- Acquired AVTX-009, Phase-2 ready anti-IL-1β mAb, in
March 2024 - Increased cash position with private placement financing in
March 2024 providing up to$185 million , including initial upfront investment of$115.6 million - Topline results from planned Phase 2 trial of AVTX-009 in hidradenitis suppurativa expected in 2026
- Expected cash runway into 2027
“We are very excited about the acquisition of AVTX-009 and concurrent financing of up to
Corporate Updates
- On
March 27, 2024 , Avalo acquired AVTX-009, a Phase 2 ready anti-IL-1β mAb, through an acquisition ofAlmataBio, Inc. The consideration included stock valued at$15 million , as well as a$7.5 million payment due upon closing of the private placement investment. Avalo is also required to pay development milestones to the former AlmataBio stockholders including$5 million due upon the first patient dosed in a Phase 2 trial in patients with hidradenitis suppurativa (HS) and$15 million due upon the first patient dosed in a Phase 3 trial, both of which are payable in cash, Avalo stock, or a combination thereof at the election of the former AlmataBio stockholders. - On
March 28, 2024 , Avalo closed a private placement led byCommodore Capital and TCGX, with participation fromBVF Partners ,Deep Track Capital , OrbiMed,Petrichor , andRA Capital Management for gross proceeds of up to$185 million , including$115.6 million of initial upfront funding received at close. The upfront investment is expected to fund operations through Avalo’s planned Phase 2 data readout in hidradenitis suppurativa and into 2027. - As part of the private placement, the Company issued (i) an aggregate of
$115.6 million of non-voting convertible preferred stock and (ii) warrants to purchase Avalo’s common stock or an equivalent amount (as converted to common stock) of non-voting convertible preferred stock for an aggregate exercise price of$69.4 million . The warrants are exercisable for approximately$5.80 per underlying share of common stock until the earlier of five years from the date of issuance or 30 days after the public announcement of the first patient dosed in a Phase 2 trial of AVTX-009 in HS. On an as-converted basis and after accounting for the financing and acquisition (excluding the exercise of the warrants), the total number of shares of Avalo common stock outstanding would be approximately 23.4 million immediately after the closing of the transactions.
Program Updates and Milestones:
- AVTX-009: Anti-IL-1β monoclonal antibody (mAb) targeting inflammatory diseases.
- Avalo intends to pursue the development of AVTX-009 in hidradenitis suppurativa and expects topline data from its planned Phase 2 trial in hidradenitis suppurativa in 2026.
- In addition to hidradenitis suppurativa, Avalo intends to develop AVTX-009 in at least one other chronic inflammatory indication.
- Quisovalimab (AVTX-002): Anti-LIGHT mAb targeting immune-inflammatory diseases.
- Avalo is conducting a strategic review of the quisovalimab program.
- Avalo is conducting a strategic review of the quisovalimab program.
- AVTX-008: B and T Lymphocyte Attenuator (BTLA) agonist fusion protein targeting immune dysregulation disorders.
- Avalo is conducting a strategic review of the AVTX-008 program.
2023 Financial Update:
As of
The decrease in net loss was primarily attributable to a
In
Consolidated Balance Sheets
(In thousands, except share and per share data)
2023 | 2022 | ||||||
Assets | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 7,415 | $ | 13,172 | |||
Other receivables | 136 | 1,919 | |||||
Inventory, net | — | 20 | |||||
Prepaid expenses and other current assets | 843 | 1,290 | |||||
Restricted cash, current portion | 1 | 15 | |||||
Total current assets | 8,395 | 16,416 | |||||
Property and equipment, net | 1,965 | 2,411 | |||||
10,502 | 14,409 | ||||||
Restricted cash, net of current portion | 131 | 131 | |||||
Total assets | $ | 20,993 | $ | 33,367 | |||
Liabilities and stockholders’ equity | |||||||
Current liabilities: | |||||||
Accounts payable | $ | 446 | $ | 2,882 | |||
Deferred revenue | — | 88 | |||||
Accrued expenses and other current liabilities | 4,172 | 13,214 | |||||
Notes payable, current | — | 5,930 | |||||
Total current liabilities | 4,618 | 22,114 | |||||
Notes payable, non-current | — | 13,486 | |||||
Royalty obligation | 2,000 | 2,000 | |||||
Deferred tax liability, net | 155 | 141 | |||||
Derivative liability | 5,550 | 4,830 | |||||
Other long-term liabilities | 1,366 | 1,711 | |||||
Total liabilities | 13,689 | 44,282 | |||||
Stockholders’ equity (deficit) : | |||||||
Common stock—$0.001 par value; 200,000,000 shares authorized at | 1 | — | |||||
Additional paid-in capital1 | 342,437 | 292,909 | |||||
Accumulated deficit | (335,134 | ) | (303,824 | ) | |||
