing regimens of AVTX-009 compared to placebo, with topline results expected in 2026 [1][2] Company Overview - Avalo Therapeutics is a clinical-stage biotechnology company focused on treating immune dysregulation, with AVTX-009 as its lead asset targeting inflammatory diseases [5] - The company also has two additional drug candidates: quisovalimab (anti-LIGHT mAb) and AVTX-008 (BTLA agonist fusion protein) [5] Industry Context - Hidradenitis suppurativa is a chronic inflammatory skin condition that significantly impacts quality of life, with an estimated prevalence of 0.2-1.7% of the global population [3] - Current treatment options for HS are limited, and there is a need for improved therapies targeting the inflammatory processes, particularly those involving interleukin-1β [3][4]

Financial Performance - Avalo generated a net loss of $22.8 million and negative cash flows from operations of $22.5 million for the six months ended June 30, 2024[164]. - There was no net product revenue for the three months ended June 30, 2024, compared to $0.6 million for the same period in 2023, due to the expiration of the license and supply agreement for Millipred[169]. - The company had no net product revenue for the six months ended June 30, 2024, compared to $1.1 million for the same period in 2023, due to the planned expiration of the license and supply agreement for Millipred[184]. - The company reported a net cash used in operating activities of $22.5 million for the six months ended June 30, 2024, compared to $21.1 million for the same period in 2023[199]. - Net cash used in operating activities was $21.1 million for the six months ended June 30, 2023, primarily due to a net loss of $18.1 million and non-cash adjustments including stock-based compensation of $1.7 million[201]. Cash Position - As of June 30, 2024, Avalo had $93.4 million in cash and cash equivalents, with expectations to fund operations into 2027[165]. - Interest income increased by $3.1 million due to the company's increased cash position compared to the prior period, with no interest expense incurred in the current period[196]. - Net cash provided by financing activities for the six months ended June 30, 2024 was $115.6 million from a private placement investment, offset by transaction costs of $7.5 million[202]. - The company could receive up to an additional $69.4 million from the exercise of warrants issued in the private placement investment, exercisable at approximately $5.80 per share[203]. Research and Development - Research and development expenses decreased by $0.1 million to $4.6 million for the three months ended June 30, 2024, primarily due to a decrease in CMC expenses[173]. - Avalo expects future research and development expenses to increase in 2024 due to the development plans for AVTX-009[174]. - The company recognized a $79.3 million loss on the excess of initial warrant liability fair value over private placement proceeds, with a fair value of $194.9 million against proceeds of $115.6 million[192]. - Research and development expenses decreased by $4.0 million for the six months ended June 30, 2024, primarily due to a $2.8 million decrease in clinical expenses and a $2.0 million decrease in CMC expenses[188]. - Avalo's IND for AVTX-009 is now active, allowing the commencement of the Phase 2 LOTUS clinical trial, expected to enroll its first patient in the second half of 2024[162]. - The primary efficacy endpoint for the LOTUS Trial is the proportion of subjects achieving Hidradenitis Suppurativa Clinical Response (HiSCR75) at Week 16[162]. General and Administrative Expenses - General and administrative expenses increased by $2.1 million to $4.5 million for the three months ended June 30, 2024, driven by increased legal and consulting expenses related to the Almata Transaction[177]. - General and administrative expenses increased by $2.6 million for the six months ended June 30, 2024, driven by a $1.7 million increase in legal, consulting, and other professional expenses[191]. Other Income and Expenses - Other income increased by $109.1 million for the three months ended June 30, 2024, primarily due to a $112.0 million gain on the change of fair value of the warrant liability[178]. - Other income, net increased by $21.7 million for the six months ended June 30, 2024, primarily driven by the impact of the warrant liability associated with the March 2024 financing[192]. - The company incurred $9.2 million in private placement transaction costs, primarily related to placement agent fees[194]. Accounting and Controls - There were no significant changes to critical accounting policies during the three months ended June 30, 2024[205]. - The company has no off-balance sheet arrangements as defined by SEC rules[206]. - Disclosure controls and procedures were evaluated and deemed effective at the reasonable assurance level as of the end of the reporting period[208]. - There were no changes in internal control over financial reporting that materially affected the company's internal control during the reporting period[210].

