Allakos Inc. Reports $26.2 Million Net Loss in Q1 2025, Enters Merger Agreement with Concentra Biosciences

Allakos Inc. reported a net loss of $26.2 million for the first quarter of 2025, a significant decrease from the $71.1 million loss recorded in the same period of the previous year. The company’s total operating expenses for the quarter were $26.7 million, down from $73.1 million in the first quarter of 2024. This reduction in expenses was primarily driven by a decrease in research and development costs, which fell to $13.5 million from $34.8 million year-over-year, reflecting the company's decision to discontinue the development of its product candidate AK006 after it failed to demonstrate therapeutic activity in clinical trials.

In terms of financial position, Allakos reported total assets of $59.5 million as of March 31, 2025, a decline from $96.6 million at the end of 2024. The decrease was largely attributed to a reduction in investments and property, plant, and equipment, which fell significantly following the termination of the company’s lease agreement for its San Carlos facility. The company’s cash and cash equivalents increased to $24.2 million from $17.8 million, indicating improved liquidity despite ongoing operational losses.

Strategically, Allakos has entered into a merger agreement with Concentra Biosciences, which includes a cash tender offer for its outstanding shares at a price of $0.33 per share. This merger is expected to close in May 2025, pending the satisfaction of various conditions. The company has also implemented a reorganization plan that resulted in a workforce reduction of approximately 75% to align its operations with its strategic focus on maximizing shareholder value through potential mergers or asset sales.

Operationally, Allakos has not generated any revenue since its inception and does not anticipate doing so in the near future. The company’s accumulated deficit reached $1.26 billion as of March 31, 2025. The management believes that the current cash reserves will be sufficient to fund operations for at least the next 12 months, although they acknowledge the need for additional capital to support future development efforts if the merger does not proceed as planned. The company’s future remains uncertain, hinging on the successful completion of the merger and the exploration of strategic alternatives.