Alumis Inc.(ALMS) - 2025 Q2 - Quarterly Report

PART I—FINANCIAL INFORMATION This section presents Alumis Inc.'s unaudited condensed consolidated financial statements and management's discussion and analysis Item 1. Financial Statements (Unaudited) Alumis Inc.'s unaudited condensed consolidated financial statements and notes detail financial position and performance Condensed Consolidated Balance Sheets Alumis Inc.'s financial position is presented, detailing assets, liabilities, and stockholders' equity at specific dates | (in thousands) | June 30, 2025 | December 31, 2024 | | :--------------------------------- | :------------ | :---------------- | | Assets | | | | Cash and cash equivalents | $ 151,753 | $ 169,526 | | Marketable securities | 334,568 | 118,737 | | Total current assets | 517,558 | 306,188 | | Total assets | $ 610,925 | $ 340,992 | | Liabilities and Stockholders' Equity | | | | Total current liabilities | 85,575 | 50,910 | | Total liabilities | 125,598 | 80,888 | | Total stockholders' equity | 485,327 | 260,104 | | Total liabilities and stockholders' equity | $ 610,925 | $ 340,992 | Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) Alumis Inc.'s revenues, expenses, and net income or loss are outlined over specific reporting periods | (in thousands, except share and per share amounts) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Revenue: | | | | | | License revenue | $ — | $ — | $ 17,389 | $ — | | Collaboration revenue | 2,666 | — | 2,666 | — | | Total revenue | 2,666 | — | 20,055 | — | | Operating expenses: | | | | | | Research and development expenses | 108,755 | 48,565 | 205,377 | 90,526 | | General and administrative expenses | 34,450 | 7,575 | 56,745 | 13,207 | | Total operating expenses | 143,205 | 56,140 | 262,122 | 103,733 | | Loss from operations | (140,539) | (56,140) | (242,067) | (103,733) | | Other income (expense): | | | | | | Gain on bargain purchase | 187,907 | — | 187,907 | — | | Interest income | 3,430 | 1,977 | 6,039 | 2,831 | | Change in fair value of derivative liability | — | (2,311) | — | (5,406) | | Total other income (expense), net | 191,299 | (368) | 193,864 | (2,624) | | Net income (loss) before income taxes | 50,760 | (56,508) | (48,203) | (106,357) | | Income tax benefit | 8,561 | — | 8,561 | — | | Net income (loss) | $ 59,321 | $ (56,508) | $ (39,642) | $ (106,357) | | Net income (loss) per share, basic | $ 0.78 | $ (23.10) | $ (0.61) | $ (44.17) | | Net income (loss) per share, diluted | $ 0.77 | $ (23.10) | $ (0.61) | $ (44.17) | Condensed Consolidated Statements of Redeemable Convertible Preferred Stock and Stockholders' Equity (Deficit) Changes in Alumis Inc.'s redeemable convertible preferred stock and stockholders' equity are detailed over time - Total stockholders' equity increased from $260.1 million as of December 31, 2024, to $485.3 million as of June 30, 2025, primarily driven by the ACELYRIN Merger and stock-based compensation[23] - The ACELYRIN Merger resulted in the issuance of 48,653,549 common shares and an increase of $238.1 million in additional paid-in capital[23] - Net income for the three months ended June 30, 2025, was $59.3 million, contributing to the change in accumulated deficit[23] Condensed Consolidated Statements of Cash Flows Alumis Inc.'s cash inflows and outflows from operating, investing, and financing activities are presented | (in thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--------------------------------------- | :----------------------------- | :----------------------------- | | Net cash used in operating activities | $ (186,707) | $ (96,548) | | Net cash provided by (used in) investing activities | 168,828 | (51,551) | | Net cash provided by financing activities | 749 | 257,211 | | Net (decrease) increase in cash, cash equivalents and restricted cash | $ (17,130) | $ 109,112 | | Cash, cash equivalents and restricted cash at end of period | $ 153,502 | $ 156,245 | Notes to Condensed Consolidated Financial Statements Detailed explanations and disclosures supporting the condensed consolidated financial statements are provided 1. Organization and Nature of the Business Alumis Inc. is a clinical-stage biopharmaceutical company focused on autoimmune disorders, with an accumulated deficit of $698.2 million - Alumis Inc. is a clinical stage biopharmaceutical company focused on