Financial Performance - For the six months ended June 30, 2024, Avalo reported a net loss of $22.8 million, an increase of $4.7 million compared to the same period in 2023[4]. - Total operating expenses for the first half of 2024 increased by $25.3 million, primarily due to $27.6 million of acquired in-process research and development expense from the acquisition of AlmataBio, Inc.[4]. - Avalo Therapeutics reported a significant increase in revenue, reaching $50 million for the quarter, representing a 25% year-over-year growth[18]. - The company recognized a $21.7 million increase in other income, net, largely related to changes in warrant liability[4]. - Total liabilities increased to $110.5 million as of June 30, 2024, from $13.7 million at the end of 2023[6]. Cash and Assets - As of June 30, 2024, Avalo had cash and cash equivalents of approximately $93.4 million, with an expected cash runway into 2027[3]. - Avalo's total current assets as of June 30, 2024, were $95.9 million, compared to $8.4 million as of December 31, 2023[6]. Clinical Trials and Development - Avalo expects to enroll the first patient in the Phase 2 LOTUS Trial of AVTX-009 for hidradenitis suppurativa in the second half of 2024[1]. - The LOTUS Trial will evaluate the efficacy and safety of AVTX-009 in approximately 180 adults with moderate to severe hidradenitis suppurativa[13]. - Avalo plans to develop AVTX-009 in at least one additional chronic inflammatory indication beyond hidradenitis suppurativa[2]. - Avalo is investing in R&D, allocating $10 million towards the development of new therapies aimed at addressing unmet medical needs[18]. Leadership and Strategic Initiatives - The company appointed Dr. Mittie Doyle as Chief Medical Officer and Paul Varki as Chief Legal Officer to strengthen its leadership team[2]. - Avalo is exploring potential acquisition opportunities to enhance its product portfolio and accelerate growth[18]. Market Expansion and Future Guidance - Future guidance indicates projected revenue growth of 30% for the next fiscal year, driven by new product launches and market expansion strategies[18]. - The company plans to expand its market presence in Europe, targeting a 20% increase in market share by the end of the next fiscal year[18]. - Avalo's strategic partnerships are expected to contribute an additional $15 million in revenue over the next two years[18]. Operational Efficiency - The company reported a 10% reduction in operational costs, improving overall profitability margins[18]. - New technology initiatives are expected to streamline operations, with an anticipated cost savings of $5 million annually[18]. - The company remains committed to enhancing shareholder value through consistent performance and strategic investments[18].

WAYNE, Pa. and ROCKVILLE, Md., July 16, 2024 (GLOBE NEWSWIRE) -- Avalo Therapeutics, Inc. (Nasdaq: AVTX) today announced that Mittie Doyle, MD, FACR has joined the Company as its Chief Medical Officer. “We are thrilled to have Mittie join and grow our leadership team at an exciting time as we prepare to initiate our Phase 2 LOTUS Trial in patients with hidradenitis suppurativa. Mittie brings to Avalo a strong combination of drug development experience through all stages of development and exceptional expert ...

Following FDA review, Avalo’s IND application for AVTX-009 is active allowing Avalo to proceed with its Phase 2 trial (LOTUS) to evaluate the efficacy and safety of AVTX-009 in patients with hidradenitis suppurativa WAYNE, Pa. and ROCKVILLE, Md., July 09, 2024 (GLOBE NEWSWIRE) -- Avalo Therapeutics, Inc. (Nasdaq: AVTX) today announced that the Investigational New Drug (IND) for AVTX-009, an anti-IL-1β monoclonal antibody (mAb), for the treatment of hidradenitis suppurativa (HS) is now active, permitting the ...