Total stockholders’ equity (deficit) | 7,304 | (10,915 | ) | ||||
Total liabilities and stockholders’ equity (deficit) | $ | 20,993 | $ | 33,367 | |||
1Amounts for prior periods presented have been retroactively adjusted to reflect the 1-for-240 reverse stock split effected on
The consolidated balance sheets as of
Consolidated Statements of Operations
(In thousands, except per share data)
Year Ended | |||||||
2023 | 2022 | ||||||
Revenues: | |||||||
Product revenue, net | $ | 1,408 | $ | 3,364 | |||
License and other revenue | 516 | 14,687 | |||||
Total revenues, net | 1,924 | 18,051 | |||||
Operating expenses: | |||||||
Cost of product sales | 1,284 | 3,434 | |||||
Research and development | 13,784 | 31,308 | |||||
Selling, general and administrative | 10,300 | 20,711 | |||||
3,907 | — | ||||||
Amortization expense | — | 38 | |||||
Total operating expenses | 29,275 | 55,491 | |||||
(27,351 | ) | (37,440 | ) | ||||
Other expense: | |||||||
Interest expense, net | (3,417 | ) | (4,170 | ) | |||
Change in fair value of derivative liability | (720 | ) | — | ||||
Other expense, net | (42 | ) | (20 | ) | |||
Total other expense, net | (4,179 | ) | (4,190 | ) | |||
Loss before income taxes | (31,530 | ) | (41,630 | ) | |||
Income tax expense | 14 | 28 | |||||
Net loss | $ | (31,544 | ) | $ | (41,658 | ) | |
Net loss per share of common stock, basic and diluted1 | $ | (114 | ) | $ | (1,063 | ) | |
1 Amounts for prior periods presented have been retroactively adjusted to reflect the 1-for-240 reverse stock split effected on
The consolidated statements of operations for the year ended
About AVTX-009
AVTX-009 is a humanized monoclonal antibody (IgG4) that binds to interleukin-1β (IL-1β) with high affinity and neutralizes its activity. IL-1β is a central driver in the inflammatory process. Overproduction or dysregulation of IL-1β is implicated in many autoimmune and inflammatory diseases. IL-1β is a major, validated target for therapeutic intervention. There is evidence that inhibition of IL-1β could be effective in hidradenitis suppurativa and a variety of inflammatory diseases in dermatology, gastroenterology, and rheumatology.
About quisovalimab (AVTX-002)
Quisovalimab is a fully human monoclonal antibody (mAb), directed against human LIGHT (Lymphotoxin-like, exhibits Inducible expression, and competes with Herpes Virus Glycoprotein D for Herpesvirus Entry Mediator (HVEM), a receptor expressed by T lymphocytes). There is increasing evidence that the dysregulation of the LIGHT-signaling network which includes LIGHT, its receptors HVEM and LTβR and the downstream checkpoint BTLA, is a disease-driving mechanism in autoimmune and inflammatory reactions in barrier organs. Therefore, we believe reducing LIGHT levels can moderate immune dysregulation in many acute and chronic inflammatory disorders. Quisovalimab previously demonstrated proof of concept in COVID-19 induced acute respiratory distress syndrome including reduction in mortality and respiratory failure, as well as a positive signal in patients with Crohn’s Disease.
About AVTX-008
AVTX-008 is a fully human B and T Lymphocyte Attenuator (BTLA) agonist fusion protein in the IND-enabling stage. AVTX-008 is differentiated by having specific binding to BTLA, with no binding to LIGHT or CD160. AVTX-008 also has high-serum stability and solubility.
About
For more information about Avalo, please visit www.avalotx.com.
Forward-Looking Statements
This press release may include forward-looking statements made pursuant to the Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements that are not historical facts. Such forward-looking statements are subject to significant risks and uncertainties that are subject to change based on various factors (many of which are beyond Avalo’s control), which could cause actual results to differ from the forward-looking statements. Such statements may include, without limitation, statements with respect to Avalo’s plans, objectives, projections, expectations and intentions and other statements identified by words such as “projects,” “may,” “might,” “will,” “could,” “would,” “should,” “continue,” “seeks,” “aims,” “predicts,” “believes,” “expects,” “anticipates,” “estimates,” “intends,” “plans,” “potential,” or similar expressions (including their use in the negative), or by discussions of future matters such as: the intended use of the proceeds from the private placement; integration of AVTX-009 into our operations; drug development costs, timing of trial results and other risks, including reliance on investigators and enrollment of patients in clinical trials; reliance on key personnel; regulatory risks; general economic and market risks and uncertainties, including those caused by the war in
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