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Avalo Therapeutics (AVTX) Surges 270% in a Week: Here's Why
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Avalo Therapeutics (AVTX - Free Report) is a clinical-stage biotechnology company focused on developing therapies targeting immune dysregulation.
In the past week, the company’s stock has skyrocketed 269.8%. This upside came after management made major strategic decisions and pivoted to its existing pipeline.
Last week, Avalo announced that it completed the acquisition of privately-held AlmataBio. Post this acquisition, the company added an investigational anti-IL-1β monoclonal antibody (mAb), which it calls AVTX-009. Initially developed by pharma giant Eli Lilly, Avalo intends to evaluate this phase II ready drug in hidradenitis suppurativa (HS) indication. A data readout from this study is expected in 2026.
Following the new addition, AVTX-009 is now Avalo’s lead pipeline drug.
Alongside the acquisition, management also entered into a funding agreement with multiple institutional investors via private placement. Through this agreement, management intends to raise $185 million in gross proceeds, including $115.6 million in initial upfront funding. This transaction was closed last week on Mar 28.
This funding has helped Avalo significantly enhance its existing cash balance. As of 2023-end, the company’s cash and cash equivalents balance stood at $7.4 million. Following the close of the above funding, management expects this new cash runway to extend the company’s operations into 2027.
Year to date, Avalo’s shareshave surged 96.7% against the industry’s 4.3% fall.
Image Source: Zacks Investment Research
The payment for the AlmataBio acquisition is a hybrid of stock and cash deals. Avalo is paying out nearly $15 million in a combination of Avalo’s common stock and non-voting convertible preferred stock. Former shareholders of AlmataBio will also receive a cash payment of $7.5 million after closing the private placement.
Avalo will be required to make development milestone payments to these former shareholders. This includes a $5 million payout when the first patient is dosed with AVTX-009 in the phase II study and $15 million if a patient is dosed with the drug in a late-stage study.
Prior to the acquisition, the company’s lead pipeline candidate was quisovalimab (AVTX-002), an anti-LIGHT mAb being evaluated across multiple immune-inflammatory indications in separate mid-stage studies. It had also planned to rapidly progress a preclinical pipeline candidate AVTX-008 candidate to investigational new drug (IND)-enabling studies. However, these candidates are now under strategic review.
Devoid of marketed drugs in its portfolio, Avalo is entirely dependent on its pipeline for growth. With this major strategic pivot in the company’s pipeline combined with the new funding, management can now focus on developing its immunology pipeline. In addition to HS, Avalo also intends to develop the drug in at least one other chronic inflammatory indication.
In the past 60 days, estimates for ADMA Biologics’ 2024 earnings per share (EPS) have risen from 22 cents to 30 cents. During the same period, EPS estimates for 2025 have improved from 32 cents to 50 cents. Year to date, shares of ADMA have risen 44.7%.
Earnings of ADMA Biologics beat estimates in three of the last four quarters while meeting the same on one occasion. ADMA delivered a four-quarter average earnings surprise of 85.00%.
In the past 60 days, estimates for ANI Pharmaceuticals’ 2024 EPS have risen from $4.06 to $4.43. Meanwhile, during the same period, EPS estimates for 2025 have improved from $4.80 to $5.04. Year to date, shares of ANIP have risen 23.1%.
Earnings of ANI Pharmaceuticals beat estimates in each of the last four quarters. ANI delivered a four-quarter average earnings surprise of 109.06%.
In the past 60 days, Galapagos’ loss estimates per share for 2024 have improved from $1.68 to 40 cents. During the same period, loss estimates for 2025 have improved from 60 cents to 17 cents. Year to date, shares of Galapagoshave lost 20.1%.
Galapagos’ earnings beat estimates in three of the trailing four quarters while missing the mark on one occasion. On average, GLPG’s four-quarter earnings surprise was 91.97%.
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Avalo Therapeutics (AVTX) Surges 270% in a Week: Here's Why
Avalo Therapeutics (AVTX - Free Report) is a clinical-stage biotechnology company focused on developing therapies targeting immune dysregulation.