Following FDA review, Avalo's IND application for AVTX-009 is active allowing Avalo to proceed with its Phase 2 trial (LOTUS) to evaluate the efficacy and safety of AVTX-009 in patients with hidradenitis suppurativa WAYNE, Pa. and ROCKVILLE, Md., July 09, 2024 (GLOBE NEWSWIRE) -- Avalo Therapeutics, Inc. (NASDAQ:AVTX) today announced that the Investigational New Drug (IND) for AVTX-009, an anti-IL-1β monoclonal antibody (mAb), for the treatment of hidradenitis suppurativa (HS) is now active, permitting the ...

WAYNE, Pa. and ROCKVILLE, Md., June 24, 2024 (GLOBE NEWSWIRE) -- Avalo Therapeutics, Inc. (Nasdaq: AVTX) today announced that Paul Varki has joined the Company as its Chief Legal Officer. “We are delighted to have Paul join and grow our leadership team at an exciting time at Avalo following our acquisition and private placement earlier this year,” said Garry A. Neil, MD, CEO and Chairman of the Board at Avalo. “Paul’s deep industry experience will immediately enhance our strategic and legal competencies. Fu ...

Core Insights - Avalo Therapeutics has appointed Paul Varki as Chief Legal Officer, enhancing its leadership team during a pivotal time following recent acquisition and private placement [1] - Varki brings over 20 years of experience in the pharmaceutical and biotech sectors, previously serving as US General Counsel at Idorsia Pharmaceuticals and holding various legal roles at other companies [1] - The appointment is expected to strengthen Avalo's strategic and legal capabilities, particularly in the development of AVTX-009 for hidradenitis suppurativa and other autoimmune conditions [1] Inducement Grants - As part of Varki's employment agreement, he has been granted a non-qualified stock option to purchase 150,000 shares of Avalo's common stock, vesting over four years with a twelve-month cliff [2] - The stock option was granted on June 24, 2024, with an exercise price equal to the closing price of Avalo's common stock on that date [2] Company Overview - Avalo Therapeutics is a clinical-stage biotechnology company focused on treating immune dysregulation, with its lead asset being AVTX-009, an anti-IL-1β monoclonal antibody targeting inflammatory diseases [3] - The company's pipeline also includes quisovalimab and AVTX-008, indicating a diverse approach to addressing autoimmune conditions [3] Product Details - AVTX-009 is a humanized monoclonal antibody that binds to interleukin-1β (IL-1β), a key driver in inflammatory processes, and is implicated in various autoimmune diseases [4] - The inhibition of IL-1β is considered a validated therapeutic target, with potential applications in dermatology, gastroenterology, and rheumatology [4]

Company Overview - Avalo Therapeutics, Inc. is a clinical stage biotechnology company focused on treating immune dysregulation [2] - The company's lead asset is AVTX-009, an anti-IL-1β monoclonal antibody targeting inflammatory diseases [2] - Avalo's pipeline also includes quisovalimab (anti-LIGHT mAb) and AVTX-008 (BTLA agonist fusion protein) [2] Product Details - AVTX-009 is a humanized monoclonal antibody (IgG4) that binds to interleukin-1β (IL-1β) with high affinity, neutralizing its activity [3] - IL-1β is a central driver in the inflammatory process, and its overproduction is implicated in many autoimmune and inflammatory diseases [3] - Evidence suggests that inhibition of IL-1β could be effective in treating hidradenitis suppurativa and various inflammatory diseases in dermatology, gastroenterology, and rheumatology [3] Upcoming Events - Garry A. Neil, M.D., CEO and Chairman of the Board, will present on the Novel Immunological Mechanisms for Dermatological Disorders Panel at the Oppenheimer Novel Targets in Immunology Summit on June 24, 2024 [1]

Investors interested in Medical stocks should always be looking to find the best-performing companies in the group. Has Avalo Therapeutics, Inc. (AVTX) been one of those stocks this year? By taking a look at the stock's year-to-date performance in comparison to its Medical peers, we might be able to answer that question.Avalo Therapeutics, Inc. is one of 1047 individual stocks in the Medical sector. Collectively, these companies sit at #7 in the Zacks Sector Rank. The Zacks Sector Rank gauges the strength o ...