identifying, acquiring, and accelerating the development and commercialization of transformative medicines for autoimmune disorders[29] - The company completed the ACELYRIN Merger on May 21, 2025, acquiring ACELYRIN as a wholly owned subsidiary[36] - As of June 30, 2025, the Company had an accumulated deficit of $698.2 million and expects existing cash, cash equivalents, and marketable securities of $486.3 million to be sufficient for at least 12 months[37][38] 2. Summary of Significant Accounting Policies and Basis of Presentation Alumis Inc.'s significant accounting policies, including basis of presentation, business combinations, revenue, and stock-based compensation - The condensed consolidated financial statements are prepared in accordance with U.S. GAAP and include accounts of subsidiaries, with intercompany transactions eliminated[44][45] - The Company operates and manages its business as one reportable and operating segment, focused on researching and developing medicines for autoimmune disorders[50] - Business combinations are accounted for using the acquisition method, recording acquired assets and assumed liabilities at fair value, with any excess of net assets over consideration recognized as a gain on bargain purchase[57] - Revenue from collaboration agreements is recognized following a five-step approach under ASC 606, allocating transaction price to distinct performance obligations based on standalone selling price[67][72] - Stock-based compensation expense is measured at fair value using the Black-Scholes or Monte Carlo models and recognized over the requisite service period[74][75] - The Company recognized an income tax benefit of $8.6 million for the three and six months ended June 30, 2025, primarily due to the realization of deferred tax assets and valuation allowance release from the ACELYRIN Merger[84] 3. Acquisitions The ACELYRIN Merger on May 21, 2025, for $238.1 million in common stock, resulted in a $187.9 million gain on bargain purchase - Alumis completed the ACELYRIN Merger on May 21, 2025, acquiring ACELYRIN, a late-stage biopharma company, in a common stock transaction valued at approximately $238.1 million[36][91][96] - The merger resulted in the issuance of 48,653,549 shares of Alumis common stock and the assumption of ACELYRIN's stock options and RSUs[92] - A preliminary gain on bargain purchase of $187.9 million was recognized, as the fair value of net assets acquired ($426.0 million) exceeded the purchase consideration ($238.1 million)[97][104] - The acquired intangible assets primarily consist of the IPR&D asset related to lonigutamab, valued at $51.0 million[101] Unaudited Pro Forma Summary of Operations (Six Months Ended June 30) | | 2025 (in thousands) | 2024 (in thousands) | | :---------------------- | :------------------ | :------------------ | | Total revenue | $ 20,055 | $ — | | Net income (loss) | (276,520) | (79,508) | 4. Fair Value Measurements Alumis Inc.'s financial assets are categorized into Level 1, Level 2, and Level 3 fair value measurements - The Company classifies financial instruments into Level 1 (quoted prices in active markets), Level 2 (observable inputs other than Level 1 prices), and Level 3 (unobservable inputs)[115][116] Fair Value Hierarchy for Financial Assets (June 30, 2025) | (in thousands) | Level 1 | Level 2 | Level 3 | Total | | :------------- | :--------- | :--------- | :------ | :--------- | | Cash equivalents | $148,040 | $ — | $ — | $148,040 | | Marketable securities | 146,158 | 188,410 | — | 334,568 | | Total assets | $294,198 | $188,410 | $ — | $482,608 | - For the three and six months ended June 30, 2025, the Company did not have any Level 3 financial instruments[126] - In 2024, Level 3 financial instruments included derivative liabilities from Series C redeemable convertible preferred stock financing, which were settled in May 2024[119][126] 5. Marketable Securities Alumis Inc.'s marketable securities significantly increased to $334.6 million by June 30, 2025 Marketable Securities (in thousands) | | June 30, 2025 | December 31, 2024 | | :-------------------------- | :------------ | :---------------- | | U.S. treasuries | $281,241 | $118,737 | | Corporate debt obligations | 46,373 | — | | Federal agency obligations | 4,851 | — | | Supranational bonds | 2,103 | — | | Total marketable securities | $334,568 | $118,737 | - All marketable securities held as of June 30, 2025, and December 31, 2024, had contractual maturities of less than one year[130] - The Company determined that the decline in fair value below amortized cost basis for marketable securities was immaterial and non-credit related, with no allowance for expected credit losses recorded[131] 6. Balance Sheet Components Specific balance sheet components, including restricted cash, prepaid expenses, and property and equipment, net, are detailed - Restricted cash increased from $1.1 million at December 31, 2024, to $1.8 million at June 30, 2025, primarily due to collateral for lease commitments and a corporate credit program[132] Other Prepaid Expenses and Current Assets (in thousands) | | June 30, 2025 | December 31, 2024 | | :------------------------------------ | :------------ | :---------------- | | Prepaid credit voucher for clinical manufacturing | $ 10,754 | $ — | | Service and other revenue receivable | 2,666 | — | | Interest receivable | 2,267 | 698 | | Total other prepaid expenses and current assets | $ 23,861 | $ 4,501 | - The prepaid credit voucher for clinical manufacturing, acquired by ACELYRIN in Q3 2024, is valued at $10.8 million and will be used for lonigutamab manufacturing invoices[133] Property and Equipment, Net (in thousands) | | June 30, 2025 | December 31, 2024 | | :--------------------------------- | :------------ | :---------------- | | Total property and equipment, gross | $ 26,972 | $ 25,525 | | Less: Accumulated depreciation and amortization | (6,644) | (4,557) | | Total property and equipment, net | $ 20,328 | $ 20,968 | Other Accrued Expenses and Current Liabilities (in thousands) | | June 30, 2025 | December 31, 2024 | | :------------------------------------ | :------------ | :---------------- | | Accrued personnel and related expenses | $ 9,845 | $ 7,765 | | Accrued professional services | 9,609 | 2,657 | | Severance liability | 3,003 | — | | Total other accrued expenses and current liabilities | $ 22,805 | $ 10,580 | 7. Revenue Alumis Inc. recognized $20.1 million in total revenue for the six months ended June 30, 2025, from a collaboration and license agreement - On March 25, 2025, Alumis Inc. entered into a collaboration and license agreement with Kaken Pharmaceutical Co., Ltd. for envudeucitinib (envu) in dermatology indications in Japan[138][139] - Kaken made an upfront, non-refundable payment of $20.0 million and will contribute $20.0 million towards global development costs through 2026[142] - Potential future payments include up to $36.0 million for regulatory milestones and field expansion options, and up to ¥15.5 billion for commercial milestones, plus tiered royalties[142] - The Company recognized $17.4 million in license revenue and $2.7 million in collaboration revenue for the six months ended June 30, 2025[147] 8. Related Party Transactions Alumis Inc. has a services agreement with Foresite Labs, an affiliate of a significant stockholder - Alumis Inc. has a services agreement with Foresite Labs, an affiliate of a stockholder, for exploring specified immunology genetic targets[152] - Research and development expenses under this agreement were $0.3 million for the three months ended June 30, 2025, and $0.5 million for the six months ended June 30, 2025[152] 9. Commitments and Contingent Liabilities Alumis Inc. has various commitments and contingent liabilities, including operating leases and contingent consideration - Alumis Inc. has operating lease agreements for office and laboratory space in South San Francisco and Southern California, with total undiscounted lease payments of $56.9 million as of June 30, 2025[153][158][159][164] - The company has contingent consideration obligations from the FronThera Acquisition, with up to $120.0 million based on clinical and approval milestones for envu[165] - Upon the ACELYRIN Merger, Alumis assumed obligations under the Pierre Fabre Agreement, including potential development, regulatory, and commercial milestone payments up to $100.5 million and $390.0 million, respectively, plus tiered royalties[166][167] - A federal securities class action lawsuit against ACELYRIN was assumed, alleging misleading investors about a Phase 2b trial. The outcome is uncertain, and no probable loss has been estimated[175][179] 10. Redeemable Convertible