In the past week, the company’s stock has skyrocketed 269.8%. This upside came after management made major strategic decisions and pivoted to its existing pipeline.
Last week, Avalo announced that it completed the acquisition of privately-held AlmataBio. Post this acquisition, the company added an investigational anti-IL-1β monoclonal antibody (mAb), which it calls AVTX-009. Initially developed by pharma giant Eli Lilly, Avalo intends to evaluate this phase II ready drug in hidradenitis suppurativa (HS) indication. A data readout from this study is expected in 2026.
Following the new addition, AVTX-009 is now Avalo’s lead pipeline drug.
Alongside the acquisition, management also entered into a funding agreement with multiple institutional investors via private placement. Through this agreement, management intends to raise $185 million in gross proceeds, including $115.6 million in initial upfront funding. This transaction was closed last week on Mar 28.
This funding has helped Avalo significantly enhance its existing cash balance. As of 2023-end, the company’s cash and cash equivalents balance stood at $7.4 million. Following the close of the above funding, management expects this new cash runway to extend the company’s operations into 2027.
Year to date, Avalo’s shareshave surged 96.7% against the industry’s 4.3% fall.
Image Source: Zacks Investment Research
The payment for the AlmataBio acquisition is a hybrid of stock and cash deals. Avalo is paying out nearly $15 million in a combination of Avalo’s common stock and non-voting convertible preferred stock. Former shareholders of AlmataBio will also receive a cash payment of $7.5 million after closing the private placement.
Avalo will be required to make development milestone payments to these former shareholders. This includes a $5 million payout when the first patient is dosed with AVTX-009 in the phase II study and $15 million if a patient is dosed with the drug in a late-stage study.
Prior to the acquisition, the company’s lead pipeline candidate was quisovalimab (AVTX-002), an anti-LIGHT mAb being evaluated across multiple immune-inflammatory indications in separate mid-stage studies. It had also planned to rapidly progress a preclinical pipeline candidate AVTX-008 candidate to investigational new drug (IND)-enabling studies. However, these candidates are now under strategic review.
Devoid of marketed drugs in its portfolio, Avalo is entirely dependent on its pipeline for growth. With this major strategic pivot in the company’s pipeline combined with the new funding, management can now focus on developing its immunology pipeline. In addition to HS, Avalo also intends to develop the drug in at least one other chronic inflammatory indication.
Avalo Therapeutics, Inc. Price
Avalo Therapeutics, Inc. price | Avalo Therapeutics, Inc. Quote
Zacks Rank & Key Picks
Avalo currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the overall healthcare sector include ADMA Biologics (ADMA - Free Report) , ANI Pharmaceuticals (ANIP - Free Report) and Galapagos (GLPG - Free Report) , each sporting a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
In the past 60 days, estimates for ADMA Biologics’ 2024 earnings per share (EPS) have risen from 22 cents to 30 cents. During the same period, EPS estimates for 2025 have improved from 32 cents to 50 cents. Year to date, shares of ADMA have risen 44.7%.
Earnings of ADMA Biologics beat estimates in three of the last four quarters while meeting the same on one occasion. ADMA delivered a four-quarter average earnings surprise of 85.00%.
In the past 60 days, estimates for ANI Pharmaceuticals’ 2024 EPS have risen from $4.06 to $4.43. Meanwhile, during the same period, EPS estimates for 2025 have improved from $4.80 to $5.04. Year to date, shares of ANIP have risen 23.1%.
Earnings of ANI Pharmaceuticals beat estimates in each of the last four quarters. ANI delivered a four-quarter average earnings surprise of 109.06%.
In the past 60 days, Galapagos’ loss estimates per share for 2024 have improved from $1.68 to 40 cents. During the same period, loss estimates for 2025 have improved from 60 cents to 17 cents. Year to date, shares of Galapagoshave lost 20.1%.
Galapagos’ earnings beat estimates in three of the trailing four quarters while missing the mark on one occasion. On average, GLPG’s four-quarter earnings surprise was 91.97%.