Avalo Therapeutics Reports $33.9 Million Net Loss and Increased R&D Expenses for First Half of 2025

Avalo Therapeutics, Inc. reported a net loss of $33.9 million for the six months ended June 30, 2025, compared to a net loss of $22.8 million for the same period in 2024. The company's operating expenses increased significantly, driven primarily by a rise in research and development costs, which totaled $23.2 million for the first half of 2025, up from $6.7 million in the prior year. This increase reflects ongoing activities related to the Phase 2 LOTUS trial for its lead asset, AVTX-009, which is being developed for hidradenitis suppurativa. The company did not recognize any revenue from product sales during this period, consistent with its strategic focus on clinical development rather than commercial sales.

Avalo's total assets decreased to $126.6 million as of June 30, 2025, down from $150.7 million at the end of 2024. The decline in cash and cash equivalents was notable, dropping from $134.5 million to $42.3 million, primarily due to cash used in operations and significant investments in available-for-sale securities totaling $70.9 million. The company reported total liabilities of $22.0 million, an increase from $17.7 million at the end of the previous fiscal year, largely attributed to rising accounts payable and accrued expenses.

In terms of strategic developments, Avalo completed the acquisition of AlmataBio in March 2024, which included the rights to AVTX-009. This acquisition was structured as a stock-for-stock transaction and involved a cash payment of $7.5 million to former AlmataBio stockholders. The company is also actively pursuing the development of AVTX-009, with topline results from the ongoing Phase 2 trial expected in mid-2026. Additionally, Avalo appointed Dr. Rita Jain to its Board of Directors in June 2025, enhancing its leadership team with her extensive experience in clinical development and regulatory strategy.

Avalo's operational metrics indicate a focus on advancing its clinical pipeline, with research and development expenses expected to continue rising as the company progresses through the LOTUS trial. The company had $113.3 million in cash and short-term investments as of June 30, 2025, which it believes will be sufficient to fund operations for at least the next twelve months. However, Avalo cautioned that future financing may be necessary, potentially through equity sales or strategic partnerships, which could dilute existing shareholders' interests. The company remains committed to its strategy of advancing its pipeline and exploring opportunities for out-licensing or acquiring complementary assets in the biotechnology space.