Preferred Stock Alumis Inc. issued Series C redeemable convertible preferred stock in 2024, which converted to common stock prior to the IPO - In March 2024, the Company issued 41,264,891 shares of Series C redeemable convertible preferred stock for gross proceeds of $129.5 million[181] - An additional 41,264,892 shares of Series C preferred stock were issued in May 2024 for $129.5 million, settling derivative liabilities of $14.3 million[182] - Immediately prior to the IPO on July 1, 2024, all outstanding redeemable convertible preferred stock converted into voting and non-voting common stock[183] 11. Stockholders' Equity As of June 30, 2025, Alumis Inc. had 96.9 million voting and 7.2 million non-voting common shares outstanding - As of June 30, 2025, Alumis Inc. had 96,857,569 voting common shares and 7,184,908 non-voting common shares outstanding, both with a $0.0001 par value[186] - Non-voting common stock holders have the right to convert to voting common stock, subject to a 4.99% beneficial ownership limit[187] Common Stock Reserved for Issuance (as-converted basis, June 30, 2025) | | June 30, 2025 | | :------------------------------------------------- | :------------ | | Stock options issued and outstanding | 18,190,124 | | RSUs issued and outstanding | 672,117 | | Shares available for grant under the 2024 Equity Incentive Plan | 5,430,350 | | Shares available for grant under the 2024 Employee Stock Purchase Plan | 1,009,440 | | Shares available for grant under the ACELYRIN, Inc. 2023 Equity Incentive Plan | 6,321,733 | | Shares available for grant under the 2024 Performance Option Plan | 98,681 | | Total | 31,722,445 | 12. Stock-Based Compensation Alumis Inc. utilizes various stock plans, with stock-based compensation expense significantly increasing due to the ACELYRIN Merger - In March 2024, the Company repriced outstanding stock options with an exercise price exceeding $8.84 per share, reducing the weighted average exercise price to $8.84 and resulting in $0.7 million incremental expense[195][196] - The 2024 EIP, effective June 2024, reserved 7,800,000 new shares and includes an evergreen provision for annual increases[202] - The ACELYRIN Merger resulted in the assumption of ACELYRIN's stock options, RSUs, and performance RSUs, with performance RSUs deemed 100% satisfied for performance conditions[204][205] Stock-Based Compensation Expense (in thousands) | | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Research and development | $ 7,225 | $ 1,641 | $ 10,944 | $ 3,085 | | General and administrative | 11,410 | 1,492 | 14,686 | 2,705 | | Total stock-based compensation expense | $ 18,635 | $ 3,133 | $ 25,630 | $ 5,790 | - As of June 30, 2025, unrecognized stock-based compensation expense was $62.0 million, expected to be recognized over a weighted-average period of 2.5 years[236] 13. Employee Benefit Plans Alumis Inc. sponsors a qualified 401(k) defined contribution plan, with no employer contributions made for the reported periods - The Company sponsors a qualified 401(k) defined contribution plan for eligible employees[239] - No employer contributions were made to the 401(k) plan for the three and six months ended June 30, 2025, and 2024[239] 14. Net Income (Loss) Per Share Attributable to Common Stockholders Alumis Inc. reported basic net income per share of $0.78 for Q2 2025, with potentially dilutive securities excluded when antidilutive Net Income (Loss) Per Share Attributable to Common Stockholders | | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net income (loss) | $ 59,321 | $ (56,508) | $ (39,642) | $ (106,357) | | Weighted-average shares of common stock outstanding, basic | 76,477,144 | 2,446,022 | 65,440,021 | 2,408,037 | | Weighted-average shares of common stock outstanding, diluted | 76,635,895 | 2,446,022 | 65,440,021 | 2,408,037 | | Net income (loss) per share, basic | $ 0.78 | $ (23.10) | $ (0.61) | $ (44.17) | | Net income (loss) per share, diluted | $ 0.77 | $ (23.10) | $ (0.61) | $ (44.17) | - Potentially dilutive securities, including stock options, RSUs, and early exercised stock options, were excluded from diluted EPS computation when their inclusion would have been antidilutive[240] 15. Segment Reporting Alumis Inc. operates as a single reportable segment focused on autoimmune disorders, with R&D expenses significantly increasing - The Company operates and manages its business as one reportable and operating segment, focused on researching and developing medicines for autoimmune disorders[243] Disaggregated Research and Development Expenses (in thousands) | | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | CROs, CMOs and clinical trials | $ 66,089 | $ 26,849 | $ 131,162 | $ 51,113 | | Professional consulting services | 7,417 | 4,765 | 13,821 | 8,290 | | Other research and development costs | 2,995 | 3,597 | 5,291 | 5,594 | | Personnel-related costs | 26,821 | 10,134 | 44,479 | 19,229 | | Facilities and overhead costs | 5,433 | 3,220 | 10,624 | 6,300 | | Total research and development expense | $ 108,755 | $ 48,565 | $ 205,377 | $ 90,526 | 16. Subsequent Events The One Big Beautiful Bill Act (OBBBA) was enacted on July 4, 2025, with Alumis Inc. evaluating its financial impact - The One Big Beautiful Bill Act (OBBBA) was enacted on July 4, 2025, modifying capitalization of R&D expenses and accelerating fixed asset depreciation[245] - The Company is currently assessing the impact of the OBBBA on its consolidated financial statements and disclosures[245] Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Alumis Inc.'s financial condition and results of operations are analyzed, covering revenue, expenses, the ACELYRIN Merger, and future funding - Alumis is a clinical-stage biopharmaceutical company focused on developing TYK2 inhibitors (envudeucitinib and A-005) for autoimmune and neuroinflammatory disorders, and lonigutamab for Thyroid Eye Disease (acquired via ACELYRIN Merger)[248] - The company incurred net income of $59.3 million for the three months ended June 30, 2025, but a net loss of $(39.6) million for the six months ended June 30, 2025, with an accumulated deficit of $698.2 million[252] - Total revenue for the six months ended June 30, 2025, was $20.1 million, primarily from a license and collaboration agreement with Kaken Pharmaceutical Co., Ltd[283] - Research and development expenses increased by 127% to $205.4 million for the six months ended June 30, 2025, driven by clinical trial progression and manufacturing[283][292] - General and administrative expenses increased by 330% to $56.7 million for the six months ended June 30, 2025, largely due to ACELYRIN Merger transaction costs and increased headcount[283][302][304] - A gain on bargain purchase of $187.9 million was recognized in Q2 2025 due to the ACELYRIN Merger[306] - The company expects to incur significant and increasing expenses and substantial losses for the foreseeable future, requiring additional capital beyond its current $486.3 million in cash, cash equivalents, and marketable securities[249][311][312] Item 3. Quantitative and Qualitative Disclosures about Market Risk Alumis Inc. is exposed to market risks from interest rate and foreign currency fluctuations, but no material financial impact is anticipated - The Company is exposed to market risks from changes in interest rates on cash equivalents and marketable securities, but a hypothetical 10% change is not expected to have a material effect[359] - Foreign currency exchange risk exists due to international CRO and CMO vendors, but foreign currency transaction gains and losses have not been material, and no formal hedging program is in place[360] - Inflation affects labor and R&D costs, but has not had a material effect on the business, results of operations, or financial condition[361] Item 4. Controls and Procedures Alumis Inc.'s disclosure controls and procedures were deemed effective as of June 30, 2025, with no material changes in internal control - As of June 30, 2025, management, with CEO and CFO participation, concluded that disclosure controls and procedures were effective[362][363][364] - No material changes in internal control over financial reporting occurred during the quarter ended June 30, 2025[365] - Management recognizes that all control systems have inherent limitations and can only provide reasonable, not absolute, assurance of achieving control objectives[366] PART II—OTHER INFORMATION This section provides additional information, including legal proceedings, risk factors, equity sales, and exhibits Item 1. Legal Proceedings Alumis Inc. assumed a federal securities class action lawsuit against ACELYRIN, with an uncertain outcome and no probable loss - A federal securities class action lawsuit was commenced against ACELYRIN on November 15, 2023, alleging misleading investors about the Phase 2b trial of izokibep[369] - The lawsuit seeks damages and an award of reasonable costs and expenses, and a motion to dismiss the amended complaint is pending[369] - The Company cannot estimate the possible loss from this lawsuit, as it is in an early stage, and has not accrued for any potential liability[179] Item 1A. Risk Factors Investing in Alumis Inc. common stock involves high risk due to its clinical-stage nature, financing needs, development uncertainties, and competition - Alumis is a clinical-stage biopharmaceutical company with no products approved for commercial sale, incurring substantial losses and anticipating increasing losses for the foreseeable future[377][379] - The company will require substantial additional financing to achieve its goals, and failure to obtain capital could delay or terminate product development and commercialization efforts[374][390] - Preclinical and clinical development is lengthy, expensive, and uncertain, with results from earlier studies not always predictive of future trial outcomes, potentially leading to delays or inability to complete development[374][393][395] - Clinical trials may reveal serious adverse events (SAEs) and significant adverse events (AEs) not previously seen, potentially delaying or preventing regulatory approval or market acceptance[374][403][405] - The company faces significant competition from large and specialty pharmaceutical and biotechnology companies, many with greater resources and approved therapies[374][431][436] - Risks related to the ACELYRIN Merger include integration difficulties, diversion of management attention, and the possibility that anticipated benefits may not be fully realized[374][438][440] - Failure to obtain and maintain sufficient intellectual property protection, or challenges to existing patents, could allow competitors to commercialize similar products, adversely affecting the business[374][522][523] - The regulatory approval processes are lengthy, time-consuming, and unpredictable, with no guarantee of approval for product candidates[374][448] Item 2. Unregistered Sales of Equity Securities and Use of Proceeds Alumis Inc. completed a private placement on July 17, 2024, issuing 2.5 million common shares at $16.00 per share - On July 17, 2024, Alumis Inc. completed a concurrent private placement, selling 2,500,000 shares of common stock at $16.00 per share to AyurMaya Capital Management Fund, LP[257][700][702] - The sale was exempt from registration under Section 4(a)(2) of the Securities Act, with the recipient acquiring shares for investment purposes[700] - Net proceeds from the IPO and the concurrent private placement have been invested in money market funds and high-quality, available-for-sale marketable securities, with no material change in planned use[703] Item 3. Defaults Upon Senior Securities Alumis Inc. reported no defaults upon senior securities for the period - There were no defaults upon senior securities[704] Item 4. Mine Safety Disclosures This item is not applicable to Alumis Inc - This item is not applicable[705] Item 5. Other Information Alumis Inc. reported no other information for the period - There is no other information to report[706] Item 6. Exhibits All exhibits filed with the Quarterly Report on Form 10-Q, including merger agreements, organizational documents, and certifications, are listed - Exhibits include the Agreement and Plan of Merger with ACELYRIN, Inc. and its amendment, and the Amended and Restated Certificate of Incorporation and Bylaws of the Registrant[707] - Certifications from the Principal Executive Officer and Principal Financial Officer are included pursuant to Sections 302 and 906 of the Sarbanes-Oxley Act of 2002[707] - XBRL Instance Document and Taxonomy Extension Documents (Schema, Calculation, Definition, Label, Presentation Linkbase) are also filed[707][709] SIGNATURES This section contains the official signatures for the Quarterly Report on Form 10-Q Signatures The Quarterly Report on Form 10-Q is signed by Alumis Inc.'s President and CEO, and CFO - The report is signed by Martin Babler, President and Chief Executive Officer, and John Schroer, Chief Financial Officer, on August 13, 2025[712]